I recently shared this note with close friends, family, and investors. I’m posting it here in the hope that lifting the veil on the hard realities of trying to get a startup off the ground might prove useful to someone out there. We hear all too often about the massive successes and catastrophic failures that are big enough to make the news, but hear very little of the realities more reflective of the experiences at scrappy little upstarts you’ll never even hear of. With the benefit of time and perspective, I hope this provides an unvarnished account of the up and downs and lessons learned while pouring everything into our attempt to manifest our vision for a better world as reality.
I’ve started and stopped this note many times over the past few years, and, by now, I’m sure you must’ve been expecting it. As Jolt has gone through various rough patches, the time to wind down has seemed near. However, each time, the thought of admitting failure was enough to motivate a renewed vigor to right the ship, and I continued in hopes of soon having better news to share. In retrospect, I could have and should have been more able to admit the failures as they came and to proactively ask for help. That tendency to double down in isolation when things got hard has been my greatest failure along the way. With so many people placing their faith and support with us, I heaped far too much pressure on myself not to disappoint and, in effect, I hid whenever failure felt imminent.
As it is now indeed time to wind things down, I want to give you some of the transparency that I should’ve given a long time ago. Below is a rough timeline and postmortem of what happened after we left St. Louis for Kansas City in early 2015.
While completing the accelerator program in Kansas City and preparing to ship our first round of orders at the end of the summer, we looked to raise additional funding. The funds were intended for use in a marketing surge ahead of what we expected to be our peak selling period – back-to-school shopping and the fall sports season. While there were some strong initial prospects, our fundraising efforts ultimately fizzled, and we refocused on working with the resources we had, while trying to ship on-time.
Mismanagement of suppliers led to manufacturing delays, exacerbating simmering interpersonal issues on the team. In the face of these issues, one of our co-founders left the company. In retrospect, we were all young, inexperienced, and handled a stressful situation poorly – my inability to better manage this is one of my biggest regrets, and a lesson I’ll carry with me forever. I am thankful that, despite how much it hurt everyone at the time, (after some time to heal) our friendship endured. Soon after this departure and the end of the accelerator program, our remaining team of two relocated to Boston.
Despite manufacturing delays and a slipping delivery timeline, we decided to run with a marketing blitz as scheduled, in the hopes of driving pre-order commitments for the balance of our initial manufacturing run. While click-through rates for the campaign were quite strong, we had almost no conversions (the timely demand for the product was at odds with the uncertain delivery timeline) and burned a stack of cash in the process.
We finally got our Kickstarter pre-orders out the door late in September. The following months were focused on rollout support. While things went smoothly with the iOS crowd, we were soon overwhelmed by Android tech support issues, despite that cohort constituting a tiny fraction of our total user base. As we worked to triage and resolve the Android issues, we enjoyed a trickle of orders without any concerted marketing efforts.
At the same time, we explored a partnership with a major regional healthcare provider to subsidize our product for local youth leagues and were in serious discussions to provide equipment for a research program at a flagship university. While both were initially promising prospects, neither effort came to fruition.
With Android issues sufficiently managed (and a number of returns processed), we pulled support for any additional Android orders in favor of the stability of our iOS user base. With sales stagnated, we turned our focus to hands-on local engagement, reaching out to every winter sports league in a multi-state area. Despite numerous presentations, hands-on demos, and free trials, these efforts did not result in meaningful sales volume, and we recognized that, while our offering was intriguing in concept, we were not providing a sufficiently compelling experience for the sustained use or network-driven growth that we had anticipated.
Recognition on the 2016 Forbes 30 Under 30 list in Healthcare generated a wave of media attention, and, while not beneficial to sales, helped to expand our network and bring on some new advisors with fresh perspectives. Given the consumer sales challenges that we were facing and heavily-seasonal demand, they steered us toward enterprise-style engagements and got us in the door with a number of professional and collegiate sports teams, as well as a network of former players.
Based on early interest and limited use trials, we were able to generate a surge of investor interest in putting together a modest seed round. However, prior to capitalizing on this momentum, interested parties began to drop. At the organizational level, fears around liability stemming from head impact data collection blocked every potential deal, and high-profile individuals, while privately supportive, felt that they could not publicly support us for fear of negative perception in the community. With lighthouse customers, partnerships, and endorsements all dead in the water, the fundraising round fell apart.
Through the course of our off-season enterprise focus, consumer orders had continued sporadically, and we returned our focus there. At this time, the company, my remaining co-founder, and I were all running dangerously low on funds. I opted to liquidate my 401k from my previous job, using the funds remaining after the early withdrawal penalty to cover living expenses and operations. Given our previous failures in overly-broad marketing campaigns, we ran a number of highly-targeted experiments aimed at identifying a sustainable strategy to invest more heavily in. The experiments proved effective at significantly increasing both click-through and conversion rates, however none resulted in a strategy that was able to profitably acquire customers.
Winter 2016 to Spring 2017
With our cash now truly depleted, my co-founder and I had no choice but to find jobs to cover our living expenses. Our naive plan was to work these jobs by day, while working to fix the business on nights and weekends. In the first few months, we made some progress on reformulating hardware functionality and app experience in response to user feedback and identified shortcomings, but our progress soon stalled. We were simply stretched too thin trying to work multiple jobs, and the arrangement was starting to exert serious strain on relationships in our personal lives. It was around this time that we also had to abandon pursuit of our ongoing patent filing, as mounting legal fees became unsustainable. Throughout the previous year, we had put off payment for earlier work as long as possible, and, after yet another office action with claim rejections that would require additional work, we had no choice but to pull the plug.
Up until this point, we had benefited from free infrastructure hosting as a perk of our accelerator program. When these credits expired at the start of the summer, we didn’t notice and quickly racked up significant charges, as we hadn’t previously worried about properly optimizing our setup for cost efficiency. By the time our hosting provider attempted to charge us, our cards bounced and our stack was frozen as we struggled to come up with cash for the payment. Although initially panicked by the downtime, we soon realized what we would’ve known if we had been watching user metrics more closely – nobody cared. Although we still had a handful of active users, none were engaged enough to contact us about the outage, and we eventually opted to leave our servers down while considering the future of the company.
Recognizing the time constraints imposed by my day job, I found new employment that I hoped would give me more flexible working hours and enough bandwidth to focus on rebuilding the business. We still believed that we had the start of something great and were excited about what we viewed as a path to redemption – our intent was to utilize our foundational tech, while rebuilding user experience and interfaces around a more robust business case. Following my move to a new city, a local startup showed interest in acquiring our hardware designs, codebase, and remaining inventory in exchange for simply paying back our investors (at this point, my dream scenario). However, interest waned after their legal counsel advised against it for the same reason that professional and collegiate teams had been trigger-shy before – data-driven liability.
In early 2018, following a surgical procedure, I suffered life-threatening complications and ended up hospitalized for a period, followed by a long road to recovery in the face of lingering health issues. Sometime around my hospitalization, our domain expired and squatters quickly swooped in. I appealed to our domain registrar to no avail. While I could not fully come to terms with it at the time, I recognized deep down that this was truly the end. I focused on getting healthy through the rest of the year, and, by year end, business operations had ceased, along with the hope of renewing them.
Still reluctant to admit that it was over, I went ahead and extended our tax filing deadline to avoid coming to terms with reality. But with our extended deadline for our final return now approaching, I have no choice but to admit that we gave it a go, but it’s time to walk away.
We made a litany of mistakes that are easy to see now, but were difficult to realize at the time. We were too myopically focused on the challenges at hand to step back, take a critical look at the business, and re-evaluate what we were doing. In the times when we were barely treading water, we could’ve reached out to our support network for help. Our friends and mentors would’ve had the perspective and separation to see things for what they were and to offer a guiding hand. But, it was at these times that we found ourselves least able to reach out.
With the benefit of hindsight, I would categorize our errors as follows:
- We fractured our efforts between consumer and enterprise offerings, and, in doing so, failed to find product/market fit with either.
- We failed to find a repeatable sustainable consumer sales model where margins exceeded the cost of acquisition.
- We left ourselves too lean to pivot/iterate quickly once we had product in the field – we were bootstrapping to broke.
- We prematurely optimized on unit costs with large hardware orders, then succumbed to sunk cost fallacy when we should’ve stepped back, ate the cost, and retooled in low volume iterations.
- We inefficiently allocated time and money a number of times. Notable instances include an unnecessary LLC to C Corp restructuring, chasing funding when we should’ve been laser-focused on sales execution, and an incredibly long and costly pursuit of patents that burned through time and money we didn’t have.
Despite the ups and downs, this has been an incredible journey filled with growth and learning. Unfortunately, these learnings often came too late, and in spite of abundant literature warning of the exact mistakes we were making. Ultimately, the difference between reading and living is immense, and there’s no substitute for lived experience.
Through it all, we had an unwavering group of supporters in our corner, and, despite our shortcomings, every day we did our damndest to make them proud, make good on their investments of time, energy, and money, and to do what little part we could to make the world a better place.
If I could do it all over again, I would. And, after making every mistake in the book, I’m eager to find that next opportunity to try again, so that these learnings will not have been in vain. For all of our mistakes and failures, I take ownership and wish I could’ve done better. And for the belief and trust that you have placed in us, I will be eternally grateful, if undeserving. I hope to one day pay it forward.
In humble gratitude,