Don’t underestimate the costs of development and focus on the big picture
Today we are interviewing Mark Friedman from OnlyBusiness.com. Tell us about yourself
“I grew up in South Africa and moved to the USA when I was 17. I started my first business is 1993 selling software to Asia. That eventually morphed into my next business, CompuGalaxy, which sold thousands of computer products online. That space became very saturated with low margins. We decided to start specializing in selling mobile products online and eventually sold that company in 2001 .I then started doing web consulting, helping businesses with their web strategy, primarily E-commerce. I then started Polaris Blue, a custom Web Development and Consulting Business with my new partner, Daniel Meyerov. In 2004, we started putting the plan for OnlyBusiness.com together and moved into full development in 2005.
Personally, I love the tech space, I find it very interesting and read every blog and article on what is happening in our space. I think we are just at the tip of the iceberg when it comes to exciting new products, especially web-based. I expect huge things to happen in the next two years.
I love playing golf and plan many of my vacations around nice beaches and golf courses “
Sounds like you’ve had a really busy time and not been afraid to change depending upon market needs. So your latest venture OnlyBusiness.com is an entirely online business model with a software as a service approach. They supply a single technology platform for their customers complete Web, Social Media, Mobile and Marketing Strategy needs. So tell us a bit about the history of the company and what benefits the online SAAS model:
“The OnlyBusiness.com BETA was released in 2008, we had spent up to 4 years before that building the platform. Both founders come from the web space, and have been active in the online space since 1995. We have had 4 major releases; the last release being a full Mobile Website Builder and converting all Flash Banners to be viewable on all Mobile Devices…
The benefits are that customers don’t have to worry about hosting, server infrastructure, security, etc. Those things are all taken care of. Most small businesses are good at running their businesses and shouldn’t have to jump through hoops to create an online arm of their businesses. As a SAAS (software as a service) business, any business is literally one phone call away from having everything taken care of for them, including their web-presence, Mobile, Social Media and Online marketing.
The difficulty falls more on our end. We have to ensure that our entire platform infrastructure is extremely robust and scalable, with redundancy and backup system. It’s definitely a lot of pressure knowing that thousands of businesses rely on your system daily, but we take solace in knowing that we have a great platform with everything in place to ensure our customers are very happy….
OnlyBusiness.com has created new opportunities for Small Businesses, by providing a single technology platform for their complete Web, Social Media, Mobile and Marketing Strategy. By Using one software solution, Small Businesses can compete in a global marketplace, with plans starting at $9.99/month.”
Wow so took you four years to build the platform? Why was that, and how what would you say to our readers about financial planning?
“Definitely, we were certainly unprepared for how much development work would be required to get the platform to where we wanted. We are in a competitive space, and you always have to create an edge over your competition. We built our own Ecommerce Platform and the Website Builder from scratch. Initially, we did market our BETA release, but the system wasn’t quite ready for the mass market. It’s a double-edged sword, as you still have to perform financially, especially for your investors. We actually ended up using most of our first round investment on system development. It was tough for us as we were chomping at the bit to get it out there, but we knew that we had to provide incredible value for money. We had over 15 developers working round the clock to get it done. So, in hindsight, as advice to other readers, when starting a software business – budget for at least 30% more than you will need, as things always come up, that you didn’t expect. You will be glad you did.”
Investment in general for startups and especially pre-startups can be very difficult to secure, especially venture capitalists and angel investment; how was your experience of getting an angel to invest?
“Early Stage investment is quite tricky. We had a vision, business plan and everything an investor would want to see, but without a system, it’s hard for an investor to know exactly what it will look like. I feel that most early stage investors really back the founders and believe in their drive and capability. We were lucky that we found an angel investor who believed in us and our business. We were able to secure funds very quickly and were on our way!”
That sounds fantastic having someone to believe in you. Operating as a partnership always helps with that as you can support each other and bounce ideas off one another, I know that you mentioned to me that like us you do some mentoring for small businesses and entrepreneurs, tell us a bit about that!
“I think it’s very useful for a start-up to take advice from others who have already embarked on that journey. There are so many things along the way, that in hindsight, we look back and would do differently. To be able to share that with others is of great value. I know many entrepreneurs, who have an idea, or are launching a new start-up, who call and ask myself or Daniel for advice, which is our pleasure to give it. We know how difficult it is, especially in the early stages. “
Let’s find out a little bit about your experiences as an entrepreneur and in the early stages of business. I hear a lot from aspiring entrepreneurs that they were inspired by someone or something, was it the same for you?
Yes… “My mom really inspired me, she has worked 12 hours a day, at minimum, since I was a kid and it was always her own business. It gave me that entrepreneurial spirit right from the start…. My Mom has had her own business since I was a kid and it was always something I wanted for myself. When I first stumbled across the web, I knew something huge was happening and decided it was the right time to start a business.”
That’s great she sounds like an inspiring woman! Entrepreneurship seems to leave people with differing emotions from their first years in business, what was your overriding emotion?
“Stress, most definitely, there was just so much to do and there didn’t seem like there was enough time in each day. But, certainly, excitement too. Knowing that we really believed in what we were doing.”
Sounds tough! How many hours were you putting in in the first year, did they affect family or home life and how did you deal with it if it did?
“We spent well over 3000 hours. Luckily I was single Daniel, on the other hand, had a girlfriend (now his wife), luckily she is very understanding. We also had Daniel’s two dogs, Buddy and Raja as our mascots, they are very tech savvy!”
Haha I bet having those two as mascots was great on those tough days! I know you think goals are important, what are your goals?
“Our short-term goal right now is securing a second round of financing to further expand the business. Our long term goal is expanding internationally and also developing more mobile applications.”
Well good luck with that. Do you have any stories or anecdotes you wish to share with our readers?
“When we first launched, we couldn’t wait to get up in the morning and see how many customers had signed-up. Some days were definitely better than others. It’s easy to get a bit lost in the day to day operations and forget about long term goals and outcomes. We just have a mantra now that we if continue building a great platform with incredible features, everything will work out fine in the long-term.”
What is the best piece of advice you can offer an aspiring entrepreneur?
“If you have an idea, go for it! There is nothing like owning your own business. But, be diligent in your research and ensure that your product is filling a space that will result in good take-up of your product. You also don’t have to build a market disrupter. Our space, for example, is so big that just getting a very small % of users, results in a fantastic business. Also, realize that the first two years, will be very difficult and that unforeseen obstacles come up daily. Just commit to what you are doing and focus on your long term goals.”
I’d like to thank Mark Friedman for taking his time out to talk to us and share his story, I’m sure you’d agree that the insights that Mark shared are fascinating, especially those into technology and development taking a much larger chunk of capital than you expect. If you are looking to have a complete web solution then be sure to check out OnlyBusines.com and let us know what you thought about Mark and his interview by leaving a comment below.