From a Bedroom to an Office — How We’re Managing Growth
That’s the amount we spent on our first marketing endeavor in 2011.
We bought a bunch of posters to hand out at our university— man, we didn’t know what we were doing.
At the time, that $327 felt like it was a million dollars.
Though that story doesn’t indicate it, in our early days as a business we were scrappy, always looking for alternatives to anything that seemed too expensive for the business. Getting an office, for instance, didn’t happen until 2014, and even then it was a coworking space and far from luxurious. We were also confident as hell, reaching out to celebrities and athletes for interviews for our online magazine with little to no credibility or experience. Now we’re taking on the same approach with our marketing agency, bringing on bigger and bigger clients monthly.
I think both of these things shape how we grow as a company.
We’re equally risk-conscious as we are confident in our model and growth. We now sit in our new office space in downtown Fort Lauderdale. We don’t have pool tables or nap rooms, and that’s fine. It’s comfortable and suits where we are at as a company.
It’s easy to follow startups, see ones you like and what their offices have and think you need all of the same doo-dads to be successful.
That couldn’t be further from the truth.
Don’t get me wrong, I like a game of ping pong as much as the next person, but it’s not going to make or break a company.
What can make or break your company is cash flow.
If we get too confident and start to spend on things like big office space, pool tables, and nap rooms then we’re becoming too confident and not scrappy enough.
Taking on too many unnecessary expenses can be the death of any startup, especially one that’s not making any money. We didn’t have a single dollar come into our company for the first 14 months — not a great start if you ask me. But those 14 months taught us how to be scrappy as hell, and make the most of our resources — that’s why my bedroom served as our office for nearly two years.
We stretched $2500 over 14 months and personally funded anything else we wanted to do/try business wise.
When it came to our first paying client 14 months in, it was for $1000 per month, to drive social strategy.
We thought we had hit the jackpot.
So after myself and cofounder Michael had one night with a couple of beverages to celebrate, it was back to the drawing board. We kept working our day jobs, putting any money which came in, back into the company. For us, we had pivoted our business without even knowing it.
As the months went on, we got more clients, I stopped bartending and Michael quit his job. It was about that time, I flew down to meet my long time friend, and now business partner Justin, who’s father ran a decent-sized travel company in Florida.
Justin wanted to be part of Cave, so after a few flights back and forth, he and I decided to start an American side of the company. This was our confidence kicking in, we knew we could grow faster if we set to open a second office. However, we didn’t have the money on hand to pay for an elaborate office, equipment, employees, etc. So instead, we made a deal with Justin’s father, he gave us a room, which was about 250sqft, to call our office. We’d have Wifi, phones, a common area, etc. In return, we’d do some of the marketing for his company.
This mitigated our risk of opening an office in Florida and allowed us to grow faster than expected. All-the-while maintaining a lean business mindset.
We stayed in that small room, three people, for one year. I think part of this drove us to want to grow faster, get more clients, and get a space where we could call it our own.
In that tiny space our business tripled over the course of one year, and we brought on two more full-time employees. Once again, not spending on fancy things allowed for us to bring on two more talented people, people who would be pivotal to our growth moving forward.
Now we’re in a much bigger space, our own internet, supplies, etc., and a healthy cash flow as we move into 2016.
This wouldn’t have happened if we didn’t suck it up and work out of a less-than-favorable space for a year.
And with all that, we’re going to stay gritty as ever. The other night, I was speaking with Justin, and he was talking about the new office and his eagerness to work more — I couldn’t agree more. I personally think this is motivated by both (i) our love for our new space and recent success and (ii) our fear of losing it.
We’ll continue to punch above our weight class, but we’ll also make sure we don’t get knocked out in the process.
Actionable Takeaways From This Article:
(i) There’s no shame in starting small — you don’t have to become Facebook overnight. Keep grinding every day, it’s the small wins every day that will ultimately transform any business.
(ii) Look at how you’re operating, and really ask yourself if you’re being equal parts confident and risk conscious.
(iii) Try to mitigate backend risk with new endeavors. There’s uncertainty in every business decision, just make sure any risk you take is manageable risk and won’t make or break your company.
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