Mumsnet, the UK-based parenting advice forum, is a case study in startup resilience and a great source of startup tips for any founder looking for some guidance.
The company was founded by Justine Roberts in 2000. It survived the dotcom boom and bust, and carried on growing despite the arrival of US social media companies such as Facebook and Twitter, at the time potentially great rivals to the community Roberts was attempting to build.
Mumsnet — which now has 14m unique monthly visitors — survived its first six years with barely any revenue, and didn’t raise any venture capital until very recently. This was partly because Roberts was unable to convince investors to back her in the early days, but, she says, in hindsight, it turned out to be a blessing in disguise. Sure, the company never turned into a unicorn but is highly profitable (with a 33% profit margin) and it has considerable political clout — UK politicians are regularly grilled by the Mumsnet audience ahead of elections.
During the Breakthrough series of talks organised by Second Home, Index Ventures and Sifted, Roberts shared some of her startup tips, to help founders navigate setting up and growing their own business.
Tips #1: prepare for success early
Prepare for success early on, even when you are running a business on a shoestring from the kitchen table. Consider issues like trademark protection and share allocation when they seem slightly ridiculous. It’s easy to give away shares to anyone willing to help in the early days, but later these can become messy to clear up.
If you want advice on what to think about when it comes to options, we’ve written a piece on 5 mistakes to avoid when offering staff options.
Tips #2: own your role as the chief executive
If you are starting a company with a group of friends it is easy to be vague about job titles and hierarchy. But other companies and people dealing with the business need to know who the chief executive is. If that is your role, make it clear to everyone to avoid mistakes or confusion as to whom is responsible for what.
Tips #3: pivot fast
In the startup world, there seems to be an idea that a good approach to pivoting, means throwing a lot of ideas up in the air, and see which ones stick. The things is, you don’t need dozens of ideas. In order to pivot successfully, less is more.
Try two ideas and pick the one that works better. Mumsnet didn’t start with the idea of being a user-led forum; forums were something of an afterthought, bolted on because the site developer suggested trying them and they didn’t cost much to add. But when Roberts saw discussions on forums taking off, she quickly turned them into a central focus for the company.
Tips #4: not every startup needs VC money
Roberts was offered funding by one VC in the early days of starting the company — but only on the condition that she stepped down and let a 25-year-old, childless man become the chief executive of the company. Roberts said no, and reflects that in hindsight, this was the best thing for the company. A community site like Mumsnet needs to build trust with its users, which can take more time than a VC-led approach would allow. Bootstrapping has allowed the company to grow more slowly, but more sustainably.
Tips #5: better a hole (in the team) than an arsehole
Hiring and culture are two of the trickiest things for startups to get right, and it is better to hire more slowly and thoughtfully than to make a disastrous appointment that wrecks team morale.
If you want some tips on what to think about when hiring people to your team, check out our piece on how to build a brilliant team.
Tips #6: let your role change as the company grows
When the company reaches around 50 employees, the job of the chief executive changes dramatically. You can no longer micromanage everything; you have to delegate. The CEO’s role also becomes more about communicating the mission and the vision of the company — both externally and internally. If you are not naturally good at doing that, learn or find someone who does and take a step down from the CEO position.
Tips #7: spend time thinking about “other things”
Everyone in the company should be spending around 10% of their time on what Roberts call “blue sky thinking”. These are ideas that may seemingly have no commercial value to the business, but that can open up the business to new revenue streams or improvements in the existing business. This is essential for a 20-year-old company to stay relevant for a new generation of mums who are consuming media in different ways, whether it be through Instagram or podcasts.