Jeremy Hyman is 28 years old, living in New South Wales, and is the founder and owner of the online bar and bottle shop guide Cheapdrinks.com.au. He talks to AMANDA GOME.
Jeremy Hyman is 28 years old, living in New South Wales, and is the founder and owner of the online bar and bottle shop guide Cheapdrinks.com.au. He talks to Amanda Gome.
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Amanda Gome: Now you’re very young, Jeremy, to have started such a site. You’ve already got 15,000 venues listed and quite a bit of advertising support…
Jeremy Hyman: Yes, I guess I’ve always been entrepreneurial and thinking about business opportunities. Even growing up I used to do events in bars and pubs, which would earn me a bit of pocket money, and the promotion just spiralled out.
I looked at an industry that I knew very well and I’ve always been a fan of a drink in a bar, pub or club. I thought, ‘Well, there’s a real niche online’.
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And how did it start?
I responded to an email that was forwarded around Sydney that had all the drink and meal deals in a word document. Someone had actually gone to the trouble to list them all in a document and all my colleagues and friends were talking about it.
It spanned all age groups and demographics, and I thought, ‘Well, there’s a real niche there online to provide that information as well as information on bars, pubs and clubs as venues and bottleshops’. So in 2004 the idea was born.
How long did it take to build?
The business plan was 70 pages and the planning phase was probably three to four months. Then the actual build of the website was a year so we’ve got a pretty complex database-driven website there, which has got a lot going on in the back end.
Right. And what did you use to finance it? How much was it, and what did you use to finance it?
We basically used what money I had earned over my career working in public relations and corporate affairs in [paid] career jobs. My business partner is my father Rodney and he used his capital to get the business going.
So how much was it?
Look, certainly in the high figures. It’s not cheap – there are low barriers to entry to get a basic information website started, but when you’re wanting to do something as dynamic and complex as our site, the dollars are significant but you’re certainly talking, if I can say, in excess of the $100,000 mark.
Well that’s still cheap. I mean if you think about what a print product would cost…
You’re absolutely right. I think that where the costs can get out of hand for aspiring entrepreneurs out there, or people that are already doing what I’m doing, is the constant development and work that you’re always doing to add to the site and make it better.
There are low costs in terms of the maintenance and running moving forward, but I think while you’re trying to refine and develop something from scratch, especially in the testing phase when things don’t often always work out as they should, that’s where the dollars can be spent.
So when you started, what was your idea for the business model? Where was the revenue going to come from?
The revenue was always going to be advertising-based, through banner and tower ads on the website. We also have a subscriber base that people can subscribe to a mailing list so advertisers can pay to advertise within newsletters and in news alerts.
So it was always going to be advertising-based, and I think the exciting thing for our future is whether or not we look to incorporate e-commerce and sell anything through the site as we now have an incredibly substantial audience.
How did you go at such a young age getting some big-name advertisers?
Business relationships and trying to be honest and excited about what you’re doing.
We were lucky to call up some industry people that had been directed our way, and we simply just put it to them that we are uniquely aligned with their business and the same message and brand that they’re trying to communicate along with a demographic that they’re trying to reach, and there was some synergy.
We gave a lot of free trials away. We tried innovative ways to give them extra value without having to charge them up front, so they could see the performance before they actually spent anything.
It was a lot of conversations and a lot of cold calling. It’s certainly not easy and my hat goes off to any entrepreneur out there that is successful.
Now did you have any advertisers pull out?
No, no major sponsors. We’ve had campaigns that have run four weeks and that’s all they wanted to do, so they’ve run the full gamut but no one’s pulled out of any advertising.
And so how did you go about advertising your site? How did you go about letting the message get out there?
I guess my background being in public relations, there was a heavy media focus. It was also …
So what did you do?
Sent out media releases any time something changed on the site or there was something that was innovative that we were doing. Whether it was advertising the cheapest beer in town, we’d always find a story and try and publicise it that then linked back to our website.
We also had people handing out flyers to people in universities and through the cities. We also partnered with various companies that were in the industry that could help talk about our product to the same people that we were trying to reach, so there was some interesting partnerships. So cross-promotion I guess.
We also have a wide network of people that we already knew and I guess it was word of mouth, and the lovely thing about emails these days is when people find something good they seem to want to forward it on to everyone they know.
So the sort of classic start up strategy of handing the brochures, walking the streets.
Yeah, we really did it tough I’ve got to say. We worked some really long days. We’re continuing to work really long days. We walked the beat. We came up with little card flyers to big posters to stickers. You name it.
What worked the best?
Flyers under car windows around the campuses of the five or so major universities in Sydney. It was only a matter of them hearing that name ‘Cheap Drinks’ and they wanted to check it out.
And who came up with the name?
It was really that email that was forwarded around in a word document with the cheap drinks, and we thought well that’s what’s going to get people in.
And what else worked really well?
Our fun branding. We’re reaching a demographic of 18 to 35 year olds, so it’s our tongue-in-cheek things that we do and say on the website. What we send out. It’s always got a bit of humour to it.
Do you find reaching the 18 to 25 different to the 25 to 35?
Not really. At the end of day we’re an information portal and they all want to find out the same things. I think they appreciate the fact that we’re simple to use. We’re one click to search results.
We’ve seen other wonderful websites out in the marketplace that have got so many bells and whistles, but people get lost in them and they don’t know how to use them and they don’t want to come back.
What else have you learnt about websites?
You’ve got to change when things aren’t working and you’ve got to do that quickly, because it’s a big ship to steer and change doesn’t come easily. You’ve also got to learn from other people and always ask questions of people that have been there, done that.
I think that you’ve got to humble yourself to know that just because you think it’s a good idea you’ve got to make sure that it really is by researching the marketplace, and when customers make suggestions you’ve got to really take them on board. We’ve just put in a blog in the last couple of weeks and that was really in reaction to people saying, ‘Hey, we’d love a place to come and talk about all things to do with bar culture’.
Are you writing the blog?
I am indeed. So I’m posting the blogs and it’s been really good to have that interaction with our audience, and I think websites that are successful are all about interacting with your audience.
If you’re going to do a blog you’ve got to be credible. Doing a blog for blog’s sake I think will end in disaster, but I think that anyone that’s communicating to their customers or have a customer base, a blog is a really powerful way to hear what they’re saying.
It’s not a difficult or expensive process to undertake if you’ve already got a website.
You obviously haven’t had to train bloggers.
Amanda, I think you do it very well from what I’ve read on your page.
Who are your competitors now and what are they doing? I bet they’re launching a few things against you.
They seem to come and go, but we’re pretty unique in that we’re the only dedicated bar, pub, club and bottleshop guide in Australia. The ones that are out there are restaurant and dining guides, but I think you’ll see a proliferation of sites when the market for restaurant guides online is just simply too saturated.
So who do you expect to come in? You’d expect Woolies or any of those big players to come in with something.
Well, we’re in partnership of sorts with them, so they’ve already looked at us and said this is a space they want to be, so I don’t think you’ll see it from Woolworths or Coles. I’d be surprised if that happens, but I can’t speak for them. I think that you’ll see competition from people like myself who love the web and are web geeks.
So I think you’re going to look at a new generation of young people such as myself starting websites and building a very organic growth from there.
Are your mates doing it? Are you seeing entrepreneurship is growing among young people?
Yes. In Australia we’ve had the lucky chance of being a bit behind the rest of the world and a lot of the ideas that have been done to death overseas are still yet to happen here, so I’ve seen a lot of my mates looking at online and how they can get their thing going. That’s what Australia offers – it is really exciting time to be on the net because there’s a lot of spaces that people just aren’t in yet.
Now you would have been earning quite a bit more money before you started this…
What’s that like, making that big sacrifice to grow the business?
If you are young enough you can perhaps think about it as a challenge. If it doesn’t work out, you’ve still got the rest of your life.
You own this with your father?
So what’s the next stage? Would you take some private equity or do you want to build it and sell it quickly?
I’m not sure. I’m pretty passionate about it so I don’t know if I want to let it go. We’re growing it to Western Australia. We’re now in all eastern states so we’re now in the process of working hard to get the content up.
We’re all in the content business and trying to find content, produce it, keep it current and put it in a meaningful way or format or medium is the challenge for us. We certainly would look at anything coming our way (private equity) but I’m certainly not thinking it.
Have you had any month where you’ve made a profit?
Yes. Yes. We’re certainly a healthy business, so that’s not an issue for us.
You mainly outsource everything you can?
Yeah, we have three employees and everything else we outsource. Our whole business model is ‘do the work when you need the work done’.
And that works? You’ve got great outsources?
Success in business is having good relationships and without them you can’t succeed, and so therefore we’ve taken the time to establish them with suppliers that we trust implicitly.
And in your short life of business, what’s been your worst day? Your worst moment?
When you’re working all hours and you’re not getting a lot of sleep and you’re in that real start up phase where you don’t know if it’s going to be a success or not. You believe in it but you do have those doubts and those moments where you think, ‘Is this all worth it?’
And I do remember one night on no sleep trying to keep the site updated and still doing a lot of testing to make sure that there were no bugs and things going wrong.
I remember that phase.
Oh Amanda, it’s a horrible time.
And how did you get through that?
Look, I think you draw on friends and family and you see the belief they have in you and the encouragement that they give you and you’ve got…
My philosophy is that you’ve got to stay positive. You’ve got to stay strong. You’ve got to persist even if the face of adversity or when others tell you not to. If you believe in it and you’ve got enough faith in it you’ve got to see it through, and also you don’t want to live a life with regrets.