How this startup took a new approach to innovation, after losing nearly $20,000 in 40 minutes
Monday, October 8, 2018/
A big part of being a startup founder is the ability to learn from your mistakes — even (and perhaps especially) when that mistake sees you haemorrhaging money when you can least afford to.
And that’s exactly what happened to Singapore-based self-serve mobile advertising platform Pocketmath, according to co-founder Eric Tucker.
In a post written for Tech in Asia, Tucker explained how back in 2012, when the startup was pre-funding (it has since raised $10 million), the team went on an offensive to boost efficiencies and achieve real-time bidding — by which advertising revenues are made on a per-impression basis.
“Like any computerised trading system, there is a huge risk — bugs or errors in trading that cost real money,” Tucker said.
And that’s something the Pocketmath co-founders learnt first hand. The team disabled safety structures to try to improve their volumes, but “faulty code caused an order to target the entire US without limits”, Tucker wrote.
“We bled $US17,000 ($19,800) in about 40 minutes.
“Fortunately, the systems were still in a low volume configuration for beta testing. Had that error occurred today, it could have been a million-dollar lesson.”
Any engineering decision is “a tradeoff between safety and capability”, Tucker wrote, and to manage this, the startup implemented an “agile process that tolerates and corrects mistakes”.
He coins this process ‘uncommon efficiency’, saying it gives the team the power to do more with less.
The trick is to break from traditional business constraints to achieve more than can be managed through a conventional approach.
But it’s also in balancing traditional ways of thinking with a new or more creative way of thinking.
“While innovation appears glamorous, it is yet another tool,” Tucker said in the article.
“We would learn by fire when, where, and how to mix unbridled innovation, well-established practices, and the fickle (but ever important) in-between,” he added.
From the frontlines
Five critical questions: Are you listing your startup too soon? Lisa Schutz Verifier founder
Sex appeal, runways and mature markets: Everything Guy Pearson learnt during his $26 million Series B raise Guy Pearson Practice Ignition CEO
Barriers from the outset: Why the government’s Boosting Female Founders Initiative is unlikely to succeed Laura Keily Immediation founder