Launching a business during a global economic downturn is ill timed, to say the least. But when you’re a start-up, you can’t afford to procrastinate, particularly if you’ve already spent a year preparing.
For Rohan Gamble, who launched his business Mozo in October 2008, it was very much a case of sink or swim.
Mozo is a financial comparison site, which aims to help consumers navigate their way through the “confusing and complex retail banking maze”.
The NSW-based business combines independent product information with peer-generated content. It also provides personalised comparison tools to help consumers find financial products to suit their situation.
“I founded Mozo because I think that too many of us put up with bad deals from our financial providers… So in early 2007, I decided to do something about it,” Gamble says.
Unfortunately, Mozo was launched just as the GFC was starting to make headlines, so a major challenge for the business was its untimely debut.
“We had spent a year developing the business and just as we were about to launch – with a wide-scale PR push – financial markets imploded,” Gamble says.
“Overnight, capital dried up, consumer sentiment towards bank security changed, and retail banking competition was flattened as the big banks consolidated their positions.”
“Suddenly, the revenue model of our start-up, based on a healthy and competitive retail banking marketplace seeking to acquire new customers, seemed a little out of place.”
Gamble did what he had to do – he revised the company’s launch plans and lowered its cost base, which meant using social media as a cheaper alternative to mainstream online advertising.
“We scaled right back on costs. For example, we decked out our entire office from eBay and cut back on technology costs by utilising Google’s free apps for email, documents and the like,” he says.
“We also had to make some tough calls on staff and make things work with less people.”
Gamble says while we would never want to relive the experience again, the business is better off because of it.
“Our cost base is lower than we originally planned and now that revenue has picked up to anticipated levels, we are now in a much better position,” he says.
Gamble says the creation aspect of starting a business was worth all the drama.
“Coming up with an idea, then turning it into a reality and watching it grow up every single day [is the best part of starting a business],” he says.
“The signs of our success are showing… Natural traffic to our site is increasing month-by-month, we have an engaged online community, and financial providers are now turning to us for exclusive marketing launches.”
Mozo has developed innovative ways of distributing its content through other websites. In 2009, it partnered with Fairfax Digital to power its financial sites and has since developed a range of financial comparison widgets, which run across the Fairfax Digital network.
Then in 2010, Mozo partnered with CHOICE on its “Compare, Ditch & Switch” service. The company recorded revenue of $1.4 million in the previous financial year, and is extending its reach into other consumer finance areas such as insurance.
“Finance has [traditionally] been a real mystery and too hard for the average Australian to do anything about it,” Gamble says.
“Since we’ve launched, that is starting to change. It’s a shift we believe is real, permanent and of great benefit to everyone.”