Rebuilding the business model
Friday, August 12, 2011/
Building a network for rural and regional businesses is no mean feat, so it’s important to get it right from the start. But when your plan backfires, how do you proceed?
According to Simon van Wyk and Patrick Cusack, you simply dust yourself off and start again.
Cusack and van Wyk are the founders of OurPatch, a network of more than 180 websites aimed at delivering information and services to rural and regional Australia.
Based in NSW, OurPatch helps businesses and community groups promote their activities online, essentially serving as a go-to for people to access event information and local news.
The company claims there is a “Patch” in some 200 towns across the country, despite rolling out the model in just 10 towns three years ago.
OurPatch was born out of the belief that rural businesses were being neglected by major online publishers. Prior to its impressive expansion, the company was marred by a major oversight.
“We started the business when somebody phoned and said, ‘I’ve been running this site and all you have to do is copy what I’ve been doing and the rest will be easy’,” van Wyk says.
“We started the business based on the belief that our model had already been proven in a number of towns.”
“We replicated the model and started the business by rolling out the model in 10 towns. Unfortunately, the model – and the success of the model – had been fabricated.”
According to van Wyk, the model was more of a trading platform than a transactional one, which meant very little money was actually changing hands.
“It wasn’t real income. It was based on swapping one service for another,” he says.
After making this discovery, OurPatch had to do some quick thinking.
“We had to restructure the shareholding, reconsider the model, refocus the site and get started again… We had to build the model from scratch and bootstrap our growth and development,” van Wyk says.
“We learned that going to the source is the key to success and the resolution of problems. You can’t make decisions without getting to the heart of the issue.”
“You can do your due diligence on what someone tells you, you can check it out, cross reference, audit the facts but sometimes – to get to the real story – you actually have to go to the source, which in this case was the advertisers.”
“We also learned that when all seems to go wrong, there is often another path.”
In spite of its setback, van Wyk says the company not only survived but went on to experience dramatic growth. With six staff on board, the business recorded revenue of $695,000 in the previous financial year.
“Our vision is to build the civic centre for our century,” the founders say.
“The civic centre we all know is a mix of business, community, events and a place to get help and contact people in your community.”
“We plan to do this by building a national platform of community websites for local users. This platform will deliver services to local business and community to all country towns.”
“We plan to give back to all the communities by building a network of regionally-based managers that run and manage these sites independently.”
From the frontlines
Alan Jones: How to raise investment for a startup with no customers and no revenue Alan Jones M8 Ventures partner
Canva's Melanie Perkins has 10 tips for startups with 'crazy-big dreams' Melanie Perkins Canva co-founder
Why Up's transgender controversy shows there can be no separation between founders and their companies Joan Westenberg StartupSmart columnist
Take a stand: Why being neutral hurts profitability and engagement Steven Maarbani VentureCrowd executive director
The power of passion: Naked Wines' co-founder reflects on what made the startup successful Peta Jecks Naked Wines co-founder
Hipsters, hustlers and hackers: Three instances of everyday bias in startupland Theresa Lim Play2Lead founder
Diversity and coaching will rid the banking sector of its toxic culture problem Hema Kangeson inSpur founder
Why you should find the right role for the right person — not the other way around Bruce Stronge Outfit founder