Adam Schwab: What we can learn from Domm Holland and the collapse of Fast

Fast co-founder and chief Domm Holland

Fast co-founder and chief Domm Holland. Source: supplied.

A few months ago, I got a random email from a PR executive on behalf of a client asking to be interviewed for my podcast, From Zero. The request wasn’t overly unusual, as going on podcasts is now common for tech founders, especially fast-growing businesses. The client was a business called Fast and the founder was a guy called Domm Holland.

The name sounded vaguely familiar, so I did some research and quickly remembered: Holland had recently appeared on the AFR Young Rich List, with an estimated net worth of $160 million. This wasn’t some made up number; it was based on his business, Fast, just raising US$100 million ($140 million) from the likes of Stripe and leading venture capitalist, Index Ventures. The Australian Financial Review also noted that it was likely that Holland’s wealth estimate was “conservative”.

While most of my podcasts are with established founders like Carsales’ Greg Roebuck or Seek’s Paul Bassat, we arranged a remote interview for early February (Holland is based in San Francisco). The interview itself was fascinating and fun to record. Holland’s story was like many successful founders; he had a difficult childhood, his parents separated when he was young, and he learned how to box to overcome constant bullying at school.

After dropping out of university, Holland somehow came across the idea for a business called Tow, which was a marketplace for tow truck operators (once described as the ‘Uber of towing’). After Queensland created its controversial hoon laws in 2013, there suddenly became a huge demand for tow trucks to impound hoons’ vehicles. Holland, who had been working for a car auction business, saw the opportunity to create a tool that made it easier for police to get a tow truck. A few years later, Tow collapsed, essentially after the Queensland Police decided to stop paying its bills (which led to a lot of angry tow truck drivers).

After a lengthy civil action, Holland bounced back from Tow. He got the idea for a one-click checkout application after his mother-in-law had difficulty using the Coles website, moved to San Francisco, teamed up with former Uber executive Alison Barr Allen, and quickly started raising an enormous amount of money from some of the world’s best venture capitalists and angel investors.

Speaking to Holland, I was entranced by his story and the story of Fast. With a mix of utter delusion and complete self-confidence, Holland claimed Fast was far bigger than Bolt, a rival one-click checkout business founded by colourful young founder, Ryan Breslin. Holland’s claims in hindsight appear laughable; Bolt recently raised money at an US$11 billion ($15.49 billion) valuation. But Holland had the perfect comeback story — from the heartbreak of Tow to creating a unicorn just a few years later.

While the finished the episode was in post-production and weeks away from release, I saw a surprising headline in Letter of Intent as rumours begun circulating that Fast was facing difficulties. These headlines aren’t unusual for fast-growing startups, especially in competitive sectors, so I didn’t take much notice of it.

A week later though the news was far worse: Fast had ceased operating, most of its employees would be hired by buy now, pay later business Affirm, and Holland and his co-founder would lose everything. Critics would quickly appear: Holland was again be dragged across the coals for the Tow collapse, and quickly become public enemy number one for Fast’s failure. Especially after it was revealed that the company had burned through US$100 million in a year while generating only $600,000 in annual revenue. Even worse, part of the money was reportedly spent on Holland’s skydiving stunts and paying $1 million to The Chainsmokers.

The news also created a bit of problem for the From Zero team, given we were about to launch a podcast lauding Holland’s achievements as one of Australia’s most successful founders.

Ultimately, we made the decision to re-cut part of the episode but essentially, let Holland tell his story from the business grave.

Listening to the episode after Fast’s collapse actually made me more sympathetic to Holland, especially knowing that while he was telling me his story, his business was collapsing around him.

The ability to compartmentalise was astounding. I didn’t find Holland dishonest, he came across as genuine, albeit in retrospect, utterly delusional.

In the past two decades, following the rise of Facebook, Twitter and Uber, entrepreneurs have gone from being objects of scorn to being adulated. But many are quick to forget the incredible infant mortality rate of startups. 99% of startups never raised any outside capital, while some who do, like Fast, are urged by VC backers to blitz scale, and simply flame out before reaching real product-market fit.

While Holland wasn’t able to make Fast work, the victims were largely venture capital firms (who expect to lose more bets than they win), wealthy investors and Holland himself, who walked away with nothing but a bruised reputation. Employees were able to quickly find new roles.

For all his faults, we need more not fewer, Domm Hollands. People willing to bet big and take risks.

You can listen to the full From Zero episode with Domm Holland on Apple Podcasts.

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