Ned Dwyer Founder Elto.com in 2012. Elto.com was a curated marketplace of developers and marketers helping small business to grow online. It was acquired by GoDaddy in 2015. Read about Ned's journey from grass root beginnings to the entrepreneurial hub of Silicon Valley.
Where did you get the idea for your business Elto?
I was running an agency at the time and building websites and apps for companies like Mediacom & PayPal. Almost every day we got emails from early stage companies and family/friends looking for help building a simple website or changing an existing one. I was always reluctant to turn away business but I also couldn't help these people - our sites started at $100k and were a lot more involved than what an emergent business needed. And I didn't have a great place to send these people to. Even something like Upwork (oDesk at the time) is not easy to use successfully if you're non-technical and getting a website built for the first time. So we set out to change that with the vision of building a marketplace that allowed anyone to find an affordable developer, and which removed the three biggest barriers for the small business owner: defining a tight project scope, pricing the project and managing the sites delivery. We kicked the project off at a Startup Weekend in 2011 where I pulled a team together. 9 months later in July 2012 we launched with some funding. After 2.5 years and 25,000 customers we were acquired by GoDaddy where we're scaling the platform up to their 14m customers.
What advice would you offer to anyone seeking to obtain funding for their business?
I think you need to really ask yourself if you really need funding. It's never been easier to start a company and every day it only gets easier in many ways. I've seen way too many companies who approach fundraising as a rite of passage or a milestone on their Linkedin. It's a lot more serious than that. For us I wish we had waited another few months before fundraising - it would have given us time to get some more traction which would have increased our valuation and funding options. We also would have had a better idea about what was needed to grow the business and how scaleable it was. Raising a round of financing also puts you on a very clear path. It's rare that you're able to just raise a single round and build a wildly successful business - though it does happen every now and then it's the exception that proves the rule. Your investors are going to want to see you grow as quickly as possible and they're going to want to see a big return for their dollars. The day you raise money you're on the hook to grow as quickly as possible to get to the next financing round and you're likely locked into this path for the next 5 to 10 years. Better make sure this is a business and an idea you're in love with and want to spend that much time working on it.
How important was it for you to have a mentor?
I've had mentors in my life since I was a teenager and found them super helpful. Some formal and some not so formal but there was always one or two people who I've gone to in order to help me reach my goals. Mentors have helped me focus down on the important aspects of my business, find a technical cofounder, identify when I needed to pivot direction and generally provided a backstop to some of the harder parts of being an entrepreneur. I don't think a mentor needs to be someone older with grey hair who has been there and done that, I get as much if not more value out of surrounding myself with other founders who are in the trenches.
You recently sold your business to GoDaddy in 2015, how did this come about?
We started talking to GoDaddy in 2013 when we were still very early on in the journey. For me it was an awesome opportunity to partner with the world leader in hosting and domain names and I had a fairly good idea that their customers needed help finding and working with quality web designers. Over the next 2 years we kept in touch, each time they would tell me about how we should work together and that they were exploring all kinds of acquisitions. At the end of that period, in late 2014, the stars aligned and by February 2015 we were on board. Being at GoDaddy has meant access to not only their 14m customers but also to an incredibly talented team of product and engineering pfolks. We're working with some of the best talent in the world to help us bring our vision to life.
What are your tips for starting a business?
1. Find a problem that you've got a personal affinity with solving.
Think through what you're doing in your job or personal life that sucks and work out how you might solve it. If you can't think of any big, gnarly problems then work out how to put yourself in the path of good a "problem flow". Get a consulting job, start talking to potential customers, interview your local business owners.
2. Focus on real problems.
Too many companies - especially early stage entrepreneurs - focus on faux problems and dont' answer the real problems. Focus on saving customers time and money.
3. Build a great team
You're going to be working with your cofounder for the next 5 to 10 years. Make sure you love working together. Iron out the wrinkles sooner than later, get on the same page with working expectations.
4. Find a big market
Small markets limit your potential upside. Again, if you're going to be spending 10 years on building a company you might as well focus on a big problem in a big market, instead of a small problem in a small market.
Ned Dwyer is an alumnus of RMIT Bachelor of Business (Entrepreneurship), he is willing to answer your questions about starting a new business. Find him in the Members section.
"I don't think a mentor needs to be someone older with grey hair who has been there and done that, I get as much if not more value out of surrounding myself with other founders who are in the trenches." - Ned Dwyer Founder Elto.com