60% of our seed capital spent, only 2 paying customers 🤯, and how we plan to turn things around
December 6th 2021 update
Hello Readers,
If you are new to this newsletter welcome. We are in month 2 of our experiment to build a sustainable business for $10,000 and sell it on Microaquire. For those that have been reading this whole time welcome back.
This week is going to be a bit different than the previous weeks, for reasons that will be very clear as you read the rest of this document. We will spend less time working on custom high-quality information content and more time just telling our story.
Current Situation
Over the past 2-3 months we as a team have been working on a host of different projects related to Flo Hiring. We have done well as a team and created a few things that have a lot of value.
First, our automated applicant tracking + Interview automation system is built off of an air-table and has recently been released from MVP. This system operates very well. It allows companies using it to automate much of the communication that needs to happen between HR, Hiring Managers, Candidates, and interviewers. It also introduces and champions the concept of video pre-screens, which have the ability to save hours in interviews that don't need to happen. It serves us well and can be a powerful addition to any company actively trying to improve HR efficiency and effectiveness.
Second, we have put together a database of 120,000 remote developers that cover all programming languages, contains tested contact information, all rows containing performance metrics allowing for quick sorting of developers, and most of which are open to new work. This will enable us to instantly match 100's potential candidate developers to any technical job post that we receive. A powerful tool for providing many potential qualified candidates in the shortest period of time.
Thirdly, we have built a data set of 560+ communities where people actively search for remote work. Allowing us access to more than 100,000 potential candidates for all types of remote work.
Fourth, we have created a series of valuable written content detailing how companies can build their own high-quality hiring systems, sharing hiring tips to remote workers to improve their acceptance rates, and shared our experiences as a company. While subjectively valuable, this content has not created any real leads outside of my close circle.
If you know anyone who would be interested in working with us for any of the systems described above share the post and get in contact with us at services@flohiring.com
The downside of this focus on product, content, and dataset creation was a lack of investment in sales and customer outreach. Putting us in a position of running out of seed capital before we can start to break even. There are some hard truths we need to face.
We have a ton of product-related work to show for the money we spent (60% of our 10,000 USD seed capital), but nothing to show in terms of organic customers. Given the small amount of capital and that our current burn rate of $3,050 a month, we have little to no wiggle room for us to navigate to our first customers let alone get to break even. This doesn't mean we won’t try.
Next Steps
I've built a few products I'm proud of and when things are going right it can be an amazing experience. Often times though things can go off the rails, putting the project in jeopardy of complete failure. This is not an outcome I'm willing to accept for Flo hiring so we will focus our efforts on righting the ship and setting us on a course for profitability.
Correcting course is easier said than done. The first step is accurately describing the reality of the situation you find yourself in. See the "current situation" section for an example of a radically transparent view of Flo hiring's current situation. The process of fixing a system can not truly start until you can be honest about what is going on.
One of the blockers that are affecting us is our high burn rate. We only have $4,000 left so we need to stretch those dollars are far as is possible. The best way to do this is to cut costs, which for a company doing a bunch of stuff that has no results in sales is very easy. After communicating with the team we have decided to reduce the hours of several of our freelancers focused on areas not moving the needle for the business. This is regrettable but an important step towards increasing the time we have to get more paying customers.
Previous Burn Rate: $ 3,050
Projected Burn Rate: $ 2,320 +/- 200
We have about 1.5 months of runway left, assuming no new income. That gives us 6 weeks to find customers and get to break even or be profitable. So what do we have to do in order to reach breakeven? Make at least $ 2,320 a month, ideally a lot more.
What are we going to do with 1.5 months? This is where we need to stop all product development and focus on selling what we currently have. Luckily, with the applicant tracking system, interview scheduling automation, and our database of 120,000 developers we have everything we need to offer direct matching of technical talent with companies willing to work with remote developers.
Where are we going to find leads? Our current plan is to visit all of the paid and free job boards, scrape all remote technical positions. After reading and understanding the job post we will match them directly with engineers in our dataset and deliver a potential tailored list, including video pre-screens to companies.
What are you going to sell your leads? We will charge $300 for successful hire and offer to schedule all interviews for the company through our applicant tracking system or connect directly with their systems.
To hit our goal we will need to make 8 hires a month in order to break even. Assuming a 2% conversion rate we will need to reach out to around 400 different companies every month to have a chance to reach this goal. Bringing that down to daily numbers, we are talking about reaching out to 20 companies every working day. Not impossible, but we are going to have to hustle hard to reach that.
Sales + Customer Outreach Progress
We have had one week to start down our new path. Took some time to communicate the new direction to everyone so really we ended up starting around Thursday.
Since Thursday we have reached out to 15 customers (10 through job post scraping and 5 through Twitter). We have had 1 reply so far from our Twitter outreach. Below is an example of our outreach communication. The team would love your feedback so leave a comment and let us know what you think.
Subject: We found 9 developers that match your job post for Senior React Native Engineer
Hi Marta!
My name is Chris and I am the founder of flohiring.com – an affordable candidate sourcing platform that matches the right talent with the opportunity around the world. We have a database of 120,000+ vetted and affordable developers for all technologies.
Why I am reaching out to you?
Well, we recently saw your job post “Senior React Native Engineer” and took the liberty of matching some developers as per your job requirements, for you. We would like you to know that we got 9 qualified developers who are openwork and who will match your expectation, as well.
Sounds interesting?
Let’s get on a quick call so that I can introduce you to them, learn about your pain points with hiring, and help you get the best talent at an affordable cost.
https://calendly.com/flohiring/15min
We are not an agency or a consultancy, just a friendly candidate matching system powered by AI. You pay only us $299 for a successful hire.
Looking forward to hearing from you.
Best,
Technical Talent Database Progress
How did we get 120,000 tech talent in our database so quickly? We scraped the internet for developer profiles and verified the emails by sending a quick message to everyone. This week we had 0 progress in adding more developers to our database because the freelancer in charge of this section of the business has been away on holiday.
Once he is back we will start working on enriching our talent database with performance data and code samples directly from the target candidates. Our end goal is to exactly match your company with a developer who has proven experience with the functions and frameworks your software project is built in.
We have a trial customer for this new code matching system but are looking for more. If you are interested in signing up for the code matching beta please reach out to chris@flohiring.com.
Want To Learn More?
We have combined our experience of hiring thousands of employees across multiple companies to come up with a method that is the most success-oriented when it comes to new hires.
Interested in using our hiring services? Send us your job details using this form: https://airtable.com/shrtHb5ffwxxhg4Up
Want to know more about Flo Hiring? Schedule a 15 min call and we'll answer all your questions: https://calendly.com/flohiring/15min
Thank you!
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