Chapter 3. Learning from Failure, the key to success
During our journey as entrepreneurs, my friend Ralph and I learned a lot about taking risks and making things happen. Despite not having all the necessary skills at the beginning, we were determined to succeed with our platform, Rentsy. We knew that there was a problem that we could solve, and we had a good understanding of our target audience. However, our platform didn’t grow as much as we had hoped.
We analyzed our business strategy and realized that we were missing some key elements, such as marketing and sales tactics. We also learned that entrepreneurship requires more than just having a good idea and creating a platform. Furthermore, we needed to constantly adapt and evolve our strategy to keep up with market demands and changes.
Despite the challenges we faced, we didn’t give up on our dream of becoming successful entrepreneurs. We sought out advice from mentors and industry experts, and worked tirelessly to improve our platform and business strategy. Our persistence paid off, and eventually, Rentsy started gaining traction and attracting more users.
Through our journey, we learned that entrepreneurship is not just about taking risks and making things happen, but also about being willing to learn from failures and adapt to changes. We also learned the importance of collaboration and seeking out guidance from experienced mentors.
When my friend Ralph and I started our entrepreneurial venture, we were confident that we were solving a problem in society. Our platform, Rentsy, allowed people to rent out their stuff to others, creating an alternative to traditional ownership and helping to reduce waste. We were convinced that we could make a difference, and we worked hard to create a user-friendly website with many features that would attract a wide audience.
Ralph and I were the founders of the company. We started it together while I was still working full time at my former job, and it was quite the journey. Despite not having any entrepreneurial skills, we learned day by day to think and act like entrepreneurs, taking risks and making things happen. Our platform Rentsy, allowed people to rent out their belongings and featured many other innovative services. Although we were confident that we were fixing a real problem and understood our audience well, we struggled to gain traction. While there was a similar platform called Peerby that had raised funding and gone international, our platform received only a few bookings.
Nonetheless, we were overjoyed when we received our first bookings and felt like happy kids in a candy shop. One memorable rental was my own GoPro camera, which I almost never used. I asked for 10 euros per day and the renter ended up renting it for 5 days, earning me an extra 50 euros. We truly believed that we were helping people by providing them with what they needed and receiving something in return, and we thought that this would be the future. However, we soon realized that the demand for our platform was greater than the supply, so we needed to grow our offer.
To do this, we attended meetings organized by sharing economy initiatives and presented our platform, which led to an increase in registrations. Our business model was similar to that of Airbnb, taking a commission from every request made through the website. However, we faced a major obstacle when it came to insurance. If something was broken while someone was renting a belonging, we would be responsible for it, but we couldn’t find a real insurance option that fit our sharing economy model.
We contacted banks and insurance companies but were unsuccessful. We were inspired by our experiences renting belongings from locals while traveling through Vietnam, where they trusted us fully and were negotiable in every way, but unfortunately this level of trust wasn’t present in our own country. We were caught up in the idea of creating an ideal sharing economy, but we struggled to change people’s mindsets and behaviors. Our downfall was that we were more focused on the idea of change than on solving an existing problem. Ultimately, we realized that changing people’s attitudes is a difficult task and requires a lot of time and effort." We learned a lot from these meetings and were inspired by the passion and dedication of the people we met. We also got some valuable feedback on our platform, which helped us to improve and grow.
Despite the challenges, we remained committed to our vision and continued to work hard to make it a reality. We knew that the road ahead would be difficult, but we were determined to overcome any obstacle in our way. We believed that the sharing economy had the potential to change the world, and we were excited to be a part of that change.
I remember feeling both excited and anxious as the number of registrations on our platform grew after my speech with the community. It was a sign that people believed in us, and it motivated us to work even harder to make our platform a success. As more and more people began to trust our platform, they started to upload their trailers, cameras, and other items that they were willing to rent out. Our business model was similar to that of Airbnb, where we would take a commission from every rental that was made through our website. However, our revenue was just enough to cover the hosting fees for our website, and we needed to find a way to increase our earnings.
One of the biggest obstacles we faced was insurance. We realized that if any of the renters’ belongings were to be damaged or broken, we would be held responsible. We tried to approach banks and insurance companies to work with us, but we found that they didn’t have a specific insurance policy that covered a sharing economy platform like ours. Designing a new insurance policy that would
cover our needs would cost us a significant amount of money, which we simply didn’t have. Nevertheless, we continued to search for alternative solutions and brainstormed new ideas that could help us overcome this hurdle.
During our travels in Vietnam, Ralph and I had the opportunity to rent belongings from local people who fully trusted us and were open to negotiation. However, when we brought our peer-to-peer rental platform to our own country, we were met with a different attitude. People who had more to spend were more cautious and possessive of their belongings, which was disheartening for us. We realized that people often care too much about their possessions, even if they were just trailers or bikes. While sentimental items passed down from family members might be understandable to cherish, we found it difficult to understand why people couldn’t extend the same trust to strangers who wanted to rent their belongings. In our pursuit of creating an ideal world, we failed to address an existing problem: the distrust that people have when it comes to sharing their belongings. We had hoped to change people’s mindset, but this proved to be our downfall. It’s like the age-old question of which came first, the chicken or the egg. Even today, scientists are still trying to unravel this mystery.
As entrepreneurs, we know that mistakes are inevitable, and the key to success is to learn from them. We realized that our rental business wasn’t generating enough revenue, so my partner Ralph and I decided to take a different approach. We rented out a spacious 5-room apartment with a shared kitchen and living room and decided to use the proceeds to fund our project and personal expenses. It was a risky move, but we had to take it.
We were fortunate to find an apartment that was ready to go, with only minimal decorating required. We wanted to create a comfortable and inviting space that would attract people. As luck would have it, I stumbled upon a second-hand pool table for a great price on a marketplace, which I saw as an opportunity to make our apartment stand out. The pool table became the centerpiece of the living room, and it was a huge hit with our guests.
After the overwhelming response to our apartment listing, my partner and I were on cloud nine. We couldn’t believe how quickly the inquiries poured in, and it was a great lesson in the power of social media. We knew that having professional photos was crucial to making a good first impression, and it paid off big time. The flood of messages made us wonder if we had priced the listing too low, but we were happy to see that people were genuinely interested in our place.
However, we quickly realized that we couldn’t respond to everyone right away. It was a humbling experience to see how companies must feel when they receive a high volume of inquiries every day. We wanted to make sure we gave each potential tenant a fair chance, but we also knew that we couldn’t please everyone.
In hindsight, we realized that we should have set expectations with our listing, such as availability and criteria for selection. It was a learning experience, but we were grateful for the opportunity to see how demand can quickly spiral out of control. We also empathized with companies who don’t always have the resources to respond to every inquiry.
All in all, it was an exciting time for us as entrepreneurs, and we felt a sense of accomplishment from our first successful venture.
The importance of first impressions cannot be overstated, whether it’s in business or personal life. It’s the initial encounter that sets the tone for the entire relationship. Making a good first impression is vital to building trust and establishing credibility. In business, it could mean the difference between closing a deal or losing a potential customer forever.
Back to the rental business, Freddy, the guy who showed interest in renting a room without physically seeing it, turned out to be a great tenant. He paid two months’ rent upfront and his mom vouched for him. It was a wise decision to take him on board. The other room was occupied by a local girl who also seemed nice and trustworthy. With the two rooms rented out, we were able to cover our rent and office costs.
Having the 2 rooms rented out was a major milestone for us. We were able to generate some income and had a place to work from. The attic served as both my room and office, and it was a cozy space where I could work without any distractions. It was a relief to have the burden of rent and office expenses taken care of. We could now focus on growing our business and achieving our goals.