Peer Effect
Best way to scale? Your peers have the answers.
This is the podcast for scaleup founders looking for insightful, actionable wisdom from some of the best operators around. Each week we’ll explore one secret that other founders and experts are using right now and how to implement it.
It’s practical wisdom to build the company AND life you want. Hosted by renowned founder coach and advisor James Johnson.
You’ve survived to £1m, now let’s scale to £10m+.
Peer Effect
Transforming Cooking & Events Through Tech Innovation, with a Startup Enthusiast
What does it take to scale a startup without losing sight of your vision?
In this episode of the Peer Effect podcast, Jonathan Cornelias, shares the lessons learned from building four companies, including Elevent Inc, a marketplace connecting experience providers and companies to deliver unique, memorable virtual and physical experiences.
Jon opens up about the mindset and strategies that have helped him navigate the challenges of scaling a business while staying true to his vision.
Together we’ll dive into:
- Why belief in your idea and finding joy in the journey are essential for long-term success.
- The power of disciplined experimentation, prioritising ideas by impact, confidence, and effort, and iterating step by step.
- Why an effective go-to-market strategy often matters more than product perfection early on.
- How learning from others’ successes and mistakes can shortcut your path to growth.
Jon’s insights will inspire you to embrace challenges, bet on yourself, and stay focused on what truly works for your business!
Connect with Jonathan Cornelias on LinkedIn to follow his journey and learn more about Elevent Inc.
More from James:
Connect with James on LinkedIn or at peer-effect.com
So I first got involved with startups. When I realized I didn't want to do investment banking, I joined a bank. Six months later, the financial crisis happened in the US and it went from doing M&A deals to doing valuation work for the next two years. And so then I took a leap and joined a startup where I was the first employee and it was myself and the founder and I called myself the CFO and he was the CEO. We made a cooking thermometer that connected to your iPhones with Bluetooth. It was called the iGrill. We had to go out and raise capital. We had to move manufacturing. We had a small little manufacturing facility in the US to China and started to sell into all the big box retailers Walmart, I mean. At the time, radio Shack was still around in the US Target, best Buy, we were even in Home Depot and Lowe's and eventually sold it to Weber Grills.
Speaker 1:And then my third startup was again I was CFO of this one, but we were a company called Scott Exchange and we were an AI machine learning marketplace, and so Gromit was a marketplace, scott was a marketplace, and this is going to lead into probably one of the biggest tips I have for for founders um, but we'd eventually sold aquint.
Speaker 1:And then I found myself kind of the summer of 2020, during covid, um, not knowing what I wanted to do next. And basically the next day, somebody I'd worked with at the grommet was like there was just a big shake I'm looking for something to do. And I was like, oh interesting, so am I Very kind of serendipitous and we sat down and brainstormed over a couple of weeks and started Elevent. Elevent is an event marketplace. We sell B2B, but it's very transactional. Right now we have 6,000 different events. We started out in virtual because it was during COVID, but now we are in 36 cities, so we have a mixture of in-person and virtual events and we went out and raised two different rounds of capital and really have lived the full spectrum of startup life.
Speaker 2:And so where does that leave you today? So events in 36 cities. Done two raises.
Speaker 1:I mean I think the journey has been a journey. I mean there were really big highs. I mean we started out in a market that was really disrupted by covid and were able to capture a lot of market share and scale very quickly. But then, when the venture capital market shifted and we had back to work, we kind of had to pivot and figure out what we, how we continue to grow and expand in a very different environment where capital was a lot more constrained and everything wasn't virtual, and so that's been a much longer road, in the sense that you sign up one virtual event, you can sell it anywhere in the world. You sign up one in-person event and you can sell it in that neighborhood.
Speaker 1:So it's a pretty big challenge to go out and sign up more and more event providers and make the platform viable and really focus in on unit economics. All the VCs were saying grow at all costs, grow at all costs, unit economics don't matter. Then all of a sudden it was like, oh, unit economics really matter. And so how did we kind of shift in that environment and make it still work?
Speaker 2:That great shift when they had free money. It was like here's some free money. As soon as they no longer had free money, oh, there's a cost to this thing. How do you get a return?
Speaker 1:yeah, and and some of them were like, look, as long as you're not coming back to us asking for money, you're doing a great job as a management team. And I was like, okay, that's interesting, isn't your whole job to deploy capital in efficient ways? But yeah, I mean, I think right now we are growing, I mean much. I mean we're still growing very healthily at 50% year over year. Is it probably where the venture companies want it to be? No, but we're operating in a breakeven environment. So in my book, if you were a bootstrap company, there's really good growth rate. So we kind of sit somewhere between the two um, and that's the whole. That's probably.
Speaker 1:Another tidbit that I would leave is that you don't always have to operate in this exceptional growth environment. There are times where growth will slow and there's times where you kind of figure it out and growth will accept, accelerate. It's not like when you say product market fit. That kind of is the entire life cycle, the company in different sizes, in different stages. It requires tweaking and adjustments and otherwise it would just be a straight line and easy and everyone would grow 10% month over month. But that really, I mean in my view, really doesn't happen. It's never consistent growth.
Speaker 2:Well, I think the idea that product market fix is a fixed thing, either market's fixed or the fit's or the product's fixed. Both move right and you hope they move together, but often they don't.
Speaker 1:Yeah, and at different sizes you have different product market fit. When you're really small, it's much easier to find product market fit in a niche and as you get bigger and bigger and bigger, it's significantly harder to harder to continue to grow that. But also you're developing new things that then open up new markets.
Speaker 2:I think it's always a fluid situation well, earlier on you mentioned sort of like, if there's one, one thing that you particularly share uh, you teased it for later, maybe we'll jump into that what is what is your, what's the thing that you would share?
Speaker 1:so I've been a part of four startups and what I've observed, and even what I've observed in ourselves versus competition, is it's it's not even this one thing that you do. But if you have this kind of like willingness to survive and this tenacity and that I mean it's it's hard to like put your finger on what kind of makes that up. But, like the people that I've worked for in the team that I work with now, like we, losing or shutting down was just like never an option. We were just going to try to figure it out and and and really it pushes you to a place where, like, you end up making decisions that you may not think that they're going to work, but then all of a sudden, one of them does work and you're like, man, I wish we had done that earlier. Um, and so how do you then kind of keep that, keep that environment, but like what?
Speaker 1:What you see, or what I see in a lot of startup literature out there is like you need to put up a landing page and test it, and if that doesn't work, you pivot and like you need this like fundamental belief that these things, these theories that you're doing, are going to work. And If you test it once and then you say, oh, that didn't work, let's pivot. It requires so much, at least in my journeys. It's required so much iteration along the way to actually get it to a place that works. It's a huge time frame. You're not going to put something out there and test it in a couple of weeks and be like, oh, does this work or does this not work? Like an example is at with the iGrill product that we had initially, like the initial batch, we're selling at a loss and we're like, okay, we're pretty confident we can sell this thing at retail. But also we're also pretty confident we can significantly remove a lot of cost out of this thing. So, like the second version, the third version and the fourth version, all of a sudden we were at a margin where it made sense.
Speaker 1:But if you just looked at it on the surface, if you were coming in as an investor, like, wow, you're losing money on every unit, and you're like, well, yeah, that's not a good business model, but we have to kind of jumpstart this thing to get to where we're going.
Speaker 1:And I'd say the same thing in our current business.
Speaker 1:We've had three or four other venture-backed competitors have blamed out or pivoted completely out of the space, and I don't know if the ones that have pivoted are potentially doing better in other areas, but for us I know, if we pivoted and we moved out of that space, it would be really challenging Because you basically spent a significant amount of time building a platform targeted on one area and to then move and pivot and do other things you're kind of starting from scratch in that way and then your cap table is going to be all messed up and it would be really challenging to then go raise unless it was exceptional and you could really kind of hit the ground running.
Speaker 1:But that doesn't really seem to happen. I mean, even for us from inception to really when we kind of figured it out, it was almost a year and we had been selling events for a long period of time. But we started out selling them out of a presentation and then we had a Wix website and then we had a slightly better website and then we finally were able to build a much more robust site that had the conversion rates that we always thought we could get to.
Speaker 2:So it sounds like you kind of have these various hypotheses and like going if these things will hold, we have a good business, but we don't approve all of them at the first time. So it's like the conversion rate, like can we sell an event? Yes. Can we sell an event with a better conversion rate? Yes, Can we sell it in person as well as online?
Speaker 1:Yeah, it was like can I sell an event out of a presentation and get somebody to just buy it? And the answer is yes, and it's like, okay, the amount of time it took me to sell that individually is never going to be a good business model. It's like, okay, so maybe let's put up a website. And now it's like, okay, it made it a little bit easier. Then it's like, okay, let's put up a website where somebody can check out. And then let's just this constant building of these products over time and having the foresight to be like where do we want to be at the end, and not necessarily always exactly knowing how you're going to get there. But that if.
Speaker 1:Are those indicators like right now for in-person, like it's a much longer build? We have indicators that we can sell events in person, but our conversion rate's not that good. But we also have much more limited inventory because we can add more stuff that gets easier and better. At least that's our thesis and we're going to try it. It's just going to take us a while to add more and test it and reposition it and test it again.
Speaker 2:I think this idea of belief has come up a few times on the podcast, like that belief in what you're trying to do to take you through the tough times, and it feels like you've done this. This is your fourth time. Each time that belief has taken you to a positive point, like an exit point. I'm just curious, having had other guests on at one particular talking about he actually shut his business when he had a second fundraising offer because he felt that the the sort of the traction of his business wasn't leading him to feel like it was going to be as successful as other businesses he's been part of. How do you balance that um?
Speaker 1:that's a good question. I mean, I think that for me, I mean I set out to do this and see this through, and I mean our first round of financing we I mean we did a small family and friends around, so, like it's very personal to me that this is successful. So I don't think that I have the ability to walk away, even if it was, um, maybe not as robust as others, and I think we've experienced that in our own way where, when we first set out, we're like virtual, like you have to put yourself back in 2020 with COVID, and it was like everything's going to be remote from here on out. It's never going to go back in the office. This market is going to be a billion-dollar market, just for virtual. I mean Hopin alone, which I believe is a European company, they raised like a billion or $2 billion and had like a $6 billion valuation and they sold for like 30, $35 million, like last year, like pennies on the dollar. But everybody was just throwing money into space because they thought it was going to be this seismic shift in the world and it was. It's just, I think, figuring out how to monetize it and where it fits and how it fits. So we had to go and make a new market and do in-person events, and we've tried other things as well. Um, so for us, I mean, the mentality is really like, as long as we continue to take swings and figure out how to position ourselves, and like that's, that's typically where we find kind of these, these breakthroughs, and just because you see something on the surface that looks so successful that like they're getting publicity, they're raising money, like it doesn't really you don't really know what's going on under the hood, and and never, nowhere, is ever, perfect.
Speaker 1:But I feel really positive about where we are and even the ability to get to, to break even. I mean, the irony is the last three startups that I was a part of like most well, I think there are periods of time where we made money. Most of the them lost money. Are those sustainable businesses? I think that, as a part of something larger, yes, but standalone, I think they were challenging at times.
Speaker 1:I actually feel really good about where we are. I think it's more of. I mean, I would ask the founder and say are you doing something that you want to do and that you feel passionate about, because it is going to take a long time. I mean, you're talking years, many years, not kind of days, and so so the answer to that is no, um, that's fine, but I think that trying to size an opportunity um is challenging. I mean, you never know until you get there. And so you're working on another problem, um, and none of them have felt like they are guarantees at all, like especially. I mean, all of those other companies had moments where it's like I don't know if we're going to be here next week and figured out a way to get out of that and keep going and growing more these success stories.
Speaker 1:So the margin of error between success and failure is really really small in a lot of cases.
Speaker 2:Quite important to mention this idea of enjoyment. It says the degree of belief like belief in the idea, but also enjoyment in creating enjoyment and actually building something that you want to build, because it's going to be a longer term journey than most people expect.
Speaker 1:And also doing it in the way that you want to. There was a situation where we had a term sheet and it would have significantly changed the ownership structure of the company at a time where we needed capital and we ended up walking away from that and that, I think, was the best decision we've made so far in this business. But it was also one of the decisions and I said to my co-founder at the time. I said, look, I would rather not do this than take that term sheet and so like, let's not take the term sheet and see where it goes? Um.
Speaker 1:But I mean, at the time it was extremely stressful, like we were basically saying we're going to bet on ourselves while all the trends in the business well, I should say the business had been trending up for a while and I think we had recognized that before they recognized that they were still valuing us as if it was like eight weeks earlier, we had figured out a couple of things that really we had talked about for eight months or a year and we finally were like we have nothing to lose, let's just implement this and see what happens. And it was a huge success, um, more of a success than I could have ever imagined. And so, like, sometimes you have those moments and other times you launch something you think is going to take off and change the business and it doesn't, and you're like, oh, that was a surprise.
Speaker 2:I feel like there's this long-term belief coupled with these sometimes shorter-term experiments and just willingness to sort of roll the dice a bit.
Speaker 1:How do we balance that? Yeah, there's a lot of conversations that I have with my co-founder around. What are we trying to accomplish? How are we best utilizing our resources? Are we seeing the return? What are the big swings that we think we want to take? And what do we? I mean we basically use. We basically use this I don't even know where it came from, but it's like impact, confidence and effort and so we basically priority rank all the things that we think we're going to do in the organization and identify the ones that we think have the lowest amount of effort and the highest amount of impact and basically try to do as many of those as possible over and over and over again, like we do it once a month and we kind of just keep taking what we've learned and trying to apply it forward.
Speaker 2:So it's actually quite a sort of disciplined process for you, this experimentation.
Speaker 1:You know now that you say yes, but it doesn't feel that.
Speaker 1:I mean he and I have also worked together for a long time and we're both.
Speaker 1:I actually feel like one of our biggest deficiencies as a group is that you know like we he and I have similar experience in certain areas and we're different in other areas, but like we don't have that strong kind of marketing branding person in that, in that group, which um. So I think some of that stuff comes more naturally to us as far as like this project is worth this and this one is worth this. But there's there's moments where, um we have to be careful of just basically if we have the same think at times, like we're not necessarily stepping back and looking out at the business and one way actually counterbalance that is actually get out and go to events. I mean do things. I mean I don't necessarily do coaching with you, full transparency, but like people use coaching, people use ceo groups. I mean I think there's external we've had external advisors at times where you're using that sounding board to like because it can be very insular in a startup, like it's the same team.
Speaker 1:It's a small team. It's all day, every day, um. So how are you getting out there and getting different perspectives of what's happening? Talking to customers sometimes helps, but then again that in itself can be very ancillary too. So we've set it up where we'll go meet somewhere. Typically it's at a co-working space between us.
Speaker 1:We've done it virtually too, and we'll block out our calendars and there's no distractions, and the expectation is that we're both going in with, like this is what we think and we kind of very professionally discuss which ones we think are where and how they fit in, and and um, and then at times when we kind of get that down, we'll bring in the engineering lead and and talk to him about like, which ones are the effort and like he has to weigh in on some of this stuff as well, um, and and then come up with basically a six or eight week roadmap, and we really don't build out farther than that because things just change too quickly.
Speaker 1:So it's really just like what are we working on next month? What are we working on next month? We're working just continually trying to elevate not only the product of the business, which is the website, but also like what? Where are we leaving money on the table? Do we need stronger account management? Do we need to change our thinking here? How do we elicit certain behavior out of our event hosts and so definitely as a kind of broader mentality.
Speaker 1:I mean, it is this I forgot there's a bunch of startup books of like, talking about iteration and process. We try not to get too. We're pretty small still over 15 people, so we try to not to get too bogged down, but there's there's. As we get larger, we're definitely going to implement more of an operating structure with, like, these are the goals and these are the stakes in the ground and this is how we're going to measure the company and and I've been in those, those seats before it was not there yet I mean, I'm still in the business mostly, instead of just being on the business. So there's a time and place for all that.
Speaker 2:And just a final question on this when you put scores against each of them I, c and E how does that work for your ranking?
Speaker 1:We do so it's 1 out of 10, except effort is inversely correlated. So if something is really easy, it would be a 1, for effort is inversely correlated. So like if something is really easy, it would be a one for effort, I guess. And so confidence is just your ability to. So if you, you know it's going to happen, you're really confident, I'd be 10. And then I mean, some things are hard to like. Some of the stuff where you're automating stuff, it's a lot more easy, easy to measure, because you're like there's two people that do this job. If we we automate it, we can save one head count. And so it's like okay, we know what that is. But I think when we get into some of the front end stuff where you're like, oh, if we change the product page and make it look like this or do this or do that or add store credits, I like we don't really know. So that that's where that confidence interval comes in.
Speaker 2:I think I think interval comes in. I think I think what's so nice about this is like founders exactly like founders tend not to be short of ideas to to the extent where often they like give their teams like slight nervous breakdowns with the phrase I've, I've got a good idea, this, this, this feels like it's quite a nice mechanism, both as a framework of like judging the ideas, but then the frequency to avoid that sort of monday morning oh, I've had an idea syndrome.
Speaker 1:And what you're for me too, which I don't want this to get lost is like I end up being charged for the product roadmap from an engineering standpoint. But the other piece that I whenever I have conversations with kind of very early founders, they seem to miss the go-to-market strategy and how important that part of it is. That's almost even more important than the product early on. How are you going to get in front of people and sell these things? We had almost no product early on and we were just slinging events out of whatever we could. At the time Somebody actually said to me I'd rather have a better business model than a better product early on. That's kind of what we had. We had something that people highly desired and needed at that moment. We barely had a product to be able to sell and enable commerce. I think the go-to-market strategy and gaining traction is just so important early on and it's probably the hardest thing that we had to do.
Speaker 1:How do you really get it going? I remember reaching out to everybody and anybody on LinkedIn Anybody that would talk to me. I would talk to them, just trying to get some traction and learn as we're building this thing out. A lot of it's just hard. You've got to really want it and get out there and do it. I think the other thing is stick to what you know. I would go even further than that and go learn from somebody else. Learn from somebody else who's dying. That's what I did.
Speaker 1:Our playbook that we use here is very similar to playbooks we've used in the past. We figured out what worked and we figured out what didn't's really hard to be like we're going to do enterprise sales, having never done enterprise sales. Um so, and I would. I mean, I think the one thing we really learned is like we have a core competency. We know how to do that, but for a long time, we were getting pushed to move into a sass model like that, like vcs love sass and that just isn't our background and isn't really how our customers want to work with us. And we spent six months building more of an enterprise SaaS and like we sold it somewhat, but never worth kind of the effort of selling.
Speaker 1:So like that was a time where, like we didn't kind of listen to our core belief and we got pushed into doing that by external people in our network and eventually, when it got to the point where, like similar to what I was saying, where we walked away from that term, she was like we're not doing this, like this doesn't work, this isn't what, this wasn't the initial vision of this, this isn't what we're good at, this isn't what the team is good at and it's really not working. Like we've hired consultants, we've hired experts, we we've hired experts, we've talked to other people, we've hired salespeople Like we could just never get that to work. So, no matter how much they wanted it, it just wasn't. It wasn't who we are and it wasn't who the company was going to be, and so we had to kind of so like, but I would recommend to founders go work somewhere else, learn on somebody else's dime.
Speaker 2:I mean, look around, think about how, how it works there, and then and then it makes it a lot easier to do it if you've had some experience in doing it already. And I really like points of goes back to what we're talking about pre pre-recording this idea that's there are lots of people's ideas on how to do it and actually all of them could work like there's probably like 10,000 different ways you could do it. Each of them could be successful. You just know that if you keep on trying 10,000 different things in succession, that's not going to work. So sometimes, just staying true to what you believe in, what feels authentic to you, but still experiment around, that probably is the best path.
Speaker 1:Yeah and what we had was it wasn't not working.
Speaker 1:It just wasn't growing at the rates that they wanted it to grow at and it was just like, well, if we go over there, that's a brand new product and a brand new thing that we're not good at.
Speaker 1:That sounds like the wrong place to be, and I think that most founders one thing that I read which is really interesting most founders of companies are actually in their mid to high 30s or low 40s, and so I think that the most and I think it was correlated with success is going and learning from somebody else actually leads to a higher rate of success when it's founding your own company. I'm not saying that everybody has to take that journey, but I definitely have found that that when I started this, I had a network, I had a group of supporters, I had advisors, I had I mean. I mean I could go through the whole list of things of kind of how we got to like cheat the system and circumvent it, and I think one of the reasons we're winning is just because we've kind of done it before and so, like there were a lot of mistakes we made on other people's times back in the the day, not by choice. Just we launched something and it didn't work. We're like, well, let's have to do that again. And we didn't. We were able to kind of overcome a lot of things just because we kind of knew exactly what we needed to get to.
