Startup News

Everything has an end

Pedro Neira, CEO and founder of Mi Media Manzana, a Peruvian dating app, recently announced the startup’s decision to stop operating in the following LinkedIn post.

Read the original post in spanish here

About 100 years ago, in 1920 a person’s life expectancy was approximately 40 years. At that moment, the average life of a company listed on the stock exchange in the US was 67 years. On average, companies outlived humans. Our grandparents grew up with that paradigm: one could aspire to enter a company, work there for their entire life and “build a career”because it was expected that the company would “always” be there. On the other hand, for those that created companies, the main issue was to figure out how that organization would survive one or two more generations.

Fast forward 100 years, and today in 2019 life expectancy is approximately 75 years while the average life of a company listed on US’ stock exchange is only 15 years. If we looked at the average life of a tech company or a startup, undoubtedly the number would be much less than 15 years. Factors such as more access to information, capital, education, and globalization together with less costs, among other things, have created a level of hypercompetition that has drastically reduced the average life expectancy of a company. Summarizing: Today we live more than companies…much more. This is without a doubt a radical change in the way in which we focus our work, but also, it has profoundly changed the focus of who starts a company. Those of us that dedicate ourselves to creating companies (or trying to), whether we like it or not, now we are obligated to answer the following question: “What should my company leave as its legacy after passing through this world?”

Since we announced the closing of operations today (June 20th 2019), I can tell you what Mi Media Manzana has left in these past six years.

INTEGRITY

Integrity is doing the right thing. To be honest and to also not do what we wouldn’t want others to do to us.

From the very moment César, José, and I (Pedro Neira), the three co founders of Mi Media Manzana (MMM), got together we realized that this value was very important to us; it was a value that surpasses all else. We can proudly say that we stuck true to that. Integrity wasn’t an abstract concept for us, it was a very tangible value that was reflected in the day to day decisions. We saw that integrity was present when we made critical decisions like defining who we raised capital from (we avoided and even turned down capital from investors whose reputation didn’t convince us), day to day business, including transparency and the information we would pass on to our shareholders. Personally, my “moral compass” to know if something was “right or wrong” has always been (and always will be) my kids. It’s a simple rule: Whatever I’m doing right now, this decision I’m making, would I be able to tell my kids to their faces? If the answer is no… then I’m probably doing something that isn’t right. In 6 years I haven’t made any decisions that I’m not able to tell my kids about, today or in the future, and the same goes for anyone who works here. We have worked with integrity.

VALUE

When one creates a company, one seeks to create value for different stakeholders, that can be divided into three large groups: value for our users, value for our employees, and value for our shareholders.

Value for our users

Creating value for users means to solve a problem, address a need that is not being covered in a new or substantially better way than the alternatives available at that moment.

Jaqueline and Joel met each other on MMM and had Andrea. She is now 4 years old. Andrea would not exist in this world if MMM had not existed, and she’s enough of a reason to say that it has all been worth it.

Jacqueline and Joel’s story wasn’t the only happy ending. We had more than 2.5 million users in this period of time and we became the most downloaded dating app in Google Play in Latin America. Thousands of love stories, people from different countries travelled to meet their partners, get married, and have kids. Logically, there have been stories of heartbreak, first dates that didn’t work, people that didn’t find a partner; relationships that began and then ended, etc. For us, the value we wanted to create for our users was always the same, and was the goal that guided us from the first to the last day:

“Transform single people… into happy couples”

We launched without rest, one version after another, one improvement after another, always backed by data and qualitative insights collected from our users. We must have made more than 10,000 phone calls and over 300 one-hour interviews with our users to collect insights about their behaviour. From these two sources we created internal hypotheses that later, using fast and design thinking methodologies, we incorporated into our product. Afterwards we would measure everything to prove that our hypothesis worked (that we really were adding more value to our users) or didn’t. We would repeat that process time and again. Sometimes it worked, other times it didn’t, but together we created value and changed thousands of lives.

Value to our shareholders

To our shareholders, we aim to give them value in terms of profitability.

We didn’t rest, we launched new products, raised rounds, expanded into new markets, etc. to be able to give them the return that the huge risk they took by investing in us deserved. This, we did not achieve. MMM didn’t work financially and is the reason for which we are closing the company. All of our investors, from the smallest to larger investment funds like AXON Partners Group and Sparklabs Global Ventures, including us Founders that put in our own money, lost capital. All that’s left is to thank them for the trust that we unfortunately were not able to reciprocate in the form of a financial return to their investment.

Value to our employees

To our employees, our “family” because that is what we call each other, we want to give them value through personal and professional development.

Our theory has always been that we spend more hours a day with the people we work with than with any other group of people in our lives: family, friends, parents, etc. Work is an extremely important part of our lives so… Why not try to make it the best environment possible? We thought which (from our perspective) would be the characteristics of a dream job and sought to create them every day for 5 years:

1. A job to which you wake up every morning and look forward to being there

2. A job that trusts your capability and constantly presents you with technical/professional challenges; generally bigger than the ones you are able to manage so that you grow professionally

3. A happy work environment, without bullshit or politics, where people can honestly and directly express what they think

4. A job that allows you to learn new things, and doesn’t have you doing the same thing that you’ve already proved to be capable of doing well

5. A job with a purpose, that positively affects the lives of the people that use our product

Personally, as CEO, I considered that it was my duty to try to create a job with these five characteristics, and fortunately, with the help of everyone that passed through MMM, I think we got pretty close.

Therefore, now that MMM comes to a close after operating for 6 years, it begs the question,

“What’s left after those 6 years?”

To those of us that work here, we are left with calmness and pride for all that we have done, and done with integrity. We weren’t able to create value for our shareholders, but we did for many of our users (by creating thousands of relationships and families), and to our employees (through personal growth and experiencing together a great period of our lives).

Thanks to everyone for this spectacular 6 year journey!

Sincerely

@pedroneiraf

Learn more about Mi Media Manzana and Peru’s startup ecosystem:

Ep 46 Pedro Neira: Innovating for the Latin American Dating Industry

The Investment and Startup Community in Peru

Peru Venture Capital Overview

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