(my personal story)

While in college, I wanted to replicate the success of the million-dollar homepage created by Alex Tew (now CEO/Founder of Calm, popular meditation app). For those who are not familiar with the story of the million-dollar homepage, Alex created a website where anyone could buy a pixel for one dollar. A buyer would place an ad that would stay on the website permanently. The project got initial coverage and the news spread virally that a student was trying to raise money to pay for his education. He got more publicity which resulted in more traffic which in turn resulted in more pixel sales. In the end, Alex sold all one million pixels on his website.

I read about this story while I attended Kansas State University. Don't ask me why I went to KSU. It's a longer story. In short, my family moved to Boston from Ukraine in 2004. Kansas State University was my choice because my father was a track and field coach and for as long as I can remember I have wanted to become an Olympic athlete. The KSU track team was coached by Cliff Rovelto, the best high-jump and decathlon coach in the US.

It's very embarrassing to admit now. But after I read about the million-dollar homepage I decided to try to replicate its success. I directed some of the money from my education to pay to oversee developers build a website 100banners.com. The idea was stupid. The homepage had a hundred banners and anyone could buy a place and the exact time when this banner will be shown. I hope you won't judge me too harshly.

Needless to say, after the website was built and launched nothing happened. I sent out a press release for which I paid a few hundred dollars. Unfortunately, my website wasn't picked up by any publication and I never sold even a single banner. That was an expensive mistake. I spent a significant sum of money paying overseas developers. However, it taught me that releasing something is just a small piece of the puzzle, you must find a way to explain to people why they need it and create some sort of catching the story. Don't assume that this realization came right then. It took a while to understand.

In the summer between my junior and senior years at Kansas State, by a stroke of luck, I got an internship at a Series A company, AuctionPal. They had a simple idea to help anyone to sell anything online. The initial product basically listed customer's items on eBay. This is how it worked. You call us or send us an image with a short description of the item. Our team would research your item and list it on eBay. When it was sold, customers would receive an empty box with shipping labels. The customer would pack it and mail it to the buyer. We send money to the seller after subtracting the eBay commission and our cut.

AuctionPal was founded by two brothers in their twenties or early thirties. Both coming from a privileged background with connections in the tech industry. Both ambitions and ego-driven. They were smart enough to surround themselves with a few senior and more experienced execs. Our COO was Sheryl Sandberg-like figure. She managed everything from product to tech operations to hiring. And of course, her responsibility included babysitting the young founders and constantly mediate disagreements and fights.

As an intern, I did pretty much everything from rearranging desks to cleaning inventory, to picking up a table from Craigslist for our office. I wanted to learn everything about starting a company. My desire to be at every meeting and to know about every major decision in the company drove me to eardrop on every conversation outside of closed meetings. I constantly found an excuse to come to the meetings. Many people early in their careers can relate to this experience. And I'm sure even more experienced readers will remember how earlier in their career they had similar desires to join every meeting in the company. Meetings become a waste of time only after you move up the ladder. Early in your career, it is hard to find a more significant recognition than to be invited to a meeting with a bunch of higher-ups.

At AuctionPAL, We have tried to sell everything from old paintings and bicycles to jewelry and china. As an intern, part of my job was to drive to the houses of our early customers to pick up items and bring them to the office. Once we brought about a hundred fifty small collectible train sets that were kept in the basement. I had to clean them and take pictures so that they will be listed. The fun part of the internship was that you never knew what you are going to be doing today. But the downside was the fact that you didn't learn much about sales, marketing, or how to start and run a company from ground zero. At least it didn't feel like it at the time.

Nonetheless, there were a few lessons that I picked up during this internship. The process is often more important than the result. Towards the end of my internship at AuctionPal I was put in charge of the most interesting project to date. First, we shipped most of the items from our office then we started sending out empty boxes to the customers to pack and shipped after the sales of their product. Since I packed and shipped almost every item in the office I was tasked to come up with a list of boxes and packaging materials that would cover 90% of all potential items that needed to be shipped.

As we started shipping out empty boxes to customers, we started seeing one recurring problem that wasn't huge at an early stage of the company but potentially can become a significant barrier to becoming a successful company. When UPS or FedEx shipped larger empty boxes they often were put at the bottom of the pile. The heavier boxes on the top would bend and destroy the empty boxes we were shipping. Customers would call us that the box was not usable and we had to ship another one, losing money on extra shipping while receiving complaints from buyers that the item is delayed. Imagine how this problem would multiply with increasing volume.

The second problem we had to deal with inaccurate listings. Our product promised customers to sell unwanted items and make extra cash without too much hassle. Therefore, the process was that the customer takes images of the item and writes a short description. Our specialist couldn't always figure out the condition of the item and more importantly whether it's working or whether it is authentic if we are talking about antiques. There were a few instances where the buyer bought something that's not exactly what the listing description said.

Now, can you imagine the hassle to fix this when you have eBay, buyer, and seller involved in this process? Do you send the item back to the seller? Do you keep it yourself and take the loss? Do you refuse to refund the buyer and take a hit in the ratings? This is an operational nightmare to solve in the early stages of a startup that's looking to find a product-market fit and figure out whether there is a valid business model here.

The third problem was similar to what Airbnb founders found early. People aren't good at taking pictures. They actually hired professional photographers to go to people's homes to take pictures of beds and rooms that they wanted to list. Now, remember we promised people that we will sell their unwanted items in an easy and convenient way. We already were asking them to pack, send an item, and write a short description. And making good pictures was an essential step to creating effective listings. We found the better the picture the higher the selling price. How do you tell people that it's easy to get rid of things that they don't want and at the same time explain that there are three or four things that they need to do? Why wouldn't they just list this item on eBay themselves and keep the high commission that we were charging?

In short, our value proposition was lacking. At the end of my three months internship, I was convinced that the approach AuctionPal was testing won't work. The operation had massive issues from the delivery of empty boxes to returning items. And even more importantly the value for the customer was low compared to the amount of work they had to do.

Another caveat, the company spent over $1M on developing software to streamline item inventory and auction posting systems. I didn't know anything about startups, marketing, or how to run anything but it was obvious to me that this isn't the right approach, this business model is unsustainable, and such spending was reckless.

During my senior year, AuctionPal pivoted to buying a large number of items from wholesale stores or liquidation sales and selling them online. It definitely streamlined the operations by taking the seller out of the equation. However, the company didn't survive. Too much money was burnt trying to make the original business model work. In addition, they were too dependent on eBay and after a few lawsuit threats (or at least that's what I've heard at the time), AuctionPal had to be closed. After my graduation a year later, after the company downsized and was on life support I was again working there part-time in the warehouse while looking for a full-time marketing position after moving back to Boston. I had almost a first-row seat to experience the failure to launch a company.

I graduated from Kansas State in July 2008, a brutal year to start looking for my first full-time job. It was clear after my experience with Hundred Banners and AuctionPal that the business and marketing education I was given in college doesn't fare well in real life. While working part-time at a warehouse I was looking for a marketing position. I knew I wanted to work in marketing and I knew I had to start learning fast, very fast. No one in the Boston area cared about a marketing degree from KSU. Boston has the largest number of universities per capita. When you have Harvard, MIT, Boston College, Boston University, Suffolk University, Brandeis, Northeastern University, and many more in a thirty-minute drive from one another who cares about a marketing degree from Kansas State. Exactly. No one.

In the month of August 2008, I emailed my resume over three hundred times. I got exactly three responses. The first job was selling vacuum cleaners door-to-door. My first instinct was to get up and run from the lobby where the line of people waited for interviews. I didn't know what the job was about exactly when I agreed on the in-person interview. The interviewer on the phone was extremely vague. The recent graduates do not always have a bullshit detector working coming out of college. This is something you acquire with painful experiences. Just like this one.

The second response came from a company that went door to door to sell dry cleaning service delivered to your home. I was dreading sales, especially when it involved knocking on people's doors and offering something like dry cleaning. I knew I would have difficulty saying no if a pushy salesperson knocked on my door. And I didn't want to be a pushy salesperson myself. Looking back I slightly regret that I haven't trained myself in this school of hardcore sales. Selling, as it turns out, is a universal skill necessary for almost anyone from engineer to senior executive.