I returned from Silicon Valley and built a failed startup

Let’s see, where do I start.

I’ve been wondering for quite some time on whether to write this or not. It’s definitely not something that one should be proud of, but I would like for others to see that the startup world is not just stories full of series A, B, C, D, E fundraising rounds, IPOs, unicorns, ping pong tables, and free lunch. I want people to get a reality check, understand that 90 percent of startups fail, and share a bit of my experience.

Okay so here’s the story.

I started building Shopious two years and six months ago along with my co-founder. Shopious was envisioned to be a fashion social commerce marketplace. My background was in computer science, being a true software engineer geek who loves to code. Why did I choose fashion social commerce to begin with? It’s for a simple reason that ecommerce was booming in Indonesia, and fashion items were among the most sought after purchases. Most online shoppers are women.

Initially, Shopious was a women’s fashion marketplace. One year later, we decided to pivot to an online shop aggregator. Why did we pivot? People didn’t have time to upload pictures one by one to a new platform that isn’t yet well known (unless they’re given something).

The marketplace model was something new to the market then.

We got asked a lot about the details of the products sold on the site, which we really didn’t know how to answer. Only buyers know the answer to it, as they have access to the products sold. When we asked potential buyers to contact sellers, they would usually just bypass our platform and make the purchase directly via BlackBerry Messenger, Line or WhatsApp, just because it is easier and faster.

At that time, it was popular for people to sell items on Instagram. So why do they have to do it twice? Let’s just aggregate online shops on Instagram and have people contact sellers directly to buy. We will parse all the item details and prices. We will make it as a paid platform, charging sellers monthly subscriptions to limit people from scamming buyers. We will showcase customers’ testimonial pictures, that is already available on their Instagram account, on our site. This kinda solved all the problems mentioned above and seemed like a good plan.

Okay, so what’s the problem here?

Unpredictable conversion rates

Ridiculous conversion rates in Indonesia

Ecommerce website conversions in the Indonesian market is still very low. The funnel we had on our site, from people browsing products to them actually buying products is super long and unpredictable.

It’s unpredictable because people would have to contact the seller directly to make the purchase. If seller does not reply promptly, buyers would lose the impulse buying mode and the transactions will not be made. We had no control over any of these issues, and they are pretty hard to track.

Instagram shops were full of resellers

We want to profit

Final notes