I speak to a lot of startups and their origin story is always fascinating. In many cases, the founder never intended to start a business. He or she may be working, studying or transitioning between life stages when all of a sudden a spark hits. It flickers and an idea begins to form. Before they know it, the idea has evolved into an all-consuming project which they can’t imagine life without.
In my case, The Room Xchange spark began six years ago.
I’m a nurturer by nature. I love to have people over for dinner and stay a while. When you walk into my home, whether I know you or not, you’ll get a hug, a meal and leave knowing you were cared for. It’s who I am.
Over the years, I’ve had people stay with me for longer than a weekend, and noticed a vast difference between someone feeling at home or feeling like a guest. Since most of these people were travelling on a budget, they couldn’t afford to financially contribute, so I offered an exchange of time for food and accommodation. Time had become a precious commodity for my husband and I so it made sense. It changed the dynamic immensely. It was the difference between our guest asking if they could have a sandwich or going to the fridge and making one themselves. They knew they had contributed fairly, and therefore earned the sandwich. It was a simple realisation but a powerful one at that.
The most profound experience was with our fourth Xchanger, Guillaume. He stayed with us for 18 months while he was in Australia on a working holiday. Guillaume became part of our family during that time and supported us through many life changing moments. He was with us when my mother was diagnosed with cancer and was at the end of her life. He supported us emotionally and physically, he cared for all of us while we were caring for her. Our experience with Guillaume was so sincere that he called me ‘Ma’.
It was at this time that my friends started commenting how great it would be to have someone like Guillaume live with them and my entrepreneurial radar went right off! My husband Harry and I were discussing it one night in the kitchen, “I think we can turn this into a global business,” he said, “what do you think?” I responded, “Hell yeh!” He then said “Good! Do you think you could do it?” And that’s how The Room Xchange began.
Deciding to start a business is easy; staying the course is harder.
According to an article in Fast Company, as many as 75% of venture backed companies fail. Entrepreneurs have to be everything to everyone, we wear multiple hats every day and throughout the journey. As a lifelong entrepreneur, I have identified five key ingredients to launching a successful startup and staying the course.
Face your obstacles with gusto
When we started The Room Xchange, our adult kids had just left home, we were debt free and at the beginning of our next chapter in life. Freedom! But no; we went in the other direction. We re-mortgaged our house and invested $300,000 which covered us for the first two years. Our goal was to get the company investor ready so we could build our technology platform, partnerships and users.
To raise the capital, I pitched in front of hundreds of traditional investors who typically invest in things above or below the ground such as property or minerals; things that actually exist. Businesses in the sharing economy space generally don’t own assets; we’re accessing and exchanging resources that already exist, so it can be challenging to get traditional investors on board.
I realized that the standard 10-minute pitches were not enough to provide traditional investors a deeper understanding of The Room Xchange. So I decided to run our own pitch event in the way that I would run an event in my home. I booked a venue space in a pub, invited celebrities, government personalities, and the media and set up an environment where they could not only get to hear the deeper story of The Room Xchange but also hear from our advocates from industry and government.
At the end of last year, after 8 months of pitching I raised over half a million dollars in capital.
Do your research
To thrive in your field and grow your business to become scalable and sustainable, you must be diligent in doing research and looking at the trends. Not only the current trends but also the projections on where our current generation is heading and the trends that are most likely to happen in three to five to ten years.
In my case, we know that Australians are increasingly locked out of the housing market in spite of there being approximately seven million unused spare bedrooms across the country. Instead of building new infrastructure, The Room Xchange platform connects Hosts who have a spare room with Guests who are willing to pay for their keep by doing up to 14 hours of house work per week.
Guests are typically home leavers, students, international travellers, or people who are transitioning through life stages. Hosts are typically home owners with high mortgages and living expenses who are working very long hours to maintain their lifestyle, elderly people requiring company and support, and ‘empty nesters’ who would rather share their space, as opposed to downsizing.
Embrace your superpower
Just like the secret ingredient my Mama had in her delicious bread and butter pudding, so too are there secret ingredients to making a business successful. My secret lies within my superpower. Everyone’s got one. I just know what mine is (because people tell me all the time) and I make sure it comes forth in everything I do. It’s what sets me apart. What’s your secret ingredient? What is it that people say about you? Listen to it. Fall in love with it. Make it the stand out ingredient. If you’d like to know what mine is, give me call or take me for lunch. You’ll know it within the first minute of meeting me.
Surround yourself with good people
You may be the most versatile person in town, but you cannot know or do everything on your own. You need great and supportive people around you. You need people who will allow you to be vulnerable so you can be real and honest about where you’re at. You need people who bring complementary skills to the table.
Above all, you need to be agile and flexible, open and adaptable to change.
We are all climbing our own Mt. Everest. You have to get to base camp first, catch your breath, and then start climbing again. Learn from each mistake along the trek and keep looking ahead.
The Room Xchange is not just a start-up company; it’s a movement that is changing the way we live. Our mission is to establish a unique, alternative way of living that will make a significant impact on people’s quality of life, the environment and the economy. By utilising resources that already exist, we can provide affordable housing for millions of people and in-home support for time poor households.
In two years we have self-funded, proven the concept, received registrations in 34 countries, raised capital, achieved regular media and won this award.
Success is about being committed to what you do, being willing to do the things most people are not, work hard, learn from your failures and keep going.
Ludwina Dautovic is the Founder and CEO of The Room Xchange and winner of the Anthill Cool Company “Editor’s Choice” Award.