28 Nov
iGottaGuide_Logo_v2

Why iGottaGuide Failed | A Startup Story

[Acquired by GetYourGuide]

iGottaGuide was my first scalable technology startup. Prior to working with my co-founder and developer Michael Griffiths, we both had extensive experience in service-based businesses. We saw tourism as a fragmented industry, hard to navigate with a massive amount of information and options available. While the best way to experience a new city is like a local, connecting with a local expert willing to share his insight and, more importantly his time, was not something easily accessible.

Trying to be lean, we designed, developed, and launched a beta site with limited functionality and only a handful of tour guides within two months. Leveraging a small network of entrepreneurs in New York City (thanks to Grant Griffin’s Poor Man’s Dinner) we arranged for initial user testing and feedback on what we believed to be a minimum viable product (MVP).

Once initial feedback was gathered we improved our user experience, product positioning, and our go-to-market strategy. Unfortunately, our efforts to avoid over-developing our product distracted us from analyzing our competitors.

We officially launched on April 15th, 2011 – three days prior to Vayable and at least three months prior to SideTour’s first iteration. Without seeking funding or applying for an accelerator program (Vayable and SideTour sought funding from Dave McClure’s 500 Startups and TechStars NYC, respectfully), Michael and I were supporting our venture by splitting our time between consulting and iGottaGuide.

iGottaGuide inevitably failed due to a number of reasons. While I stopped focusing on iGottaGuide 7 months ago, I have not had the time to reflect on its failure and learn from my mistakes. However, I have recently taken the time to think about my professional experiences in hopes of better understanding my career goals and minimizing the chances of repeating past failures.

Similar to my peers, I view an entrepreneurial failure as the result of an isolated issue; in this case, bandwidth. However, after a discussion with Michael, we have outlined a number of issues that ultimately contributed to iGottaGuide’s failure.

Bandwidth. Time is my most valuable asset. As a recent graduate, I was faced with the decision to secure gainful employment and begin paying my dues as I worked my way, over time, up the corporate ladder, or pursue my entrepreneurial itch.

All jobs are demanding. Being an entrepreneur presents unique difficulties that are typically viewed as more challenging and time consuming than employment at a larger, more established firm. Starting a business requires time to strategize, formalize processes, sell, refine, and repeat.

I made a mistake and simultaneously started a consulting firm to self-fund iGottaGuide. Splitting your time between a full-time job and a startup decreases your chances of success both as an employee and an entrepreneur. I jeopardized the chances of iGottaGuide succeeding from day one by dividing my time. It is now 19 months later, and only one business survived.

Chicken Versus Egg. iGottaGuide was a peer-to-peer marketplace for unique experiences. An all too prevalent challenge with technology startups, our platform was only as valuable as the number of service providers (guides) and consumers (tourists) who utilized it. When launching we realized the importance of growing both sides of the marketplace to ensure there were equal parts supply and demand. We leveraged our network and contacted registered guides in New York City to provide supply while creating partnerships with Eventbrite, the Roger Smith Hotel, the Sanctuary Hotel, and Gomio to increase demand. Unfortunately, our strategy of leveraging existing supply and demand within an industry created a larger issue, further contributing to our failure.

Compete Instead of Disrupt. While initially setting out to bypass existing sales channels and inspire individuals to create unofficial tours based off of their personal hobbies and expertise, our tactic of aggregating existing supply within the industry made us a competitor to everyone who could originally help. While we did have limited success with amateur tour guides, it was hard to extract value from them without sufficient scale.

Positioning. iGottaGuide was one of the first open marketplaces for unique experiences. However, as (one of the) first movers in the industry we were unable to capitalize on the opportunity to differentiate and gain market share. Within months the landscape was flooded with similar business models ranging from social networks for travellers to unique activity listing sites and many, many more (constantly updated, thanks Tnooz). Increasing competition meant that it was harder to get market participants’ attention.

We found that a slight shift in positioning proved to be an underlying reason for success between numerous, localized competitors. For example, iGottaGuide directly competed with SideTour during the summer of 2011 in New York City. With similar listings (many guides co-listed between the sites), we could exclude supply as a contributing factor. While SideTour advertised its platform as a way residents could explore their own city by taking advantage of local experts, iGottaGuide positioned its service for tourists exploring a destination like a local.

As a result, SideTour could centralize its marketing efforts, for both sides of its marketplace, in one geographic location. Whereas, iGottaGuide needed to, once again, split its efforts between increasing the number of local tour guides, and garnering the attention of the most highly sought after consumer group: travellers. And, the 50 million yearly visitors to the Big Apple, do not all originate from the same hometown.

Vanity Milestones Valued Too Highly. From an extravagant launch party to press mentions, iGottaGuide valued entrepreneurial milestones that did not result in an increase in the number of transactions. While having the New York Times cover your startup may make a great speaking point at the next NYTM, its message doesn’t necessarily reach your target audience.

Feedback. Although efficient, our operations and development procedures did not allow for real informative user testing. Both Michael and I regret not being more thorough in gathering initial feedback on mock up designs, interactive mockups, and even simple surveys. At no point in our creation process did we have a clear understanding of the conversion funnel. While shipping-it may be important, thinking through a process to minimize the likelihood of a negative response is even more so.

Overall, I have no regrets that I started iGottaGuide. I am certainly embarrassed by creating or contributing to so many of the issues that caused its failure, but the knowledge and lessons learned from experiencing it first hand will allow for me to take on my next challenge and further explore my passion for technology and business.

By taking the time to write this reflection I am hoping to better understand my past actions. Furthermore, I am hoping that by sharing them publicly I will be able to make others more aware of potential pitfalls. When I was starting out I’d read about similar difficulties that I was sure I would evade, but I went on to repeat them anyway. Reading about the mistakes of others doesn’t always resonate directly with the reader, but experiencing mistakes first hand will allow him to more easily avoid repeating them in the future.

I am looking forward to making a few more mistakes, avoiding repeating similar blunders, and having continued success with CNSLT.us.


  • Par Boman

    Great read. Thanks for sharing and a candid view of your experience.

  • Bob

    You failed because you stole this idea from someone I know and are a fake entrepreneur! Why would I ever hire you to be my consultant when you fail at everything!

  • http://www.KeithPetri.com Keith Petri

    Thanks for the feedback Par. I appreciate your note.

  • http://www.facebook.com/karen.drake75 Kara Dake

    Honorable piece here, Keith! I can certainly relate to many of this, as several of my early concept ideas have failed due to teammate issues, lack of lean startup methodologies, funding, and not reaching product-market fit. The fact that you’ve maintained one successful business while creating two is admirable in itself! Many bright things in your future, I’m sure.

  • http://www.KeithPetri.com Keith Petri

    Hi Kara. Thanks again for all of your support early on in iGottaGuide’s development process. I really enjoyed your insights and willingness to contribute – in more ways than one! Would love to learn more about what you are working on!

  • http://www.excursiopedia.com/ Kirill Sermyagin

    Hi Keith! Interesting experience, thanks for sharing it. Hopefully we successfully pass some of these issues in Excursiopedia – Munich based social marketplace for tours and activities, launched in the same time as iGottaGuide. And I hope fail of iGottaGuide will not slow entire industry. Anyway – good luck in your next company and I’m sure that you will use this fail as stair to success :-)

  • http://www.KeithPetri.com Keith Petri

    Great hearing from you Kirill. I certainly hope that iGottaGuide shutting its doors isn’t a reflection of the entire industry! Travel in general has much room for innovation – from booking to organizing itineraries to social interactions. There are still problems to be solved, and I believe both iGottaGuide was trying to and Excursiopedia is still trying to solve just one of them. Best of luck.

  • George Way

    Hi Keith, Great reading and you said it all. All the struggles and hard decisions a entrepreneur has to make between self-funding and not to be distracted, a cushy MNC job vs own start-up.
    The important thing is , when you lose , don’t lose the lesson. and each time we fall, all we have to do is STAND UP one more time and we will soon be flying. cheers
    George Way

  • http://www.KeithPetri.com Keith Petri

    George, I couldn’t agree more. I am definitely standing again and making sure I carry along the lessons I’ve learned. Cheers.

  • Bojan

    Hi Keith, thanks for the insightful article. Can you share your thoughts on who you think is going to make it in this ever expanding P2P market place for experiences? I have a similar idea, but after some research was completely blown away by the sheer number of people trying to do the same thing. It seems that we are all onto something, but what is the right model. Thanks in advance for your thoughts.

  • http://www.KeithPetri.com/ Keith Petri

    Bojan, thanks for reaching out. I would encourage you to continue to conduct due-diligence on the market landscape prior to committing to a concept. If you are trying to solve a problem, then make sure that other, similar solutions do not exist – unless they are unsuccessful.

    Unfortunately, unsuccessful competitors mean one of two things: i) their go-to-market strategy failed, or ii) the marketplace is not ready. Online marketplaces are a proven concept. P2P is a viable business model – as shown by eBay, Craigslist, AirBnB, and the like. However, companies like GetYourGuide and Skyara tried to disrupt the tour and activity industry long before Michael and I had decided on a name, written a line of code, or contacted any NYC based guides. As Johannes (CEO of GetYourGuide) has said on numerous occasions, the concept was ahead of its time – and might possibly still be.

    I cannot speak to the traction of other competitors in the space. However, as stated above, iGottaGuide’s shift from disrupting an industry to competing with established tour guide reservation channels resulted in a lack of differentiation. We created yet another competitor in the travel space instead of a unique service. There are only a handful of current P2P marketplaces for activities in the space that have correctly – in my opinion – positioned themselves as a disruption (e.g. SideTour). I would put my money on those startups.