Skip to content

Why a startup cancels a product with 4000 transactions – Startup Struggles

Akord has privately and securely transferred 4000 files in just 8 months. Surprisingly they will cancel this early file sharing product. Many startups would be more than happy with this kind of product usage, so why would you drop support? Stick with us to find out how Covid-19, losing a co-founder, and a pivot made it an interesting year for Akord.

Meet Akord

Akord is a young startup based in France and has embraced the challenge of data privacy and security. They believe that the internet doesn’t have to be a place where your privacy disappears and that they can play a role in keeping your data safe. We talked to Pascal, Co-founder of Akord to understand their startup struggles.

In 2020, privacy and security are not new concepts and since the EU introduced the GDPR law they have increased in importance. GDPR impacts the entire internet, from small businesses to global internet giants (Google has already been fined 50 million USD). The lawsuits have focused on the big players, but with the 2020 COVID-19 roller coaster even more companies have moved their workplace online. Privacy and security are hot topics and considering the potential fines, a great place for startups to work in.

A 2020 startup

You can’t really tell from the Akord website, but they’ve only been around since January 2020. Pascal and Richard both worked for a startup called Stratumn which secured the business processes for insurance companies. Their constant exposure to the privacy and security sphere and the many customers they talked to gave them a great breeding ground for new ideas. Both Pascal and Richard love the excitement (and chaos) of an early stage startup. As Stratumn became more of a company than a startup, they decided to leave and start Akord with a third co-founder.

Delivering first customer value

The first goal for Akord was clear: Get something out to the public as soon as possible. They decided to work in a 6-week challenge. They determined it was a good balance between delivering a decent chunk of work while keeping the risk acceptable. In these 6 weeks, they built a public file sharing service that promised to deliver these files only to the people you wanted and with end to end encryption. They already knew that this wouldn’t be the final product, but it could function as a module in their commercial offer. Once launched, the power of their existing network and google ads drew visitors in.

Fast growth

In only a couple of months many more users found their way to the file-sharing tool. The Google Ads paid off: with over 4000 transfer in 8 months, they definitely collected an active user base. For each transfer, the uploader needs to provide at least 1 email address. This means that they have a massive database of email addresses. When we asked them if they would use the collected email addresses in future marketing campaigns, Pascal told us that this would be against their vision of privacy, and that they would not. Even though they’ve collected thousands of email addresses, they chose to ensure their customer’s trust.

Covid-19; what else?

Covid-19 hit France and impacted all three founders: Pascal ended up taking his family back to the UK, Richard took some time in the south of France, and their third co-founder decided to focus full-time on another project. After a month of little activity, the 2 remaining co-founders regrouped and did what many other businesses do in corona times: make the best of it. In fact, they noticed that many small and medium sized businesses (SMB) were using the Akord service to securely send files. Covid-19 increased remote work significantly, and therefore also the usage of Akord to transfer files between colleagues. This validation was incredibly valuable, because it confirmed their assumption that there was a need for secure workflows.

Cancel the product

So why would they ever cancel this product? They learned everything (or most) they could from the file sharing service and managed to validate some assumptions. It was time to move to the next stage. Their first (free) product started to distract them too much from their future main product. That’s when they decided to no longer provide this free service (at the time of publishing it is no longer available). With the first validation finalized (learn how to apply these validation techniques yourself), it was time to continue bootstrapping Akord.

A new breath

With only 2 co-founders, and a new company vision, they required a new set of technical skills in the Akord team. They found 2 people, a crypto/security developer and a web developer. With this fresh team, they decided to throw out all technical work and start all over. This can be a tough decision, but sometimes it pays off. In this case, it was a great way to energize the new team and foster a shared feeling of ownership. In three 6-week cycles they managed to put together a first version of their new product: A platform for small and medium sized businesses to securely exchange highly sensitive documents (think of notary offices or real estate). With their “secure workspace” concept they will provide a central hub to securely digitize workflows.

It’s the best product & the best team we ever worked on

Pascal about the 2nd product

The second launch

In November 2020 they plan to release a first version of their new product. They now have a pretty good understanding of the market and their initial file sharing service was actively used by SMBs. So they feel confident that customers will sign up. That’s why they will charge their users as soon as possible. Zapier drove this even further by launching with a paid beta, charging users from day 1. Whatever format Akord will choose to launch, the goal is clear: focus all their time and effort on the users who really value the service and are willing to pay early on. This might seem scary at first (what if nobody wants to pay? – read more about startup failure and learning), but Pascal is no stranger to a bit of customer-confrontation risk. He believes strongly in (paid) customer feedback to get them on the road to product-market fit fast.

Pascal’s advice

When we asked Pascal if he was nervous about the beta launch he replied: “Coming from a design background, I’m used to getting things out there and getting all kinds of feedback. So actually, I can’t wait for the launch!”. 90% of his UX work never sees daylight. He knows very well how scary it can be, so he has a tip for new entrepreneurs: “If you remember that ultimately you’re making something to help someone else, it will create a bit of healthy, emotional distance from your ‘baby’, and increase your empathy for the people using your product.” 

More about Akord

If you’re a small or medium sized business, be sure to follow Akord on twitter.

Screenshot of Akord twitter account
Share this article
Published inStartup Struggles

Be First to Comment

Leave a Reply

Your email address will not be published. Required fields are marked *

This site uses Akismet to reduce spam. Learn how your comment data is processed.