Editor’s note: This is a guest post by Edvard Nore
Top Pop Up was my attempt at creating a market for short term rentals of commercial real estate in Oslo. What AirBnB did for private rooms I wanted to do for storefronts that was free between contracts. In principle a very simple idea. Allow owners to capitalize on underused real estate, and open up the city to new forces. Never mind that I had never worked in real estate, this idea was in my naive eyes so good and so easy to sell to people that I thought I could just bootstrap it by myself. He.
So, I failed. I’m almost out of money, but mostly, I gave up.
Let’s start with the best part first: What went well.
I’ve discovered an amazing market. Our cities are extremely constrained places that leave almost no space for anything different. The system is now so inevitably geared towards long-term contracts that we don’t realise that so much more can happen in our cities.
There are so many people that want to use our cities for really exciting things, and they’re not provided for at all. It almost feels like I’ve gotten a glimpse into what the future can hold for our cities, with all the crazy ideas I’ve heard from people. Making a dedicated platform for short term rentals of store fronts and other spaces in the city is a thing that has to happen. Every time I got up in front of a crowd to talk about what I did, I’d easily get 4-5 customers from word of mouth afterwards.
I got some insane personal experience that I don’t think I could’ve gotten any other way. The learning curve was steep as hell. I like to call it my ghetto MBA. There were some major lessons, such as the difference between an idea and an opportunity (which is where I got burnt), “just say no” (saying no to people you want to say yes to), and the vitality of dealing with details at the very first moment. What’s interesting is that these were things that had been mentioned before in some form of class or lecture, but having them tossed at you in real life was something different entirely. What seems clear-cut then, is of course never that as it appears. I’ve also become a lot more analytical of situations, and generally a bit more skeptical of other people and their motives (which sort of sucks). There’s also the more subconscious decisions you have to deal with all the time. You’re the CEO (AND the chief coffee monkey) of your company, so you learn how to deal with other companies at that level. This is extremely interesting, as you start to see how a lot of things actually work behind the scenes.
Getting to be interviewed on the BBC in front of 15 million people was also fucking cool, as well as taking part in a panel debate on urban development in Bergen.
So why did it not work? I didn’t know the market well enough. I choose a field that I knew moderately well (I thought), but that was nothing as compared to the on the ground knowledge I should’ve had before I started this. Over the course of five months I managed to find one space for one tenant, despite having tons of people that wanted to rent. Creating a marketplace from scratch is so hard, you need a large demand (which I had), to be met by an already large supply. But to come from the outside with little experience to back yourself up and convince people in a profitable industry to do things different just didn’t fly. AirBnB set up a two sided marketplace from scratch without any underhand tactics as far as I know, and that took them two years of walking block upon block in New York City and knocking every single door, to get a critical mass of supply to match the demand.
To actually effectively build something that will work, you really ought to build something you or a friend need, as well as something that you know beforehand at least ten people will be willing to pay for. Word of mouth after that will probably take care of a lot of your marketing, and word of mouth is a fucking great way of marketing, it’s like social media but real. Cue my next project.
The realisation that stuff wasn’t working came gradually to me, but what brought it into force was when I in early December was approached by a property company to take what I did in-house. I was almost out of money by then, and I realised that if I didn’t accept the offer I’d effectively doom my project. The thought of binding myself to work for several more years in real estate was one that didn’t appeal.
Real estate is generally an incredibly old fashioned industry, think Mad Men but more secretive and sans Christina Hendricks or scotch. It was not a place I was going to enjoy being at the age of 24. The people I were talking to were a lot more forward-thinking and professional than what you generally see in real estate in Norway, but it just wasn’t right for me to bind myself. It was a life-line, and I threw it away. I realised it was time to quit, not throw good money after bad and spend my time doing something else.
So what now? I have no idea. I had a job-offer, but it fell through, so now it looks like my central Oslo apartment and AirBnB will become good friends to keep myself alive.
There is not an ounce of regret in my body that I did this. I messed up but I feel a lot more ready to start a new project.
Got any ideas? Let me know.
Edvard Nore started Europe’s first student-led investment fund while he was a student at UCL and his first company right after that, which failed pretty miserably. He’s now working at Zoaring, helping build Norway’s startup community, as well coming up with a new genius idea.