Why GreenLED Failed

My Dad told me I was going to fail. As soon as I explained the idea to him, he told me the idea was way too grand for my level of experience. After arguing with him about how I was going to make it work, he slowly started to smile, and said, “well, you’re not going to make any money, but you’re going to learn a lot in the process.” I hate that he was so right.

The concept behind GreenLED was to convert current streetlighting into LED streetlighting with solar panels and central control systems. The benefits were better adjustable lighting, the ability to better coordinate lighting, and of course massive energy savings that translate into cost savings. Technically, it’s not a bad idea and it’s totally possible, but you need much more than good ideas and good intentions to succeed in business.

Insufficient Market Research

Any good army collects intelligence and does reconnaissance before sending in troops. If you’re starting a lemonade stand, you don’t need to too much market analysis, just look up and down your street and make sure no one’s selling lemonade on your block. We did much more than that to be fair, but with a large-scale operation such as what we were plotting, the amount of market research we did was totally insufficient for the war we were taking on. In fact, we didn’t even realize how much of a war we were about to fight.

We were about half a year into the startup, gaining some steam on social media, earned the attention of some interested institutions, and we were about to approach an investor we knew for some early seed capital. We came together to do a review of our business plan and dive deeper on our market research - it was at this point that we realized we were probably doomed. While we were all eyes on marketing in order to raise cash and generate public support, the big utility companies were playing the real game. Governments were very quietly signing massive contracts with major utilities and mega conglomerates like General Electric to do exactly what we were proposing. They had the cash and connections to move in, and we were just a little pup barking in the park while the big dogs shared the meat.

Failure to Deeply Analyze the Team

As I grinded out 10–12-hour days 6 or 7 days a week, my Dad would occasionally ask me how the business was going, and I would give him status updates. He would sometimes ask who was handling what, and as he noticed a pattern he asked me a question, “Are you sure your team works as hard as you do, because it seems like the things you say they’re supposed to be getting done are not.”

My primary job in the company was marketing and communications. I created the crowdfunding, produced a commercial, ran social media, wrote blog posts, worked on SEO and did outreach to key organizations. My other partners were responsible for research and development, business development, and operations. What I won’t do is blame them for failing. What I will do is blame myself for improperly assessing their capabilities. They were my friends, the idea came from one of them, and we had talked for so many hours about our ambitions and visions. This clouded my judgement, and I couldn’t see what was right in front of me. They had the intellect, but they did not have the drive; they were too comfortable - and I blame myself for not seeing that on day 0. Maybe, if I would have ensured that I had the right team, we would have seen the market moving earlier and made better pivots.

Underestimating the Learning Curve

Though the technology was nothing that hadn’t already been invented, the business landscape was more complex than we had originally imagined. It sounds simple: create a company, start doing small scale private jobs, then bid for increasingly larger municipal contracts. As we began to actually plan the operations, we realized that this was much more difficult than we had imagined.

Learning the logistics and relationship management of large-scale transitions of infrastructure is no joke. When you sell to the government, the people who make the decisions are not your customers. We knew that, but quite frankly, apathy is hard to calculate, and governments usually move at the speed of continental drift. This is why getting into the door usually involves greasing palms or using some kind of quid pro quo or leverage. We did not have the ready capacity to do that, and we did not anticipate it until the big guys had already gobbled up major markets while we were still trying to figure out how to play the game. In some businesses you can really learn as you go along, but in the world of high-stakes government contracts, trying to learn as you go is a good way to lose all your money, time, and sanity.

Conclusion

“Move Fast and Break Things.” Translation, fail faster so you can learn faster. I learned a ton in the year I tried this startup, I jokingly refer to it as my relatively low-cost MBA. I learned how government contracting really works (not what they tell you), the ins-and-outs of LEDtechnologies and the future of green energy, how to make a commercial (Pro Tip: Amateur actors work for free to get exposure), the importance of deep market analysis that is constantly being refreshed, coordination of large scale logistics, what to look for in a good team, and how to lose all your money on a startup :)