Sunday, March 16, 2008

The Regular Couple Behind Bebo's Success!

Earlier in the week AOL announced that they would be buying Bebo.com for $850 million and I chose not to write anything about it because AOL bores me and I knew next to nothing about Bebo. Well, this morning I came across a great little article profiling the husband and wife team behind Bebo.com and was amazed to find out they will be taking home 70% of that $850 million – Wow!

This story meant a lot to me personally because it showed that failure is just a part of living and if you keep working until you find the right formula, success will follow. Sometimes, as I’ve posted in the past, you need to realize that your current business model is not working and either fix it or quit and start something new.

“This is the story of a couple of struggling computer entrepreneurs who met in a London bar and moved to California without enough money to pay for their accommodation. Michael Birch and his wife Xochi are now expected to make hundreds of millions of pounds from the sale of one of the hottest properties on the internet.” Says the TimesOnline in its profile of the husband and wife team.

Allow me to quote a large part of the article to give you a feel for their story. It is not unlike my story, except they are now some $600 million richer than I am. I’m sure many of you online entrepeneurs can relate to what the Birch’s went through to get their “lucky break”

Birch was born on July 7, 1970, an inventor’s son, and grew up in the Hertfordshire village of Cuffley. At school in Cheshunt he was a bright child who excelled at chess but lacked ambition. He said later: “I used to wonder what I’d do in life if computers hadn’t been invented. I don’t think I’d be good at much else.”

He was no more motivated after graduating with a degree in physics from Imperial College London, where he met Xochi at the university’s Southside bar. The dismal jobs market at the time prompted him to begin his career in the unlikely setting of Zurich Insurance. Computer programming and insurance struck him as the two most boring activities imaginable: “I was frustrated by the environment because it was very bureaucratic. But I found out that I really liked the computing side of it.”

Birch stayed in insurance for six years before becoming a freelance IT contractor. He gave up work to concentrate on his own ventures after Xochi gave birth to their first child. The rising property market enabled the couple to remortgage their flat in Richmond, southwest London, and ride out their initial disappointments.

Their first three dotcom start-ups were unsuccessful. Then the Birches hit a lucky streak. Their first success came with BirthdayAlarm.com, initially a simple alert service that evolved into an e-cards business. By the time the Birches decided to act on a long-standing plan to join Xochi’s parents, BirthdayAlarm was not generating much revenue, although it eventually began paying off and enabled the inlaws to move back into their bedroom and the young couple to rent “a really terrible apartment”.

The swift evolution of the internet captured their imaginations. “When social networking came along I just thought: wow, something to do with computers and it’s fun. This was invented for me,” Birch said. Envious of the success of Friends Reunited, he was galvinised into action by the appearance of Friendster, a social neworking site launched in 2002. After studying it for half an hour he began coding his own site, which went live 13 days later. Named Ringo, it gained 30,000 members within days.

However, the stress began to tell: “There was myself and my wife in this 120 sq ft office in the suburbs of San Francisco, trying to cope with the amount of traffic we were getting.” Overwhelmed and lacking finance, they sold Ringo within six months.
(bold is mine)

That brings us to Bebo, which began after the sale of Ringo and the rest is now history.

The world is filled with stories of “lucky” breaks that turned regular folks into millionaires overnight, but when you actually research their background you find that there were many failures and lessons learned before they became “lucky”.

As you look at your own life or business and wonder if you too could be this “lucky”, remember that quitting a failed business model, or having it quit on you is just a lesson in your journey to something greater. If your start-up, online store or great new product idea fails, just dust yourself off and get back in the game. Persistence pays off and you can’t get “lucky” like the Birch’s, unless you are actually in the game.

Many eBay sellers and start-up founders can relate to this story and though the degrees of your success are not on the same scale as the Birch’s, your story may be very similar. For those of you who haven't had your "lucky" break, take a look at your business model, make sure it still viable in this brave new world of ecommerce, make corrections, shut it down or morph it into something completely different and as long as you keep working hard, someday you too could be as “lucky” as Michael and Xochi Birch

4 comments:

permacrisis said...

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Anonymous said...

"AOL boars me.."

Oink, oink! No one likes to be treated in a porcine fashion...;0)

Randy Smythe said...

Spell checker didn't catch that. "AOL bores me"

:)