yourself.online, a service to clean up your social media and online reputation, founded by James Chance in 2018 whilst still doing his MBA programme at London Business School was recently acquired by a leading US based software and services provider, PPLSI.
We sat down with James to discuss his entrepreneurship journey and how he managed to secure a successful exit after only a few years of running the company.
Were you set on becoming a founder as you started LBS MBA?
“Entering the MBA, I was focused on exploring ideas and building up entrepreneurial skills”, James reflects. He would proactively seek out like-minded people at LBS and brainstorm new business venture ideas. In one of the many brainstorming sessions, he was joined by his classmate Enzo Ottens who has recently founded Earnr, an app for self-employed disrupting the accounting sector, see the related blog post.
James immersed himself in all the LBS entrepreneurship activities available such as participating in the Hackathon and LBS Launchpad, led by LBS Entrepreneurship Club. These competitions were a great backdrop to testing ideas out with more structured feedback. He also took part in Entrepreneurship Summer School, allowing him to fully focus on the idea for yourself.online over the summer instead of taking a paid internship elsewhere. By the time he started his exchange at McCombs, Texas in his final year of the MBA the idea was more “baked”.
So, how did he come up with the idea?
“In my job before the MBA, I was starting to see new AI-based technologies such as Natural Language Processing and Vision Analysis being used in more and more applications. When I joined LBS, I started having conversations with my classmates, who were applying for jobs and having panics about what was on their old social media profiles. It was apparent that your online presence was becoming more of an influencing factor on how you were perceived as a professional, by recruitment firms. Joining the technology and the need, I started realising that there could be an opportunity to build something”, James remarks.
The roots of yourself.online started crystallising in James’ mind but he needed to test it further. To do so, he did a range of customer interviews and what produced the most emotive response was “wow, are those photos from years ago still online?”.
Although this provided an early validation, the real litmus test was “what are people willing to pay for”. He designed a landing page, targeting customers with adverts online and seeing whether customers showed interest in paying for the product. The initial traction proved good and he set on developing the MVP of the product.
At this point, he was on exchange at McCombs, Texas where he won the Pitch Texas competition at the South By Southwest tech conference, as one of the few handful of international entrants, netting $35,000. The win further proved that yourself.online was a viable venture.
Let’s talk about the big F, Fundraising – how did that unfold?
“Initially we managed to build the prototype from the competition money received”. The venture was bootstrapped whilst James was finishing his second year at LBS. He had met a number of advisors during his experience at LBS and in Austin that provided valuable advice on how to navigate the fundraising landscape.
The key question was “What funds do you need to hit the next milestone in terms of traction and revenue”. James raised a small pre-seed round: $250k, whilst initially targeting $400-500k. He then topped up the round with other angel investors to reach $387.5K in total. A lot of the investors were LBS alumni. To get the alumni interested, he put out a fundraising post on the LBS Portal and got approached by several individuals. The connections he had made in Texas helped to fill up the round and provide validation. But the most important thing aside from money in the bank is that “You’ve got to find the right angels with the right strategic fit”. This proved a significant influence on their journey, “By mid-2021, we were approaching break-even which reduced pressure on raising subsequent rounds, we eventually became self-sufficient on revenue”.
In terms of what good metrics look like to investors, it’s difficult to say but as a rule of thumb, James says, “If you’re raising a seed round of $1.5m – 2m you need revenue of $250k-$300k p.a, say $20-$30k monthly and to be on a good growth trajectory”. “For a smaller pre-seed, it’s important to be able to prove that you have (any) revenue from your target customer base and that they’re engaged with the product”.
How did you know it was the ‘right time to sell’?
“These opportunities don’t come up too often”, James remarks. He looked at the opportunity on a risk-adjusted basis. To keep yourself.online scaling further, he knew he had to raise a substantial round next, likely to entail more dilution and conditions to the capital. Then he compared the outcome of the business in 2-4 years from now, and the offer on the table. “After looking at how the typical start-up works out, and pitfalls moving from seed to series A, it was clear we were in a very good place with what was on the table right now”. Aside from pure financials, he knew that with the backing of PPLSI, he could keep building the product and have access to an even wider customer base of over 1 million members. It was a new chapter in yourself.online journey.
Advice to budding LBS founders?
“Have a really good focus on the core problem you’re trying to address and don’t do too much too early.” James sees as one of the biggest pitfalls of founders becoming anxious that they only focus on one small problem. In reality, having lots of ideas connected to the problem is great, but pick a key one – test it and then have a clear plan to address the other ideas as you build towards your vision.
The other key piece of advice is “Revenue is the best form of traction”. Showing traction via customers who are willing to pay for the product and already booking revenue ahead of a potential fundraise is a strong positive signal to prospective investors.
yourself.online is aimed at professionals to monitor and clean up their social media presence. The service has over 10,000 paying customers and is provided by a range of organizations to their employees alongside individuals buying the service directly. Blog readers can try a free scan of their social media scan at www.yourself.online.
About the author: Kathryn Larin, London Business School MBA 2021 and former Co-President of Entrepreneurship Club. Kathryn hosted the podcast, Ride it Out interviewing VC investors and LBS founders. She now works as Strategy Manager at Codat, B2B Saas scale up. Get in touch with Kathryn via email.
Start up diaries – How to be yourself online – advice for entrepreneurs
Back in May 2019, we did a podcast with James Chance MBA2019 to talk about how his start-up idea was evolving and why it was necessary to keep track of our online identities and who has access to them. Listen below.