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❌ Failed startup
✅ Successful startup

HitroNaSplet: Time Investment > Revenue = Wrong Direction

HitroNaSplet was a hosting reseller company. They invested a lot of time in SEO and achieved the first page in Google, which let them start making some monthly revenue. However, after some months, they realized it didn't generate enough revenue to be worth the time invested, so they closed their doors.

Slovenia
Technology
Capital

Ales Krivec

March 17, 2018

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Hi Aleš! What's your background, and what are you currently working on?

Hi, my name is Aleš Krivec. I graduated with a degree in computer science and worked for some time as a PL/SQL developer. I am currently developing WordPress Themes for sale on my shop PremiumCoding and for Themeforest, TemplateMonster, and Mojo Marketplace.

PremiumCoding Screenshot

I am also a passionate landscape photographer and I spend a lot of my free time in the mountains and iconic spots, catching that perfect morning light. The product of that is my second website DreamyPixel.

DreamyPixel Website

However, before achieving success with these two startups, I failed with HitroNaSplet, a hosting reseller company.

What was HitroNaSplet about? What motivated you to start it?

I always wanted to have my own business so I started a few ventures in the past that I thought could be successful. One of those businesses was hosting reseller website. This was about 10 years ago and one of my previous businesses (online computer shop) already failed. Back in the day it was pretty popular to start an online store and I also wanted to have one. But it turned out it’s not as easy as I thought it would be. Some big players were already on the market and getting in front of them in Google search was nearly impossible. After the initial boost, everything went downhill pretty fast.

How did you build it? Which marketing strategies did you use to grow it?

We simply created a website with a friend and started to resell domains and hosting packages. We invested a lot of our time in SEO and for some time we were placed on the first page in Google (for Slovenian language). 

We already had the knowledge of building an online store and this wasn’t that far from it. We planned our content carefully for SEO reasons and soon our daily visits were quite good. We didn’t do a lot of marketing as that wasn’t that popular back then and we didn’t have a lot of knowledge about. Our focus was mainly Google and at the start the revenue was decent.

We also created a Facebook page and a Twitter account but I had no idea how to promote the business well across the social platforms. So besides learning a few things, it was more or less a loss of time.

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Which were the causes of HitroNaSplet failure?

While the business wasn’t a total failure, the problem was that it didn’t generate enough revenue to be worth the time invested. We figured there was no way we can do that for a living (without having a daily job also). There was just too much work with support, refunds, and billing to be worth it. So, we started building websites and later developing WordPress Themes. After that became our main source of income, the hosting reselling become just a pain in the ass.

The problem with hosting is that you can’t just close it, you have responsibilities to your existing customers. So, the procedure to close it was quite long and tedious. Fortunately, in the end, one of the biggest hosting resellers in the country offered a small sum to buy everything and we were happy to just get rid of everything. 

So, my advice would be if you start something similar to calculate well what you need to invest (not just money, but also your time) and what the minimum and maximum revenue can be. And what would increase revenue mean for you. Because when our revenue increased, the invested time that we had to put in support was just too much to handle, yet we didn’t make enough to hire someone to do it. In WordPress themes business it’s different, our revenue jumped high very soon, but we also had enough money to hire support staff to work full time on customer’s emails.

Which were your investments? Did you achieve some revenue? Did you lose any money?

Our investment was mostly our time. In the end, we didn’t lose any money, but our salary while doing this wasn’t really great, to put it mildly. So, working almost for free wasn’t very fun at the end.

The most valuable thing we gained from all of this was the knowledge that allowed us to move forward to the next step. To create, sustain and support WordPress themes and plugins. And everything that we learned from the previous failure, helped us a great deal with the new business.

If you had to start over, what would you do differently?

Probably nothing since it turned out great for us in the end. But if we wanted to succeed in the hosting market, we probably should invest in the promotion and hire someone to handle the support so we could focus on promotion and growth. But we wanted to do everything by ourselves and it just became overwhelming.

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What did you learn?

We learned a lot about hosting, websites and what people actually need and that helped us a lot with our next venture which turned out to be pretty great. We saw what users usually do when starting the website. A lot of them is very lost at the start (especially the ones starting personal blogs). Most of them would just like to blog, but they have no idea how to make the first few steps. And you have to be aware of that when you are selling themes. People don’t just buy themes as a product, they also buy your support and help to get them started. Your help means a lot to most people. And grateful customers are also returning customers. 

What's your advice for someone who is just starting?

Always start with something that you at least like a little. If you hate doing something in the first place and you are only doing it for money, the chances that you are going to build something sustainable is very small. And if you fail you will regret the lost time a lot less if you enjoyed the path. Otherwise, you will just be upset that you lost so much time developing something that didn’t work out.

Which are your favorite entrepreneurial resources?

Number one is Google. I know it’s not an actual resource but most of the searches start at Google. Then you end up at websites that actually offer what you need. Probably website that I used the most is Tympanus. They have really great innovative CSS tricks that helped me in designing my themes. I also used CSS-Tricks a lot when learning new techniques or just searching for a solution for a problem I couldn’t solve by myself.

Other resources that I use on a regular basis are:

Where can we go to learn more?

You can learn more about what I do now in the article on IndieHackers. And you can, of course, check my WordPress themes in our shop that is the main source of income (besides Themeforest).

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