
Startup Science
February 26, 2018

Startup Science

Written by: Mark Engelmann

Listen to Scott Thomas, Co-Founder of Creatively Squared, discuss his move from helping start-ups as a management consultant to starting up his own business. He talks about his take on lean start-up methodology, the journey from employee to self-employed, and his recent successes in acquiring funding. This is a must watch for anyone looking to go out on their own.


Scott Thomas, Creatively Squared


Interview Transcript

Mark Engelmann: Hello everyone, thanks for joining the show today. This is the Go for Growth show, and my name is Mark Engelmann, your host, and on today's show I've got Scott Thomas with me. He's co-founder of a business called Creatively Squared. Welcome, Scott.

Scott Thomas: Hello, thanks for having me.

Mark Engelmann: No worries. So, Scott I'm gonna talk ... ask you to talk a little bit about Creatively Squared later on in the interview, but I thought we'd get into something that I certainly see you as a bit of an expert in. Prior to Creatively Squared, you worked as a management consultant, and in particular, an area of focus was or is the lean startup methodology. Can you talk the audience through the basics of what lean startup is?

Scott Thomas: Sure. So, the basics of Lean Startup is to hypothesis test everything. So only build what you need to, and test the most important aspects of your business model with your customers before you build anything. So, really, at its core, it's a risk reduction tool. How do you make sure you are building the right thing for the right people the right way or without spending too much time and, more importantly, money building the wrong thing?

Mark Engelmann: Yeah, cool. So, how do you test something that doesn't exist with customers that don't exist either?

Scott Thomas: There's a lot of making stuff up and facades to use but at its basis, it's really the scientific method being applied to business problems. So, come up with a hypothesis and then test it, work out what the result was. As an example, if you wanted to build a new platform for a marketplace, one option is to go and outsource that to a team and build something that might cost you $5 million and then you put that out to the market and then see if it works. I wouldn't advise doing that, but that's how things were done a lot of the time previously.

An alternative option is to build a quick and dirty landing page. You put a website up, it looks like the real thing, and you get people to sign up and test whether people actually come to this site and use it and that might cost you an hour and 20 bucks. At the end of the day, you learn the same information, but one has cost you significantly more than the other. So that's kind of the idea behind it: To test as cheaply and as quickly as possible.

Mark Engelmann: Yeah, cool. People might look at lean startup methodology and they might think "Well, you know, I've already been in business for a couple of years. I'm no longer really in startup mode. It's really not that relevant to me". But from my point of view ... I'm a business owner as well and we're always thinking about new directions we can take our business. Is there any sort of application for lean startup methodology in existing, well-established businesses?

Scott Thomas: I think it's applicable to all areas of all businesses in certain ways. The basic tenet of coming up with an idea, working out how you can test it quickly and cheaply to see if you're right or not and then if you are, then implementing it, I think that applies everywhere. You don't have to necessarily follow the lean startup ... the book and the methodology word-for-word, and there is an aspect of gut feel and experience in working out what to test, but at the end of the day working out here's what I think we should do, how do we test that and validate that it's correct before we move on to the next thing is applicable everywhere.

Mark Engelmann: Yeah, cool. What do you think some of the challenges would be facing businesses looking at implementing lean startup?

Scott Thomas: In larger business rather than startups?

Mark Engelmann: Yeah, or both.

Scott Thomas: Or both? So, I think that the larger and older the business is that it's the pace that's the biggest challenge and the risk. As literally each day as a startup, it's "Here's an idea. I'm going to test it in the next hour, see what the result is and move on to the next thing". In some traditional companies, that might be "I've got an idea. I'm going to put that forward to be reviewed, and then approved, and then sometime in six months we might get to testing it." But, at the end of the day, that's what you're competing with these days with new entrants to the market. So, it's the pace of work that's the biggest challenge for large businesses and, on the flip side, as a startup you do have to consider some of the risks when you're doing these things. It is good to move quickly and learn as fast as you can but sometimes you need to consider what the repercussions of that are if you get it wrong.

Mark Engelmann: Yeah, for sure. Can you give us some examples of ... You know, you gave the landing page example before and I know previously you coordinated the lean startup challenge with UQ and Era Innovation and I mentored one of the teams there, so you've had a fair bit of practical exposure to people going through this methodology. Can you give any other examples of how the sorts of things people do to engage with potential markets and try and get an understanding of whether or not their product or service has really got legs and is something that they should progress with?

Scott Thomas: Sure. So, I think that the obvious example where it's used mainly is in software development and tech startups where you can put a website up, you can put up ... Or you can develop a wire frame of an app rather than an actual app, put that in front of somebody, and get feedback on how it works and whether they'd use it. That's the most useful example and that's where it's often used primarily, but I think you can apply it to other areas too.

For example, we did a project on a snack food, a new snack food for a company, when I was with Era. Rather than going and developing this snack food, and it's sort of a new market that was opening up more so in The States than in Australia, we just went and imported a bunch of the products from The States, put some different labels on it to work out: Would it resonate, what texture do people like, what packaging did they like? And that cost us a couple of hundred dollars to put some food and drinks on. So, the idea behind it works everywhere, I think. It's just how do you apply it to different industries. It's just kind of how do you test something quickly, cheaply and learn as fast as possible.

Mark Engelmann: And at what point? So, I imagine some... some of the listeners today would be wondering "So what point do I stop the testing, and when do I pull the trigger and take this thing to market?"

Scott Thomas: Yep. So that's "how long is a piece of string?" It is tricky but what you find is that it's not necessarily a number, but you work out what you want to test and who you want to test it with and once you've been doing it for a while it does come from experience. You start to hear the same things over and over and that might be from 10 interviews, so you try something, you hear the same thing 10 times in a row, you pretty much know what the answer is going to be then. Other instances where I've tried something, and you might put it in front of 50 people and you get four or five different perspectives coming from all over the place and then you have to go and refine what you're testing and take that into account. So, it's not necessarily a number or a time period. It’s more of a saturation point where you start hearing the same thing and then you know you're on to something.

Mark Engelmann: I guess there's a whole ... throughout that testing phase there's a whole bunch of different variables that you have to keep your eye on. It's not just the product or the service that you've created but the people that you're actually getting to test it. I.e., your market, right? So, you said before that you might get four or five different perspectives out of a group of 50 and you might go "Well, let's get 50 more people like the five people that said that this is great and see if we can niche this into a different market."

Scott Thomas: Yep, exactly. And you might start off a little bit wider and then work out we're hearing the same thing from these types of people and they might be ... It's not necessarily demographics where it's age or location or gender or anything like that but it's people that have the same problem, and then you narrow in on that.

Mark Engelmann: Yeah, cool. And so we always ... In marketing, we always hear about talk to the business ...the business's problem, or the individual's problem that you're trying to solve and the days where you're just advertising the features and benefits of a particular product are over, so I think from that lean startup point of view, that's a really interesting way to not only get your product and service right but the way that you market that as well.

Scott Thomas: Yep. Yep, definitely. That's another tricky part of it too, where asking the right questions and not being influenced by what your solution is. So, we've got some examples with what we do at Creatively Squared where we create images and visual content for companies. So we don't go to them asking "How do you create your visual content?" We ask them "What are your biggest challenges with digital marketing?" And ideally, hopefully they're coming back and saying, "It's creating content!" But it might not be, so that's also something you need to take into account and not influence the answers.

Mark Engelmann: Yeah, cool. So, on to Creatively Squared. Can you tell me a bit about what you guys do and how you're helping customers?

Scott Thomas: Sure. So, what we do is we create custom visual content for brands, and we do that in a cost-effective manner by partnering with semiprofessionals and talented social media users. Traditionally, if you wanted to create creative images or visual content you would go to either a photographer, which is probably going to cost a fortune and you might have to set up a set and get props and all kinds of other stuff, or small businesses will probably take the photos themselves, which obviously has impacts on quality and it takes a lot of time.

What we do is go out to ... We've got a community of 13,000 people, mostly on Instagram, around the world, and they're all really creative and talented people. They often have ... They might not be fully ... they might be stay at home moms, or they might be freelancers, but they've got a bit more time on their hands and we just partner with them and work out who has a good fit for your brand and your style and we get those people to create the images for you so it's outsourcing that.

Mark Engelmann: Yeah, okay. Is it purely for Instagram?

Scott Thomas: It's not for Insta ... So the content can be used anywhere. A lot of our clients do primarily use the images for social media and that's where they're best used, but they're also used for advertising and for websites. The quality of most of the images is, to be honest, really, really impressive so we are getting more requests for them to be used in print campaigns or other areas as well, but the bread and butter is for social media use because we can create good looking content at scale for an affordable price.

Mark Engelmann: Yeah, okay, cool. And that digital space is just ... If you're not in it, at the moment, as a business, you're kind of not ... No-one knows you if you're not doing digital marketing and engaging with your social channels so it's really great to see that you guys are providing another option there for business owners who may not be that savvy with social media and the digital world. Could you talk to me a little bit about who is the target market for Creatively Squared?

Scott Thomas: Sure. I'll be upfront and honest, we've only been going since the start of the year so we're investigating a number of markets but most of our customers at the moment are E-commerce customers. So, they're Shopify store owners or E-commerce store owners. Product-based stores where they're selling something, and they need to create content, social media, or their websites. You want to keep that fresh and interesting and exciting. Rather than doing that yourself, we can just provide a constant stream of really good-looking images of your products.

Mark Engelmann: Yeah, cool. Have you implemented any lean startup thinking into Creatively Squared given that it is in the early days?

Scott Thomas: Yeah, Definitely. We won't give away all the secrets behind what we do but rather than going and building a platform, which we could have done to start with, we just built a simple website and put up "Here's what we do" and that's kind of what's run things at the moment. Over the past few months we've added bits and pieces to it and made it a little bit ... Add a little bit of tech into it, some other plugins that automate a lot of the processes in the background but at the end of the day, it's still just a website that we've built ourselves because we wanted to test that ... One, what our market was and that what we're providing is actually going to resonate before we go down the path to building something ... a dedicated platform so that's definitely been our approach from the start: To only build what we need to learn the most from the market.

Mark Engelmann: Yeah, that's just ... When I think about lean startup, I know that there is a very clear process that is written in the textbooks and all that sort of thing, but at the end of the day, in my mind, it's more of a mindset and it's more about testing and trialing and understanding when you should just stop going down one path because it's not working and then just change tack and go down another. Is that something that you guys are doing now at Creatively Squared?

Scott Thomas: Yeah, definitely. I mean, really what it's about is being led by your customers rather than your own gut feel. So, you could build something, it's a ... it's the wrong market, they just don't get it, and keep going down that path but at the end of the day, the value you create has to be in the eyes of your customers, not yourself. We're constantly testing things and changing things. Often, they're small things, sometimes they're larger items, but we've got a list of things that we're testing and trialing. And, the other part, to do that well, you need to have partners and customers that are willing to help you on that journey too. So that's one of the really cool, fun things about building a new business is people ... Especially with other businesses that are particularly small up and coming businesses, everyone's out to help each other and work out what works and what doesn't.

Mark Engelmann: Yeah, definitely. So, what's the future going to look like for the new business, for Creatively Squared?

Scott Thomas: I wish I could tell you. We've had a pretty busy month. I've only gone full-time in the business a month ago. We won the Creative3 event, it was ... had us ... Over to Copenhagen next month to represent Australia as the leading creative tech business, so that'll be exciting and get us in front of a lot of people over there. We're also participating in the Virgin startup programme over there, so we've got a lot on our plate with those programmes. We're also out there talking toas many marketing managers, social media managers and E-commerce stores as possible to really work out how we can provide the best service to them, and what that service looks like, and what the problem is that we're solving. Yeah, we'll go from there.

Mark Engelmann: Yeah, awesome. That sounds exciting that you're winning these competitions and awards and being nominated to represent Australia. What's the ... this overseas competition you're going to? What's the-

Scott Thomas: So it's called the Creative Business Cup. It's been out for a number of years now. What they do is they take one national winner from each country and you go over there and it's basically a pitch competition. You get up there in front of a lot of investors and VCs and startup people from Europe and around the world and ... Yeah, we'll see how we go but hopefully, what we're building and where we want to take it resonates with people.

Mark Engelmann: Yeah, cool. That's super exciting. You'll have to keep us updated on that. We're almost there. So, second last question: What's your top business growth tip for businesses looking to scale fast?

Scott Thomas: Well, I wish I had one at the moment. What we've done the nine months we've been in business is we've ... I think we validated that this is a problem for businesses, this creating content. It used to be the one big campaign and now you need to be constantly creating stuff and putting it out, especially on social media, to keep people engaged. So, we validated that as a problem, and the focus for us over the next 12 months is "Right. Now that we know that, how do we turn that into a platform that scales?"

So that's ... We've got a list of ideas to test and we're party with people that have been there and done that before that can help us on that journey, and that's one of the great things about the startup ecosystem in Brisbane, and Australia. Everywhere, really. Everybody's trying to help each other. To be honest, I don't know what the best growth tips are. I know how to go from idea to something that might work, but hopefully we can come back and have a second interview in 12 months’ time and I'll tell you "These are the two things that worked best-"

Mark Engelmann: (Laughing) "that we did." Nah, but I think you raised a really good point and I think a lot of business owners think that they're a little bit alone sometimes, out in the wilderness, and they don't have anyone to talk to or to help or assist them in their business and I really think that partnering with likeminded people and, like you said, Australia's great ... Australia as a country is really supportive of startups, and I think that going to the incubators like River City Labs or joining a business community is great for helping-

Scott Thomas: Yeah, and that probably is the greatest tip at the moment. You can feel alone some days when it's just you or a couple of people trying to build something but just reach out to people and you'll be... if you haven't done that yet, you'll be shocked at messaging somebody and saying, "I need your help" on LinkedIn or Twitter, whatever may be. Most of the time they'll come back and not expect anything, which is probably the best thing about being in the startup scene.

Mark Engelmann: Cool, cool. Last question: Have you been using any technology or applications or services that have really made your life easier or helped you with the business?

Scott Thomas: The one that I'm using the most at the moment is probably Zapier. Zapier's a tool that allows you to connect basically any piece of software to another one so I’ve been using that quite a bit. We recently switched over to Airtable. We used to use Google Sheets to manage all our spreadsheets and ... They're a new startup out of San Fran that are growing quite quickly but that tool is really useful. A lot of our backend is managed on that now.

It can get a little bit addictive. There's always a new tool or something to save you time, that you could plug in. But yeah, they're the ones we've used for the last two weeks and the other one probably is Drift so we use that for live chat on our website.So anybody can jump on the website and chat with us and that goes straight through, in our case, to our mobile phones and allows us to have that conversation with a customer at the time they're on the website rather than getting back to them days later by E-mail. It's really easy to use and that's been a really big help to our business.

Mark Engelmann: Yeah, cool. Can you talk to me a little bit more about Airtable? How is that different from Excel and Google Sheets?

Scott Thomas: I think it's the way that it plugs into other services. For instance, when somebody signs up for our services, either to create the images as a stylist on our website or to buy images, we've got a form that goes straight through to Airtable and then we can also take the data in that, we can manipulate it and then send that to other services and there's what you might call processes that other companies use, so they've created a process where Airtable does XYZ and you can copy that and use that. So, it's not only what you've created to do with it, you can use templates that other companies have used, which saves you a lot of time and there's ones on there I wouldn't have even thought about handling things that way but that we'll look at using, so it's kind of that ... Like a lot of these, like Slack, I'm not sure if you're familiar with that, putting yourself at the centre of all the other services. I think they're trying to do that with spreadsheets rather than just being a standalone product, which is really cool.

Mark Engelmann: Yeah, it's cool. There's all these apps out these days that kind of make it so much easier for people that aren't software developers or coders to integrate into other services and I know we use Zapier a fair bit and that's great, so it's always good to hear about new ones.

Scott Thomas: That's a really good point. One of the things I just want to highlight there is you don't need to be a tech person to have a tech startup. I've got a business background and my partner Red's got a creative background, yet we're listed as Australia's leading creative tech startup. It's a gap we need to fill longer term but it is possible to get started and do quite a bit these days with just plug-and-play and drag-and-drop services.

Mark Engelmann: Yeah, totally. Alright, well I don't have any more questions, Scott. Thanks for your time and thanks for coming on the show. I'd love to catch up in 12 months’ time and see how Creatively Squared is going and see how you go at these startup competitions that you've been nominated for and you're going to the next level at.

Scott Thomas: Yeah, for sure.

Mark Engelmann: So, thanks for coming on the show and I'll talk to you soon.

Scott Thomas: Cool. Thanks for having me. 
