Mistakes I Made While Building an EdTech Startup With 400K Active Users

In 2017, my partner and I launched the first mobile app for children. I took the position of CEO. Because of the lack of a lot of relevant experience, I began to make mistakes almost from the very beginning.

I didn’t really know how to “swim,” - yet, I suddenly found myself in the open sea.

Nevertheless, even back then, I understood that it is impossible to build a business completely without mistakes. Yes, I did a lot of things, but every time it gave me experience, which I invested in the further development of the project.

Let me introduce myself. My name is Mikhail Kotlov. I am a co-founder of IntellectoKids, a start-up build around educational applications for children that have been translated into more than 30 languages. Our apps are in the top 10 in the Apple App Store (Kids 5 & Under category) in 40 countries worldwide. We are mainly focused on the European and United States markets, now launching in China. Our product line includes 3 children's applications, an app for parents, a project with online lessons, and an educational animated series "Team Mendeleev".

Today I will share the mistakes that I made while building IntellectoKids, and most importantly, the lessons I learned in the process.

Started with the "discovery of America"

For many startups, the United States is the most desirable market and main target. I was no exception. Launching IntellectoKids, we thought ambitiously and decided to immediately promote in the United States.

In our case, this turned out to be a mistake because advertising in America was more expensive than we expected when planning the budget. In addition, at that time, we did not have enough competencies for successful promotion.

Simply put, we weren't ready - and we could do it. Therefore, we quickly changed our strategy and turned to less competitive markets. We have localized the product into Swedish, Spanish, and French markets. It worked: the company began to grow. Of course, then we returned to the USA, but now we had more experience and money, so everything turned out well. Now our applications are very popular in the States.

So if you have already tried to storm the US market and failed, do not worry: look at the countries of Latin America and Europe. Perhaps, you will have a better chance there.

Locked all processes on me

When you only have 8-10 employees, you are thoroughly immersed in everything that happens in your startup. Almost no phone call in the team is complete without your participation. This is not uncommon, and in the beginning, this is the right strategy.

However, at some point, the company was already growing in terms of metrics, the team was getting larger, the processes were growing, but the approach stayed the same. This is what was happening at IntellectoKids.

I was aware of the smallest details: any problem, any solution passed through me. As a result, I had practically no time left for strategic planning. And the CEO's task is to constantly check the course, anticipating everything several steps ahead. It's good that we have two founders at IntellectoKids, and my partner partially covered this problem.

Immersion in routine processes interferes with researching trends and communicating with people from the field. However, this is necessary to keep the pulse on market trends and news. Eventually, new ideas come less often because you are too busy with operations and troubleshooting every small issue.

Unintentionally, my behavior looked like distrust for my team. It partly prevented the company's team leads from developing professionally. Until I dared to trust my team, they entirely relied on my opinion and could not become independent "players".

As a result:

• It started hurting business goals;
• It made the team bored and burned them out

Fortunately, it didn’t come to a critical point, and I got it together. We now call the team leaders once a week to discuss global product and marketing issues and adjust the action plan if required. Plus, I do regular one-on-one calls to make sure things are going as planned. This tactic saves resources and avoids distraction through trivial issues. As it turns out, my team is capable of brainstorming ad creatives or controlling the release of a new version of the application without me.

Today, the creative team and the development team are now working independently. I would like the same thing to happen over time with all teams, but it takes time to cultivate talent and find candidates with leadership skills in the job market. For example, currently, we are now looking for a competent CMO. As of right now, I take care of the CMO duties as well.

Worked with digital agencies

There was a time when I thought it was easier to outsource marketing and creativity. I was wrong. Although for many companies the agency is a great option, it turned out that in my case, it was not suitable.

The reason is the particular aspects of our niche market. It is difficult to advertise an app for preschoolers. First, you have two target audiences: children and parents. The child needs an exciting product, and the parent needs a useful one. Therefore, it is important to show the educational value of the app, not just the demo of the game.

The second difficulty is that parents have a very wide range of interests. When we advertise a children's app, we compete with all products and services of interest to women between the ages of 25 to 55 - this can be anything from match 3 games to beauty salons. We must catch moms' attention in a limited period of time while they are on Facebook.

The field of children's applications is quite young. Most agencies do not have a sufficient understanding of how to work in this field. It is very difficult to gain experience in conducting such advertising campaigns if you work in an agency and are not thoroughly immersed in the project, like the guys at IntellectoKids. Therefore, at some point, I had to abandon the idea of outsourcing. I've built an in-house team of creators and marketers who do a better job than agencies.

Didn't share ideas

"Sitting inside a box" was a big mistake on my part. I did not talk about projects and plans. I was a little afraid that my ideas would be stolen and was superstitious: I did not want to announce any new features until they became a reality.

In fact, you are unlikely to come up with something completely new. In other words, there is nothing new under the Sun. So you shouldn't be afraid of collaborations or discussions. By staying silent about your ideas, you rob yourself of the opportunity to get useful feedback. I think I missed a lot of useful comments from smart and experienced people who, at that time, understood business processes better than I did. Moreover, if you don’t share ideas and plans, you will never learn how to make a great product or promote it. In the long run, exchanging ideas and feedback is a lot more valuable than staying silent.

Finally, there was a need to raise capital, and I realized that it is wrong to stay silent. One of the founders' responsibilities is to get the attention of potential investors. It means constantly telling people about the company. You never know which contact will invest or direct you to the right investor, so you need to keep your business network informed and excited about your company.

When asked for advice, I always say: "Be generous." Share your ideas and news. The established connections will definitely come in handy one day.

Didn't develop a recruiting team

For three years, I had just one recruiter, and we built up the marketing, development, and product teams together. At the time, I didn’t think about the need to build a recruiting team to optimize the hiring process.

The Russian market is not the target market for IntellectoKids; we work little with this category of users. People are not familiar with our product, and practically, not familiar with the company. The fact that we are not heard of significantly narrows our opportunities for recruiting specialists and reduces the number of applications for vacancies. To increase the company's recognition in the Russian job market, we began to engage in PR. Currently, we are working to create our HR brand. But it should not stop there.

It's really great in our company: we create high-quality content, work with modern development technologies, offer various pleasant bonuses - from voluntary medical insurance to pay for specialized training. But someone has to “sell” all this to candidates, hunt people from well-known companies, and use non-standard search methods. In this case, you cannot do without a strong recruitment team, so I recently allocated resources to create a recruiting department.

Interviewed people incorrectly

I didn't always know how to conduct interviews. I thought I was asking the right questions. But in fact, I missed the important details, which subsequently influenced the person's work and his relationships with other team members. These details were mostly values ​​- and if a candidate’s value matched the company values.

It is much easier to assess professional skills in a regular interview than soft skills. And it can be difficult to understand whether a newcomer can organically integrate into the team. The simplest example: once, I hired a girl who, as it turned out, was used to swearing at her colleagues. This is not accepted in the culture of IntellectoKids: it’s crazy for us to even raise our voices. Unfortunately, the conversations did not affect, and we had to part ways with that employee. And I had to continue to search for a suitable person for her role.

Now I stick to this rule: during interviews, I pay attention to soft skills. If a candidate doesn’t check all the boxes on soft skills, I won't hire this candidate, even if he/she is a genius.

After a couple of unfortunate incidents, I decided to dive deeper into the issue and look for a system that would help me hire competent people. One of my acquaintances recommended “The Who method”, as described in the book by Jeff Smart and Randy Street. (See, not being silent and talking to people helps!)

The selection process is quite long. On average, it takes two to three weeks from the first interview to an offer. But the method works: during the time that we have been using it, there have been almost no cases in IntellectoKids that a person did not pass the probationary period. So, the system is useful for everyone involved.

How does it work? First, the interview is conducted by the recruiter to check whether the person is generally suitable. For example, we check if the candidate’s goals align with the company's goals. Then, we give a test task. With the test task, we obviously check the hard skills. However, we can see how this candidate thinks and how he/she can immerse themselves in a topic. The next step: the team-lead interviews the candidate to see if the candidate has professional skills.

The next step is an interview with me. If the candidate is not on my team, I act as a barraiser. Barraiser is an expert invited for an interview who is not directly interested in the candidate. The interview is all about identifying the strengths and weaknesses of soft skills. This is done, among other things, so that both parties understand how comfortable it would be to work together.

If the conversation went well, we would collect references from past jobs. Candidates are often intimidated by this point. However, there is no reason to be scared here. We might not extend an offer because of negative recommendations, only when something truly terrible that this candidate has done in their previous job.

Finally, after this stage, we extend an offer.

It turns out that getting to us is quite difficult. But we have a low turnover rate. Usually, each hire is a win-win match.

The main thing is not to be lazy and not to skip any of the selection steps. There were a few times when we didn’t follow each step in our hiring method. As a result, the newcomer either left or got fired.

Not enough investment in server development

Until recently, our server development was based on part-time employees. We did not have a full-fledged team in this direction. Meanwhile, server-side development is very important for monetization, analytics, and marketing, because all analytical and marketing tools require server-side solutions. Otherwise, it is impossible to draw the right conclusions, analyze the data and understand what is more profitable for you to sell and how to promote the product.

The lack of a competent full-time server development team began to hinder the development of our marketing and analytics. And in the end, when it was necessary to grow, we were engaged in the development of server architecture. Actually, we are still fixing this mistake.

Stopped running CustDev

I started my business researching parenting pain. But at a certain stage of company growth, I stopped further researching on the subject. It was definitely my fault. CustDev must be persistent.

First, the needs of your target audience are always changing, and you need to improve your content in accordance with those new needs.

Secondly, your product changes, and you need to understand if you are on the right track. We recently started to focus on CustDev again, but due to lack of time, we are not as active as we would like to be.

Got stuck on Facebook

We researched different promotion channels; our main focus was Facebook. Our ads worked so well; we were tempted to spend our entire marketing budget on Facebook. But through practice, we learned that it wasn’t the best approach.

Even when you find the most profitable channel for your product, it is important to use other channels as well. Currently, we are looking for new team members who will be engaged in promotion in Google Ads, influence marketing, CPA networks, and different partnerships.

I wanted to get results without investing in the team

When we launched online lessons, we needed to look for teachers. At first, I took care of it myself. I looked for candidates myself and attracted the head of the online lessons department. However, real results started to happen when we hired a dedicated recruiter with the appropriate expertise. There are many similar examples in my practice.

As a result, I strongly believe in hiring the right people for the task. Instead of dividing new responsibilities between existing employees, who may or may not have enough competencies to succeed with this particular task.

If you are trying to reduce financial risks without investing in people, you are still taking risks, the risk of undesirable outcomes. When you get these outcomes, you will think that the reason is in the product itself and in the lack of demand. The chances are that your company simply does not have the expertise that would allow the product to grow. Or maybe your current team doesn't have enough time to devote to the project. In both cases, the solution is to hire people who will only focus on the new task.

Staked on game content

We develop educational games for children. Previously, the process of creating content was structured as follows: first, the game designer came up with a scenario for the game, and then we "built" learning mechanics into it.

During the pandemic, the demand for systematic education of children through applications has grown. The parents wanted the child to not just play and, perhaps, learn a new skill as a bonus. Our target audience needed something more: a product that carries an understandable educational value, and only then, just as a bonus, entertains.

Therefore, our apps now help children prepare for school through gamification. First, the teaching methodologist writes an educational program, and only after that, the game designer packs it up and makes an exciting game.

This point can be attributed to errors only conditionally since we rebuilt the processes in time. Still, we could have done this earlier; it would only help us gain more users.

How I learned and still learning from my mistakes

To be wrong in the “right” way, I carefully analyze past experiences and understand:

• what exactly went wrong;
• what risks in the future does a particular mistake carry;
• what opportunities it opens up for me;
• what can I fix - and how;
• how can I minimize losses at the same time;
• what needs to be done so that the mistake does not repeat itself.

Also, I advise everyone to read the book by Carol Dweck, “Flexible Mind.” The author of the book, a professor at Stanford University, explores the nature of the fear of mistakes and gives advice on how not to be afraid of new experiences. The book also talks about how we can only learn through our mistakes.