The 1-Page debacle is really bad for the disruptive recruitment technology industry
Basically, their Information Memorandum was impressive - even I thought they had a clue what was going to be the future. While I have no inside knowledge of the company other than to look at their confusing website that appears to sell proposal writing more so than a recruitment solution (5 second rule), I cannot understand how a company could be worth so much money just 8 months ago, and herald the star of disruptive recruitment, then in February this year, be a complete and utter mess.
We learn as entrepreneurs to hire slowly and fire fast. Why was the CEO not fired - fast and kicked out of the company? Having said that, why wasn't most the board not dismissed? To write code in this area, is not something that takes years when you have a team and a burn rate of $1,000,000 per month, it makes a matter of months.
I know this first hand.
Additionally, their sales was recorded in one newspaper as being $82,000 for the year or thereabouts. We are beta testing a recruitment technology now, and our first small sale at "mates rates" is $84,000. Our second, should the beta test work is verbally for half a million. Sure there will be tweaks and it will take longer than expected, but I'm playing with my own money, not the publics.
I am constantly confused and disappointed in publicly listed companies that fail through bad management, incompetence and boards that are either way too soft or have no idea what they are doing. I know nothing of the Board of 1-Page so I can't throw direct stones at them, but I can say, when you own your own business and you are dealing with your own money, you don't allow yourself to burn $1 million per month with no result.
In addition, if you don't have clients lined up, how did you get to the position of raising so much capital without a viable product, and in a country where you didn't even list. I find many Australian companies or Americans who want to raise money in Australia, but set up companies in the US or Israel, are doing it not because they have a proven track record in that market, but because of ego and dillusional dreams that because a market is big, they will immediately be successful.
Let me assure you, if you haven't been successful in Australia, you are more than likely going to have to eat humble pie going to America without sales in hand.
As a good friend said to me recently when we were in Mexico City, "it's very hard to be successful as an Australian in the US". Her first four years, she didn't know whether the company would fail or succeed.
Why would successful investors take such a stupid punt on software that is actually disruptive at all and not viable in the competitive playing field?
I'm gobsmacked, but it is a lesson for everyone. Succeed in your own back yard, and make sure you have a product that the market wants - and you can deliver on your promises.
Why I write about this is because there are so many great companies out there building quality technology, testing it on companies that if they are successful, will be clients in the future - and their reputations when they go out looking for funding will tarnished by failures such as this.