CharlieHR, this week's pick for The Investibles, wants to free founders up to concentrate on creating value, rather than doing administration, based on their experience building three other businesses. Starting with a free HR platform for small firms they plan to develop a whole operating system of tools. Here founder Rob O’Donovan talks about raising funds, mentors and working with your best friends.
1. What is your investment status?
We recently closed a £1m seed investment round from Connect Ventures and early-stage fund Seedcamp, alongside angel investors Nick Hungerford, founder of Nutmeg, James Wise, partner at Balderton Capital, Alistair Mitchell, founder of Huddle, and Ian Hogarth founder of Songkick, among others.
2. Describe your business in one paragraph; what’s its vision and what problem does it solve?
We already know each other’s strengths, weaknesses and annoying habits, which is super helpful!
We’re building a platform to automate much of the administrative burden that comes with running a company. There’s too much “stuff” that drags people away from the reason they started the business in the first place – doing what they really love – and we’re giving back to founders the very thing they need most: more time.
We’re starting with any organisation’s most important asset – its people. CharlieHR is the free HR platform for small businesses that automates many of the administrative headaches involved with managing teams effectively, so founders can concentrate on what matters.
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3. How did you come up with the idea for your business?
Simply put – our own intimate experiences and stupid mistakes!
This is the fourth company we’ve built out of our startup studio The Eleven and on each occasion we’ve been constantly frustrated by the time that’s sucked away and distracted us from building real value in each business.
We felt that building a company was hard but running one shouldn’t be, and we could never find an elegant and cost effective software solution for looking after our people. Onboarding new hires, managing their personal information and tracking holiday and sick days was always a messy quagmire of spreadsheets and we just knew there had to be a better way.
4. What’s your addressable market?
We’re focussed on small companies with one-100 employees. There are over 1.25m of these businesses employing over 10 million people, and that’s just in the small island that is the UK. We have an ambition to take CharlieHR to every small company on the globe and, in the process, empower millions of small businesses to solve important problems that can make the world a better place to be.
5. What’s great about your team and do you have a mentor?
We’ve worked together for a long time, so while this is a very new venture we know each other extremely well! As founders, Ben and I are best friends from school and started our first company nearly ten years ago, and Tom’s been working with us for the last four years. The bulk of the rest of our team have been involved in one of our other companies, so we already know each other’s strengths, weaknesses and annoying habits, which is super helpful!
Raising was an exotic mixture of excitement, frustration, chaos and unbelievable learning.
We have too many mentors to name. Over the years, it’s phenomenal how many brilliant people there are who have been willing to share their experiences with us, make introductions or just be a sounding board for some of our silly ideas! If you only see the surface of London’s entrepreneurial ecosystem it can often look plagued with self-interest, but underneath there’s hundreds of amazing people that are eager to help each other and we would never have got this company off the ground if it wasn’t for them.
6. What key challenges have you faced and how have you overcome them?
Raising funding was an entirely new game for us. It was an exotic mixture of excitement, frustration, chaos and unbelievable learning, but we came out the other side with a result we’re really happy with. That’s largely due to the leagues of seasoned entrepreneurs who gave up small pieces of their time on frantic calls or quick coffees to give guidance. Without that support it would have been a far taller order.
7. How have you funded your startup and why did you choose this route?
We funded the initial few months ourselves – to shift the first version of the product – and we’re now funded largely by a venture capital fund alongside a few strategic angels. We recognise that if we’re going to achieve our ultimate goals we’ll most likely need to raise significant capital over the next five years, so it made sense to start with VC early on and begin that learning curve.
8. How do you market your business and how successful has it been so far?
We launched six months ago and there are now over 800 companies in more than 20 countries benefitting from CharlieHR.
We’ve been extremely lucky to date. I think we’ve built a good solution to a genuine problem and that developed a community of early customers who really love what we’re doing, and so our growth has largely come from word of mouth.
9. What are your plans for the future?
Right now, we’re focussed on continuing to build an exceptional product that sits at the heart of small companies, reduces those admin headaches and gives them back more time to do more of what matters. We’ll soon launch a number of paid products and services that will enable our customers to build even more effective businesses (and enable us to make money, since the core software in CharlieHR is free!), and look at taking them beyond Europe and into other territories.
Longer term, we want to build more than just the free HR tool. Charlie will become the operating system for your company. A platform that quietly and effectively automates much of the daily “running” of your business and becomes an integral part of giving you the best possible chance of success.
10. If you started again, is there anything you would do differently?
Focus earlier. The temptation is always to do too much too quickly. Do the basics, but do them brilliantly.
11. What advice would you give to entrepreneurs that are starting a business?
Read The Mom Test by Rob Fitzpatrick (you can breeze through it in a few hours). Follow it by the letter and be really honest with yourself. You don’t want to spend five years of your life working on something that ends up failing only because you didn’t do your homework at the start.