How the role of a founder develops over time and other words of wisdom from one of Australia’s “original global startup builders”

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DesignCrowd founder Alec Lynch

DesignCrowd founder Alec Lynch says the role of a startup founder changes drastically as a company grows and develops.

In an AMA run by Blackbird Ventures, Lynch says he has had three “distinct phases” of being a founder since creating DesignCrowd nine years ago, but one thing has remained constant.

“Across all these phases I’ve tried to stay close to product and I’ve always tried to stay focused on growth,” he says.

The first was when DesignCrowd was entirely bootstrapped and the team consisted of just Lynch.

“So I did everything from coding to customer service,” he says.

After some angel investors got on board, Lynch also brought in a co-founder.

“My focus became sales, marketing and investors,” he says.

“My co-founder Adam joined the business and led product and engineering and we hired our first person in customer service.”

Once DesignCrowd completed two rounds of VC funding, the role of founder changed again.

“We’ve scaled the team from three people to 48 and from one office to three and from a few angel investors to angel investors and two VCs,” Lynch says.

DesignCrowd has now hosted design contests worth more than $33 million in total, and Blackbird Ventures co-founder Niki Scevak says Lynch was one of the first local founders to take their startup international.

“He’s one of the original global startup builders from Australia,” Scevak says.

The AMA session included many other pieces of advice and interesting insights into how the rapidly-growing startup was formed, why culture is so important and how it managed to raise $12 million from Australian investors.

Why startups should try to raise money locally

Lynch says he’s proud that the design marketplace startup has raised all of its $12 million in funding from Australian investors, saying there are important advantages associated with staying locally for investment.

“We’re really proud that we’ve raised all of our capital from Australian investors,” he says.

This has included $300,000 from Australian angels, a Series A round of $6 million and a Series B round of the same amount.

“We were able to access investors who had helped Australian businesses go global before and we weren’t going to be pushed to move the whole team to the US just because our investors were there,” he says.

“We considered raising in the US and could see this could come with some advantages, but it also has some disadvantages.”

Competition should be viewed as a good thing

Since its launch in 2008, DesignCrowd has seen the design marketplace industry grow quickly in Australia, with numerous competitors taking it on at its own game.

Most significantly has been rival 99Designs, but Lynch says this sort of competition needs to be viewed positively.

“If you’re a business you will need to accept you will have competition, even if it’s not there at launch,” he says.

“There’s no point getting mad when it comes along.

“Competition can be a good thing. Healthy competition will push you to innovate and scale as fast as you can.”

The role of luck

One month after Lynch quit his management consulting job to work on DesignCrowd, the GFC struck.

“With hindsight I think it was good luck,” he says.

“By sticking at DesignCrowd during this period our service could help businesses save money and once the GFC had lifted I had traction and was ready for investors.”

But he says startup founders need to make their own luck.

“I prefer not to think of luck as a determining factor in success,” Lynch says.

“I think it’s beneficial if your mindset is ‘I am the master of my own destiny’.

“To experience luck you need to have started your business. If you have a business idea and you want to make your own luck, take action, get started and move fast. Fortune favours the brave.”

Building startup culture

In its early days, culture wasn’t a primary concern for DesignCrowd.

“Initially we didn’t think much about culture,” Lynch says.

“We just tried to hire great people and when we thought about a candidate we’d think, ‘does it feel like a fit?’

But once the startup began to grow, the team implement a set of 10 key cultural values.

“We have the values up around our office. We look for these behaviours when we hire and each month we give out awards to reward staff that demonstrate these values.”

DesignCrowd’s ten most important cultural values:

  1. Think big
  2. Push yourself
  3. Move fast
  4. Be a scientist
  5. Be an entrepreneur
  6. Be a designer
  7. Create fun
  8. Create positivity
  9. Be a teammate
  10. No bullshit

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Denham Sadler is the editor of StartupSmart. He was previously a journalist at the publication and has worked as a freelancer for the Guardian, the Saturday Paper and the ABC. In his spare time he likes puns and jaffles.
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