Everything you build should translate into more resources for children’s learning
Frank Albert Coates
What's the story of the company and what stage you're in?
Alex Tep
I am an ex teacher. I taught biology at a school in London for two years. And when I was there, I saw just how backwards and antiquated and old fashioned the process of buying equipment, microscopes, footballs, whiteboards. Some schools still order from paper catalogs and telephone orders and they've been doing that since the mid 20th century.
Some schools still order from paper catalogs and telephone orders and they've been doing that since the mid 20th century.
So I left my job. And I taught myself to code - I spent about 150 pounds on Udemy courses, which I think is a pretty good investment. And I built a marketplace for school equipment, which I launched in September. We are at a point now where I'm closing a pre-seed round, and we've signed on some of the biggest science suppliers in the country. So there we are.
Frank Albert Coates
Wow, fantastic. So congrats, for the pre-seed round. And that opens the question, how did you do it? Because we hear from a lot of founders that the first pre-seed round is a challenge and also finding angel investors. So how did you go about and what helped you the most?
Alex Tep
For sure, it's a challenge. And I'm sure everyone in this community as well knows how tricky especially a pre-seed raising for education if you're selling into an education institution is. There was a little trick on my site, in that Bunsen is free for schools, it charges suppliers when a purchase is made. So, our customers are really businesses that sell to schools, rather than the schools themselves. And this made things more palatable for VCs to get meetings with them. So that was certainly a help.
Frank Albert Coates
Is there anything else that helped you find these individuals that invested in your company now?
Alex Tep
Yeah, I think it's a simply a case of trawling through through the internet. Dealroom is a fantastic resource that I have been using to find some investors. Using CrunchBase, as well. And just one by one, going through as many of these as I could, you've got to have real patience in this, especially at this stage. But, I'm told it gets better at later rounds, once you have revenue, it starts to matter less and less that you sell to institutions. And if it's working, then of course, people want to participate. In terms of angels, the best thing I can say is to build relationships with people - like in the EdTech Garage.
In terms of angels, the best thing I can say is to build relationships with people - like in the EdTech Garage.
I'm also part of another community called Everything Marketplaces. And I've met loads of marketplace founders there who have introduced me, to their angel investors. And this has only really happened by actually meeting them in person at events, asking them for coffees and actually building proper relationships there. And at the end of every discussion one of my angels told me to always end your discussion with; who's the best person you know, to talk about this? Who's the best person you know, would fund an education business and then follow it up in this order: Do you know them? Can you introduce me to them? So to always end your conversations with those three questions. Who's the best person you know? Do you know them? Can you introduce them to me?
…always end your conversations with those three questions. Who's the best person you know? Do you know them? Can you introduce them to me?
And it's very rare that somebody will say no to that and it's been shocking in a matter of three weeks, I built up a quite a sizable network that's filled out the rest of my round just by doing that.
Frank Albert Coates
And let's take a few steps back. So if you look at your journey when you wanted to start up your company. Was there more to it that sparked your envy to go and create a startup? You saw the problem, but why did you jump the ship and change your career?
Alex Tep
Yeah, that's an interesting question. I found that the way I was teaching was changing. And I found myself teaching less and less biology. And more and more teaching to exams, or sort of tricking children into doing something biology related. I found that the authenticity of teaching in my country in the UK at least, was sometimes missing. We were motivating children always extrinsically that they had to learn this for this particular purpose, or that particular purpose. And increasingly the lessons became more and more contrived, where I would get children to role play the process of respiration, which is very suitable in many age groups, for instance, but at some point, you have to really get them to engage with the real subject that they're about to learn or pursue later on in life. And if it's boring, sometimes children need to know that they don't like something as well - students might need to see the real thing. Sometimes I found myself doing less and less real biology teaching, and more and more, administrating biology flavored games or activities, but that didn't actually constitute the subject that I love. This is a very personal opinion. So I wouldn't take this generally, this is a very particular gripe I had with the profession. And the other thing was looking to the future in my teaching career. I had to think about my options, and they were all administrative; become head of department, become head of pastoral care, become head of sport. And I'll just be doing less and less teaching and more and more paperwork. I'm sure many teachers can sympathize with that if you've come from teaching yourself.
Frank Albert Coates
So obviously, knowing the subject matter helps. What do you think will make you succeed in your journey and what's the secret sauce to that in the company?
Alex Tep
I've touched upon it already and one of the secret sources is that we are free for schools, unusually, for something that has schools as users or customers. We're free for schools - we charge businesses that sell to schools that can afford to pay. This helps us avoid one of the biggest problems of selling to institutions and that is limited budget.
We're free for schools - we charge businesses that sell to schools that can afford to pay. This helps us avoid one of the biggest problems of selling to institutions and that is limited budget.
And it helps me align my mission to what schools want. And that makes me very happy to get out of bed every morning to know that this is fairly in the service of school. I'm not saying that anyone who charges schools is being extractive or evil in any way at all. But, it's particularly lucky in this case that we don't need to and that we shouldn't right now.
Frank Albert Coates
And when you look at your steps since you started, obviously, fundraising is one big event. Have there been other challenges that you had to work through and that you managed to solve?
Alex Tep
Yeah, a related challenge is that free for schools isn't the solution to everything and comes with its own challenges and problems. When schools have a product that is free, it can sometimes mean they don't have skin in the game. They don't have an immediate motivation to use the product right now. If they paid for something, you know, they paid for it, and they're going to make the most use of it. Sometimes, it's tricky to get schools to come onboard your product when you're free and to actually get them to engage with it and to use it.
Sometimes, it's tricky to get schools to come onboard your product when you're free and to actually get them to engage with it and to use it.
That's a problem that I'm still solving at the moment. And we're still thinking about incentives about how to address that problem. But, in a nutshell, free is not always the silver bullet for schools either.
Frank Albert Coates
What do you see among the marketplaces; what are the models that work the best otherwise?
Alex Tep
Among marketplaces, I think the one that's particular to me is the model of a SaaS enabled marketplace. A marketplace with an extra SaaS tool attached to it. And that's what Bunsen has. We're a marketplace on one hand - we connect school suppliers to schools. But, we also offer schools a free tool that lets them book out equipment for lessons, our SaaS side of the marketplace. So, say I'm a teacher, and I'm teaching a lesson on microscopes on Wednesday, and I need 10 microscopes in my lesson. My tool lets teachers book out those microscopes for that lesson, and depletes the schools inventories. They know they don't have many left in stock. And when the inventory runs low, they can repurchase from my marketplace. This is a way of building up a pool of demand in my marketplace before I have many sellers. So, allow schools to use Bunsen in single player mode and to engage with Bunsen even when there aren't many sellers to buy from. And it's a way of solving the cold start problem or the chicken and egg problem in marketplaces where it's a challenge to get schools on boards when you don't have any sellers or the challenge to get sellers on board when you don't have many schools. This is a way to sort of go around that. And it's been a model that's worked in other marketplaces as well.
Frank Albert Coates
And when looking forwards, you have now almost completed your pre-seed round. What are you going to do next, that keeps you up at night?
Alex Tep
So my immediate next step is to reach this point of liquidity in the marketplace where you have a good pool of buyers and a good pool of sellers transacting regularly. And the next path for me is to accumulate enough pool of schools, at first, to start to pull the sellers on board. There's an asymmetry in this marketplace, in that schools are really what drives this. Schools are the hard side of this marketplace. If we had all the schools in the world, sellers would obviously want to come and sell to these people.
There's an asymmetry in this marketplace, in that schools are really what drives this. Schools are the hard side of this marketplace. If we had all the schools in the world, sellers would obviously want to come and sell to these people.
That's not necessarily the case the other way around, if we have the perfect choice of loads of sellers, we'd still have to do some work to convince schools to change their unusual systems to come on board here. So that's my hypothesis that I'm going to have to test out in the coming months with this new funding; is can we get enough schools on board to bring on the sellers, which give enough choice to the schools and complete this sort of loop, this cycle in my business.
Frank Albert Coates
And something else I heard from you previously, is around building the team. So tell us a bit about what you're looking at now to build the team - the roles that you're looking to fill and the challenges around that?
Alex Tep
So currently the main hire I'm looking for is a senior developer to take over the coding. So as a solo founder, it's just not feasible for me to continue doing the product, the development, the marketing, the growth. I can't continue to do that for any longer. So to have someone take that who's more competent than me to take over that side of my business, that's my main concern right now. And so for that, I'm talking to friends who work for coding boot camps. I am going to the Ironhack event in a couple of weeks time as well to hopefully meet some more developers there. That's my main priority right now for hiring.
Frank Albert Coates
It's a key step in the next stage. So lastly, final question. What advice would you give to other edtech startups that are getting off the ground based on what you've learned so far?
Alex Tep
Teaching is a very unique profession, with a very, very difficult problem at hand. I would say it's an impossible problem. And I think, in my experience, a good teacher should know that. What I mean by that is that it is totally impossible for you to know that every single one of the 25 children in your class has left that lesson, learning something new. We don't have electrodes that we can plant into kids brains just yet - maybe one of you guys will invent this. But, it's a black box because it's very difficult to get evidence about whether kids are really learning and even then what counts is more trouble to ask, than this podcast can afford. So, these customers that you're serving, are people who have this extremely difficult problem at hand, and you should be really sympathetic to that, and really ask yourself; certainly don't make the job more difficult for them. And certainly always tie it back to this problem that they care about; is my product helping with children's learning.
So, these customers that you're serving, are people who have this extremely difficult problem at hand, and you should be really sympathetic to that, and really ask yourself; certainly don't make the job more difficult for them. And certainly always tie it back to this problem that they care about; is my product helping with children's learning.
At some point down the line, it should somehow translate to that. Bunsen is a bit further away from that, but it still ties into that, that if schools can buy equipment more quickly, and at a better price, at some point, that should translate into more resources for children's learning. Everything that you build should somehow end up with that conclusion.
