How I Successfully Failed 🙊

tl;dr

In 2018, I solo-founded ExJewel. Later, three amazing teammates joined me: Yasmina, Edna, and Tony. Our AI platform appraises jewelry and gemstones and manages inventory for jewelers. Our goal was to innovate in a century-old industry. This is the story of what we did. After 2 years and 5 product development cycles, I had to face the facts #IdonotblameCovid19. We open-sourced ExJewel, so you can now appraise your jewelry for free. I am proud of what we achieved and of what I learned. I am excited to now join FEMPO to spearhead their Growth! 

Summary:

1. The dream: founding my own startup.
2. The original idea: reuse the world's 92% unworn jewelry
3. The early journey: from dream to reality
4. The pivot: a 100% digital jewelry appraisal tool for all!
5. The launch: 100% virtual through a global lockdown
6. The end: a failed pre-Seed round
7. The 4 lessons learned
8. The next steps

Enjoy the read 😉 (7min read)

1) The dream 💭: founding my own startup

I am the 6th generation of a family of Armenian jewelers and diamond traders, the Boghossian’s. Growing up, I learned the trade through my father’s wholesale diamond trading business. Since my early studies, I went after my dream of becoming a designer and gemologist. He hoped my brother and I would join him. I expected to inherit a flourishing business, like my father did 30 years ago. By the 2010s, the jewelry industry was in a full digital revolution and my father’s business with it.

After my studies, I worked for some of the industry's notable brands like ST Dupont and Versace. I discovered the truth behind luxury production and the waste associated with it. I became fascinated by new economic models, focusing on recycling and reusing materials. From this discovery, I nurtured a dream of becoming a social entrepreneur. Instead of joining my father, I decided to first work on changing the way traditional take-and-make jewelry works.

2) The original idea💡 : reuse the world's 92% unworn jewelry

ExJewel's original idea was brought to life through my Master’s thesis: The Afterlife of Branded Jewelry. After a market study of the jewelry industry, I realized too many pieces were being produced and stocks were piling up. In all, 92% of jewelry made was unworn in any given year!

I wanted to build a new kind of ecosystem, with four pillars in mind: transparent appraisals, traceable goods from mine to resale, standardized marketplace, and a sustainable program where recycling precious metals and reusing gemstones is a norm. I resolved to rethink luxury in general.

ExJewel was born with the sole goal of offering a redesign service for jewelry owners. My first client was an obvious choice: my mom. The redesign worked! #MVPstyle

3) The early journey 🚀 : from dream to reality

While I was training at Y Combinator and participating at the Junction hackathon, the online luxury market was rapidly evolving. Some of the big corporations and brands I once worked for were starting to invest into digitizing inventory and building a ‘smart’ industry through technology and data. I noticed that none of the small and medium-sized jewelers were using data to support their business. When a customer wanted to estimate the value of their jewelry, a physical jeweler had to be involved, making appraisals slow, imprecise and expensive.

With my idea, I joined an incubator, which later became Schoolab. There, I learned everything I know about start-ups:

• Constantly iterate instead of obsessing on a perfect first launch #leanstartup
• Generating first sales with no investment #growthhacking
• Thinking outside the box #designthinking
• Using ‘no-coding’ for my website and KPI tracking #nocode
• Pitching the story to investors #pitchsessions

This is also when I pivoted - several times - to find ExJewel's unique value proposition.

4) The pivot 💻 : a 100% digital jewelry appraisal tool for all!

Typically, jewelry appraisals are done in shops, at great time and cost (sometimes up to 10% of the value of the piece). Our ExJewel concept was that any user can sign up on a web or mobile application, upload a picture of their piece and some information like any gemstone certificate and characteristics, and then boom: an estimation for the value would be generated straight away by an AI.

We tested our MVP (in Excel) with some of our early beta users, then validated our business model with the market. We then built a chatbot to be able to teach our customers on jewelry basics. With good engagement metrics pointing towards a fit to a real market need, it was time to jumpstart product development. I launched a love money crowdfunding campaign of EUR 16K to make jewelry appraisals 100% digital.

To provide value to our customers and scale our business model, we had to accurately value gemstones, precious metals and craftsmanship. Not an easy feat! We started a bottom-up data model and built brick by brick. We scraped public sources and nurtured a proprietary dataset to populate our prediction data repository (5M lines database). We also created a badass pricing algorithm that made appraisal easy and accurate, for professionals and individuals!

I am grateful for our stellar team that enabled this, including:

• Tony Seng, our Lead Product Owner. Without him, the database would not be the product engine it has become. Tony also brought on Louis Soris, who became our lawyer guiding us through the nightmare that is French bureaucracy.
• Through tried-and-true Lebanese networking, I met Yasmina Schoueri, who later became the Lead Developer for the platform. She made my dream come to reality in less than 2 months!
• Through Schoolab and the startup ecosystem, I met Edna Mensah, who later became our Chief Marketing Officer. She was my partner in crime in all digital campaigns we launched with minimal budget
• I also brought some fantastic industry leaders and rising stars on board as my mentors. Thank you, Jean-Baptiste Andreani, Taha Zahedi Vafa (my advisor, my roommate, my dear Belgium friend) and Prof. Diana Derval for believing me since day one, even though we still didn’t have a proper Business Plan ;)
• Obviously, my family (both my brothers Patrick & John, my parents) who supported me and helped me get started with angel investments. I salute John Boghossian for correcting this article and so many others (+ everything else he was here for, first being my brother). I salute my father for teaching me the beauty inside every diamond. 
• And undoubtedly, my girlfriend Yasmina Sfeir who cheered me up every time I was down.

5) The launch 📈 : 100% virtual through a global lockdown

We are a corona-baby company. We launched ExJewel 100% digitally on the night of the 20th of February 2020, two weeks before global lockdowns started. We didn't know that the country would close its doors and people would stop thinking about jewelry. s*** happens. As expected, it was not the best 6 months of my life (or anyone’s for that matter). I probably learned the most from these tormenting months, though. As far as start-up troubles from COVID-19, ExJewel had a good few:

• We were literally locked at home in France, so working remotely was a challenge initially. We managed to survive the first wave relatively unscathed.
• Suddenly, all our B2B events got canceled, leaving us with only our killer product online to bedazzle potential partners and beta testers.
• We hit our 30% month-over-month growth targets for active users, but almost no one paid for our service. So, no revenue was being booked into the company, which is a costly war to fight without outside investors.
• Since most of our B2B were at risk of closure, we decided to pivot and launch a paid plan for B2C customers. This worked well. With near-zero euros invested in marketing, we evolved our AI to handle thousands of customers at a time. In less than 2 months, we hit our goal of 50K pieces of jewelry uploaded and appraised.
• We were approved for non-dilutive funding from the French government (or “BPI”). Those were delayed six months due to COVID-19 and bureaucracy. We eventually got a little boost amount, but it was too little too late. Lesson learned: don’t plan on government grants!
• Since our AI had so much data to analyze, we decided to launch some published trend reports. It was a success with our customers and the broader community. The reports covered the most influential trends in our industry ( (♻️ Conscious Jewelry Trend Report 2020, 💎 Lab-grown Diamond Report 2020, 🛒 💍 Jewelry Online Sales Report 2020) and were downloaded thousands of times. We received press coverage for our position in trend forecasting.
• We were scheduled to join the accelerator Creative Valley as part of Station F. That too was a delayed start due to the pandemic.

6) The end 💰 : a failed pre-Seed round

As an innovative startup with a cash-for-growth business model, we needed to raise funds to build exciting products for our users (businesses and consumers). One obvious next step for ExJewel was to create a marketplace where our users could buy and sell appraised jewelry in a private ecosystem. We felt our KPIs enabled us to raise outside funding from angel investors and venture capital funds.

As we know, it is not easy to raise funds in the first place. It's even harder to do so for a LuxuryTech concept during a pandemic, where luxury receded to the back burner as people focused on more basic needs. We decided to raise a small 400K pre-Seed round to cover basic product development and growth while we waited for the economy to restart.

The state of the economy, the second wave of the virus and lockdowns, and our inability to appeal to customer discretionary spend weighed heavily on the development of our project. Investors were interested but noone wanted to take the lead. After 6 months of inconclusive fundraising, I decided it was time to sunset ExJewel. We remain committed to transparency, so we decided to offer ExJewel’s AI-based appraisal service for FREE. Try it here if you’re curious what your jewelry is worth or want to learn about what we did. I hope our tool continues to provide a useful service. At the time of writing, it is still used hundreds of times a day! This gives me great satisfaction, alongside our small contribution to the digitization of our industry.

I remain committed to disrupting our antiquated and opaque jewelry industry. I hope the industry will, one day, make more long-lasting and sustainable products.

7) The 4 lessons learned ✅

How to bounce back from an entrepreneurial (ad)venture's failure

"In theory, failure is good" said Oussama Ammar, founder of The Family. I can't agree more, and I feel OK with failing. An estimated 90% of new startups fail, including 34% within their first two years. So ExJewel was part of that first third.

I am 27 years old, and I survived 1,095 days as a founder. I am alive because I believed in my project and wanted to build a sustainable tech jewelry company my way. It’s like an old friend once told me. Good instincts are earned by making mistakes. If you are lucky enough to survive a few errors, you’re going to do all alright. There is a great big, beautiful, inspiring world out there.

It is challenging to process the toll of unfinished business and spent time. Still, I look around at the last 3 years of my professional and personal development and I owe much of it to ExJewel. I got to meet wonderful humans, work on a problem dear to my heart, and build a team. First and foremost, I want to thank my most inspiring friends and family, caring mentors, and talented team that gave me energy and happiness.

Half of the solution is to admit there is a problem. My best rebound energy came from taking a hard look at myself in the mirror and answering the question: is there something else I’d rather be doing? Once my answer was “yes” for many days in a row, I knew I had to make a change.

So... If I failed at building my first startup, what lessons did I learn on my way here? Here is my list for my next venture:

1. Market (niche) : Never underestimate a niche market. In this specific case, the luxury world is currently undertaking a digital transformation. We were a bit too early trying to achieve an almost impossible goal, and competing with multi-millionaire companies seemed impossible. I had chosen to create my first startup in a niche industry that I thought I knew well, and that's a mistake I wouldn't have made if I knew the challenges an entrepreneur’s life would be.
2. Money (startups burn money fast) : Founding a startup is not as easy and cashless as it seems, so having thousands of $ in your bank account to spare, is a good start. I should have better managed my cashflow and predicted a second wave to hit the world (perhaps, use RocketChart 😉)
3. Incubators & accelerators: I have to be thankful about the value accelerators and mentors could bring to founders; the experimentation mindset.  

I am certain this failure taught me much more than it seems. With all the struggles the world is currently going through due to COVID-19, I have managed to survive this crisis and find my way around the French startup ecosystem.  

And if we had to do it again? Here we are in a digital world where entrepreneurship is a banal thing to do. For me, it is an incomparable professional training during which you work on your hard skill and soft skill all at the same time. Therefore, being a founder is an excellent opportunity to grow personally, mentally and seize constant failures. So without any hesitation, if I had to do it again, I would. I am more than ready to do so...

8) The next steps 🔮

Starting 2021, I work free-lance for various startups in the French ecosystem: 

• I was hired to develop a growth strategy within Time2scale, a company that help startup scale.
• I joined the FEMPO team as Head of Growth. FEMPO is a menstrual care startup that is revolutionizing the period industry and the well-being of woman (Warriors). I was psyched to help grow their sales during their transition.

I can’t wait to experience and contribute to a different culture. I’m also ready for less stress for a while ;) Don’t get me wrong - I loved being an entrepreneur and believe I will be one again someday. For now, it is time for me to work for and with others, and to see their transformational vision come alive. 

I say goodbye to the world of jewelry, but no doubt, see you very soon...

And you.

What has been your rebound for this year, 2020-21? Have you risked failure?