It’s International Podcast Day (yeah, that’s a thing!). The latest episode of our Leicester Startups Podcast features multi-award winning app LoyalFree founders Sophie Hainsworth and Jason Nesbitt.
Jason & Sophie share how to pivot and scale, battling burnout and dreaming of becoming millionaires.
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This monthly series aims to shine a light on talent from across Leicester and Leicestershire to inspire listeners, whatever stage of the entrepreneurial journey they are on.
In upcoming episodes we have founders discussing their successes, like securing millions of pounds of funding, to failures like losing their homes because of their business.
This episode is kindly brought to you by Twist and Shout Communications, a production team that aims to entertain and inform; because they know that when people smile, they’re engaged. And it’s smiles that get shared. Visit www.twistandshout.co.uk/ for more.
This series has been made possible by the Leicester Startups network working together with the University of Leicester, De Montfort University, City Council and Leicester & Leicestershire Local Enterprise Partnership, who have join forces to support new businesses through the Start-up Leicester Co-working Project.
I always love solving a problem and seeing stuff used. So the funny side of the business is Sophie sees money everywhere and I see the matrix everywhere. So I’m just very focused on technology that can be used makes me very happy and money makes Sophie very happy.
Manish Verma 1:18
Sophie Hainsworth and Jason Nesbitt have been friends for 15 years. One is an introvert, the other isn’t. One reels of inspirational life quotes and the other questions life itself. One is able to concentrate on lines and lines and lines of code. The other gets distracted easily.
He’ll hide information from me so that I’ll actually listen because I’m like a child.
Manish Verma 1:51
Despite all their differences, they both have some things in common. Building businesses being the main one. The pair have attempted a few different ventures over the years. But it wasn’t until they were in the right place at the right time that they finally found one that clicked. That idea was Loyal Free. An app where users can see local business offers, events, guides, competitions and collect loyalty stamps. And it’s a business which turns over a quarter of a million pounds. Hi, I’m Manish Verma. And you’re listening to the Leicester Startups Podcast.
When I graduated, I had a couple of friends both have their own businesses now one of them sold it recently and did an amazing thing with it. And they really taught me the idea of cheating life and and being able to escape the normal nine to five so when you combine the love of technology with that, the idea of starting a business and joining them and being able to do this cheating life, which coincidentally, I bought cheatinglife.com, which I think is one of my best investments ever. Not done nothing with it yet!
Manish Verma 3:08
Was this also at the time where Facebook, had Facebook blown up at that time? What was going on around you?
It was just past the dot com I would say. I would say apps were becoming a thing. The world was going very web focused.
Manish Verma 3:21
Sophie, you’ve said to me, you just can’t really stand the idea of working for other people. Where did that come from? Has that always just been there? Tell me about your background.
Yeah, I think it’s always been there. So when I was a teenager, any part time job I had, I just got sacked really quickly. Not because I was incapable of doing the job but because I was bored and there was no challenge and there was nothing interesting to me. And, you know, I think my parents were worried because it couldn’t hold down a job at Tesco. That and the real reason was because I just was frustrated with how slow everything is and how nothing gets done. And then that was amplified when I went into to graduate scheme in London at a big four company. So that that got really bad in London. And there’s been jobs that I’ve liked and great bosses, loads of things I’ve learned, amazing colleagues. But I knew probably about a week into my first post uni job that I wasn’t going to stay in a job that was going to work for myself, but it took perhaps a few years longer than I thought it would.
Manish Verma 4:28
When did you think actually right I need to just to make that step I need to start a business.
I felt like that all the time that there was never really a good time because my, my time was interrupted with quite a lot of ill health and there was like moving around the country. So there was just never I mean, it’s cliche, isn’t it, that there wasn’t a good time. And then we had tried little ideas, but I’d never really fully believed in it. And then really, when we started putting this business together, I’d still at that point, I guess, didn’t forsee that I would work on it as a business. And it happened very naturally almost by accident.
Manish Verma 5:05
I’m interested in what those are the businesses were.
Pin City was one. I’ll explain Pin City. So we were in different places. You were in London and I was in Leicester, we wanted to meet in the middle. You’ll be able to use this website or web app to say these locations, eight people. This is the place it’s in the middle. That’s a really good cafe that you could meet up, for example. It went nowhere.
There was a real need for it. Because I was living in London, and there was constantly groups of friends, and you wanted to meet up somewhere that was convenient for everyone. And the idea was it would find that convenient place and then everyone directions and do the booking but it has already been done. No easy path to monetizing. Oh, that’s why we stopped there was no way to make money. And then we had probably a bit more of a rogue idea because neither of us have any experience in manufacturing or production. We were going to build a business called Mumsy, which was onsies for pregnant women. Which is actually quite a big market now. And there’s a there’s a huge markup on that. And the ones that had become this huge thing. And we did loads of research, we bought sewing patterns, prototyping, we still own all the domains if anybody wants that. And then it was Mumsie and Me and there was a small version for the child and then we sort of realised, okay, neither of us have kids, we have no experience in manufacturing, we probably shouldn’t go into business that we’re we’ve got no reasoning behind.
Manish Verma 6:32
So after dabbling in a couple of different ideas, they were ready to quit their day jobs just yet. Sophie stayed in London, Jason in Leicester. But then Jason was approached to build apps for some friends. One owned an Indian restaurant, and the other a pub.
So I saw that there was a bit of a customer demand for businesses wanting their own app. So rather than making fully separate apps, I made the separate apps but I made them connect to a website where they could update the information themselves. So they could update their menu, they could add offers. And I think I was travelling in Southeast Asia for the the end part of finishing it. And I got really excited and I’d be sat with my notepad going, yeah should be a millionaire in about three weeks. We’ll get there in no time! Obviously getting very excited about it. And then I came back to England and I finished the apps. And then I showed the idea to Sophie, whilst we were in Edinburgh.
Yeah, so you know, when someone does something, and everyone around them tells them how great it is just because they’re your friends. So Jay had sort of come back and he had all these flashy sheets of information. And maybe I was like secretly a bit jealous because you were actually starting a business and I still had a job. And then you know, everybody was like, isn’t it amazing? It’s amazing. And then we went for coffee in one of our favourite cafes, and Jay explained it all to me. And I sort of said, well, you know, it’s okay, but it’s not really because you’re not going to make any money. Like the scale that you’d have to grow this to you weren’t making any money and no one’s going to use it. And I was maybe a little bit mean, but I just knew from knowing Jay, that he could do a lot better than that. And that wasn’t the thing that was going to make him be able to grow a huge business. I knew that it wasn’t the best he could do. After that, Jay said, well, what if we have one app for everywhere? And then secretly went away and didn’t tell me and then two months later, just said “oh, you know, that thing we were talking about? I’ve, built it”. And I was like, What? Like, we haven’t spoken for two months, what are you on about!
Manish Verma 8:40
That idea became a small project for the pair. Jason redesigned the function of the app. And he asked himself one basic question. What would customers most want? So he thought, rather than have customers carry around one of those little cards for every cafe or restaurant, they visied, why not digitise it?! Why not have one app, which had all your loyalty card stamps in one place? He built it. And then together, they approached small businesses in Leicester and Loughborough. I think that was probably some of the most demoralising months of our life. Because when you try and start something brand new and you don’t exist, everyone just says no. And we had a real point where I thought, well, we can’t even give this away. And it was incredibly demoralising.
Very useful. I think everybody should go through that at some points of super super rejection and just determined to get through it. And also the feedback was very, very crucial. So St. Martin’s cafe gave us the amazing feedback of saying it’s nice, but I just I don’t want to be just an item in the list. I want to have something more personalised so can you put my Instagram feed in there? So went away did it that night, came back the next day and said, do you mean like this? So they said, Yeah, and actually signed up first paying customer.
potentially, actually paying And so yeah,
Manish Verma 10:08
Oh so the business then paid you to feature them on this on your app?
At the time at the time, which is now changed, which we’ll get into.
Manish Verma 10:18
So then where do you go from that? So you’ve got a few businesses, few doors shut in your face, but at least one paying client, then what happens?
It all sort of happened very quickly. So for several months, we followed with that plan, and we got we maybe got 10/15 paying customers on a monthly subscription, and we sort of proved concept. And we got a lot of feedback. We started changing the app, adding in Google information, just making it more customer facing. And we just constantly went to networking events because we were a bit of a loss and in a lot of the books I read, they just say at the start, just meet as many people as you can and something will come of it. And I had to drag Jay around because he is an introvert and he hates socialising!
I didn’t have a laptop, I wasn’t coding!
I was like dragging Jay, for all these networking
And then we ended up at one in Loughborough for about half, six in the morning. And it was a breakfast meet with the local MP. And you know, he’s like, what are we doing? And I was I could just feel something goods gonna come soon. And that’s when we ended up sat next to somebody who worked at the Loughborough BID, which is the business improvement district. And they explained about the bid and how the whole town or city paid into this pot and the bid reinvested the money in the area to improve it. So they might improve the way the street looks. They might hold events. They might do things like introduced the digital app. And that was sort of the the moment. And then I went home and I was just googling about bids. There’s 300 in the UK, just finding out absolutely everything I could about this industry. And that was the moment where I was like, we need to focus everything we do on this industry. And this is how we can monetize. And this is how we can actually have an impact because instead of knocking on individual doors, we can work with a body that has access to maybe 600 businesses in one area. And that sort of trundled through very quickly, we got invited to the board meeting. And it was a tough sell, because they didn’t know who we were. And we had no case studies really. And we were very early stage. But luckily for us, the team there who we’re very close with, they said to us we just believe you, we just believe that you’re going to build a big, amazing business. And we want to be the first ones to say, you know, we’re the first involved and we couldn’t believe it. And it was a big chunk of money to us at the time. And it was a yearly chunk of money. It was a real contract. So even for a year after that contract, and we were both we both had other jobs. I was still in London, three days a week. So we were only really working on it at the weekends, when I came home to Leicester to work on it. And Jay had his own business building websites and apps. So it was it was a struggle at the time. And yeah, I think we put about 500 pounds in at the start. And we had a discussion about how we thought that we could do it without the investment mainly because the technology, which would have been the main cost was in house.
I’m very scared by how many companies want to keep going without making a profit. And I’m not even the money focused one, yes, it seems strange to us. So we just just have been cash positive as quickly as possible, and just want to keep it that way and keep the control.
For me, I wanted to quickly prove the source of revenue. And then by the time we were even thinking about investment, we sort of broke even more because you know, such as small amount of investment, we breakeven almost straight away. So we’ve always been in profit. And then as that went on, the need for investment got less and less because the revenue increased and we’ve managed to keep a control on the costs. Obviously, they’ve gone up.
Manish Verma 16:12
BAecause you’ve managed to get more bids on board?
Yes. So we work with 12 now and more in the pipeline. And I just think we will question the investment. So we thought about it. And then you know, I sort of pushed it a little bit. And Jay said, well what will we actually spend the money on? Do we need the money? And I was thinking well, really, the only things we need a staff and then our marketing budget, but we can take that out of our money. And as a result, we obviously didn’t pay ourselves for the first maybe year and a half. But we had our other jobs. And so I think it only worked for us because we had income from somewhere else that we were able to not take an income from the business
Easier to make the sales as well. Because when you can turn around to somebody and say we control all of this, we can make a decision in this room right now. And that’s the whole company saying yes to it. Which is very powerful.
And also, you know, we both wanted to work and not have a boss and we wanted to work for ourselves. And sometimes taking the investment puts you in a position where you are essentially you just become an employee, depending on how involved the investor is. But there is someone checking your decisions and informing the direction of the business. And to me, that would just be then not why we started a business.
Manish Verma 17:26
And I’m keen to hear about actually. What it’s like? Was it a slog, like you’re working, obviously, the week in London, and then during the weekend, you’ve got a business that you’re running, and doing this in your spare time, I guess what, what is that like?
There is no spare time. You’ve got to be very obsessed with it, I think. It’s something I say to people these days, any kind of business, they want to start, especially technology stuff. I was so excited in the mornings, to wake up on a Saturday morning and sit and code. It’s still my ideal day, to wake up and to be able to code for the first three, four hours of the day, and then enjoy life afterwards. But it’s yeah, I just think you have to do it that hard.
You have to want to work on that more than you want to do most of the things. You have to be prepared that you will miss social occasions. That you might miss sleep. That you definitely won’t have time to sit and watch TV series, you know that time all goes. But at the time, it didn’t feel like a slog because I was just so excited to I would finish work in London, and then I would work on this all evening and be on the phone to Jay in London, because we were so excited about it. And we were a bit younger than as well. So perhaps had a bit more energy, which is sort of lagging now. But you know, it didn’t, it didn’t feel like a slog. But people do say to you, you know, well, I haven’t seen you in ages, you don’t come out anymore. Our friends started calling us team boring, because we wouldn’t go on nights out. Because we would be like we’ve got to go now getting up at 5am. And you have to be willing to accept that people aren’t necessarily going to be on your wavelength about it.
And it was exciting because we were moving so quickly. Changes were happening so quickly that it became a new business every week or every month. There was so much to focus on. And I think if things slow down, and you have to wait a long time before being able to make a change you’re excited about it might feel a bit more of a slog.
And the money. I mean, if we’ve carried on not making money for a long, long time, I imagine that’s where you lose excitement. But because we monetize quite quickly, it was easy to stay enthused because there was that opportunity and that realisation that it was actually a business that could be financially viable, and we would be able to leave our jobs.
Manish Verma 19:39
So things got very exciting for the pair and things started to grow. They went from one bit on board to two, then three, four, five, six- 12 have since signed up! But that journey hasn’t been easy.
This the step from one to 12 has been blurry, fast paced, messy.
Manish Verma 20:02
They went from both working on its part time to full time. But things were getting too much
The end of last year, when we got to December, we were working sort of all day, all evening. Sometimes be in the car for seven, eight hours a day, visiting bids around the country.
Just an absolute blur.
You know, we haven’t really seen our friends or our families, you know, your relationships with people are falling apart. Your health sort of takes a downward spiral, you know, starting to argue about things that just would never be an argument.
Usually, as soon as any action could be done. We do it straight away, because that felt like the natural thing to do. It was all leading to burnout.
Because I’ve had burnout before when I was in London for burnout for four months, off work hospital. I was very aware of burnout happening last year. And I could I could see it happening to me and I could see it happening to Jay and maybe he wasn’t aware of it as much because he’s so obsessed with the coding, but just the sheer like tiredness and our inability to have proper conversations and I think that looking back, we were both actually on the brink of burnout. And thankfully, we realised before we got to that point and solved it and said actually, what we need to do is get staff in, take a step back. And when it got to December, we both went away. So Jay went to Morocco, and I went to New Zealand. And we got a bit of space. And we both came back and said exactly the same thing to each other. We’ve been doing too much we really need to slow down, work out what’s important. And work what what you always say to me work smart, not hard.
Now we’re taking more time for strategy where we’re getting our head above the water. And we’re just looking at it and going well, that doesn’t need to be doing all that can be done like that. And just just not making smart decisions. We were working hard, not smart.
Manish Verma 21:59
So just as they were on the brink of burnout, they took themselves away and came back with a new perspective. One of the changes they made was implementing something called the 80 20 rule.
If it’s 80%, good, you’re never going to get to 100%. So we would just look at a design that we’ve done a new sale sheet or something we’d say 80% in an action just just by just print them. It’s there. It’s good enough. So we said that we don’t say anymore. It’s just a given now, but we were saying that for months.
It really changed things for us because we would agonise over tiny details. And another thing that we always say to each other is marginal gains. And that’s when you’re just carrying on working on something, when really they’re not going to make a difference at all. So we’ve just tried to be more efficient. Is this good enough? Because we both sort of previously in previous jobs were perfectionist, that was a real challenge. Yeah. And when it’s your own work, handing something over, that’s not perfect, feels very uncomfortable. But if you don’t do it, you will literally just never move forward.
Manish Verma 23:01
And wow, have Sophie and Jason move forward. Not only has their working style changed, so has their app. It’s not just an app where users can collect loyalty stamps anymore. It’s one where people can check out trails, competitions and deals. It’s a police app. And it’s been so successful. That Loyal Free has beaten retail giants to some national awards.
Okay, we’ve just won against John Lewis and Cafe Nero, like, What? What’s going on? But there have been there have been a lot. Because I handle all of that Jay never knows what’s going on, to the point where when we won an award, he’s like, what’s the award for?
Well, actually, no, that was the time at the East Midlands Chamber Awards where we were sat at the table, and Sophie went to go get a drink and the compere for the evening. We have a rule where we just have to put your hand up every time if you get the chance to speak, always speak about your business, always do something said and stand out. So he said, who’s up for an award like and I was like, Yeah, I am Sophie had nip to get a drink from the bar. And the microphone came up to me. I was like, and they said, what award are you up for? And I just didn’t know you! Good question. I’ll let you know.
We had a funny time in the eastern chamber awards, where Jay had done the judging panel on his own. So to this day, I don’t know what was discussed. And then we won this award. And we weren’t expecting to win. And we won this business improvement through technology. And it came on the screen. And they they give a little blurb about why you want it. And the reason was for automating their business with the use of robots. And so it’s not a huge screen, and everyone’s laughing. And I’m like, Jay, we haven’t built robots. What, what, what, what is going on? So we walk into the stage to pick up the award, and I’m just laughing and they come they give the mic to me. And I can’t answer any of the questions cuz I’m laughing so much. And then Jay just decides to go with it and talk about the robots we’ve built.
I think I grabbed the mic and I said, I’ll answer this question, because I’m the one that made the robot!
We just went with it. And then all night, people were like, you’re the guys that built the robot. And I was like, I think we should leave. We haven’t actually built robots, and just made a bit of a swift exit. But actually, now we’ve massively step back. Because I think with every business, there’s a period you go through where you’re building credibility, and having awards is amazing. And then there’s everyone will tell you, you get to a certain point where you you are tired and going to a six hour formal evening event becomes strenuous, because it’s time when you could sleep. Yeah. So we have taken a step back.
Manish Verma 25:37
What’s the future hold for you guys? Where do you want to take this?
At the moment, our focus is okay, let’s really, really scale up now let’s start working with say 50 BIDS, that’s really get into that UK market. We’re also recruiting. So we’re going to be spending a lot of time working on the processes of the business and the management of that. And and basically, the end goal, whatever we do location wise, the goal now really, is to start removing ourselves from the finite details of the business so it can grow, because we’re very involved in everything. And it’s just not you’re just not able to grow business that way. And we’re very aware of that.
It’s probably our biggest challenge, because it’s one that we’re really, really trying to think about constantly the removing yourself. The task, you’ve been doing yourself for two years, and then all of a sudden, get that task done. But you don’t do it. It’s something we’ve really struggled to detach ourselves from.
Manish Verma 26:35
Yeah, but you so baked into it, right? The tech guy in the business, the sales, everything is mostly you two.
We’re both control freaks. Jay’s like you could just hand the social media over to someone else. And I’m like, no! No one’s touching it. And we actually we have, although we work closely together, we have very separate roles in the business and we don’t touch each other’s stuff. So even between ourselves, we’re control freaks.
Manish Verma 27:02
The beauty of why this has been a success, actually having someone who’s completely different to you, and someone who’s completely different to you. And that marries up perfectly to make this.
I’ve always said that from the start of when we started working together, that there’s so many tech companies out there, and it’s two techies. And you think they have a great idea and they never seem to get anywhere because they haven’t got somebody who’s focusing on marketing and sales and isn’t tech. You’ve got to have someone commercially focused. And that isn’t to do with the technology. And we sort of got lucky. And we’re also lucky in the sense that we sell to different markets, some who respond better to techies, some respond better to marketing, some respond better to men, some respond better to women. There’s always one of us that’s better placed for any situation. And you know, I can be like Jay can answer this or, or this is for me. And when work comes in, it’s very clear who it belongs too. And I think a lot of business partnerships fall down, because you’re both doing the same job. And then there’s friction, because you’re trying to perform the same task. And you’re comparing and, we don’t have any of that. And I think another reason is that we’re just both so output focused. So we don’t have a fixed number of holiday days, we don’t work the same hours, some weeks Jay works a lot more, some weeks, I work a lot more. It’s not even a discussion. It’s just have you done the output for your parts? Are we going in the right direction? I think that’s important. I speak to a lot of businesses, and they’re annoyed at their business partner because you know, when I work harder, and it’s this constant competition. You’ve got to get rid of that mentality because it’s only disruptive.
Manish Verma 28:41
And that brings us nicely to the way we started was how you met and the friendship over all these years and now working so closely together, what one thing do you think you’ve learned of each other that you didn’t know before?
The importance of communication to the outside world. And that whole networking. If I’d started this business by myself, I literally would not have got myself out there, I would have not gone to any of this networking stuff in the morning. And I stress the importance of this before massively learnt it. And if I ever go off to do anything in the future, anything else with or without Sophie, that’s definitely something I would take away as I need to pull myself out of bed at five in the morning and go meet the local MP, because that’s very important.
And I think like the opposite. So Jay, saying, you know, he’s sort of learned to be a bit more extroverted. For me, I guess I’ve learned to be a bit more introverted. From Jay, I’ve learned to say no to things, because I’ve always been a person that just says yes to everything. And that’s why I reached burnout. Because I just love doing everything. That’s one of the things and also just that you have to focus. I have a really short attention span. And it’s a constant struggle for us to have conversations because I’m not focusing- but I’ve got better. And that’s something I was never very good at. I feel like I’m a much better listener now being Jay’s taught me actually, you need to stop and just listen to this one conversation and not you know, look at all the dogs around and get distracting.
Manish Verma 30:15
For me, Loyal Free is a really good local story. Everything about it celebrates local. It was of course, built by local people, and completely self funded. The businesses they feature in their app include independent retailers and local attractions. So what did the pair have to say about their local city, Leicester?
We have sort of an ongoing joke that everything is two hours away. Like it doesn’t matter where we get go for sales meeting, it always seems to be two hours away. And and it is, you know, is home.
There’s so much going on here, way more than people realise. I mean, Leicester Startups, a lot of people attend those events. De Montfort and Leicester University, both amazing universities. I mean, I can only speak about De Montfort of my personal experience there. But I’m still good friends with my main lecturer, just so influential. Yes, there is so much going on in Leicester
Manish Verma 31:06
And you you’re in the tech and digital and startup scene here. Where would you say is and what needs to happen to let it flourish even more?
I think people perhaps need to be a bit prouder of the Midlands and what they’re doing. We’ve met, you know, a tonne of amazing business owners here. And I think Ben at Leicester Startups is doing a great job of trying to pull all those people together and say, look actually as a group, we’re really strong force. But only when we come together as a group. It’s a bit, maybe still a bit siloed and a bit split up. But I know there’s a lot of people working really hard.
Yeah, I would say that the businesses need to be more vocal and involved as well. So if anybody’s listening to this, and they are doing their own business, there’s a lot of support out there. And a lot of people that would help. We’ve had mentors before. And I think we have a lot of life mentors around in general, which we wouldn’t be where we are without them. So getting involved more.
We both read a lot. And it’s easy to get hung up on getting all your advice from books, which don’t get me wrong is amazing. But you have to remember to reach out to people and a lot of people let their pride get in the way. I was talking to a friend about this the other day because he didn’t want to ask people for help because of pride. And I said we sometimes you just have to be shameless and ask for help and they will help you and then equally, you have to make time to give that back. So even throughout the blur when we were really busy, we made time to go and volunteer, to go mentor other people because that’s just what’s right. And you have to you have to give it back.
Transcribed by https://otter.ai