Priit Salumaa is a startup enthusiast and a passionate software engineer. He is the co-founder at Mooncascade, an Estonian mobile software house, and Garage48 Foundation. This post is based on Salumaa’s work with the latter.
We have been doing hackathons for four years now at Garage48 Foundation. This means 33 events in 12 countries, with a total of more than 2500 participants, more than 750 ideas pitched, and nearly 400 prototypes built. Nine of the teams have successfully involved venture capital.
We initiated Garage48 hackathons in order to boost the local startup scene by bringing the Silicon Valley attitude to Eastern Europe and other developing markets.
We want to show that a small team with a kick-ass attitude can achieve amazing things on a lean budget in a very short period of time. We believe that one can move from an idea to its first prototype without waiting for an investment. We want to bring people together from different fields with different skills for a larger networking effect at a later stage in their lives. We want to give participants a taste of how it feels to work in a startup team.
Do 48h hackathons work?
Over four years of operation at the foundation we have seen our fair share of critique (The latest of them was published in ArcticStartup). The range of critique given is quite wide: from pushing participants to think small to the analogy of teaching children to drive a motorcycle without a helmet.
Much of the criticism is well argumented and also very true (a must-read analysis by Sten Tamkivi). The only problem for me is that much of it is founded on the wrong premises. Or in case of the right premises, there are things we cannot influence, but rather tend to bring to attention.
I want to make one thing very clear: Although some talk about 48-hour startups, Garage48 is not a startup factory. The 2–3% of successful businesses out of all our teams is a by-product. All of us at Garage48 Foundation know that developing a business takes much more time than creating a prototype during the weekend.
From idea to a prototype
Garage48 hackathons fill a very important niche in the life cycle of a startup idea to a startup company. We stick to an “idea to prototype” phase, where people verify the idea – its technical solution, first market research, and first thoughts on a business model.
After the weekend hackathon, others must take over: acceleration programs, business angels, and incubators. In a way, a Garage48 team exiting the weekend is well prepared to apply for an acceleration program. With a prototype you’ll have a competitive advantage over an idea with just a slide deck. A prototype says more than a thousand slides.
Filling this niche has proven successful. We have nine teams from Garage48 accepted to SeedCamp, Startup Sauna, Startup Wiseguys or other acceleration programs. 2–3% of our teams get to a real company, to investments, to revenue models – very often pivoting or changing the team on the fly.
A local Estonian example: Out of the seven finalists in Ajujaht 2014 (an entrepreneurship competition held by Enterprise Estonia and broadcasted on Estonian National Broadcasting with a prize fund of 50K in 2013), three were initially Garage48 teams: GoWorkaBit, Timber Diameter, Photofing. Now two more hardware ideas – Rahu and Mimmi – have built their first prototype in Garage48 Hardware & Arts, bringing the total to five Garage48 teams out of seven finalists in Ajujaht.
And still, Garage48 is no startup factory.
One-night stand vs. marriage
It is a fact that a business idea can be brainstormed during 48h and a prototype can be built over two fortnights. It is also a fact that business development takes much longer – you cannot build a sustainable business during a weekend. This is quite obvious and nobody should have illusions of 48h startups. We do bring that to attention at our hackathons. But as it sometimes happens, journalists look for more flashy words in the titles like a “startup” vs. a “prototype”.
A weekend hackathon can be compared to building a business, like a one-night stand can be compared to a marriage. You can have sex with a stranger and leave the next morning, but building a family requires long-term commitment, trust, and friendship – a different kind of relationship.
That said, it seems to me that some teams tend to break this kind of thought pattern. Sometimes, for a lucky few, a one-night stand might lead to something greater and bigger. Believe me, I know that. For me and my wife, our relationship started with a one-night stand, followed by a coffee the next day, lunch, dinner, and by today – occasional fights, two kids, and a mortgage.
Garage48’s goal is not to produce successful businesses, but this happens sometimes anyway. A successful business after our weekend hackathon is not our doing, but the effort of the individual teammates. These people decide to go on, and find the motivation and ability to work together. We just happen to be there when they meet.
From my personal experience – 48h hackathons do work
When starting the initiative, we as organisers took part in our hackathons. I personally participated as a software engineer at the first two Garage48 hackathons.
I can still remember the adrenaline rush during the event when coding away: the very nervous and even more nervous moments, and an overwhelming feeling of success when we deployed on a live environment something that really worked.
There are some things which were quite unexpected. All our teams reach a working prototype during the weekend and the amount of work done is inhuman (In our history one team has failed, but on Sunday they presented the story of their failure – why and what they should have done differently). The energy and focus level at Garage48 is just astonishing. For participants this is amazing and fun!
We have a very positive networking effect at the event. Nothing introduces you to a person, verifies his or her qualities, and creates trust more than working on the same problem for 48h. It definitely beats swapping business cards or having a couple of beers at a random mixer.
This kind of contact base – knowing the real value of people from the event – provides a very good platform on which to build towards future startup ideas. You will know whom to talk to in the future in case you have another splendid idea. Many people who met at Garage48 have later started working together on various projects (For example, the guys at Margn, the easy-to-use online accounting software, met at Garage48).
Garage48 participants get an experience of what it’s like to work in a startup team. As in a startup, the team will have few resources and even less time, so they have to focus only on important things. In the context of the weekend it means focusing on the idea’s core functionality and getting something working for Sunday evening.
Teams have to build an MVP (minimal viable product), so to say. They have to divide the work, target low-hanging fruit, and hard-prioritise tasks. There is no time for bells and whistles or bullshit like “what ifs”. Dirty hacks rule over beautiful solutions if you need to get something done quickly for a hard deadline.
We do have a great learning aspect to our hackathons, since they are open to everyone. Students can work in a team with startup veterans or great professionals. Jaan Tallinn, one of the Estonian Skype founders participating in Garage48 once said to me: “It is like a startup-culture bath participating in this event”.
Ideas have no limits
We do not produce the ideas, participants do. One can come with a grand business idea to Garage48, with a non-profit idea, with something just to hack on, or just to have fun. Everyone is welcome, and every idea is welcome. We encourage building something – it can be the tiny, first bit of a grand solution, something to show on Sunday. We just do not allow any PowerPoint slides on the demo evening.
The qualities of magnitude or ambition are directly related to the authors of the ideas, their cultural background, education, risk tolerance, and other things far beyond our influence.
The IP belongs to the team
Garage48 does not take any equity from the teams. We are a non-profit organisation. The entire intellectual property (IP) produced during the event by a team belongs to its members equally.
Thus, dropping a teammate after the weekend is not that simple. We do suggest, though, that the teams who want to go on need to have a plan. They should set quantifiable goals and milestones. Plus, the non-active team members should let others go on, and should not be a dead weight.
We have seen teams buying out members who just wanted to have fun during the weekend for a couple of hundred euros. We have seen teammates leave teams because of not being able to commit and thus giving up the IP for free. We have also seen nasty fights. This happens in life and is very natural.
We at Garage48 tend to be stubborn in a typical Estonian way and do things we think are right. This brought us to Garage48 hackathons and Garage48 HUB in 2010 (from an idea to a co-working space in three weeks). But now we have taken on new directions. The beginning of February 2014 saw two of our new initiatives:
- Student Startup Camp, organised in conjunction with the University of Tartu – a week-long special course loaded with lectures, motivational speakers, and hacking to reach similar goals to those we have at normal Garage48 weekends.
- Garage48 Hardware & Arts, organised in conjunction with the University of Tartu and Estonian Academy of Arts – the very first hardware hackathon in the Baltics.
We are also taking on new verticals like healthcare and wellness at our Tallinn 2014 event in April. The new initiatives have proven to be a great success. Thus, we will continue with them, organising and perfecting subsequent hardware hackathons and week-long student startup camps.
These new directions help us to spread the go-getter attitude into different business fields and demographics. We see that it does require changing our event format to achieve the training and networking effects, but we are very careful not to change our DNA – what makes Garage48 a Garage48.
Read the original and longer version of this post on the ArcticStartup website.