I recently interviewed Will Geronimo, one of the co-founders of TableXChange, a Spring 2008 InSITE company. TableXChange.com served as the first and only online marketplace to buy and sell reservations to the hottest restaurants in New York City, San Francisco, and The Hamptons. As the economy worsened, however, even the best restaurants in these areas, which once boasted 30+ day waiting lists, began to have empty tables and the niche filled by ancillary services like TableXChange was no longer necessary. Here are some highlights from my interview with Will:
OH: Tell me about how and why TableXChange failed.
WG: The downward spiral was pretty quick. The bottom line was that the company didn’t make money. We thought that if we could get enough traction we could monetize our business model. But to be honest we never had a perfect understanding of what our business model was. One thing we did know was that if the marketplace for online reservations took off, we would be the first ones to make it big in that space. But our timing could not have been worse. The economy went into a downward spiral and our business, which was based on scarcity of tables, was no longer needed.
OH: Did anything besides the economy hurt your business?
WG: Although the primary reason was the scarcity of tables, it did not help that as the economy worsened we got increasingly negative feedback from the restaurant industry. It was never our intention to harm restaurants, but as our website kicked off, the restaurants began to approach us and say “the way that you are setting this website up is creating a lot of confusion with the hostesses, etc”. We ended up being portrayed as the bad guys, especially once the market for high-end restaurants slowed down. The negative press obviously did not help us.
OH: Do you have any advice for graduate students who are hoping to start their own ventures soon?
WG: Absolutely. I have started a few businesses in addition to TableXChange; I have had a couple of failures and a couple of successes. The most important thing I have learned is that partnership is HUGE. You want to pick partners with ancillary skill sets and complimentary skill sets. One of the problems with TableXChange is that Gabe and I had the same skill set—we were both finance guys and management guys. Dwight was the programmer, and he was the only one with the technical skills to put many of our ideas into action. In other words, we had two management guys and one technical guy when it should have been the other way around. My advice to students is to make sure to not bring too many people on your team with the same set of skills; and if you do, make sure those are programming or technical skills, which can be ancillary, rather than management skills.
— Omar Haroun, AVP Teams 2009-2010