After 28 months of building TheMissionZone, we are officially closed.
As I look back over the life of the company, I am sad that it didn’t work out, proud that I was able to build something that our customers enjoyed, but frustrated that we never got to really build the full thing. This is going to be a long post, but I’d like to take a look back over the life of the company and what lies ahead in the future.
As I have written before, this is a 25+ year dream of mine to build an experience in which I could play a video game or be the action star in a secret agent movie. But it wasn’t until the 2010s when I started to build metadata driven code, that I began to see how to a create a product that could scale. While I knew the vision, I could never figure out how all the pieces fit together.
In 2013 I read Lean Startup stuff and loved the concept. Steve Blank talked endlessly about getting out of the office and gathering feedback from customers. But what was an MVP that I could actually build and give people a sense of the vision, to collect their thoughts? At the same time, I was convinced that experiential learning for STEM was absolutely the best way for this vision to impact the lives of people. It was the best beachhead market to win customers when they are young, and build on their experiences as they mature. I watched a whiteboard style video of a Sir Ken Robinson presentation about the future of education. I was amazed, the animations helped tell a visual story and I didn’t have to build anything physical. Steve Blank had suggested a video could be MVP, so I was off. I found a company that does the animation and spent $5000 in late 2013 for a 3 minute custom video. When I showed it to friends and family and teachers, everyone loved the idea of teaching this way. Would you pay for it? Yes.
Over the next 4 years I started building the website content and working through how to build the software as a company. Joe and I met several times and I turned my kitchen into an ‘office’ with whiteboards on each wall as we sketched out the architecture. Eventually Joe moved on to a much better career with Microsoft. My first test, could I convince someone to focus on my dream…well as I like to say, we are not ‘living on Ramen’ type people, now in our 40’s.
But as luck would have it, my life changed in several ways all at once. Sara came into my life and she was 100% supportive of my dream, a partner that would help me pursue my vision. And Taylor was accepted to the Air Force Academy, which means free tuition! At the ripe age of 45, I had an opportunity for a smooth exit from my job and give this thing a go starting with the new year 2018.
Nothing moves as quickly as I think it will. I never got as much done as I thought I could. While teachers and parents loved STEM education for my first market, as soon as I met with a school principal, I learned about the challenges of curriculum and NCLB. Before I left Fidelity, there was a pilot to teach NAVs and MILs using a mocked-up escape room in one of the training rooms. When talking with the L&D folks, they loved the idea of TMZ as a platform for doing more of this. So I decided that I could buy a trailer and set up temporary modular walls to build the unit. I could get in and out in a week. But how could I sell it without ever demonstrating anywhere? How would it actually set up? Would it fit in a trailer? Would I actually gather enough data from customers? Was that cost worth it?
I felt I needed a real space, where people could walk in and give it a try. I needed data. I could advertise something with real images and they could see that it was real. And I could even still run corporate training as an ‘offsite’ style event. I figured I would spend several thousand on the trailer anyway, so what If I could negotiate a short-term lease and run a test? Enter Apple Tree Mall in Londonderry in Nov 2018. They were in the middle of a lot of construction and didn’t mind letting me hang my shingle for four months. If it started to work, I could sign something longer. Long story short, permitting with the city was a nightmare (learned a LOT) and it took 6 weeks to get everything built, assembled and up to code. Alas, I had a functional Proof of Concept that I could test with real customers.
Crickets. It seems my network has a viral coefficient of zero. But with some help from Groupon, I started to get business in. I changed the engagement model. Tweaked our intro videos, Missions, props, etc. Customer feedback is your friend. People paid for the experience. Most really liked it!
And just like that, Apple Tree said no thanks. So I moved. And had MORE permitting issues with the town of Derry. But business started to improve and I continued to refine the business model, how we interact with customers and even did a few small development rounds to upgrade the app. Most importantly, the proof of concept, taught me a lot about the way my full-size model should work. How to make it scale. How to maximize throughput. How to blend different genres to create new markets. Over the summer I worked with advisors on my pitch, I felt there was a real venture scale business here, just waiting for the next step. If I could prove that one site worked and could become profitable, we could blitzscale our way across the country and then the world. It was time to raise funds and plan for the next phase. I proved the product worked, I just needed to prove the business model would work and can scale.
I had read about how hard fundraising for venture capital can be, but wow. I never expected to be completely ignored. I read so many VC blog posts talking about how a well crafted and personalized cold email can get you in the door. I don’t have the time or proximity to spend all day networking and my network in financial services is completely separate from investment capital. I would spend about 10 minutes researching a firm to see if they were even in my space. Maybe 40% looked like they might be a potential. From there I would spend roughly 2 hours reading theses, reviewing bios to find the best associate/partner, researching Linkedin and blogs, reading posts, all to find an ‘in’ that I could use as a paragraph to introduce myself to an investor. I needed to show TMZ would fit within their portfolio or thesis. Some of the text in the email was copy and paste, but most was unique to the scenario. I never once sent a boilerplate or merged note. But I had to find a hook, intro the business, get them to review the deck/video and deliver a call to action all in 3 paragraphs (less is more).
I have a log of every communication. Over the 2 years (most in the past year) I sent 146 individual communications (tweets with links, form submissions, mostly cold emails) to 106 different firms (sometimes targeting multiple investors, some follow-ups). I received 46 responses (32%). Of these I categorized the responses below.
Offered “help” but ignored business 7 (15%)
Replied to my ‘hook’ but ignored business 15 (32%)
Some form of ‘pass’ from email slides/video 22 (47%)
Success! (details below) 3 (6%)
Sarah Downey (Accomplice VC) – In person meeting! My only one. Instead of ‘pitching’ I talked about business, trying to build a relationship for when we were ready to raise. Which was what all the VC blogs say to do. She said we were too small anyway. Pass
Tae Hea Nahm (Storm Ventures) – Phone pitch. Great conversation. Interesting, but not for them. Pass.
Alex Iskold (2048 Ventures) – Video conversation. Didn’t want to see anything. Wanted to change our business to SaaS, which makes no sense. There is no market. Pass.
Business slowed down in the fall of 2019 and I used that as an opportunity to leverage the PoC for new markets. I needed further proof points that we could do corp training, STEM and theme nights. When you have fixed costs like real estate, part of the business model is proving that you can scale usage for more hours of the day to improve unit economics. I refer to this as new genres. Most escape rooms do entertainment and thus only use nights and weekends. There is ‘team building’ but not direct training. I knew our no-code platform could scale content for more uses.
I was all set to test a few solutions in Feb-Apr for the last quarter of my lease. I figured I would get some great data, just before moving out into our new space with VC backing. And then Covid19. Customers disappeared. My partnership ideas = dead. VCs turned inward to portfolio co’s. The market crashed with tons of volatility because we have an ineffective president so angel investors are out. I’ve spent $300k of my retirement and borrowed another $35k from F&F. I think I gave enough. Time to go back to steady income.
I wanted to raise $850k to build a full-scale version of TheMissionZone experience and a team to run it for the next 2 years. Imagine a streetscape scene that is like walking through a multi-level movie set with 30 different themed rooms. All connected with secret passageways, air ducts you can climb through, elevator shafts, etc. Hundreds of missions are available and you can do your work’s corporate training or your kids’ math lesson together as a family outing. You could have a James Bond themed ‘date night’ where you go out for a drink and complete a Mission while working together as a team. You could stop in for a free mission to learn about a local brewery, or car company and after a 5 minute adventure with their products, earn a coupon for a discount. Next winter when the family is all in town and you are bored with entertaining them, you shoot over and complete a personalized Mission just for your family where you all compete against one another answering family lore trivia as part of an adventure. I know I am a dreamer, but I really believe the possibilities are endless. When you build a platform, you enable people to build experiences you never envision (keeping it clean of course).
If ever there was a time for a contrarian investor to see the benefits of this vision, now is it. In just 3 months of spending all day on a screen, does anyone really want MORE virtual entertainment? Do you want to spend more time in front of a screen? There is more pent up demand for reality-based entertainment than any time in the past 50 years. People are LITERALLY protesting their right to get out of their houses, away from screens and back into the real world.
There are over 5000 movie theaters in the US, mostly closed. What will be there when they reopen? The newest Trolls movie decided to open direct to personal streaming channels. It made over $100M in 3 weeks, which is more than the first movie made in 5 months. Theaters take 50% revshare while streaming takes about 20%. When this is over, who is going back to a theater? The chains need to evolve their experience if they are going to entice people to come back.
At the end of every customer experience, I talk to them about what they like or didn’t. I tell them they just experienced a PoC. I paint the following picture to see if they get it and what they think of our vision. Before closing I even recorded two of those interviews here and here.
Imagine you go to see the latest Mission Impossible movie. The IMF team is learning about who they are pursuing, what the target is and what resources they have. Tom Cruise gets the famous challenge, “Your Mission, should you choose to accept it…” And then the movie stops. The lights come on and you and your friends file out to the main lobby. You grab a drink and set up your team at a table. You all start assigning tasks, doing research, planning your mission. A middle school version might require math to solve an engineering problem to return a stolen talisman which you need some of your history lessons to know the properties of the object to find. You all walk over to the “Q-Branch” window and secure the equipment you need; screwdrivers, diagonals, a volt-meter, headsets for communication. One last pep talk from the team leader and you click ‘Launch’ from your wrist mounted device. You all go to your assigned places, enter the secret codes to open the doors. Engage. You have 3 ‘lives’ to complete the Mission. Purchasing more from your wrist if needed, interacting with the space and maybe other players. You might need to ‘hire’ a computer expert to hack a door lock for you. Or bribe someone for intelligence. Your team earns points for speed, stealthiness, efficiency, and the Mission level you selected. At the end, you might fail, or you might succeed. You see your team codename on the leaderboard screen. You return your gear, get some more snacks to quench your thirst and cool your adrenaline. You go back to the theater and see how Ethan Hunt completes the Mission.
After experiencing it on a small scale in our PoC, about 74% of our customers love the idea of this vision and would pay for it. The only people that don’t seem to get it are a bunch of investors who think that all the world wants is more enterprise SaaS to make us work more efficiently, AI/ML algorithms to buy more relevant stuff and more games to play on a screen or a headset. And yet every societal trend points to a world that wants experiences.
There are so many things I did wrong building this company. Overall I wish I had done 3 things better because these themes directly led to us not making it…
More planning and strategizing around business model
More networking and connection to VCs
More focus on viral growth
We’re done for now. Maybe something will change in a few years as I still have hopes of one day living this experience in the real world. My sincerest thanks to Matheus for helping me build an awesome piece of technology and to Felipe whose design and style made the whole thing feel cool and real. Thanks to my family and friends who supported me and even came out to see us. Many thanks to all 936 paying customers of TheMissionZone who helped me ‘learn while having fun’. Most importantly of all, special thanks to Sara who had to endure a lot of the emotional ups and downs on this journey. It certainly was hard on her and I may never be able to make up for it.
Josh: Out.