JournalMar 2016

The State of Hanno: March 2016

A year ago now, on the back of a really financially strong 2014 and with a decent amount of cash saved up in the bank, we knew it was time to take the next step.

We set ourselves some huge goals

We weren’t exactly shy about identifying where we wanted (and needed) to change in order to make Hanno relevant for the next 5 years, rather than just the next few months. In our roadmap for 2015, we decided to:

  • Increase our bus count to protect our team
  • Improve our team diversity
  • Get better at design thinking and level up our skills
  • Diversify our client base away from San Francisco
  • Start doing more good and to become a social business

We knew this wasn’t going to be easy, and we knew that we’d need to invest heavily in order to make the transition. We even pre-empted the financial challenge by looking at crowdsourcing a loan.

But I think it’s fair to say that the challenge of that transition has been one of the most gruelling and stressful changes we’ve made at Hanno since we first started.

The good

  • We diversified away from over 50% of our clients being SF startups. Europe became a bigger deal for us, and we also started to win projects in Asia. We knew we needed to win some corporate work to give us more stability and we managed that. We’ve been working with bigger companies like Lenovo and Betfair and running innovation workshops for corporates, too. That’s not about selling our souls for the money—it’s an important step to putting us in a position to do good.
  • We build more products. Both for ourselves and the open-source community and our clients.
  • It’s easy to forget that we only really went all-in with design thinking last February. We now have some experienced design thinking experts (new shipmates Laïla and Jonny) and the whole team can use design thinking well on projects.
  • We totally changed the structure of the team and the way we take decisions when we shifted to teal self-management in June. That was a big, tough change, but it should set us up well for the future.
  • We identified education, environment and healthcare as our top priorities 7 months ago, and since then we’ve started to win more environmental and healthcare projects and been working with NGOs too.
  • We built a proper network of connections to help market us, developed better referral relationships for generating new leads, and for the first time, built a proper structure to the way we do our marketing, instead of just throwing out a never-ending stream of blog posts and hoping they’d magically win us projects.

Those are massive, massive wins and the next few months are now looking really exciting and positive. But…

There was a lot of very bad and ugly stuff that we had to make it through

I didn’t just list all of those positive changes to brag about how great we are. We’ve said we’re committed to transparency and with that comes an obligation, I think, to share the negatives, too. Here’s a little selection:

  • We made a financial loss in 2015, compared to a very healthy profit in 2014.
  • We ended up taking loans at the end of the year to tide us over while waiting for invoice payments.
  • We were hit by a classic 3-month slump in new clients and projects. Just because we expected it didn’t mean it was any less gruelling.
  • Many of the team made individual decisions to reduce or defer their salaries. That might sound crazy, and it’s not something I would ever demand or pressure people to do, but it demonstrates the level of commitment that the whole team has for what we’re trying to achieve.
  • There was huge pressure on the whole team to bring in more of the right projects with our cash runway gradually running down.

Change is hard. Incredibly so.

There have been times in the last few months where I’ve genuinely questioned whether we’ve taken the right choices or have taken on too much at the same time.

We’ve had to fight to convince other people that the social good side of our work is part of the solution, not the problem. I passionately believe that’s the case but it’s still hard work to convince people of that when you’re asking them for a loan!

There’s a reason I’ve been writing and thinking a lot about stress and the way we handle it recently. We took on certain financial and emotional debts that we’re now working to repay to the team now that we’re back on track in 2016. Fortunately, I’m part of a team who shares the same sense of purpose in where we’re headed and is prepared to stick it out.

We’ll be writing more about the challenges of this transition soon—after all, that’s a lot more interesting than just reading success stories. But for now, let’s just say that this journey of ours is not always as smooth as it looks!

Posted by
Jon Lay

Jon is a Partner at Hanno. He wears many hats, but his primary focus is on leading our engineering and technical operations.