Adir Shiffman is the founder of Help Me Choose, a website that allows users to choose a home loan, health insurance and life insurance. The business, which turns over $3 million a year, is actually his second successful start up; Shiffman co-founded international consultancy Global Reviews after abandoning his studies to become a surgeon.
Today Shiffman talks about building a business throughout the GFC, the pitfalls of fast growth and why he still keeps his hand in as a doctor.
You trained and worked as a medical doctor. How do you end up starting a website from there?
I finished my medical studies and was working as a doctor and was heading down the surgical training path, and thought that before I go and commit the rest of my life to doing this, I should pursue my passion of business and see where it takes me. Because once you’re a surgeon it’s pretty hard to deviate from that vocation. So I thought we were just going to go off the path for a year or two and see how it went and one thing lead to another. The business we started at the time – Global Reviews
– just started growing very rapidly and one day passed after another and it’s now 10 years down the track.
So what was Global Reviews all about?
Global Reviews is still running and I’m still a shareholder of that business. It’s a business basically that provides consulting services to large companies about their customer experience, specifically how they can improve their website experience to make the process more beneficial for consumers and more beneficial for the company. So it’s got an office here and in the UK and it works with people like banks and airlines and insurers and universities and those types of companies.
So it’s more of a services-based business?
Correct. I started it with a friend of mine who actually was a lawyer who was working at Freehills and we decided that we’d have a punt in an area that we knew absolutely nothing about and maximise the naivety.
A doctor and lawyer walk into a business – it does sound like the start of a good joke! What skills translated well from your previous profession and what did you have to learn?
What I had to learn is a very long list and realistically, although it sounds very clichéd, it’s a process that’s never ended. I thought I knew quite a lot about business after seven years being in business and then the GFC came along and all of a sudden what I knew paled by comparison to what I didn’t know.
There are two things that were beneficial. One is that once you’ve been through a medical degree, no amount of workload seems like it’s overwhelming because it’s just a ridiculous course and such a ridiculous profession in terms of how hard you work and the pressure that you’re under. When something goes wrong in medicine, there are pretty dire outcomes and consequences of life and death and no matter how bad business is, it’s never that bad.
The other thing is medicine’s a very analytical profession so you don’t run on gut feel a lot, what you want is evidence-based information and decision-making and I think that’s beneficial in business.
Why did you decide to leave Global Review in 2008, when revenue had grown to around $5 million? Did you want to do something different or did you think you’d gone as far as you could?
My view was two-fold. Remember that this was before the GFC, the world was nuts basically and there was money flying everywhere and an opportunity presented itself for us to utilise some of the expertise that we developed in Global Reviews and apply it for ourselves, to help people just make decisions around financial services rather than just helping companies help their customers. So there was an opportunity to apply that knowledge.
I think the other aspect of it was I have always been more interested in consumer-focussed businesses as opposed to B2B services or professional services. So for me the opportunity to go back into that was very interesting. While I was going through medical school I ran a few internet business that were consumer-focussed, selling mobile phones online and the like and that was always very interesting for me.
But I think that the truth is that everything was going nuts in 2007 and 2008 and we saw an opportunity to build a business that we thought was going to be successful and I stepped across to try and take that opportunity.
Did the GFC affect that decision?
We made the decision pre-GFC and the interesting thing about the GFC is again two-fold. So the first thing is once you’ve got one leg on either bank you’re committed, you have to cross the river. So that’s where we were at when the GFC hit with Help Me Choose but the truth is Help Me Choose if anything actually benefited from the GFC from an operational perspective.
Help Me Choose is a two-sided market, one side of it is about helping consumers find deals effectively or the best deal and that’s huge in an economic downturn. And the other side is providing sales leads to companies which if anything is even bigger in a downturn when there are so few sales leads around and in fact that was one of our motivations for starting that business. We knew that Global Reviews was much more of a discretionary business being professional services and we looked at what would be companies couldn’t live without irrespective of the economic climate and one of those things we identified is sales leads.
The only difficulty that the GFC caused that business is it’s a business that grows very, very rapidly and it’s much harder to secure funding than it was in 2007.
Were you able to fund Help Me Choose out of Global Reviews?
Well that’s what we did initially and then effectively the existing shareholders provided some additional funding. But really it’s spent the last couple of years achieving the growth that it’s achieved on a shoestring budget. So we’ve been very tight, we haven’t undertaken the sort of explosive marketing that we would have liked to have undertaken. It’s been done really on a cash conservation type basis.
The online comparison market looks to be a crowded one at the moment. Going back a few years, what was the situation? There would have been some sort of competition but what did you see you could do different?
I think that the perception of the comparison market, the Australian perception of the comparison market is deeply flawed. So Australian companies looked and still look overseas to the UK and they see companies like Money Supermarket and they badly misunderstand the business model that’s actually driving Money Supermarket. They think it’s just about clicking on a link and getting paid a few dollars for the click.
But our view of things, having come from a background where we understood the value of taking consumers through a process and how that translated into sales online because of our Global Reviews work, we knew that that concept of just a click was just a very, very low value lead. It’s almost not a lead.
Our focus was very much on providing a more in-depth experience for the consumer to really assist them and to increase the value of that lead and then to monetise that lead as effectively as possible.
And one of the early things we did was build a whole lot of technology which enabled us to do things like drive the right traffic to our website for a lower price than our competitors. We can manage leads better than our competitors and the consequence of all of this was we don’t really see ourselves as a comparison site, in fact we won’t provide a simple rates comparison in the table. That is a very low value proposition. We see ourselves as being heavily differentiated. It’s a bit of a mouthful, but we say we’re more decision assistants and what in the US they call mediated shopping as opposed to comparison shopping.
James was the editor and publisher of SmartCompany and LeadingCompany for five years. He is now the Australian Financial Review‘s companies & markets editor, and a former BRW editor.
