QikCommerce: Behind the MIH-Obox break-up

Back in March, we reported that Naspers’ investment arm MIH had teamed up with Obox to launch QikCommerce — a WordPress-based eCommerce tool that lets users “create an online shop in minutes”.

It was an exciting development: a large multi-national internet company had joined forces with local internet entrepreneurs to launch a new ecommerce service that allowed users to create their own online stores on the fly. But just a couple of months after QikCommerce launched, Obox founders David and Marc Perel had left the joint venture.

Obox made its name after switching from creating full websites to WordPress themes in 2009. The company hit international headlines by building some of the official themes for the well-known blogging platform Posterous.

QikCommerce was launched as a joint venture between Obox and MIH. Under the terms of the deal, Obox headed up the project and MIH provided access to resources like online payments service PayU and online product and price comparison site PriceCheck. Integrating these services was also meant to make things easier for the people using the tool. Users were told that setting up an online store would take “no longer than an hour” and that it would take away “50 pages of documentation and months of delays”.

On his blog, Obox CEO David Perel reveals exactly what made them exit the joint venture and what it taught them, apparently referring to what they saw as a clash of cultures between a corporate giant and an entrepreneurial startup.

Perel’s blog post (full size)

Perel describes being stuck in what he claims was a “cycle of 16 to 20 hour working days, meetings, pitches” and “playing political warfare with corporate ninjas”. There were also a number of issues familiar to anyone in the corporate space but which would be anathema to a career entrepreneur:

We learned who you could trust and what were corporate red flags. We learned what KPI’s [Key performance indicator] were and how they completely kill great products at any cost. We learned what it was like to have not one, but three ‘bosses’, in quick succession and we learned that unless the ink is DRY, you are completely exposed.

Perel even makes the claim that working on the partnership took his company to “breaking point”. The Obox boss says that launching QikCommerce meant that he and his brother found themselves in a “deep and dark abyss of ridiculous deadlines and one-up-manship”.

Speaking to Ventureburn, however, Perel adopted a more conciliatory tone: “Even though it was an experience which ended badly, the people involved still tried their best,” he says, adding that “there were no hard feelings when we left and it definitely wasn’t a walk out”.

Perel couldn’t reveal whether the startup had been bought out of the joint venture, saying that “Obox had delivered on its side of the agreement and simply wanted to refocus on themes again”.

QikCommerce is still up and running, although Perel says it has taken a slightly different turn since he and his team left. Its blog hasn’t been updated since the service went live in March, and the Twitter account has been dormant since April.

Ventureburn asked MIH Internet boss Bill Paladino for comment, but received no response at the time of publishing.

Advice to entrepreneurs
Perel imparts some words of wisdom for entrepreneurs, saying this was a lesson about drifting away from their core business.

“What we had on our hands was a disaster of sorts,” says Perel. “What was once an incredibly stable business, growing at 100% p.a. was now dormant and completely leaderless”.

The biggest mistake, he says, was chasing “the pot of gold at the end of the rainbow when in fact we were building a gold mine back at base. You cannot give your core business 20% of your time while you pursue ventures which only have a 20% chance of succeeding.”

Speaking to Ventureburn, Perel maintains it was a good experience for the company:

“We learned more during the QikCommerce project than at any time in our careers. There are definitely things we would have done differently but overall the experience was invaluable. It gave us a thicker skin and a sharper eye. On top of that it also made us realise how to make better products, which has benefited Obox recently”.