What I Learned From Wasting $10k on a New Sales Channel

Last updated: February 24, 2023

This is a story about good intentions, government contracts, and throwing money at a dream.

In 2015, Museum Hack hired a company to help us sell into city, state, and federal budgets.

We lost $10,000 and at least 100 hours of one of our most senior employee’s time.

But it wasn’t a total failure. We learned valuable lessons about the right – and wrong – ways to break into a new market.

We thought we could get into government bids for employee training. We were wrong.

Museum Hack and Workplace Training

Our sales manager at the time, Mark Kennedy-McClellan, met Dave* at a Chamber of Commerce networking event in NYC. Dave was confident and friendly. He told us he specialized in helping small businesses win government contracts.

I’ve changed the name of the company and contractor. We’ll call him Dave, and we’ll call his company Global Government Partners.

Dave assured us there was a great opportunity for small businesses to reap benefits from government contracts.

He believed our business was a great fit to take on mandatory – and often boring – training sessions required for government employees. If we could liven up museum tours, we could surely liven up workplace training!

In hindsight, I was probably projecting: I believed in the opportunity, and Dave was keen to support our beliefs.

Museum Hack team member Anna leading a team building tour at The Met.

This was a new market for us.

Based on the success of a recent team building activity that Museum Hack hosted for parole officers in New York City, we assumed other government organizations would be at least potentially interested in what we had to offer.

Dave assured us he could help navigate the red tape and hoops we would have to jump through.

  1. Governments have budgets for team building activities and offsites,
  2. Governments frequently need staff training.

The opportunity seemed perfect!

It helped that Dave was a smooth-talker. He was a good salesman. When he told Mark he could definitely get us deals with government clients, Mark believed him. After meeting, I believed him, too.

Our cost would be $10,000 as an upfront payment, plus a small commission on each successful contract. (I think it was 5%.)

We thought this would be the next big thing for Museum Hack.

We were wrong.

Checking References

Always check references yourself, and always wear a suit if you have an awesome beard and are meeting in the park.

Like any savvy business owner, we decided to check Dave’s references first.

I asked him for a few business owners that I could call who would testify to their success working with his company.

Feedback included:

  • “Dave helped us win $2 million in government contracts”
  • “He seems to have a niche in government bidding”
  • “We are very pleased with him”
  • Dave was “invaluable in showing us the ropes”

This all seemed positive, and we were anxious to get started.

Drunk with excitement on the opportunity, we signed the $10k check.

In hindsight, it should have raised a red flag that none of the references still worked with Dave. Also, several mentioned that the paperwork and contracts were time-consuming.

What Happened Next

We signed the deal, wrote a check, and eagerly awaited the new sales.

Things started out great.

Dave and his team were busy scouting deals for us. He sent us a lot of opportunities. He was eager and responsive.

Sample Bids

We got lots of emails with titles such as:

  • Federal bid due Aug 21 Sexual Assault Prevention Training
  • Federal bid due Aug 20 Generational Diversity Training
  • New York Power Authority Bid Submittal Authorization
  • Leadership Training due Aug 28
  • Federal bid pre-solicitation
  • Strengthening Families due 10/16
  • Bid due Sep 9 Sexual Harassment Training

At first, these all seemed like a great fit for this new market we were exploring. Mark was quick to review Dave’s emails and hurried to gather the necessary documentation.

Then we waited.

This same scenario played out many times over the year:

Dave would send us requests for proposals that were often 30, 50, or 75 pages long.

These lengthy government RFPs would require us to pull together disparate information and write custom content about how we would approach certain training.

Mark would spend hours and hours putting information together.

We would send it to Dave and then wait to hear back… and then…


Our contracts were never accepted.

Of the 35+ RFPs that we painstakingly responded to, we never won a single contract.

HALP. We spent a lot of time on paperwork applying for government contracts.

Pivot: Make a New Training Company

We thought maybe the Museum Hack brand was too flashy for the government space.

Dave suggested that we set up a new company shell, MH Consulting Group. The website had a more professional name and a business focus.

This was a good learning experience for us in presenting the right image to our target customer.

But it did not prove effective.

Fade Out

Eventually, our partnership with Dave just fizzled out.

He stopped sending us bids, and we stopped asking him for status updates.

The RFP process was too demanding to keep up with, and we were not getting any results that made the effort worth our time.

We don’t entirely blame Dave for this failure. He was a great salesman who convinced us of his value and tried his best to get us some deals.

It was up to me as the business owner to evaluate the risk. I made a bet, and I lost.

I misunderstood the opportunity. We didn’t have the right fit for the market.

Lessons Learned

This experience wasn’t a total failure.

We learned a few valuable lessons. These are useful for any small business looking to break into a new market.

Lesson #1: Research

Research the new opportunity or new market carefully.

We thought the government training space would be a perfect fit for us.

It wasn’t.

Had we not been so eager about the opportunity and researched the market more carefully, we might have reconsidered our decision.

Which companies were winning these deals? What type of appetite for risk did buyers have?

You will never have all the answers. Don’t let incomplete information keep you from trying new things. You won’t grow if you don’t take risks.

Lesson #2: The Owner Should Do The Reference Checks

The excitement of a new project can often push you into making a bad choice. I would pick the yellow door, btw.

Don’t let enthusiasm push you into making a bad choice.

While we did check references, I did not check them personally.

I delegated making the reference checks. I wish I would have made the calls myself and asked more probing questions.

My excitement about the idea blinded me to the warning signs.

I should have asked better questions about the process and the paperwork that I heard mentioned.

No single vendor is ever going to be a perfect fit for your business. But don’t let enthusiasm push you into making a bad choice.

Lesson 3: Cut Your Losses

My biggest regret about this venture was the amount of time we wasted internally.

Mark, a key person on our team, spent months consumed by the process.

All of this government contract bidding was in addition to his existing workload chasing our own incoming leads, running corporate training programs we had already sold, putting together highly customized proposals for top clients, etc.

I deeply regret wasting his focus. This is time that could have been better spent in other areas of our business.

While it’s worth trying new things, you must know when it’s time to quit.

Set a time frame. If you do not see results by that deadline, walk away.


Small businesses should be willing to take risks. Also: what game is this from? Looks cool.

We spent $10,000 and a whole year with nothing to show for it.

Would I do it again?

I guess so.

We needed to do it to explore a new sales channel and avenue for growth.

But I would not have allowed the process to drag on for so long.

I wish we would have cut our losses sooner.

As a small business owner, you have to be willing to take risks. No business ever achieved success by being afraid of the unknown.

My advice would be to know when to walk away. If you’re not seeing the ROI, chalk it up to a learning experience and move on to the next opportunity.

Learn what you can get if you invest $10.000 in New Way Homes while supporting affordable housing in California at the same time!

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