Thanks everyone for the insightful questions! Hope the answers here and the Startup School talk are helpful to our community. This was fun! Singing off now -- I'm hungry and it's time to cook up a 10-minute Gobble dinner.
105 karma · joined October 29, 2009
With Gobble, I discuss the answer elsewhere in this thread. Two engineers were moonlighting with me to learn RoR and see what it was like to work at a startup. We built a very simple website to display meals and collect sales for a few months. That basic site, along with PDF mockups I designed of our future product, was enough to raise seed money. I hired one of the engineers full time after I raised the funding. Then, I started meeting everyone I could in my extended network and recruiting the rest of the team.
It was just the four of us until I raised the seed round. I was the only one working on Gobble full time, and the investors (to my surprise) were not deterred by this fact.
I started hiring more senior people full time after our seed financing. The best hires, and I cannot emphasize this enough, came by referral. It's a 10X difference. I recruited them by paying a salary to cover their expenses, but mostly like every founder, by sharing the mission and selling the dream.
Recruiting goes back to the entire message of my Startup School talk. I looked for people who aligned with Gobble's mission and they feel more purpose working at Gobble than at any other company.
In the bigger fundraising meetings, you have to control a room of 15+ people. I only think about my psychology, the rest is just details. I meditate for longer than usual the morning before these meetings.
The Pre-Pitch Playlist is an extremely guilty mix of pump up pop and hip hop music... think Work from Home (Fifth Harmony) and All The Way up (Fat Joe). The Diligence Playlist is a set of concertos and symphonies featuring Ludovico Einaudi, Rachmaninoff, Edouard Lalo.
And Chris - Thank you for engineering brilliance, your sense of humor, and for grinding it out with me at Gobble for so long and sitting right next to me through all our ups and downs.
The way to filter feedback is based on your target demographic. Identify exactly who are the super users of your product (hopefully they're a small part of a very large segment of our population) and then listen to only them for the feedback.
Other tips: (1) Make sure to get their feedback in multiple ways, we still do surveys every week, phone calls, and home visits. On a survey, someone might say they shop at Whole Foods. At home, you'll see all the Costco stuff in their pantry ;) (2) Set benchmarks for when feedback becomes meaningful. When over 5% of our community says something, we start prioritizing it. When less than 10% of our community uses a new feature or offering on our website, we consider letting it go.
To get to product/market fit, meeting the customers is everything. They will help you both better describe who is your exact target market (the professional mom who says she shops at Whole Foods but still likes deals from Costco) and help you refine your product for that market.
Big secret: There are no real stages. We didn't just have a seed, Series A, Series B, etc. And, that's the story for most companies. There are oftentimes intermittent rounds, that you can call bridge rounds or just financings. We had three times where people put in more money, sometimes a little, sometimes a huge amount, that aren't technically called anything. These intermittent financing are especially common in the early days.
I just searched my email for "sit this one out", "going to pass", "won't get there", "not the right fit", and "not going to get to the finish line", and I think we're at 200+.
Maintain good relationships with all investors, especially those that reject you.
Treat every funding like your last. Be thrifty and try to make revenue, and ultimately profit, as soon as possible. It will at worst extend your runway and at very best help you avoid the need to fundraise anymore at all. The goal is not to raise money, the goal is to build a standalone bad ass business.
That said, when fundraising, keep going and remember: it only takes one yes.
See my other answer about getting our first users and then here is Part II of that answer:
AirBNB scaled product appeal by later building out an entire internal marketplace and international network of freelance photographers to take great photos of all their hosts' properties.
I care deeply about the personal touch of our business and personalization in both our communications and the dinner kits given to each member every week. We have built software and systems that target my direct communications and our overall lifecycle emails in a very nuanced way across our community. We slice and dice our community in different ways constantly for all daily experiments, communications, and backend analyses. I hate sending someone an email that is not relevant to them.
When you do something that doesn't scale, you gain key insights into what is working for your company. You may not be able to replicate the exact same action from the early days, but you can certainly work to build a scalable solution that replicates those key insights and yields the same success.
I put our promo cards at coffee shops and laundromats, emailed meetup groups, went door to door, bought people coffee to demo our product at Starbucks, walked around farmer's markets and gave people coupons and samples, and literally pounded the pavement.
Then, you follow up with them personally. Do they want to order again? Why or why not? What would make them order again? Are they willing to let you visit them in person? What patterns are you noticing in the early feedback?
High level: first you develop a small core user base, then you learn everything about them and communicate with them constantly to find what is secretly working and not working. I would go to people's houses and talk to them and watch them eat dinner multiple times per week. That led me to our 10-minute dinner kits. The AirBNB founders went door-to-door to people's houses and helped them take the right photos to market their homes. This grit is the difference between the want-rapreneurs and the entrepreneurs.
i.e. when growth is flat in the trough of sorrow, wine consumption goes up linearly week/week... that said, even when you start growing, you develop new problems and can gathering bottles even faster ;)
The key is re-using the boxes, ice packs, and insulation liners, all of which we are setting up with our new delivery+return system for delivering a box and picking up a box each time we visit a customer.
In particular, the packaging is a big concern for me. I'm actually in the works of landing a huge partnership that will allow us to easily pick up all of our packaging when we drop of each week's current box all across the state (just like the milkman). We're so excited to be able to re-use all the boxes, ice packs, and insulation. We'd be the first in the industry to take this big step. Look out for this announcement in the next couple weeks :)
About allergies: We are adding that information to next week's menu (among other exciting improvements!). Stay tuned and you'll see a full ingredient list and allergy labels starting tomorrow.
freshness + control + speed = our recipe.