A Product Market Fit Show | Startup Podcast for Founders
00:09:15 · Pablo Srugo, Shmulik Fishman
[00:09:15] S1: Okay. You show up with this idea. You have some relationships. What's Step 1? Do you MVP it? Where do you go from there? [00:09:22] S0: I'm happy to report the very first version of the Argyle service was a website that an Uber driver just logged into, and they took a screenshot of this fake resume we would build. It would generate from their Uber profile data, but it would just put a certificate on a page. It would have their name and the star rating, and they would take a screenshot of it. It would have the Argyle logo at the bottom, and they would show this screenshot to an Avis clerk on the other side. Because they knew me and they knew what Argyle was, there was a way for them to be like, oh, I know what this screenshot is, but it was a very retro first experience. We were just trying to figure out could we shorten the cycle times? Could we get down to a day, to one connection to get hired for the job? It was the early winnings. [00:10:12] S1: This is a bit in the weeds, but I think it's important. How did you get in – you went to Avis and you told them about the service. How did you get in front of the drivers for them to even go into this place and get the certificate? Did Avis tell them to do it, or did you market directly?
00:10:12 · Pablo Srugo, Shmulik Fishman
[00:10:12] S1: This is a bit in the weeds, but I think it's important. How did you get in – you went to Avis and you told them about the service. How did you get in front of the drivers for them to even go into this place and get the certificate? Did Avis tell them to do it, or did you market directly? [00:10:25] S0: Super low tech again. Super low tech again, which is when Avis sends out a job posting – and it still happens today. On Craigslist, on Jobvite, there's all these requirements for what the job is: print out your resume, come with two references, and so they just added another thing. Get a resume from this website. I believe our first website was actually applicationprecompletion.com, a super long URL. We just added it in as text. Again, it's something that completely doesn't scale, but we're trying to get the first 500, 1,000 people to try it. What we've done over time, we're mapping the origin story and where Argyle is, is everybody that needs income and employment data needs different pieces of it. A big part of the service that we've come to realize is real important is that everybody can build their own resume now and figure out what they want to put on the resume or on the verification report. [00:11:17] S1: Are you charging Avis at this point, or what are you trying to get out of this first pilot?
00:11:17 · Pablo Srugo, Shmulik Fishman
[00:11:17] S1: Are you charging Avis at this point, or what are you trying to get out of this first pilot? [00:11:21] S0: Yeah, there's billing or invoicing set up at that time, so that was not in place. This is a company – it's still the culture of the company today, but we're really building backwards because we're not industry veterans. I don't come from an income verification background. I have no experience in credit bureaus. I've never worked in any of these businesses, and so we've been so client led from the very beginning. We've just been getting feedback from each one of our clients. The first client that paid us was a business called Level Goals, which I – is still around. They're a small dollar lender, and Level Goals only was interested in doing lending to gig workers. We had already built the first integrations into Uber and Lyft for the Avis use case, but they just wanted to use those same data points but to issue a small dollar loan for $100. I believe they gave us $1 per verification. That was the first paying client, and that is a much bigger business just for the industry, for income verification. That's also become a major business for us as well. [00:12:35] S1: How much time went through from the first pilot with Avis until you signed that first paying customer? [00:12:40] S0: It took a while. The first year of Argyle, I believe, until the late part of 2019 – Argyle was found in 2018. Until the late part of 2019, we had no paying customers. We were just building, and I think we got our first couple of customers in late '19, including Level Goals.
00:12:40 · Shmulik Fishman, Pablo Srugo
[00:12:40] S0: It took a while. The first year of Argyle, I believe, until the late part of 2019 – Argyle was found in 2018. Until the late part of 2019, we had no paying customers. We were just building, and I think we got our first couple of customers in late '19, including Level Goals. [00:12:58] S1: What was hard about it? What are you building? From the outside looking in, you're like, okay, we've got this resume builder thing. It's got the main KPIs on it. I feel like somebody should pay for that.
00:12:58 · Pablo Srugo, Shmulik Fishman
[00:12:58] S1: What was hard about it? What are you building? From the outside looking in, you're like, okay, we've got this resume builder thing. It's got the main KPIs on it. I feel like somebody should pay for that. [00:13:05] S0: What is novel about Argyle, what we had to build literally from scratch is connectivity into payroll processors. Some history or some stats to make it interesting, the IRS says that there's about 6,000 registered payroll service providers, which is a really wonky term, but basically, it just means there's 6,000 entities that are allowed to submit payroll on another company's behalf. That's a super fragmented market, and in order to provide income verification, Argyle needs to connect into every one of those platforms. For any business of value to use a verification service, you need to have most of that connectivity built out. The initial wedge and, again, totally on accident just because there was this huge correlation between people that worked for Avis and gig workers, we had this natural wedge at the beginning where we were building out connectivity just into gig platforms so Lyft and Uber and Instacart and DoorDash, Lugg. At the time, Postmates was still around, and that is tough to do if you're doing it all by yourself in the very beginning. You're having to build microservices into third-party applications that you are not under the control of, and so you need to build into their spec.
00:14:33 · Pablo Srugo, Shmulik Fishman
[00:14:33] S1: How did you think about when to charge? I'm on this question because I think the lean startup methodology would tell you, as soon as you deliver a unit of value, try and figure out what it's worth, especially, as a first-time founder, what you're going in with or what you're hammered with, if you go to an incubator accelerator, all those sort of things. You didn't do that, and you didn't do that with the experience you had in your previous company. It was deliberate. Curious if you could just dive a bit more into how you thought about it back then and where you were trying to get to in that first year before you started charging. [00:15:05] S0: I'm a big advocate for having a pilot customer that you're giving the product away for or the feature away for free for a period of time. They're helping to design the first version of it with you, and we still do this today when we release new product. The first couple of people that use the new feature, we give it to them for free for a little bit because we want them to see value in it and for it to be part of – when it becomes part of a general release, then you should start to charge for it. I think it's important to get people using your product and to be able to get feedback on your product, even if it's negative, and then put the pricing part on it. That's been a big part of my strategy, and I think it works at different levels of scale as well.