A Product Market Fit Show | Startup Podcast for Founders
00:17:21 · Pablo Srugo, Chaz Englander
[00:17:21] S1: Oh, so it's still operating, like this lending marketplace still exists? [00:17:24] S0: It's funny, A, is, it only just as in the last couple of weeks in The UK which is where the bulk of the business was got rebranded to this new business. But even today I was in this... We did some photo shoot for something at the business and all the equipment that the person was renting there was rented through Fat Armour, which is feels good. And also the amazing thing about our business is like it's a really rewarding story, right? Because what it did to so many creatives was unlock their ability to their passion full time. And I mean, I generally there's probably hundreds of thousands of people that that business changed people's lives for the better, which... And I've [00:18:04] S1: never met them. Right? And that's why it was such a great business, I think, the end to be involved with, and still involved with. When did you sell that, and then when did you start your next company, Fancy? [00:18:13] S0: So 2019 and then end of twenty nineteen, Arnd and I, my brother and I, we kinda just thought it'd be cool if you called the groceries on your phone. I wouldn't necessarily say there was more to it than that. We were like, wanted to build something. We thought that would be cool. And just like polar opposites the first business. Like, we launched with like... To call it an MVP was like an overstatement. It was almost like a WhatsApp group. It was so bad [00:18:41] S1: of an app. So it was a native app. And what city did you choose to launch in?
00:18:41 · Pablo Srugo, Chaz Englander
[00:18:41] S1: of an app. So it was a native app. And what city did you choose to launch in? [00:18:45] S0: Newcastle. Again, a bit of a fluky part to the whole story. So Arnes was CEO and we decided to launch Newcastle. One reason, Newcastle for the listeners, whether they know or not, is like a tiny little town. Actually, people from Newcastle would probably get out somewhere. It's a town in the Far Northeast Of England. That is an amazing town or city, but quite small. It's a bit of a university town as well. And yeah, we launched up there, so it was very much a case of like coding during the day and then we'd kind of open up, mainly in the evening was when the orders came in. So like from six onwards, deliver orders until midnight. Did you guys do the first deliveries or [00:19:25] S1: did you partner with someone right away?
00:19:25 · Pablo Srugo, Chaz Englander
[00:19:25] S1: did you partner with someone right away? [00:19:27] S0: The team is in the founding team did the first like 1,400 deliveries. We didn't know this at the time, but one of the things that, you know, Arne always says this that was so amazing was obviously, if you're doing the deliveries, you're getting the most real time user feedback that you can possibly get because you're literally... You're meeting every single user every time they make an order in person. So it's almost like you have customer interviews for every order which helped us iterate and build so much quicker. But yeah, the model was originally, you know, obviously we were vertically integrated, right? In other words like it was... We had the warehouse, we had the stock, etcetera, but we didn't have anything beyond the app. So we were like getting orders, we were like going down to the corner shop, we were buying like cigarettes and vodka, and then like delivering them. [00:20:22] S1: And you would pay yourself and then get paid later? Like you didn't have a partnership with the stores where you're buying stuff?
00:20:22 · Pablo Srugo, Chaz Englander
[00:20:22] S1: And you would pay yourself and then get paid later? Like you didn't have a partnership with the stores where you're buying stuff? [00:20:26] S0: No way. Yeah. There was just like... We had nothing. And and to... But this is the thing, right? We learned from the first business. We were like, we literally said to ourselves, and also I think it was Michael Seibel as in YC, Michael Seibel, he said to me, he said, a proper MVP is like, it is a WhatsApp group. Isn't that the way that you should think about it? We applied this and we were like, look, we're not gonna spend any money. We're not gonna do anything. We're gonna write code. Right? We're gonna stand outside these student halls or whatever. We're gonna hand out some flyers. We're gonna get an order. There's no back end, by the way. Right? So there's a text message that we got the order, right, that we hooked up to Twilio. Everybody's gonna go to the shop. We're buy them. We're gonna take it to them. And if they order again, the unit economics add up, then great. But that's, like, how it started. But it just grew quickly. Pre COVID. Right? So we quickly got to, like, hundreds and then thousands of orders a day with no marketing. Right? So it was purely... There was a referral based thing and sticky and just so different to the first company.
00:21:26 · Pablo Srugo, Chaz Englander
[00:21:26] S1: I'm gonna ask you for a small favor, a tiny little favor. In fact, it's not even... Now that I think about it, it's not even really a favor for me. I'm actually trying to help you do a favor for you. Just hit the follow button. You won't miss out on the next episode. You'll see everything that we release. If you don't wanna listen to an episode, you just skip it, but at least you don't miss out. And you mentioned, like, competitive landscape earlier. Was GOPAF already doing this in The US? Like, did you get inspired by others doing it in different cities and you brought it to Newcastle? [00:21:56] S0: So, no, GOPAF already exists in The US. We didn't know them because they were in stealth mode really, so there was no like press about them or anything, they they were still in stealth mode at that point, they were doing pretty well in The US. We launched in Newcastle again for just like small town, easy to get around. [00:22:11] S1: So it wasn't like you saw somebody doing it in a different market and you brought it to The UK market?
00:22:11 · Pablo Srugo, Chaz Englander
[00:22:11] S1: So it wasn't like you saw somebody doing it in a different market and you brought it to The UK market? [00:22:14] S0: No, and I think in that respect, it was just lucky. I think it was just like, hey, we think this is kinda cool, you know, as a concept, would you want this? Yeah, okay, well let's just build it. And by the way, now with AI as well, I said to someone the other day, our MVP probably took a month to build. Again, no back end, it was just an app that you could like choose from a selection of maybe like 30 different items. Also I remember we literally hooked up the items database to a Google Sheet and even the image of the item was being pulled from like an image URL on the Google. So we weren't even hosting the images. It was just like some random image online. It was a real piece of you know what, like, I don't think we didn't have payments in the beginning, you know, people paying cash, was just boom, we ordered, we got a tech specialist, that was it. [00:23:00] S1: I... It's the ultimate test of product market fit. And it's not so much like if you can give them a shitty product and still use it. It's just like, do they care about the optimization piece and like the bells and whistles, or do they just want the thing? Right? In that case, they just want the... They just wanna deliver like groceries deliver. And like, yeah, the thing doesn't look that good and it doesn't work like perfectly, that's fine because I'm still getting my groceries delivered, and and that proves the core thing.