Y Combinator Startup Podcast
00:18:57 · Chaz Englander, Arnie Englander
[00:18:57] S0: the same cost as they would get it [00:18:59] S1: from the corner shop anyway. So we took off, that was obviously really exciting. And then we got onto YC, and then COVID happened. And COVID, for our business, was really that shot of adrenaline. I mean, COVID happened, everyone was staying at home, the business really then started to take off. It was an amazing business. It's an extremely difficult business. I'm sure we'll come on to it in a bit, but we got hit with, always like to say, a lot of cricket bats to the face. A lot of stuff can go wrong, but it was awesome. So we continued to grow in The UK. We raised money out of YC, and then we got an acquisition offer from GoPuff about eighteen months after we started. And GoPuff, at the time, a market leader. They were very, very big in The US, and they wanted an opportunity to come into Europe, and we were best placed for that. It really was an incredible ride.
00:19:51 · Chaz Englander
[00:19:51] S0: Yeah, yeah. It was like the... At least for that amount of time, felt like the perfect kind of start up ride, I'd say. But, again, I think Fat Lama was the polar opposite. The story I always talk about with Fat Lama in terms of perseverance was, you know, I was maybe very early 20s, obviously. And at that time, when you believe in something and you're raising a small angel around so this is pre YC, right? We were raising, I think, maybe 50,000 maybe $100,000 which nowadays is like, suppose back then, at least then, it meant everything to us. We were scraping around. We were doing half an hour pitches with an angel that might put in $2,000 right? We were just doing everything we could. We fundamentally believed in this idea. And anyway, so we built the MVP. We launched and I started accounting. So I was big on, are the numbers going to make sense? So I had my forecasted average transaction value, my retention, everything else. So we launched, and pretty much straight away, like within the first day, got a rental. And the rental was for $600 So I'm like over the moon. I'm updating. One of the first things I did is I'm straight into the financial model, and I'm updating the average order value. And this thing is looking crazy. I'm like, we're going home. We're going We're home. Right? So that was on Friday. It was just to returned on Sunday lunchtime. Alright? And remember, the criticism I got, know, I probably did 100 pitches to raise money, and maybe one out of 100... I must have done close to 1,000 in the end with TS, but the other 99 was like, no one's going to lend out an item because everyone's going to steal them. And even if you have insurance, the insurance isn't going to work, right? Anyway, so we had... And that's all I'm thinking. That's all we're thinking about at the time. So we had this first rental. Anyway, got to Sunday, and the lender of the item called us
00:21:34 · Arnie Englander
[00:21:34] S1: and said, I can't get
00:21:35 · Chaz Englander
[00:21:35] S0: ahold of the borrower of this item. So we're like, okay, it's fine. And then we realized after a couple of hours he wasn't responding, and we started to get a bit nervous. One of the things we did, it was a native app, and when people search, because it helps with what you show in the search results, we save or we look at the latitude and longitude, so quite an accurate geolocation of the individual. So we had that. I was like, I'm going straight out there. We've got go and find this item. And this was like an 1,800 pound drone, right? So for us, this was like everything, right? So we went up. Anyway, so I arrived on this random street in North London, and there was just a door open to this house. I don't think we've ever told this story because it's just like, it's that awful. And the door was there. Door was open. I couldn't believe it. As I opened the door, there it was. The drone was just there on the side. So I picked up this drone. I got back in the car, and I just went straight down to the lender's house. I arrived at the lender's house. But you've to picture this, right? What's going through my head is everything that we've pitched, every person that I pitched, family and friends, we had spent months, probably close to a year at this point, convincing people that this would work, and they believed us, and they believed Arndes and I, and they bought into this. And so all I'm thinking is like, I've lied to them. My whole world was falling apart at this point. And so anyway, I arrived at the borrower's house, or the lender's house, rather, opened the door, and he was like, Hey, you're not the lender? And I was like, Oh, I know. I gave him the drone. He was like, And you're wearing a Fat Alarms T shirt? I was like, Yeah, we deliver the item back automatically. He was like, This is awesome, man. Like, closed the door. And so it did add up in terms of the insurance. We focused on verification, but it fundamentally came to that perseverance piece. It's like, We believe this is something that should exist, and we believe from a tech perspective we could make it work. And it ended up doing so. But yeah, it was tough.
00:23:20 · Gustaf Alstromer, Chaz Englander, Arnie Englander
[00:23:20] S2: Both outcomes seems really great, though. It's set you up well for this company. [00:23:24] S0: Absolutely. Arnes did, what, the first 1,200 deliveries, I think. [00:23:29] S1: Yeah, I think with Fantasia, from the outside, it looks like a very fairy tale story. Everything I put, like, after the fact. Exactly, exactly. And they're like, Wow, it's like, I should start a startup. And I'm always like, You should. But really, it doesn't really it's not all what it seems. With FANCIE, we had so many disasters and so many times where we were like, God, is this really going to work? Even when COVID happened, we had stopped delivering for a couple of weeks. There was a point I remember, I actually remember this sort of maybe two, three months into the company. So we were working with Stripe as our payment provider, and one day they just shut us off because apparently there was a breach in their terms of service, which later it was a misunderstanding. But anyway, they shut us off for probably three or four days. Bear in mind, we couldn't take any payments, right? And at this point, I can't remember how many orders we were doing. Maybe not massive, but maybe 500 orders [00:24:25] S0: a week. [00:24:25] S2: Had an inventory, so there wasn't a problem with that, at least.
00:24:25 · Gustaf Alstromer, Arnie Englander, Chaz Englander
[00:24:25] S2: Had an inventory, so there wasn't a problem with that, at least. [00:24:27] S1: Yeah, exactly. And so at this point, what do we do? We've orders coming in. We can't take payments. So we ended up just taking payments over the phone, taking payments with cash, taking payments with PayPal. And there were so many of these stories, and if you think of our business, you know, the amount of issues we had with delivery drivers, with warehouses, It really was an intense situation, but that's really what made it fun, right? I think building a start up, you just become so thick skinned and problems come about on a daily, hourly basis and kind of your mood is like this all the time, but it's epic, right? [00:25:04] S0: On the payments one, we emailed Patrick directly, and he responded. Like, within an hour, he sorted us out. [00:25:09] S1: Yeah, was awesome.