A Product Market Fit Show | Startup Podcast for Founders
00:02:03 · Pablo Srugo, Mark
Welcome to the Product Market Fit Show brought to you by Mistral, a seed-stage firm based in Canada. I'm Pablo. I'm a founder turned VC. My goal is to help early-stage founders like you find product market fit. Well, Mark, welcome to the show. [00:02:23] S1: Yeah, thanks for having me, Pablo. [00:02:24] S0: Let's start at the beginning. You now have a company called Bolt, but you started off and it was called Second Closet. I'm sure things have changed quite a bit. That entire change, we'll be diving into today, but maybe to set context, if you could tell us about the time when you started Second Closet. [00:02:46] S1: We've actually undergone three rebrands, so we're not Bolt anymore, we're now GoBolt which is the official trade marketable name. We're happy to be finished our rebranding journey. When the business started, as you pointed out, we were called Second Closet. We were a totally different business than what we are today, but the inner workings of it are much the same. Second Closet was a valet storage company that would pick up, store, and return people's stuff. We started by breaking into the international student market because every summer, students needed to store their things when they went back home. This was very common practice, and it was a pretty niche and lucrative industry. We decided to attack that just because we were university students at the time and understood it really well. Eventually, it evolved to start storing things for people like you and me. Seasonal wardrobe, seasonal items, and eventually typical storage applications.
00:02:46 · Mark, Pablo Srugo
[00:02:46] S1: We've actually undergone three rebrands, so we're not Bolt anymore, we're now GoBolt which is the official trade marketable name. We're happy to be finished our rebranding journey. When the business started, as you pointed out, we were called Second Closet. We were a totally different business than what we are today, but the inner workings of it are much the same. Second Closet was a valet storage company that would pick up, store, and return people's stuff. We started by breaking into the international student market because every summer, students needed to store their things when they went back home. This was very common practice, and it was a pretty niche and lucrative industry. We decided to attack that just because we were university students at the time and understood it really well. Eventually, it evolved to start storing things for people like you and me. Seasonal wardrobe, seasonal items, and eventually typical storage applications. [00:03:38] S0: Take us back to those early days, pre-Second Closet. What's going on? Are you in this mindset of like, you want to start a business and you're looking for the thing, or how do you even come up with that first idea?
00:03:38 · Pablo Srugo, Mark
[00:03:38] S0: Take us back to those early days, pre-Second Closet. What's going on? Are you in this mindset of like, you want to start a business and you're looking for the thing, or how do you even come up with that first idea? [00:03:49] S1: It was a very much go-with-the-flow moment in time. My co-founder, Heindrik, and I both had full-time jobs lined up. I was supposed to be a management consultant. He was supposed to be a product manager at a large health tech company. We were just doing Second Closet as a side hustle to make more money on the side. The problem was that with $500 invested into guerrilla marketing, and by guerrilla marketing, I mean we used U of T printing credits, which were free, VistaPrint business cards, which are super, I don't even know how they make money, it's super inexpensive, and some really targeted Facebook ads geographically confined to campus, so $500 in total. We generated 20k of monthly recurring revenue in two weeks. We said, holy shit. [00:04:32] S0: How cheap were those Facebook ads? Each one is supposed to be at least $2, $3 to get an actual event. No?
00:04:32 · Pablo Srugo, Mark
[00:04:32] S0: How cheap were those Facebook ads? Each one is supposed to be at least $2, $3 to get an actual event. No? [00:04:38] S1: Well, let's keep in mind this was back in 2017 when the times were good. Before any kinda iOS changes. We probably had the benefit of some of that tailwind. We had the benefit of being able to target just university students, just in these postal codes. Our frequency of someone seeing our ads was super high. It built a lot of trust in the brand that they've never heard of before. Then seeing our flyers inside of bathroom stalls and in front of urinals, I don't know if that added or detracted, probably how the hell did these things get in here, but in any event, people had high frequency in their dorm buildings and then we slipped the business cards under people's dorm room doors when we broke into all the buildings somewhat illegally, but we were technically students, so it was okay. All that to say, we had a very targeted campaign with very cheeky messaging because our audience were students. We said, "Hey, summer storage made sexy, use code wrap it up for $10 off bubble wrap," knowing full well that no one actually even would redeem that code because they don't really need to use bubble wrap. Just cheeky messaging like that caught their attention, and then they went to our site and ended up booking a ton of orders. It was a bit of a crazy moment for us when the orders started to roll in because they were fast and furious.
00:04:38 · Mark, Pablo Srugo
[00:04:38] S1: Well, let's keep in mind this was back in 2017 when the times were good. Before any kinda iOS changes. We probably had the benefit of some of that tailwind. We had the benefit of being able to target just university students, just in these postal codes. Our frequency of someone seeing our ads was super high. It built a lot of trust in the brand that they've never heard of before. Then seeing our flyers inside of bathroom stalls and in front of urinals, I don't know if that added or detracted, probably how the hell did these things get in here, but in any event, people had high frequency in their dorm buildings and then we slipped the business cards under people's dorm room doors when we broke into all the buildings somewhat illegally, but we were technically students, so it was okay. All that to say, we had a very targeted campaign with very cheeky messaging because our audience were students. We said, "Hey, summer storage made sexy, use code wrap it up for $10 off bubble wrap," knowing full well that no one actually even would redeem that code because they don't really need to use bubble wrap. Just cheeky messaging like that caught their attention, and then they went to our site and ended up booking a ton of orders. It was a bit of a crazy moment for us when the orders started to roll in because they were fast and furious. [00:05:51] S0: What even led you, this is when it was already kind of a side hustle and this was your growth hack, let's say, but how did you come up with the idea of helping people store stuff for the summer?
00:05:51 · Pablo Srugo, Mark
[00:05:51] S0: What even led you, this is when it was already kind of a side hustle and this was your growth hack, let's say, but how did you come up with the idea of helping people store stuff for the summer? [00:06:02] S1: Yeah, I think my mentality in general is obstacle, solution, obstacle, solution. In this case, the seed was planted when I had moved out of our family home as a 17-year-old with my brother and we moved into a tiny condo in Liberty Village. Really only started working on the idea much later in 2016, built a website with a team overseas that was super inexpensive, launched with that website, and some tweaks thereof. It was a personal experience that drove it. The ultimate application of what it was, the beachhead market was a lot different. It was just a good moment in time to revisit the business and push it out. We did that and saw that really early success, and shortly after that big push, we raised the 500k seed round a day before I was supposed to start full-time on June 1st and rescinded our offers with two weeks' notice technically, but in advance of starting, and I've never looked back. [00:07:01] S0: I'm curious. We will jump into that in a second but you talk about this obstacle, solution, obstacle, solution, which I think is a pretty common frame of mind amongst founders. That's what makes them builders. Was this your first business, or was this the first one that worked? I'm curious if you had a bunch of other attempts prior to that.