A Product Market Fit Show | Startup Podcast for Founders
00:25:14 · Andrew Lockhead, Pablo Srugo
[00:25:14] S0: We never really thought about giving them money back, to be honest. It was such a small amount for the big investor. We had around the table. For them, it was not going to make any change versus, oh, if there's a way actually you can use that cash to get bigger and find opportunities, that's going to be such an upside for you. [00:25:30] S1: You’re going through these conversations and just none of them materialized, or did you decide, actually, we don't want to do this, or just – literally, it’s just nobody would buy you guys so you got forced to push? [00:25:41] S0: I know we actually went through a couple of conversation with this. Most of the time, it was coming back to can my employees get whatever good salary, which was not good salary back in the day? That was a checkmark all the time because every company out there can fit better than we could. The stocks, so they were not able to transfer the stocks, and we wanted for employees, my colleague, to get something out of the journey. They might have been with us up to three years at that point. We’re like let's get in, make sure they haven't got paid $20,000 for nothing during that time. They must have something in return, and we were not able to use just because, obviously, we had no leverage. We were burning the money every day. Every month we were going down. We knew for a fact we had a goalpost that was going to kill us in a couple of months, so it was super hard. [00:26:25] S1: What did runway drop to at that point? [00:26:27] S0: Without the government, we were at about six month of runway.
00:26:27 · Andrew Lockhead, Pablo Srugo
[00:26:27] S0: Without the government, we were at about six month of runway. [00:26:27] S1: Wow. [00:26:27] S0: We were going down pretty fast. Good thing that we just raised before, so it was good. With the government stepping in and paying 75% of the salaries in the rent, we were able to extend it up to about 18 months, which was exactly what we needed. [00:26:44] S1: When do you start to shift from, oh, my God, on fire, let's just try and get out as quickly as possible as long as it meets certain conditions to let's find an opportunity? [00:26:56] S0: The opportunity was always there. I was probably not the one leading it all the time, but about two months, two months and a half later, after running all of those scenarios and brainstorm, nothing is really working out. Nothing is sticking up. We don't feel so good about ourselves, so we're looking at the different scenarios. [00:27:16] S1: Just so I know, how many people are you at this point? [00:27:19] S0: We’re 42 as of today. [00:27:20] S1: No, I mean, in the story at that point. [00:27:23] S0: Oh, sorry, we're probably around a dozen people back then so 8 to 12 people. [00:27:27] S1: Dozen people brainstorming. No one's doing any work-work. They're thinking, but there's no production because there's nothing to work against and two months of that, all right. [00:27:35] S0: Exactly. You don't know what to do with your day, right? [00:27:35] S1: Exactly.
00:27:35 · Pablo Srugo, Andrew Lockhead
[00:27:35] S1: Exactly. [00:27:35] S0: What are you supposed to do? You don't reach out to customer. You don't spend time, so people just sat at home doing whatever they can. Obviously, they all have their family as well. They all have their own problem. You're not able to go grocery shopping. You're not able to go out. Your mental issue is not as good, so everyone's having the same type of challenge. We're just trying to do those daily and weekly call about, hey guys, here's what happening in the market. Here is the data we're looking into. We think it's going to go back in X amount of time, but we barely know what's going on. We’re trying to make our best to keep the positive attitude, even though we know it might never come back, and we'll just have to deal and shut it down. [00:28:12] S1: No one did. I mean, that's the crazy thing about then is nobody did. There was nowhere to point to that you could say they know. It just was complete… [00:28:20] S0: It was bad. A year exactly after this, so March 2021, we lost our biggest supplier, which was Airbnb. Airbnb decided to drop [unclear] platform. They wanted to go public so go with, yes, one, show that 95% of people go direct to Airbnb, so they shut down everyone. Airbnb was representing about 72% of our reviews back then. [00:28:40] S1: Wow. [00:28:40] S0: That was another big drop, so we're starting to slowly get back. Pow! Now you got to find another way in. [00:28:49] S1: You're getting back just… [00:28:50] S0: All of my investors…
00:28:50 · Andrew Lockhead, Pablo Srugo
[00:28:50] S0: All of my investors… [00:28:51] S1: Just through that time, you're getting back on still the same model selling to ticketing platforms, or did you start making a shift at that point? [00:28:56] S0: At that time, what we noticed is nothing's happening with the event industry. Let's move out of this. We came back to the conclusion of like where do people travel right now? They're not able to go outside of the country. What they're going to do? Go back and export their cities, which was the main thing people did. I don't know if you did look at the nicest beaches 90 minutes away from where you live. Go back and see whatever, museum and outdoor activities. This is what most people… [00:29:21] S1: Cottages, that's what we started doing, yeah, 100%. [00:29:22] S0: Exactly, cottage and you go hiking. Over there is a nice trailing. All those massive outdooring company just lift up during the pandemic, and this is how we decided to switch. We're like, okay, good. Now we have an idea. How do we get to those people? I'm always the go-to market. How do we find a distribution to get them? The one talking about this were either content creator, bloggers, or media company. Both of them were the one driving that type of travel, so we decided to talk with those people and say, okay, it's a bit different than what we're doing with ticketing platform. The map-based solution doesn't work as good for you guys, but we can find a way to get it. [00:29:59] S1: Just to get more clarity on that, this is what? This is somebody that writes top 10 beaches in Ontario, this kind of thing?
00:29:59 · Pablo Srugo, Andrew Lockhead
[00:29:59] S1: Just to get more clarity on that, this is what? This is somebody that writes top 10 beaches in Ontario, this kind of thing? [00:30:05] S0: Exactly, you got it. Those are moms and pop shop. This is going to be Caroline, 45 years old, that live in Missouri that's going to talk about here's a nice thing to do around the city. If you got kids, the 10 nicest activities around. This is exactly your type of crowd that we’re dealing with. [00:30:19] S1: Okay. The media companies would be what? [00:30:22] S0: In Montreal, it would be our city. They’re the one talking about mostly for Gen Z. Gen Z calling the nice shots. What's happening with the vibe? What's going up in the trend right now? [00:30:32] S1: Let’s say it’s like a BuzzFeed but local BuzzFeeds, things like that…. [00:30:35] S0: You got it. [00:30:35] S1: ...that are writing these kinds of lists.
00:30:35 · Pablo Srugo, Andrew Lockhead
[00:30:35] S1: ...that are writing these kinds of lists. [00:30:37] S0: Yeah, something called BuzzFeed. Reach out to those people, try to understand what the pain point is. At that point, me and my co-founder decide to get back on the steering wheel because we had some people working with us were like it's not fast enough. We want to be at the leading edge of this. People don't trust, let's be honest, us anymore because we've been hyping the situation for a year and a half at that point. Hey, don't worry, guys. It's going to work out. It's going to work out. Nobody believe us probably at this point.There's a demo like this is scrap , this is scrap , this is scrap . But that's there . It's kind of cool. So let's like explore this a bit further. And we did this for about 10 days just. [00:31:30] S1: Crazy. [00:31:30] S0: It’s like, okay, let's get back to this. During the day, I was running interview with bloggers, so I was running 5 to 10 people doing workshop, calling them out, seeing what their pain point was, just trying to understand. My co-founder at night was coding the product that we're describing for a full week, and the next day, I was having another conversation with different blogger like, oh, where's – we work on. There's a demo. This is crap. This is crap. This is crap. It's kind of cool, so let's explore this a bit further. We did this for about 10 days. [00:31:31] S1: Just to make sure the timeline right, February 2020, that's the round. March, April, you start trying to see if you can exit of 2020. This is a year later? [00:31:40] S0: Yeah, a year later.