My Pivot from Consumer to SaaS: Brands Are People Too
In my last post, I provided an in-depth summary into the inspiration behind my new venture. The TL:DR; I left Blue Apron to build a business based on my PhD research at Penn with the mission of helping people buy products that fit their values & lifestyle.
It’s been a busy few months. I launched a “proof of concept” in mid-February that attracted a few thousand users, built an Instagram following, cobbled together a team of (now 6) freelancers, and kicked off the design process for v1 of our mobile app.
Oh, and I pivoted from B2C to SaaS. Just a tiny detail.
It’s a start-up, so things are changing all the time. Sometimes days feel like weeks, weeks feel like months, and months feel like years. But while the overall mission of my venture is unchanged, the focus of my business has shifted from helping consumers *find* great products to helping CPG brands *make and market them*. It’s different than what I initially envisioned, but something I’m really excited about.
When I founded Vivar, my first instinct was to build a digital consumer product—something that generated demand. We would help people find products that were tailored to their idiosyncratic preferences, no matter how complex. And in return, we’d take some share of the proceeds for acting as a matchmaker. A possible (and, in my mind, likely) outcome of our matchmaking would be that sales would shift from big CPG brands to niche competitors. 90% of CPG brands were already losing sales to smaller competitors, so we’d just be adding fuel to the fire by making it easier to find specialty products.
Initially, this wrinkle in the business wasn’t something that I was worried about. My general logic was that if big CPG brands weren’t creating products that fit the needs of consumers, our platform would provide an opportunity for smaller players to throw their hats into the ring. Small businesses would thrive, big CPG brands would gain insight into why smaller competitors were beating them, and then big CPG’s would acquire the small businesses. Win-win.
But as the founder of a data-focused company, it’s important for me to anticipate all of the possible outcomes of the algorithms we’re building. And occasionally as I was drifting to sleep at night, I would worry about what would happen if consumer preferences skewed dramatically towards small brands (as they did in our beta). Would it be a terrible experience for users if the platform frequently recommended products that were sold out in stores? And how would small brands respond when they faced sudden and unexpected pressure to scale? Could they live up to the tenets that attracted new customers to them in the first place, or would they compromise on quality during the scramble?
Some of these fears came from direct experience. My time at Blue Apron not only spanned the intoxicating days of hypergrowth but also our painfully public turnaround. In my first week, I vividly remember a heated discussion about whether we could fly boxes over the Rocky Mountains because our East Coast facility was at capacity. The state-of-the-art plant we were building in Linden, NJ couldn’t come a moment too soon. But two years later, just as we’d opened the very facility designed to scale our supply chain, demand unexpectedly softened. My team was responsible for publishing a forecast that showed the impact of falling demand on revenue, which led to a company-wide lay-off. Scaling too fast nearly killed the company, and left a lasting impression on me.
As I worked through these concerns and fleshed out my business model, my partner was there every step of the way. We even have “family pitch time” where I practice my pitch over and over again. Even the dog is involved: dutifully, reluctantly by my side so I can pet him when I mess up the delivery of a slide for the 20th time in a row.
Obviously, my partner does other things than listen to me pitch. In fact, he’s a product manager in New Product Development for J&J. A CPG company.
Initially, he provided tactical insights to help my data mining operation. When I was seeing low match rates of UPC’s across retailers, it was him (not Google) that explained to me how UPC codes worked, as well as shortcomings of the classification system. Then, it was explaining the idiosyncrasies of how quantities and volumes are included in product titles. Then, the org structure and job titles for key roles at CPG companies to inform my go-to-market strategy. Then sizing the number of SKU’s by brand or product line. And so on and so forth.
Birds of a feather flock together, so it should come as no surprise that I’m paired up with someone with similar interests to mine. But whereas my approach to furthering sustainability has been to build software (duh), his approach to bettering the world is to make disciplined, systematic changes to his personal life. First he stopped eating meat — then fish, then dairy. And when I launched my beta, it was his parents who dived into the frozen food section to hunt for vegan products at Wegmans so he had something to eat when visiting home.
Which led me to a key insight: brands are people, too. More specifically, the people who work for big CPG’s like Proctor & Gamble, J&J, Unilever, Colgate-Palmolive are the same people who are trying to make decisions that are better for the planet in their private lives. On weekdays, they’re enacting change from the inside: advocating for better packaging, designing more efficient product development cycles, and targeted go-to-market strategies. All with the goal making products that resonate with customers while reducing waste.
People like my partner weren’t potential users, they were potential clients. And, information generated by my platform could further their ability to advocate for sustainability, and act as catalysts within their org. The fastest path to a better future was not shaping consumer demand but working directly with brands so they can live up to their customer’s aspirations while leveraging existing economies of scale.
So I honed in on the research component of my platform, and sharpened my focus on generating actionable data for product managers and marketers within CPGs. In other words,
Vivar is a platform that helps brands understand how people make purchasing decisions across channels and retailers. We do this by providing consumers with a free tool that digitizes and personalizes their shopping list.
I’ve been part of two successful start-ups that pivoted. Blue Apron was initially a company called Petridish, which crowdsourced funding for academic science projects. And Curalate was initially a company called Storably that aimed to be AirBNB for storage. These role models taught me that success can come from zigs and zags.
This pivot is personal. Now back to petting my dog. We’ve got work to do.
