"Scaling a Marketplace with a Physical Product” Shruti Shah (Move Loot, SVB)
We were delighted to welcome Shruti Shah, Entrepreneur in Residence at Silicon Valley Bank and ex-Cofounder & COO of Move Loot. In this talk, Shruti shares the story of Move Loot, the YC-backed full-service marketplace for buying and selling furniture. ⚡️ In only 3 years, they raised $22M and expanded across the US, with the vision to reinvent how people sell their (big) stuff. Startups tend to pursue growth at all costs. But how do you grow at startup-speed when you're a customer-facing business, with physical bulgy items that need to move from point A to point B? The challenge was enormous, and eventually Move Loot had to shut down. In this talk, Shruti shares some of the learnings of: - Going from a crazy idea to a live business - Building a fully-integrated logistics platform - Raising a lot of money FAST, and growing a team - Pivoting, and what it’s like to shut down a company ** Shruti Shah is an Entrepreneur in Residence at Silicon Valley Bank where she is currently working with the early stage practice team on strategic partnerships. She was previously the co-founder and COO of Y Combinator backed Move Loot where she led national expansion and general business operations. Shruti was honored by Forbes as a 2016 30 Under 30 recipient in Retail and E-Commerce and the Aspen Institute as an Aspen Ideas Festival Scholar in reimagining capitalism. Prior to co-founding Move Loot, Shruti worked for the New Schools Venture Seed Fund, a seed fund that invests in early-stage education technology companies, and she was also a public school teacher in Baltimore, Maryland through Teach for America, where she taught elementary school.
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"Scaling a Marketplace with a Physical Product” Shruti Shah (Move Loot, SVB)
- 1. Shruti Shah Scaling a Marketplace with a Physical Product: The Story of Move Loot
- 2. 2 A little bit about me…. • EIR at Silicon Valley Bank • Co-Founder and COO at Move Loot • Worked briefly for an education technology seed venture fund • Started my career as a public school teacher
- 3. On to….
- 4. Getting Rid of Furniture Buying Furniture
- 5. BENEFIT CUSTOMERS & PROMOTE SUSTAINABILITY A Better Way to Buy and Sell PHOTOGRAPH + SUBMIT $400 LISTED FOR SALE SELL THE OLD$200PAID!SELLER BUYER FREE DELIVERY* WITHIN DAYS! SHOP PICKUP
- 6. 6 •Launched in fall of 2013 •Raised initial capital on Indiegogo •$15K got allowed us to rent 1400 sq feet in a shared warehouse space •We did all of the pickup and delivery ourselves The Beginning….
- 7. 7 • Applied and were accepted to Y Combinator - $120K in funding • YC Investment helped us grow • Eventually we were in 9 storage units in the shared warehouse space • We were doing pickups and deliveries all over the SF Bay Area (Napa to San Jose) with an external moving company Initial Traction
- 8. 8 • Needed a bigger warehouse space • No cash to afford a bigger space • Started raising money from investors • Closed a $2.8 Million Dollar Seed Round Then, things started to get interesting….
- 9. 9 Growth
- 10. 10 Growth Atlanta New York City Los Angeles Raleigh Charlotte
- 11. 11 Los Angeles San Francisco Hub and Spoke Fresno
- 13. 13 Costs and Funding • Raised $9 Million Series A and $11.7 Million Series A1 • ~200 employees + 6 markets • Costs spiraling out of control • Began focusing on profitability instead of growth
- 14. 14 The Pivot • Even after focusing on profitablity, we still needed to grow • We didn’t have the cash to launch new markets with physical operations • We started building a peer to peer marketplace • Launched nationally in March 2016
- 15. CASH IN THEBANK Pre-Launch Revenue $600K Monthly Post Peer to Peer Launch Revenue $150K Monthly Jan 16’ Feb 16’ March 16’ April 16’ Jun 16’ Post Pivot Financials Projected Post Launch Revenue $750K - $1 million
- 16. 16 The Shutdown • Talked with board and investors and tried to raise more money to keep the business alive but didn’t raise enough • Made the decision to try to sell • When the business didn’t sell, we fulfilled all of the remaining orders and in July of 2016, we shut it down
- 17. 17 Takeaways • Be thoughtful about costs - physical products = more cost • Tech driven businesses with physical products often can not scale as quickly as tech driven services BUT a common assumption is that they can • Bring in experts who have worked in the industry before to help you build systems and processes that can help you grow sustainably • Trust your instincts when it comes to growth
- 18. 18 Questions?