Monday, August 10, 2020
Interview with Ruben Schultz, Swoop
Today's interview is with Ruben Schultz, the co-founder of Swoop (www.swoopapp.com), a new startup which develops software for limousine, party bus, and other transportation providers. The company recently announced $3.2M in a seed funding round. from Signia Venture Partners, South Park Commons, and angels.
What's Swoop all about?
Ruben Schultz: We are solving problems for operators of all types of group transportation, anything from an SUV to a charter bus. How this industry works today, is there are over 40,000 small, mom-and-pop shops, all of which own just a couple of vehicles. Historically, they have worked in a very outdated way, running their business with pen and paper. What Swoop does, is we build technology for them, SaaS tools, which allow them to run their businesses more effectively. We provide order input, driver tracking, assigning drivers to a rider, assigning routes, as well as accounting and payment afterwards. In addition to all of that, we also generate new leads for them. Right now, those operators only see vehicle utilization of around 49 percent, and their vehicles are standing around most of the team. Part of our team is working on partnerships and sales with big companies like Netflix, Google, and others who require group transportation. They book through Swoop, which leads to those operators. So, operators both are getting software to run their businesses, as well as new leads.
How did you start this?
Ruben Schultz: My co-founder, Amir, is the brain behind this. His parents own a group transportation business, and we actually spent our early days in the garage of his parent's company trying to figure out this space. That's where our domain expertise comes from, and where the idea came from, and also our understanding of how outdated this space really is. Personally, I jumped into technology right out of school, and worked for Google first, made the jump to Facebook, and worked on a team there in between product and scaling new products.I wanted to start my own thing. Amir is a family friend, and it happens our parents immigrated from the same, small town in Iran. I've known him for a long time, and in the early days he told me about what he was doing, and we spent a lot of time together on it, so I made the jump. Our other co-founder, Pete, was at Microsoft in business development and sales. We're now a team of thirteen, still very small, and on our seed round, but we're slowly now entering our growth stage.
How has it been getting folks so used to just using pen and paper to enter the electronic age?
Ruben Schultz: This is also where COVID has actually worked for us. Group transportation is down because of COVID, and people are not moving and definitely not in groups. So, lots of these operators are rethinking their businesses, and rethinking expenses. Where they previously were using separate tools for text messaging, paying fees that were too high for credit card processing, and employing 5 part time people, they can now cover all of that with our SaaS platform. So, it's been a good time to catch them. Plus, they now have more rest or downtime, to think about making some bigger decisions for their company. One thing against us, obviously, is everyone is unsure where the industry is going, and when it is coming back, but that's where one good thing is our model. We generate leads for their businesses, and if you imagine you might own five vehicles, you don't want them sitting around all day on a Wednesday. Instead, we come to you, tell them there's a trip coming up where someone needs three vehicles, and you can make $2000 for that ride. That's appealing to them, and that distribution and acquisition model has worked very well for us.
Did you close your round before the pandemic or in the middle of all of this?
Ruben Schultz: Right in the middle of it. We started working on this slightly before, but got everything finalized during the pandemic. It was definitely one of the most challenging times and the hardest work for us in our life, but it's worked out super nicely.
What did you tell investors to get you thorough getting this round done and to keep their support as it seemed like everything was changing?
Ruben Schultz:This might sound generic, but we were super convinced about our mission. The fact is, it's hard to book group transportation still, in a world where you can book anything else easily, whether that's a train ticket, a flight, a Lyft, really anything. Try booking a charter bus—it's pretty much impossible without calling five places. The reason is, no one has control of the supply side. No one knows where all those vehicle are. With SaaS, eventually, ou can provide a great booking experience and rides for everyone. Even with COVID, we never swayed away from this story, and indicated that we're not here just for the fundraising, but because the fundraising is an accelerator for this mission we're trying to accomplish. Also, I'll be the first to admit it, maybe it's also luck, because maybe our investors are great, good people. Also part of it might be luck, the part we can control is communicating effectively. It also helped that we're an LA startup, so our burn rate is much lower than they are accustomed to in the Bay Area. We have quite a significant runway with this raise, and we can last a lot longer than they might expect, which might have contributed to it.
So, I assume you are starting this company remotely—especially since we're taking right now when you're in Germany. How is that working out?
Ruben Schultz: It's worked out better than I expected. Obviously, there are some growing pains, but the key thing we have to learn is how to run our 13-man organization like a 100-man company in the office together. That means figuring out all the processes, communications, and meeting notes. Things you usually don't do in a standup have to be air tight. Working remote is just forcing us to get our house in order. What we've learned is you have to take notes on your meetings, be much clearer on meeting schedules as a group, You've got to understand what meetings are necessary, and which ones aren't. I think a good guiding principle, is status updates don't need a meeting, or zoom. We use a Notion doc. If it's a brainstorm, or if it's a discussion, or disagreement, that's something you want to hop on a call on to emulate the office experience. Tooling helps. Notion is great, and we use a tool called Jam, which is on your desktop and lists everyone in your company, like Slack, so you can directly call them. That removes an friction from making a call and it's been helpful. If there's a question in your head, it kind of mimics the serendipity of the office, you can turn around and ask a question.
What's next for you?
Ruben Schultz: Two things we are planning. We're really focused on the product. The software we're building is a lot better than it would have been had COVID not appeared, because we're now hyper-focused on building the best product possible. We're also able to spend as much time as we need with operators, because they have been very generous with their resources, because maybe they're not having to deal with as many rides. The second thing we've been able to do, is create partnerships that maybe we wouldn't have been able to create before. For example, our operators are now doing a lot of deliveries. The vehicles they have been using to move people, they are taking out seats and doing shipments. There as been a drastic increase in shipments, if you look at companies like Shopify, where their stock is up 11 percent, and some deliveries has to be involved. That's where we come in, we've been connecting our customers to help deliver packages, testing kit delivery, and moving essential workers. Those are some of the things our partnerships we have created have given our customers leads and money ultimately goes back to those operators.
Thanks!