Like the fashion world, various trends have come into fashion in the local startup space over the last few years, leading to a wave of startups launching in a similar sector, before the next hot trend takes over. The likes of blockchain, artificial intelligence, and virtual reality are the current flavours du jour, but look back a few years and ecommerce was a big player.
From group buying to apps promising to help consumers find the best deals near them, dozens of startups emerged with a fresh take on buying and selling.
Tapping into this was BidzDirect, launched by Phil Tran and Zaven Matevosian in mid-2015. The idea had first come to Tran through his use of eBay, then still best known for its auction model; a frequent bidder, Tran said he saw a few issues in the model that he wanted to fix.
“One of the flaws was that when you engaged in an auction it could take anywhere from five to 10 days to finish, days where you were willing to pay a good market price for the product, but you still had to waste time tracking the bid, and also remembering you placed a bid in the first place. A lot of times you would forget about it, then realise you’d been outbid and lost an item for a good price,” he explained.
BidzDirect sought to be, essentially, an on-demand marketplace, allowing a seller listing an item to define their pricing parameters, such as the lowest price they would accept. A buyer could then submit an offer, and get a yes or no, or start a negotiation, straight away direct with the seller.
“The retailers were coming on board because a lot of them already had a shopfront, but what we offered was a platform that allowed them to set a minimum and maximum delegation, if you will, for a product and if an offer was made it would sell automatically. At the end of the day, they could still have a shopfront and have an online business that took care of itself.”
While BidzDirect was bringing users onto both sides of the marketplace, looking back, Tran admitted his experience building and running BidzDirect was fraught with lessons.
With every dollar key for an early-stage startup, Tran said BidzDirect wasted too much money outsourcing its development to the US, only to learn this agency was then outsourcing to developers in India.
Not only were there issues with the platform that Tran found difficult to communicate to the developers directly, but being billed by a US entity meant the startup was not able to claim its research and development from the government’s R&D Tax Incentive.
The most critical lesson Tran learned from BidzDirect, however, revolves around team.
Though he was working on the startup full time, his cofounder was on BidzDirect in between his other job, leaving Tran alone with the business 90 percent of the time.
“I was pretty much running the company as a one man founder and team, which I found very difficult because when you need help you can’t just turn to someone with that expertise to do it, you have to research and leverage your network to provide the answers,” Tran said.
Running the business as a one-man show had flow on effects he couldn’t see or didn’t realise at the time.
For example, Tran said, one day he drove the nine hours from Sydney to Melbourne to meet with investor Adrian Stone for a 30 minute meeting.
“He ended up giving me a full hour, and driving home after that meeting, thinking about it, just opened up my view and perspective on things,” Tran said.
“One comment he’d made, which I thought was a stupid comment during the meeting but turned out to be true, was when he said, ‘Phil, you go into a startup with an idea and you come out with a totally different idea’. I thought, ‘What are you talking about? I’m here to talk about BidzDirect, there’s no other idea, I’m trying to make this become a reality’.
“Ultimately he was right, because when you hit different obstacles these can also present different opportunities, and you can make the decision to pivot if it makes more sense.”
Tran now realises that, had he had a team around him, the decision to pivot would have come sooner than it did.
The pivot came when Tran met Ben Burns and Darcy Kean and they formed Deal Tap, an app essentially looking to transition coupon experience online by allowing users to find deals or offers at stores nearby.
With a solid team, the startup hit the market fast.
“I can’t emphasise team enough, to be honest. After forming a team with Deal Tap, I saw people who had launched startups at the same time as I had launched BidzDirect, and they were still in the same league, still struggling to get out of that, ‘I own the company and I don’t want to give any away’ mentality. They really struggled to form a team with that sort of mindset,” Tran said.
“Getting away from that mindset allowed me to open the doors to people with other skills that I don’t have, people that are leaders that I could join forces with that could help me make impact in the right area, and focus on the right things that need to be done right now rather than prioritising something because it’s the only thing I know how to do.”
Building the right team, of course, is only one battle in the war that running a successful startup can be, with giving the market the right product at the right time another issue – and it was here that Deal Tap struggled.
The core problem, Tran believes, is the Australian market’s general attitude towards coupons and deals. While a venue advertising a meal for two for 50 percent off on a platform like Groupon, for example, might think it’s a good way to get customers in and hook them for next time, Tran argued that, though they may have loved the food, a consumer won’t come back and pay full price next time if they’ve already had it cheaper.
As Deal Tap went to market and began talking to venues, they discovered that while they were shying away from discount and coupon models, they had other problems that needed solving. Chief among them was how to drive greater efficiency within, from entertaining customers to ensuring orders are right every time, customers aren’t waiting too long, and so on.
Presented with the decision of whether or not to pivot, Tran said his team was a significant factor.
“As CEO, my decision was quite easy because I thought, what is the team excited to do? And it was so obvious that they were so much more excited about tackling this new problem that’s now Tayble than keep beating down the path of Deal Tap,” he said.
“A lot of startups will face that choice, and sometimes it’s obvious there’s a right decision and a wrong decision, but where there’s not an obvious one and you’ve got investors’ money involved, you need to think, if the team is excited to do something they will do it a lot quicker, and as you know, in startups it’s all about how quickly you can execute and go to market and how you can dominate and respond to the market quicker than the big players.”
Keeping in mind that every decision made comes back to the fact you’re spending your investors’ money is also key, Tran said, and as such Tayble has always sought to be accountable.
“As a startup it’s all about being lean and not spending unnecessarily so that’s always at the back of your mind. It’s about filtering that down to the team and putting in processes to control some of the costs and spending to create that financial governance,” he said.
“Just like any big company, you can’t just go out and spend thousands on entertaining clients, you need approval to get the sign off from managers, so we try to put that up front and create a culture where we move fast like a startup but operate through systems and processes like a corporate, which allows us to control a lot of spending and look after our investors’ money.”
From team to culture, product to market, Tran believes the startup is now on the right path with Tayble, an app allowing customers to view a restaurant menu, order, and pay for their meals through their phone, with no need to wait for a waiter.
With brands like McDonald’s and Starbucks releasing their own apps to allow customers to order ahead, Tran said a growing number of consumers are slowly becoming more aware of and used to the concept of ordering through their phones, while venues are attracted to the gains in efficiency presented by the app.
“I was a late adopter of Uber but once I got on board, now even if there are 10 taxis in a taxi bay in front of a hotel, I’ll still pull out my phone to get an Uber and I’m happy to wait. If Tayble can reach the point where you go into a restaurant, and even though there’s five waiters standing around, you’re more than happy to order via your phone, then I think we’ve done quite well,” Tran said.
Changing consumer habits will be no easy feat, but Tran is confident in the Tayble team, which he believes is “one of the strongest teams in Australia”.
“A lot of people say, ‘You’re going to make one of your team rich one day’, but my answer to that is, ‘Actually, the team I’ve built are making me rich’. In a typical corporate environment you have a similar chain of command that limits your innovation; what I encourage at Tayble is that everyone’s on a level playing field regardless of title, everyone has the right to pitch ideas and put their best foot forward and it’s encouraged,” he said.
“A leader can attract a group of followers but it takes a great leader to attract other great leaders that can help them change the world. It’s challenging to manage a group of leaders rather than a group of followers, because followers will just do whatever you do, but when you manage a group of leaders, they challenge every idea you have, and that’s what pushes you to the next level.”
Image: the Tayble team. Source: Supplied.