Who inspires you? Six years ago Ryan Cohen’s dog, Tylee, inspired him to launch a new startup, Chewy. Today, PetSmart bought Chewy for $3.35 billion - the biggest e-commerce acquisition in history.
How did it happen? In 2011 Ryan and his co-founder Michael Day were struggling with their startup - an online jewelry site. Nothing was working and that’s when Ryan thought ‘This jewelry idea - we’re not passionate about what we’re doing.”
That’s when Ryan looked at his poodle, Tylee and thought “She’s my No.1”. That’s when he realized he was a “Pet Parent” who would spend on premium food and products for his dog.
Surely if Pet Parents like him were willing to spend on the best products, they would also love the best service? “So I was going to the pet store and realized the market online was really under-penetrated. This is a much better opportunity.’
This was something he could get passionate about: “I understand the customer - because it’s myself. So we built the company.”
Ryan and Michael sold all their jewelry inventory at a loss, scraped together their last $50,000 and launch Chewy - as a “Zappos on steroids”.
As Ryan says: “From the beginning, we came in saying that we want to provide pet parents with the most amazing customer experience. Period.”
While the food they offered on their website was really no different from what pet owners could buy in stores, the difference was in the service.
The two answered customer calls themselves, and taking no salaries to begin with, they spent their money hiring “Chewtopians” - who they explained to their customers were “pet-loving, adventure-seeking, silly hat wearing folks whose sole mission is to enrich the bond between you and your pets.”
In February this year, People Magazine published a story of a pet owner, Sheree Flanagan, who told the story of what happened when her 15-year old cat, Thor, died. She called the Chewy service number to see if she could return her unused pet food.
Sheree ended up on the line to a Chewtopian, Ashley: “Ashley was amazing. She told me she had a cat put down and she really understood. I kept saying that I didn’t mean to bother her and she kept saying ‘No, this is important. Tell me more.’”
Not only did Sheree get a full refund, but the next day a florist van showed up at Sheree’s home with a large bouquet and a note of condolence.
Sheree’s husband wrote back: “My wife has been taking their loss especially hard, and when we received the flowers we decided it was enough for us both to decide to stop shopping around and give Chewy all our future business.”
Kelli Durkin, Chewy’s VP of customer service, said they created a WOW department that sends out cards to customers for life events from birthdays to weddings, to illnesses to deaths soon after the company started. She says “We don’t feel we’re talking to customers. We are talking to pets’ parents. We want to hear the good and the bad. We are feeding their children. We are part of their families.”
Today, every Chewy customer gets a handwritten thank you card in the mail. All get entered into a lottery to win one of 700 weekly hand-made oil paintings of their pet (Chewy now has 200 full-time portrait artists). The company also has a 40-strong TV crew with 3 sound stages producing pet-care tutorials for the Chewy YouTube channel.
As a result of their incredible service, Chewy’s sales have grown exponentially - from $26 million in 2012 to $900 million in 2016. This year, the company is forecast to reach $1.5 billion in sales, giving it over 50% of the online pet food market.
All this started just six years ago, when looking at his poodle, Tylee, Ryan felt he was more than a pet food shopper. He was a pets’ parent, and wanted to be treated as one.
How are you treating your customer?
As part of a company? Or part of a family?
Today, PetSmart is buying Chewy for $3.35 billion, making this the biggest deal ever in e-commerce - and showing that it pays to care.
“No one cares how much you know, until they know how much you care.” ~ Theodore Roosevelt
Within a matter of months, the centre of startup growth will shift permanently away from the US.
This week, CB Insights reported that a total of 91 startups outside the US are Unicorns - with values of over $1 billion. This is about to overtake America’s total of 98 Unicorns and this will be the last report where the US number is greater than 50%.
The number of new Non-US Unicorns overtook US Unicorns 2 years and has been a growing percentage ever since.
> In 2014, Non-US startups were 37% of new Unicorns
> In 2015, Non-US startups made up 53% of new Unicorns
> In 2016, the Non-US number grew to 58%
> In 2017, this year 72% of the 11 Unicorns are Non-US
The 8 Non-US Unicorns this year are:
* BrewDog in UK
* Avaloq Group in Switzerland
* ReNew Power Ventures in India
* Toutiao, NIO, Ofo, URWork and Zhihu in China
That’s good news if you’re in Asia, where 6 out of this year’s 11 new Unicorns are based.
As with all tipping points, this shift is already leading to a rapid increase in opportunities, resources, talent and capital. If you’ve been waiting for the right time to start your business, now is the time.
More startup stats from CB Insights: https://www.cbinsights.com/…/startup-unicorns-international…
We are living in a world of great change and great uncertainty - but also a world of great opportunity.
“It was the best of times,
it was the worst of times,
it was the age of wisdom,
it was the age of foolishness,
it was the epoch of belief,
it was the epoch of incredulity,
it was the season of Light,
it was the season of Darkness,
it was the spring of hope,
it was the winter of despair.”
~ Charles Dickens
A Tale of Two Cities
Which side you choose to focus on will determine your actions today and your future tomorrow.
This week Tesla overtook General Motors to become the most valuable car company in America - worth over $51 billion - Just one week after overtaking Ford.
This, just 10 years after Elon Musk saved Tesla from “A near-fatal financial situation”…
At the end of 2007, Elon (before he ran the company) had already sunk over $100 million in Tesla as an investor. That’s when he realized the Tesla roadster was still a long way from being finished, and the company would run out of money long before it was.
What did he do? In September 2007 he flew to Stuttgart, Germany to meet with Daimler executives, thinking if he could just find a big contract, he could get extra funding and pull Tesla through.
As a result of that visit, in November (a month before Tesla’s money ran out) Herbert Kohler, Daimler’s head of advanced engineering, said he would come and visit the Tesla factory in California.
Elon called JB Staubel, Tesla’s CTO and said “We need to make an electric Smart car in six weeks. Can you do it?” (Smart was made by Daimler).
The problem was, there were no Daimler Smart cars in the US. JB found the closest one for sale - in Tijuana, Mexico. So he walked into the Tesla finance department and said “I need $20,000 in cash in a bag right now. We’re sending someone to Tijuana to buy a Smart car.”
A Spanish-speaking staff member made the trip, and the Tesla team then worked for five and half weeks around the clock to replace the gas engine with a battery pack and motor.
When the Daimler team arrived, they asked how long it would take for Tesla to come up with a battery that could work with their Smart Car. Elon said “We’ve actually got something to show you”, taking them to the garage where the Smart car was waiting. “It’s electric”, he said.
Herbert Kohler said “What do you mean?”
“We put in a Tesla battery and motor.”
The two took the Smart car for a spin. Elon remembers "it was so fast you could do wheelies in the parking lot". JB called it "The fastest Smart car ever made.”
When they got back from the test drive, Herbert said “Let’s explore a partnership” - and that led to Tesla’s first development contract.
Elon said of the partnership "The Daimler partnership gave us credibility. If we haven't done that, Tesla would have died.”
Elon took over as CEO, and let go of 25% of the staff to keep the company going. By 2009, in the midst of the global economic crisis, both Tesla - and Elon - were down to their last dollar and he said “I had to borrow money for rent.”
He managed to pursuade Daimler to buy around 10% of the company in return for $50 million. (Valuing Tesla at $500m - Just 1% of what it is worth today). Elon says "We were bailed out by Daimler. Without that investment, Tesla would have been game over.”
If Elon hadn’t flown to Germany to create that partnership, Tesla wouldn’t exist today.
Are you more focused at your product, or your partnerships?
What partner could make the biggest difference to your success?
“If you help enough people get what they want, you will get what you want.” ~ Zig Ziglar
Tesla listed on Nasdaq in 2010 and Daimler went on to sell their stake four years later for a $780 million profit (if they had kept the shares they would now be worth billions).
This week Tesla has become the most valuable car company in the US, and is on track to become more valuable than Honda in the near future, and then Daimler, the company that saved it from bankruptcy.
Sachin and Binny Bansal both had coding jobs with Amazon - but quit after just 18 months. Why? Because they thought they could beat Amazon at its own game.
The result? Today, they just raised $1.4 billion for their startup, Flipkart, which 10 years after it launched is now worth $11.6 billion.
Here’s three big flips that led to Flipkart’s success
FLIP ONE: Focus on the customer, not the competition.
Sachin recounts the story, “When we were working with Amazon we got bored… So we basically asked the question ‘can two people working from home compete with the bigger players?”
“We went and did our research and we found that the answer was yes.” How? By realizing that the technology players were not doing such a good job at service. And “If we could do a good job there, we could probably compete with them.”
Easy, right? No. They started in 2007 from a Bangalore apartment with just 400,000 rupees (US$5,900). Amazon began by selling books online. How hard could it be to do the same in India? Very, as no one was buying online at that time: “We used to stand outside Gangaram Book Stores on Church Street and hand over Flipkart bookmarks to the people coming out of the shop.”
The two persevered, knowing if people just tried their online store, “our business opportunity was to do better than everyone else in terms of service.”
FLIP TWO: If you can’t fix the problem, throw it out.
The biggest problem the two faced was the same one that all the other e-commerce companies were facing at the time in India: “How can anybody trust a new company with their money?”
Sachin remembers, "We tried to give them a better interface, we tried to build a brand, that kind of thing". But none of that made much difference.
The breakthrough came when they thought "If people won’t trust paying online, why keep trying to make them?"
That’s when they created their ‘Cash on delivery’ model, and sales took off. The entire Indian e-commerce industry then grew with the aid of the cash on delivery model that Flipkart pioneered. Then as trust grew, buyers got more comfortable paying online, and Flipkart launched their own payment gateway, PayZippy.
By sidestepping the problem instead of solving it, Flipkart began to grow: “In 2007 we were two people. By 2008 we were five people. By 2009 we were over a hundred.” Today Flipkart has over 30,000 employees and $2.2 billion revenue.
FLIP THREE: Beat Amazon by not being Amazon.
Flipkart began expanding into many sectors outside of books, just like Amazon, but Sachin saw what made the India market different from the US market. First, mobile first. Sachin focused on their mobile app and initially made Flipkart mobile-only, saying: “Consumers are showing us the way. If we don’t focus on mobile as the primary channel, somebody else will.”
Then, to beat Amazon they followed Alibaba’s minimal stock model, connecting sellers directly with buyers instead of getting caught up with all the stock challenges that Amazon had. Sachin now compares Flipkart more to Alibaba than Amazon, saying “Yahoo had invested the same amount in Alibaba in 2005. It was the inflexion point in China then, exactly where India is today.”
What could you do to flip your own thinking?
“Every side of a coin has another side.” ~ Myron Scholes
Every coin has 3 sides: A side, a flip side, and an edge.
To see both sides, live on the edge.
Today, Sachin and Binny’s gamble has paid off, as it announces a new $1.4 billion funding round from eBay, Microsoft and Tencent, valuing Flipkart at $11.6 billion. While this is lower than its last funding round, it's coming from global heavyweight partners and signals the beginning of India's next chapter in growth.
Talks are now underway for a merger between Flipkart and their rival startup, Snapdeal, and with this new funding Flipkart now takes over management of Ebay India. This comes just weeks after Alibaba invested $420m in another Indian e-commerce startup, Paytm. These big deals back up Sachin’s prediction that India’s tech growth is just five to eight years behind China’s.
Last month, amidst high profile cases of misbehaving Unicorns, from Oculus to Uber, Mara Zepeda & Jennifer Brandel wrote a blog “Zebras fix what Unicorns break.”
They said “The current technology and venture capital structure is broken. It rewards quantity over quality, consumption over creation, quick exits over sustainable growth, and shareholder profit over shared prosperity."
"It chases after “unicorn” companies bent on “disruption” rather than supporting businesses that repair, cultivate, and connect.”
They then say “A company’s business model is the first domino in a long chain of consequences. In short: ‘The business model is the message.’"
"From that business model flows company culture and beliefs, strategies for success, end-user experiences, and, ultimately, the very shape of society.
This new movement demands a new symbol, so we’re claiming an animal of our own: the zebra.
1. To state the obvious: unlike unicorns, zebras are real.
2. Zebra companies are both black and white: they are profitable and improve society. They won’t sacrifice one for the other.
3. Zebras are also mutualistic: by banding together in groups, they protect and preserve one another. Their individual input results in stronger collective output.
4. Zebra companies are built with peerless stamina and capital efficiency, as long as conditions allow them to survive."
If you are striving to grow a Unicorn, you may succeed, although they are beginning to look rarer as VCs slow down their investing.
If, on the other hand, you are striving to rear a Zebra, you are in good company. After all, Zebras like to group together, and they are becoming increasingly common as entrepreneurs seek co-operation and sustainability over competition and monopoly.
When you seek size and scale, you may never reach success. If you seek purpose and profit, you can succeed the moment you start.
“Go into the world and do well. But more importantly, go into the world and do good.” ~ Minor Myers Jnr
If you like the idea of being a Zebra, you can read Mara & Jennifer’s “Zebra Manifesto” at http://bit.ly/
You can also visit https://
And because a gathering of Zebras is a “Dazzle”, you can also join the first Zebra gathering at “Dazzlecon” later this year:
Nguyen Thi Phuong Thao has just become South East Asia’s first self-made woman billionaire. And she has achieved it with one big rule: “I have always aimed big and done big deals.”
How has Nguyen built her wealth to over a billion in a country (Vietnam) which only has ever had one other billionaire in its history? Here’s the 3 step formula Nguyen has used for each of her 3 big wins over the last 30 years:
1) Make your best guess on the future, and then bet on it:
When she was a student in USSR in the 1980s, Nguyen bet on the USSR breaking up and international trade growing. So she started trading fax machines and latex rubber between USSR and Asia in between her economics classes, saying “When people were trading one container, I was already trading hundreds of containers.”
She began with no money, but scaled by growing her trust with suppliers: "I didn’t have much money. They gave me more and more products with longer credit terms."
Within 3 years she had made her first million by 21 years old.
2) Realise the best opportunities are always right in front of you:
Nguyen then took her earnings back to Vietnam with her, guessing that her country would soon follow the growth of China and India. Knowing that the early wealth in both those countries had come in banking and property, she decided to invest in both, despite having no experience of either.
She set up Sovico Holdings, named after her early Soviet success, and was the first to invest in Dragon City - an area of swamp land she guessed the government would turn into an economic hub. It did, and that bet is now worth $1 billion
3) Begin with a beginners mind, and learn from others
Her biggest bet then came when she realised that it was only a matter of time before the Vietnam government opened the market to competition against the state-run airline. Having no idea how to run an airline, she first tried to set up a joint venture with AirAsia. But when that failed, she decided to launch her own company, VietJet, 5 years ago.
Before launching, she studied other fast-growing airlines like Virgin and AirAsia in detail, saying “Some say that anything I put hands on will be profitable. But I don’t think it’s that simple. There’s no easy path to success. I studied and I did my research. It was a lot of hard work, and to be successful you need to be passionate about the business that you invest in.”
Seeing the power of stunts, Vietjet launched with all-female crews in bikinis as a stark contrast to the staid, state-run Vietnam Airlines. It worked. And while a lot of recent western media headlines have read “Hot Flight Attendants In Bikinis Made Vietnam Its First Female Billionaire” and “How Bikini Airline Helped to Create Vietnam's First Woman Billionaire”, the reality is today the crew only dress in bikinis as part of the promotional flights to new tropical destinations.
Nguyen’s response to the western media’s skewed view of her success: “We don’t mind people associating the airline with the bikini image. If that makes people happy, we are happy.”
Today Vietjet has 300 flights a day and has now set the ambition of being the “Emirates of Asia” - recently ordering more than 200 new planes worth $23 billion. Last month the company floated on the stock exchange, making Nguyen a billionaire.
Today, Nguyen is worth $1.7 billion. Asked what she thinks about her net worth, she says "I’ve never sat down and calculated my assets. I’m just focused on how to boost the company’s growth, how to increase the average salary for my employees, how to lead the airline to gain more market share and make it number one.”
Based on current growth, VietJet will overtake Vietnam Airlines this year after just 5 years in business.
Where will you be 5 years from today? And how can Nguyen’s journey be an inspiration towards your future flight plan?
“We all fly. Once you leave the ground, you fly. Some people fly longer than others.” ~ Michael Jordan
Imagine if rivers, reefs, mountains and forests had rights to survive and thrive just like humans have rights and animals have rights? This month big steps have taken place towards that kind of a world.
First - New Zealand made the Whanganui River the first river in the world to be granted the same legal rights as a human being. In the same way that corporations, foundations and governments have legal rights where they are treated like people, and humans can then fight for them in court, the sacred Whanganui River now has the same rights.
That lets the Maori tribes fight on behalf of the river to protect it. Attorney-General Chris Finlayson said last week "The approach of granting legal personality to a river is unique. It will have its own legal identity with all the corresponding rights, duties and liabilities of a legal person.”
As part of the Parliament ruling, the Maori tribes who represent the river received $80m settlement from the government for damage done, and another $30m to improve the river.
Second - This week India followed by granting two of its most holy rivers, the Ganges and Yamuna, to also have the same legal status, calling both rivers "living entities having the status of a legal person.”
The Indian judges used the New Zealand case as a precedent and said the ruling was essential as the rivers were in danger of "losing their very existence.”
Indian lawyer, MC Pant, said "This will help protect the rivers, as they now have all the constitutional and statutory rights of human beings, including the right to life.”
Imagine if we all agreed that nature has the same right to life that humans and animals have. Each river, reef, mountain and forest could then get representation, funding and protection just as companies can. People would choose whether they want to work for a factory or for a force of nature.
Imagine every beach cafe and restaurant knowing some of their revenues goes directly to the team supporting the beach, who would use it to preserve and clean the beach. Imagine every home, business and boat that uses a river knowing they are helping to fund the team that is ensuring the river is alive and thriving.
I remember when I first heard from Lynne Twist that her foundation, the Pachamama Alliance, had helped to inspire Ecuador to be the the first country to adopt rights of nature in their constitution, how great it would be if this became a global movement.
The wave has started.
In the midst of plenty of bad news around the world, good things are happening.
"Small channels flow noisily, the great flow silent." ~ Buddha
Imagine coming up with a crazy invention that has the power to transform an industry. That’s what Mark Moore did with “The Puffin”. In 2010, Marck came up with his ‘flying car’ idea for his doctorate at university.
Flying cars have been in science fiction for a century. So what was so special about the Puffin?
Mark designed an electric one-man vertical take-off and landing (VTOL) vehicle which could actually work. He posted an animation of it on Youtube which went viral, hitting over 648,000 views in its first week.
Why did Mark call it the Puffin? He says "If you've ever seen a puffin on the ground, it looks very awkward, with wings too small to fly, and that's exactly what our vehicle looks like.”
"But it's also apparently called the most environmentally friendly bird, because it hides its poop. So the vehicle is environmentally friendly because it essentially has no emissions. Also, puffins tend to live in solitude, only ever coming together on land to mate, and ours is a one-person vehicle.”
Mark’s invention inspired Google’s Larry Page to look seriously at flying cars. Since then, Larry has invested over $100 million of his own money in flying car companies.
This month - in the year of the Rooster - flying cars have gone from science fiction to science fact. Early this week, Dubai announced it would have flying cars by this summer, partnering with Chinese flying car pioneer, Ehang.
Yesterday, the world’s first commercial flying car, the Liberty (from Dutch company PAL-V) went on sale for $400,000, with deliveries beginning next year.
Airbus is also getting in on the action, saying they will test flying cars by the end of 2017. Their VTOL vehicle is modelled on Mark’s paper.
Is Mark’s vision of flying cars taking over from cars a near reality? I met someone when I was in LA two weeks ago who thinks so. His name is Jeff Holden, Head of Product Development at Uber.
Jeff believes flying cars will take over from cars sooner than we think, and Uber has recently launched “Uber Elevate” as their flying car division.
What about Mark? Where is he now?
Mark just got a new job last Friday, as Uber’s “Director of Aviation”.
Who would have thought that an invention written for a thesis, and a viral video, would lead to spearheading the opportunity to spearhead a revolution in how we travel?
What crazy idea are you putting off?
Maybe it’s time to get it back on the drawing board. Because in a world of flying cars, anything is possible.
“It always seems impossible until it's done.” ~ Nelson Mandela
How many times are you willing to fail to succeed? Apoorva Mehta endured over 20 failed startups before starting Instacart - and today, 5 years later, he has just raised $400 million, valuing Instacart at $3.4 billion.
After leaving a job at Amazon, in 2010 Apoorva decided to try his own hand as an entrepreneur. But it wasn’t easy going. He tried creating an ad network for gaming. It failed. He tried a Groupon for food. It failed. He tried building a social network for lawyers. It failed.
In total, he tried over 20 startups over 2 years, which all failed. “I tried to get traction for those products. But the result was always failure, failure and more failure.”
What did Apoorva learn from all this failure? “The experience taught me that you shouldn’t start a company just to start a company. The reason should be to solve a problem that you truly care about.”
That’s when he turned his focus on a problem he was having himself - having to go buy groceries (ironically because he was too busy working on ideas that weren’t working). “You're working 14 hour days and the last thing you want is not to have good food in the fridge”.
That got Apoorva thinking: “It was 2012, people were ordering everything online, meeting people online, watching movies online, yet the one thing everyone has to do every single week - buying groceries.”
Deciding to create a company to provide home delivery from your favourite grocery store, Apoorva decided to motivate himself by not visiting the grocery store until he had finished his app:
“I began writing code for the first version of the app and, when it was ready, placed the first order. Then, I went to the grocery store, picked up my groceries and delivered them to myself.”
"So, technically, we started with one shopper in the summer of 2012 and have about 7,000 across the nation today.”
Apoorva learned from the earlier failure of Webvan, which had gone bust trying to maintain their own distribution and groceries. Instead, he partnered with the grocery stores and grew a national network of shoppers who would shop and get paid when an order came in, similar to Uber’s network of drivers.
The company grew exponentially, from $1 million in sales to $10 million the year after and $100 million in 2014. As Apoorva says, “You couldn’t get groceries delivered in one hour, you couldn’t get them delivered from all grocery stores in a market. Today Instacart does this, as a result of that we grew to get to this point very, very fast. We went from having three markets to 15.”
In 2015, Forbes named Instacart No.1 in their “America’s Most Promising Companies” list, the company grew from 15 to 35 cities and today Apoorva announced the $400 million investment led by Sequoia Capital, valuing Instacart at $3.4 billion.
What would have happened if Apoorva had quit after his 3rd failure? Or 10th? Or 20th?
What idea that isn’t working should you quit, so you can start on the one that will?
And if you don’t have the right idea yet, do what Apoorva did, and shop around...
“When one door closes another door opens, but we so often look so long and so regretfully upon the closed door, that we do not see the ones which open for us.” ~ Alexander Graham Bell
1) OECD projects that women will account for two out of every three graduates across advance economies by 2020.
2) A Credit Suisse Research Institute found balanced boards with more women leaders let to higher returns on equity and superior stock price performance. Barclays Bank took that fact and set up ‘The Barclays Women in Leadership Total Return Index’ to track and invest in female-led companies. The index has grown 28% in the last 12 months.
3) The two most powerful finance positions in the world are both held by women: Christine Lagarde, MD of the IMF and Janet Yellen, Chair of the US Federal Reserve.
4) 45% of all business leadership positions in Russia are now held by women. Followed by Lithuania (39%), Philippines (39%), Estonia (37%), Thailand (37%) and Indonesia (36%), according to the latest global survey by Grant Thornton.
5) Women-led startups now account for over 50% of all startups in sub-Saharan Africa, Ghana, Nigeria, Zambia, and the percentage is growing.
While there is still a long way to go before women have the same share of leadership positions as men, growth in equality is growing.
Our entire global senior leadership team at Entrepreneurs Institute (except me and Suraj!) are made up of women and over 55% of our top mentoring circles and investor circle are women entrepreneurs. We are far better off because of it. So the equal balance and connected culture we are experiencing in our global entrepreneur community is a sign of things to come.
Happy International Women's Day 2017
“I am a woman with thoughts and questions and shit to say. I say if I'm beautiful. I say if I'm strong. You will not determine my story. I will… I am not who I sleep with. I am not my weight. I am not my mother. I am myself.” ~ Amy Schumer, Gloria Awards and Gala