 You guys tried to raise money, and so nothing really materialized. Nothing materialized on the West Coast at all. And what were you guys thinking when that happened? We were just trying to find a way to keep it going. It was a matter of like- Did you deplete all your savings? Oh yeah, it was gone. It was gone a while back. Were these dark times for you and your co-founder? They were. Okay, we managed. This is Startup to Storefront. Today's guest is Garv Thomas, a co-founder and chief technical officer of Buttery. Buttery was an on-demand alcohol delivery app that ran in four cities across the US before it was bought by Drizly, one of their competitors. Garv is a skilled software engineer, responsible for developing and coding the app, as well as the backend of the website, which was part of the reason why they were such an appealing acquisition for Drizly. So listen in as we cover everything from dealing with the competition in their early days to sometimes having to make alcohol deliveries himself and the thought process behind selling the company he and his co-founder worked so hard to build. And you can also listen for the occasional on-king from angry Boston motorist stuck in rush hour outside the Drizly offices while we conducted this interview. So with that said, now back to the episode. Welcome to the podcast. We're here in Boston, Massachusetts with my boy Garv. How you doing? Garv was the founder of Buttery, which was acquired by Drizly. Tell everyone what the Buttery, what it was. So Buttery was essentially a marketplace and a way for liquor stores to establish like online presence and have an e-commerce store for themselves. And what year was this when you decided to move forward on this? So we started with the original idea in about 2014 when we are like started exploring this problem. We were like, we wanted to make e-commerce easier for like small and medium businesses. What was the original idea? So the original idea was making things easily purchasable from your local moment pops or like from your local stores. So if you are looking for something, you're right, nowadays you would either go on Amazon or online and find out where it is, but it's probably also available down the street from your local neighborhood store. So we wanted to bring that concept of instant buying, making it easier for you to shop from your local stores. And that's when we started experimenting, understanding different use cases, talking to businesses and figuring out what their problems were, what are they, like how to make this happen. And that's how we had started. So we are like all different types of businesses and we are doing a lot of things for everyone which was like not serving the right use case, not serving the customer properly. So we tried out, we tried and tested a bunch of different things, saw what was working. How many years did you test the different concepts? I think it was probably about a year. And at that time we had quit our jobs, we were like full time into this. Yeah, before you guys were at Verizon, right? Yes, before we were like me and my co-founder, we were working together at Verizon. As engineers, you're both technical. Yeah, we built mobile apps for streaming video solutions at that time. Yeah, and you guys were working out of Boston University, the library. When we were like playing around like test, like initially when we were like experimenting with this idea, we used to work like nights and weekends, go to use like free resources like we use library and make use of all the resources, which is great. When we figured out that yes, there are some legs to what we wanted to do, we just quit our jobs and gave it our full shot. Yeah, what was that like, what was leaving your job like? Oh, it's terrifying. It's absolutely terrifying. Yeah, you're like leaving away a six-figure salary, you're figuring out how do you... Safety. There's no safety net at that point, right? Right. So like, okay, what do you do? Did you guys have a little bit of savings to make your life a little bit easier? Yeah, that's what we relied on a lot. Some of our savings, our wives supported our ventures pretty well. So yeah. What kind of revenue did you have coming in at that point to... Zero. Zero. Yeah. There was no revenue. I said, exploring what's going to work, what's not going to work, talking to different types of businesses, because we yet quickly realized that we were doing a lot of things for like all different types of businesses, but it's not going to serve the end consumer that well. Right, you got to plan your flag, you got to like pick your market place. Yeah, you need to pick either your vertical, you need to pick your niche and figure it out where what you're good at and what is the best use case that you can solve for. At that time, we were working with one like liquor store as well, which was again, coincidentally a friend of mine. So that vertical and that use case, like his store started to get like more orders and people were interested in more products around that and so looking at that little bit of that data, we talked to more liquor stores and figured out like there's a real need for a good e-commerce platform like that in the alcohol space. Well, at the beginning, did you set out to sort of test? Was that always the plan that for a year, you guys would just test different market places and then whatever you saw signals, you'd double down or was it just a natural progression? I think it was a natural progression. Like I'd be lying if I said we had a plan. Like we clearly don't know what we're doing. We're trying out different things and figuring out what sticks, but we quickly learned along that way as well that forgetting out doing a bunch of different things doesn't really work. You have to really test out those things. And so then after a year, you guys said, all right, the signals that we're getting from the alcohol market, specifically that one store are doing well. Let's double down on that. We cut down everyone else. We removed all the other businesses from the platform. Said, sorry, we couldn't continue with you right now. We, our company was called ScanCart before, if you know. And we had rebranded to a bit more like alcohol focus. Did I went through a whole rebrand relaunch? Did you guys hire to do that? No, it was just us. It was just us, like it was two of us. Yeah, we got like branding help from things like like Odask and like freelancers and work with a couple of friends of ours who are graphic designers with helping us with like logos and branding and coloring and things like that. As soon as you have the strategy set, your rebrand is done. Yeah. So just about so that the rebrand was a little bit more a conscious effort as well, where you're like, yes, we need a critical mass of people are critical mass of the businesses to be on the platform for us to go like really go after end consumers and given that this was a lot more like hyper local strategy. So we were like constrained in terms of like where with geographies we would like be able to operate and launch in. So we we made a conscious thing about getting stores in Boston launching in Boston. We are like, yes, we we need about eight to 10 stores to be on the platform the day we launch. And at that time, we got we got a few of those stores. Signed up when I brought them online and think it was sometime in 2015, like August, we launched as buttery. And what was the pitch to the to the liquor stores? Was it, hey, here's a free way of getting you guys out there, secondary marketplace for you guys, free delivery. And were they getting paid a premium to be on there? Like were they, let's say a six pack cost eight bucks? Yeah. Were they getting nine or was it? No, so our main value proposition to them was like, they they had an online presence, but they're all their websites for mostly informational. So they would address, they'll put up a map and they'll be like, these are ours. Here's a phone number. Call us, right? Yeah. But they were not being able to convert that traffic into a buy intent. Right. So they don't have any e-commerce presence like a lot. Some of them had it, but they're all websites were like clunky. It's bad. Yeah. They're pretty bad. So we offered them this new way of like not be not having to manage any of that. Easy sign up inventory integration and be able to offer like instant like one hour delivery as well, because a lot of those stores did deliveries themselves and they did it while we were operating as well. So the value we offered them was instant online presence. No, no management at all. Right. We get them additional orders that they wouldn't have seen outside. They're like a quarter mile radius from like foot traffic or whatever. Right. You're also expanding their delivery footprint to some extent. Yeah. So if they wanted to go beyond their like immediate zip code or immediate like half mile radius, they can do however far they were willing to go. Were they pre-receptive? I mean, they weren't like as many people like not really too concerned about it. OK, it was fine. Like that that wasn't a problem like at all. What's the delivery more of the issue for them? Delivery was an issue. A lot of people were doing delivery themselves. A lot of people wanted to get into the delivery business because of the whole like e-commerce boom in the Amazon and people getting used to getting stuff delivered to them. So they were receptive of establishing their own delivery as well. How are they doing it? They were just like hiring. Yeah, they had their own employees do the delivery. They had their hard drivers. The store isn't too busy. You get in your car and go deliver. Yeah. But then the store gets busy, then people are waiting a long time. That was that was always a problem when there's like in the evenings when the store is busy, they are like, I can't do this order. I don't want to do this order. And they would end up canceling it. What did you guys start with? Was it mostly beer or was it? No, it was the whole entire store. The entire store. Like we integrated with their point of sale system. Pulled out all the inventory from there. And we had a live inventory feed going on, right? So every hour we would get a feed from their system, push it up to their online store on buttery. And it was what you see in the store with the same prices at the same quantity, you would see it online as well. And I think you told me this, but you guys were the ones doing the delivery, right? Yes, there were definitely times where when the stores didn't want to and we wanted to keep the lights on, we didn't want to have customers get like bad experience about the cancellations and whatnot. We went and did deliveries ourselves. We signed up with the stores like saying, call us when you want to. Yeah, and literally you. So you were personally driving around? Yes, me and my co-founder, both of us were like doing deliveries from the store to the customer. So did you have a limit to how far you were willing to go? No. So someone's 80 miles away who needs a bottle. 85, yeah, we did like five, five, seven miles. But even like five, seven miles in Boston is like a is like an 45-minute drive. Right. Yeah. So yeah, it's a significant amount of time that you're spending on the road. Yeah. Yeah. The one thing that I'm also curious about is you were clearly you had to card them, right? When you get to their door, so is that a type of training? Like you have to know what to look for. And, you know, yes, so when we signed up with the store, there were a couple of things we had to do it like officially. We had to undergo a it's in Massachusetts. They call it like tips training. Like so you have to be tip certified to be able to validate the idea and make sure like in what conditions you are allowed to sell alcohol to customers in this case, like hand it over or deliver to them. Be able to validate whether it's a fake idea or not. Like all of the all the things around that. Did you have to scan it or was it just an eyeball check? Yes, we had we had we were using an ID scanner as well to validate. And yeah, we got a couple of fake IDs for sure. So in that same vein, I know bartenders are tasked with cutting people off if they're too drunk, same with stores. So did you ever get to someone's house and they were clearly like too drunk to serve in a sense? Luckily, we didn't have that. Yeah, luckily, the only thing was we got presented with like fake IDs sometimes we didn't have to deal with that. But we see that we see that here all the time. For how many years did you guys do the delivery yourselves? We were doing some for for some like we were doing deliveries pretty much seven, eight months before before we got acquired here. Yeah, or at least like two plus years for sure. What was the delivery fee? Like how much were you guys making per transaction? So the so the agreement support transaction in Massachusetts, it's a it's a slightly gray area where either you're not allowed to take any like percentage fee on on an order. So we had like a tiered contract with them. OK, depending on like their order volume they do in during the day and for that order and things like that. So it was like a flat rate based on like the order volume. Got it. So but it was still around seven to eight percent. OK, yeah. So you negotiated that with the consumer with the store. So the customer like the end customer pays the price of the product. They pay five dollars like four ninety nine delivery fee and an optional tip that if they wanted to add. So with the stores, we had the thing like if we are doing deliveries for you, we'll take that delivery fee and the tips. Also the commission from the orders. And so after a little while of working with the stores, what was the reception where they did they love it? Did they stores that were getting like decent amount of deliveries? They loved it. They had their own website, a personal storefront that they had like linked it up to their static websites as well. So they were happy that now they have an online presence that they could use. They were also able to like merchandise their own products. They're like, hey, I want to sell these as like my top selling items or like my featured items, some stores, of course, depending on the areas and they had like less fewer orders. So they were still like, ah, it's not like as interesting because all they want to see is more more money, right? So if they don't see that and of course, like when you're starting out, you promise them the word. So it's like managing some of some of that as well. And the expectations there. Yeah. And then at what point were you guys, because I'm sure for you guys, you're doing the calculations, right? You're you're in year two, three, four and you're thinking like, all right, is this going to scale? We're sort of educating the market, which is really what you guys are doing to some extent. Yep. Was competition coming on? Was there a lot of competition at the time? There was there was there was good competition. Like, of course, Risley was one of the biggest competitions, both companies being in Boston, the same in the same backyard. So Risley was always like the big name out there in the market. A lot of our stores that we were working with as well, they were working with Risley as well. So they are like what whichever channel gets me like the most order price. Yeah, they were playing both sides. Oh, yeah, they don't they don't really they don't really care. They are like more orders from whatever orders they can get from anyone. They are they are happy with it. Right. And from your perspective, were you guys thinking of raising money to try to compete? Yeah, we had like self-funded this for for a while. We wanted to even when we got to a stage where we rebranded and relaunched as buttery. We were it was all bootstrapped self-funded operations. But yeah, we would right after that, we started out getting money, like raising money. I think once you have launched, you get measured on a different yardstick, right? Like if you if you are a pre if you are a pre product company, if you have not launched, the parameters are different. But after we launched, we were everyone was like looking for like, oh, what's your revenue? How many consumers? What's your traction like? What's your growth? What's your growth? Number of stores, number of consumers, like all those fund metrics. And then did it change your business model at one time? Because were you guys thinking like, OK, how do we make our business look like appealing to these investors with some vanity metrics, more markets? We we did a little bit of that towards like towards the end later, maybe a year, year and a half later, where we are we are having like hard time raising money because everyone wanted to see more consumers, more traction and it was a function of being in Boston or did you think it was? I think it was a little bit of both. It was being in Boston, Dresley being a big presence, right, your main competitor with the name. Yeah. So people listening, generally speaking, it's harder to raise money when it comes to tech in Boston. The Boston investment groups are typically a little bit more conservative when it when it comes to giving out money, specifically around what your finances look like. They want to see sort of a proven revenue model, whereas in, let's say, San Francisco or Silicon Valley, they're really just betting big on the team and the idea. And if the market's big enough and if you have no money and no traction, but they like the team and the market's big enough, they'll just go ahead and double down. Yeah. And so it's a little bit more gambling, I guess, is kind of the spectrum I put it on. But it's been very successful. And so you're dealing with these two different groups. But you guys, you guys tried to raise money out. Yeah, we not as much, not as much on the Vescos. And so nothing really materialized. Nothing materialized on the Vescos at all. And what were you guys thinking when that happened? We were just trying to find a way to keep it going. It was a matter of like... Did you deplete all your savings? Yeah, it was gone. It was gone a while back. Yeah. Were these dark times for you and your co-founder? They were. OK, we managed. We figured out some family savings over there. All right, so you tap into your family savings. And then what were you thinking? Were you thinking, let's just keep scaling it? Yeah, we were trying to figure out a way which made the business more appealing. We're saying, given that when you are trying to go acquire consumers, you need like, you literally need money to go spend on like social media, SEM, SEO... Cost of acquisition. Cost of acquisition is always there, right? But we also tried to do it the other way around. So we wanted to see how fast we can expand into different markets. How fast can we scale our sales strategies and whether that works or not, whether that makes it a bit more appealing as our business to... Yeah, if you could prove like a payback period. Yeah, so if I go into this new city, I inject X amount of dollars. I'm seeing that return in months. Absolutely, absolutely. And even with whatever little marketing dollars we were spending acquiring consumers, having presence in more markets, more geographies always made it a little bit more efficient to acquire that customer, right? So targeting like this one zip code in Boston versus targeting like Boston, New York, LA, Chicago, like it's more efficient. And also we wanted to prove out whether we can go get more stores in other cities and have a remote sales strategies work and inside sales strategy work. So we gave ourselves like two months and saying, what can we do over this summer, right? So that one summer, we are only focused on signing up stores in Washington DC, Austin, Chicago, Los Angeles, and we were able to launch in those four markets by just two of us, signing up stores which were, which provided like our critical mass of that geography and saying like, yes, we have coverage that we can prove this out. And we tried to go back to investors at that time, but then it's like always a moving target, right? Like we have, it's fine. Like we were not successful in fundraising from VCs. Sure. So what happened then? How to go on the expansion? So the expansion was fine. Expansion went below. Did you have to fly there or was it all via phone? No, it was email and phone calls. It was all inside sales. We were sitting in that BU office space that we had and yeah, we signed up about 10 to 15 more stores in those four markets. And yeah, we turned them on. We were getting some organic traffic, organic traction through- Like it was doing the delivery. The stores, the stores do the delivery. Yeah. Like everywhere, like apart from one or two stores in Boston, like all of our other stores were doing their own deliveries. They had their own delivery operations. Did that change at some point where some stores were primarily looking to you guys to do the delivery? Not really. Okay. Not really. Some of them were in Boston leaning towards that. But at that point, we were like, we can't support that anymore with like the scale that we have. Yeah. So we had to cut ties with a few of them. Then at what point were you guys thinking of just walking away from it and hopefully getting a flyer? So we were at a point like in, this was I think, early 2018, like spring 2018 where we're trying to figure out like, yeah, what are the next steps, right? Like if we are not able to fundraise well, if you're not able to grow at the pace that we should be growing and we wanted to grow at, it doesn't make any sense in continuing the business at that point, right? So we're trying to figure out different avenues, talking to a few people to see whether an acquisition makes sense or just partnering makes sense as like growth partners to power somebody's like alcohol delivery and like alcohol as a vertical because we knew that well. We're talking to different people, different companies. Then we got introduced to founders who are at Drizly and we had a conversation. It was great. What did you find out that you guys were doing better, if anything, whether it's the tech? I don't know if I can point to like one certain thing that we were like doing better or worse. This is how I'll put it. I'll say with the amount of stuff that a two-person company achieved in that last three years, I think that was like the best thing that we did, right? Like putting all our sweat equity into building that company and growing that, performing all the functions around like, be it customer support, being delivery, be it tech, be it sales or all of that stuff. With that sort of like limited resources, what we achieved at that point was I think our biggest achievement. Was there any kind of hit to your pride? You'd started this company and you had stuck with it through very thin times. Was there a sense of like, well, this is ours. I want to keep it ours. Or was it just like, you know what? We need to accept that it's time to start looking for ourselves. Yeah, I mean, there's always there are always those feelings, right? And yeah, you've put in so much effort to build something from the ground up from nothing. And you're at a point where, what's the future of that company? But yes, it hurt for sure. But I think it was fine. I think it was like the right outcome. I think we found like good partners to merge with like, now we are here, which is we're solving the same problems just on a bigger scale, which I think is good. What was the process like? I didn't know if you like followed any specific process. Like while talking to people, like we started getting introductions and started reaching out to people who could make introductions. So we had conversations, we tried to understand what their vision is of their companies, what their vision would be for us and what are they as a product and us as founders joining a different team as well. Yeah, how was that like, that conversation? Because in some assets, you guys were siloed, right? It was just you and Garra on your own, chasing your dreams. And now you're gonna come into a structured environment. That's completely different. Similar but completely different. Was that, I mean, what did you guys think of that? I don't know. I don't know. I don't think, at least me personally, we didn't have much concerns of going into a structured environment back again. We worked at Verizon for like seven, eight years before we started our company. So we've been a part of a big 100,000 people company going back to a two-person operation coming on joining a 100-person company. So it's not as rigid, as corporate, as someone like Verizon. Sure. We're still a startup here. Still scratching the surface of the problem. There is good opportunity here. Yeah, and then in terms of what roles were you guys given or how did you guys decide what roles were available even to you? We started out in engineering, both of us, but we wanted to do different things. Then Garra slowly moved into leading one of the products here and I'm still in engineering, but I like what I was doing. So I stayed around in engineering, leading a team, got that opportunity. Leading products, like engineering products from the backend retailer side of operations and how to quickly bring them online, how to make them do their deliveries more efficiently and all that suite of products. If you could go back, is there something that you would do different? You have the same source of capital, so the money's the same that you guys had. Yeah. Would you do, what is it that you think might have helped if you did a small tweak here? And I don't know, like right now I'm probably just guessing. Yeah, totally hypothetical. Totally hypothetical, like one thing I would have maybe done differently is probably fund-raised earlier, like tried fund-raising earlier before we actually launched, had a product. Pre-launched fund-raising. Yeah. So Go would help us with bigger team and bring on someone with slightly more complementary skill sets, because both of us were engineers, like product-minded engineers, we wanted to build products. Maybe we could have helped with someone either with sales or with more like business type of a person. I think that would have complemented our team like much more than what we were. So one of the things that I've picked up on in meeting all sorts of startups is it's like heartbreaking but endearing when they talk about their, let's say, I'm gonna call them years two through six when they were so afraid to spend money and they don't realize that if they had spent the money hiring the team or on these certain things they could have accelerated their company a significant amount. Do you feel like that's with your company? I don't know if I'm in a position to make that judgment because we didn't have money, right? We had what we had and we had to spend it in the right thing. So that goes back to that's why you would have fund-raised? Yeah, that's why I may have attempted fund-raising a little bit earlier and trying to accelerate the team growth, the product growth, the traction growth, all of that. Was there one thing that you guys saw that really made the difference when it came to delivering alcohol? Was it like special sales, special promos around events? Did anything like that really? I think what we made easier was for a liquor store to establish their, establish a website at a storefront for them, right? Yeah, they could have gone to Shopify and signed up on Shopify but that's not really like alcohol specific. They would have to manage their own website by themselves. Putting those 5,000 products they have in store online is not an easy task, right? So managing, maintaining that sort of data accurately, representing them online, that's not something that they can do it on Shopify themselves, right? Which is what we made it super easy. We managed a lot of those things for the stores, like we did that. How did you do it? Did you guys just have a template that you set up? Yeah, I mean, all the storefronts were on a similar template. Yeah, one course light is the same as another one. Yeah, so all the product metadata images, description, all of those things are common across stores. So once you get it for one, it's available for everyone else. Right. Which made scaling easier as well when we got new stores online, yes, you have all of these products. I have, we have the metadata for you, right? So you don't have to redo it all over again. Yeah. Yeah, was that valuable in the acquisition? It was, it was absolutely valuable. Like all the experiences that we had, like the way we did like our inventory integration, our tech, our backend, like the operations are very similar, just on different scales. When you guys got acquired, was it stocked? Do you have to be here for a certain amount of years or what is what it sounded like? Yeah, I don't want to go into too much detail about that, but yeah, it was, I mean, we don't really have any like restrictions, like per se, like of course there's like, best things, schedules and options and stuff. Do you guys plan to stay here for a little while? I think so. Yeah, I think so. Do you ever get the itch again to start something else? Any other ideas floating around your head? There's always ideas floating around in our head, right? I don't know if there is a real itch per se, but yeah, you know me, like I like to build products, right? So build things from scratch and see it working. That has a totally different like feeling when you see something tangible working that you've created. So that's always exciting. We'll see. I know, we'll see, we'll see. For people listening, what was the pressure like at home? So you're doing your own startup. It's just you and your buddy. Yep. What is your wife telling you? I think my wife was great. Didn't have as many complaints at all about like, or like any pressure about like making this work until we had a kid, which then started like, then it struck hard that like, okay, there's now there's, I think the time is running out. It was like, she didn't really say that, but it was always in the back of my mind per se. Yeah, this is. Right. Now you have another life to take care of. Yeah. Now you have to think about someone else as well, right? So. And did that anything change for you when that happened in terms of your mindset around the business? Not directly on mindset on the business, but like, yeah, when you have a newborn, you're spending a lot more time tending to them and making sure they eat, sleep, poop well. So you would, of course, spend not, not spend as much time on business and not spend as much time working on it. So. You gotta find the balance all over again. Yep. What would you, what advice would you give anybody listening around either starting a company or scaling a company or even on getting acquired? I mean, what would you? I would say like, if you're, if you're really passionate about solving a problem, just go ahead and do it. Like there is, there is always a, if there is a problem out there at the market, there are, there is always a better mousetrap. Did you think about, if you just lost everything, would you have cared? Lost everything about? Yeah. Like if you didn't get acquired, like if we didn't work out, it was no happy. We, we, we were fine with that as well. Like we, yeah, we accepted that fate. Yeah. We knew that was a realistic option. So we were, we were okay with that, with that decision as well. Yeah. That happens. Were there any backup plans? No. No. No, go find a job. Yeah. At the end of the day, I guess you're both obviously still two very talented engineers. I could easily, I would say easily get a job. Yeah. Right. Yeah. And I guess that gives you the. That, that was, I think, I think that was, that was not as big a worry at that time in, in my head. I wasn't too concerned about it. Yeah. I'll find something. Where, where can they find? Oh, true. Yeah. Where can people find Drizly? Drizly? Drizly.com. And what's the Instagram ad Drizly? I think it's Drizly Inc. Yeah. D-R-I-Z-L-Y. I-N-C. One Z. No, I-N-C. No, I know. But I'm just saying there's. One Z, one Z. Yeah. A lot of people make that mistake. And internally we don't like really enjoy that. But. It's the Drizly Drizly. Yeah. That's another education of the market right there. Yes. Well, awesome. Thanks, brother. Thank you very much. We here at Startup to Storefront would love to hear feedback from you. Reach out and let us know what you think, either through rating us on the podcast app or by sliding into our DMs. You can find us both on Facebook and Instagram at Startup to Storefront. Our theme song is composed by DoubleTouch. If you want to learn more about the products and businesses featured on today's episode, check out the links in the show notes. And if you enjoyed the episode, consider subscribing because we've got a lot more great guests coming up that you won't want to miss. Thanks for listening and we'll see you next time.