SPEAKER_00: all right we have a great interview today with go puffs co-ceo raf ilishayev just a great guest and

SPEAKER_01: a great business you're really going to enjoy it but first we're going to tee up a very relevant story that broke right after we did this interview which is joker j-o-k-r is an instant delivery

SPEAKER_03: startup that is looking uh to sell its new york city business so they can stay focused on their home turf in latin america why because they're allegedly burning a ton of cash in new york city

SPEAKER_00: and possibly because go puff is torching them in new york city hey oh pun intended then we talk about cruz which is a still around and b raising 1.3 billion dollars from softbank this is the autonomous driving startup that was acquired by gm and is now starting officially a robo taxi beta

SPEAKER_11: in san francisco what could go wrong what could go right who knows gonna be an interesting 37 days

SPEAKER_12: and this is gonna be a great episode stick with us this week in startups is brought to you by

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SPEAKER_18: o-u-r-c-r-o-w-d dot com slash twist all right we have a great interview coming up but before that we

SPEAKER_21: got a little news that is very relevant to the great interview that we have coming up instant delivery

SPEAKER_00: startup joker is in talks to sell its new york city operation after facing big losses according to reporting by the information and uh the reason i say it's relevant to our interview is that we're talking with gopuff co-ceo roth ilishayev and they're of course a competitor to joker and they seem to be going gangbusters yep but here joker is pulling out of the new york city market and this is a company by the way that only operates in one other u.s city which is boston and two or b just raised a 260 million dollar series b at a 1.2 billion dollar post money valuation which was co-led by ggb and hb

SPEAKER_27: capital so what are we looking at here well uh you know it just reminds me of when uber and lyft

SPEAKER_29: and uh what's the other company god there was another uh a sidecar there were a bunch of different people who were trying to do you know the the uber lyft thing and it became clear to lyft that uber was such a dominant player and so good at what they did and so well capitalized that lyft went to the cities people forget this early on that uber had not gotten to yet so there was a time when uber was only in five cities so lyft said okay you're not in atlanta you're not in nashville we're gonna we're gonna go to those cities first this way we know you're coming and when you do we

SPEAKER_03: know you're gonna put your foot down but maybe we can get a little head start here maybe we can build up our brand and i think what joker is dealing with is you have a company backed by softbank huh who is super well capitalized and they're gonna play a certain playbook which is whatever city you're in we're gonna dominate in we'll spend twice as much money uh we'll lose money if we have to these things might seem anti-competitive um discounting is not an anti-competitive practice you're allowed to give discounts but it could be for a large company if they did it to extinguish

SPEAKER_30: another company i think it can be considered a um anti-competitive practice we'll have to like double click on that of when it applies but that's what's happening here joker just can't compete there's too

SPEAKER_29: many players too many fish in the pond not you know enough algae or food or whatever for them to eat which means you are uh could have a collapse in the ecosystem and when something collapses in the ecosystem and you're the fish that's big and doesn't die you become more powerful so this is just

Chamath Palihapitiya: too many fish in the pond some of them are going to die and joker apparently is uh folding and well that's

SPEAKER_21: healthy for a market they're folding in new york city and they appear to potentially at least according to the information have set their sights on a different pond investors a few months ago joker

SPEAKER_00: was going to further expand global operations after launching across over 10 cities in latin america europe and the us evidently its investors probably because of all of the reason the big fish like go puff in the pond over here are saying we want you to double down on latin america because labor costs

SPEAKER_35: and competition are far lower jokers actually based in latin america yeah and it you know so yeah

SPEAKER_29: they'll be closer to home they understand those markets better big win this reminds me of uber in china and uber's philosophy was we're going for the gold and if we get the silver we're not happy about it but we're in the game but if we're bronze or below we're going to sell the unit to whoever his gold or silver and we're going to win that way yeah they did that with dd they did it in russia they did it in a couple of other markets with grab i think too so they're folding new york because they can't win and i think it's a smart smart idea if you're again in an industry and you're the number one or number two player you're in all likelihood going to hit profitability and you're going to print money and it's going to be a delightful experience when you're number three four or five your acquisition bait and you're basically screwed postmates sold to uber uh doordash bought a company i don't know if it was i always forget the name of the company they bought but there was some other delivery service they bought it's just really hard to exist as a fourth or fifth player and

SPEAKER_27: now you're fighting a war really far from the homeland and that also is a recipe for a disaster we've seen that in wars right like literally it's kind of hard to go fight a war in you know maybe in

SPEAKER_00: modern times it's less so but halfway around the world joker might be i mean joker compared to potentially some other competitors because let's not forget that the wall street journal report since 2020 there have been there's been five and a half billion dollars invested into just six instant delivery competitors in new york city at least joker is in a position where they've got a beachhead to retreat through to right they can go back refocus reconcentrate in latin america and potentially kill it there for all we know um whereas as the rest of this market consolidates some of these companies you know get here i think it's pronounced gorillas might end up dying um you're gonna obviously hear a little bit more about the go puff business model in a couple of minutes and it doesn't seem like they're in danger of dying but everybody is feeling the loss it's gonna be um you know a very difficult

SPEAKER_29: business because it's about scale and it's about being able to survive for a decade who's going to be able to survive for a decade doordash uber eats um amazon and it feels like gopuff but it doesn't feel

SPEAKER_03: like anybody after that has much of a chance of surviving um i think we'll look back on this in 10 years and i would be surprised if you know the names i just mentioned were not the dominant players around the world three or four of them and i would be surprised if anybody else adds to that list and even for gopuff i think you know with our interview today as good as they're executing as well as they're executing they're going to be coming up against amazon doordash and ubereats and those are going to be formidable competitors uh who you know they're going to be hard to uh compete against because i i my personal feeling on this and this is my feelings after we did the interview that's coming up in the second half of the show i don't know that people care about the difference between 15 and 45 minutes i you know having experienced these now i think it might be a little overblown i think under an hour is the magic and i think that means that the doordashes and ubers and eventually amazon if they choose to are going to have a pretty good role to play here i mean i don't know about you molly is there

SPEAKER_55: my most of your purchases is there a difference for you between 15 and 60 minutes not really right

SPEAKER_00: like at some point it's just not it's not that crucial unless it's i don't know tampons but like what i do think is interesting alcohol maybe alcohol well and that's where so the the competitive advantage that gopuff does have and i'm not going to give away too much of our interview but what i do think is interesting is that compared to doordash uber and amazon which are well amazon owns whole foods so if you're getting groceries from them at least you know you're getting groceries from a whole food so they have that delivery um they have the fulfillment centers built into their delivery premise whereas doordash and uber are getting it from restaurants or ghost kitchens um and go puff's big differentiator which we will discuss at length is that they own their own fulfillment centers and micro fulfillment centers so to me this whole interview and listen for this all comes down to the suburbs yeah whoever wins the suburbs could win i think it's gonna be a big part of it yeah

Chamath Palihapitiya: and i mean also we've talked about this just in our investment careers asset light versus asset heavy

SPEAKER_29: uh businesses and go puff has chosen asset heavy to get some advantages in speed and then the question is if you're doordash uber eats and you're fulfilling from walgreens and cvs and you're doing it in under an hour which is a better business to be in yeah it's gonna be a dogfight and it'll be interesting

SPEAKER_03: to see 2021 was a huge year for ipos we all know that over 1 000 companies went public but two-thirds of those companies are now trading below their offering price according to research from our friends over at masterworks and reports of raising interest rates are causing some investors to adjust their portfolios that's why some people are allocating more capital into blue chip art massworks is the investment platform that lets you invest in shares of pieces by legends like picasso monet and of course banksy in november the wall street journal published an article titled art is among the hottest markets on earth they reported that art owned by the wealthy has potentially appreciated even more than their other asset classes for example back in may a picasso sold for a hundred and three million dollars that's a fourteen hundred percent increase from its original auction price so with mass works you don't need to be a billionaire to own a picasso and masterworks is letting twist listeners skip their waitlist just go to masterworks.io slash twist to cut the line that's masterworks.io slash twist see important disclosures at masterworks.io disclaimer all right let's do our next story and this is in the we live in the future uh w lit f is our acronym lit a f is what they say yes uh cruise just opened at san francisco uh robo taxi service to the public and announced a 1.3 billion dollar raise from softbank uh which is you know like a quaint raise from softbank i know exactly i was like that sounds like so much money but not 10 not five just a billy uh remember cruise was acquired by gm back in 2016 for 580 million uh they raised over 13 billion to date both before and after the gm acquisition cruise was recently valued at 30 billion dollars uh so let's talk about this robo taxi service they're starting with a small number of users california dmv gave cruise a permit to test fully driverless vehicles in 2020. right now it's going to be free uh and in december 2020 2021 the san francisco municipal transportation agency pushed against cruises proposal to charge rides citing safety and vehicles ability to follow rules like picking up passengers at the curb instead of in the middle of the road uh so uh let's take a look at this uh passengers this is some b-roll of

SPEAKER_00: this is uh this is techies getting driverless rides in san francisco and sitting in a vehicle that of which no one is at the wheel they demonstrate uh rides by the way at night so just to show like our cars the uh but the sign form does make it seem like they'll be testing in all times of day on uh both apple and android devices and by the way these are going to be driving around san francisco so just like heads up heads up people in the crosswalk i know you're already getting run down by cars um they appear to call in the video the car from the cruise app and you see the car doing basic driving things like slowing down to go over speed bumps and picking people up and you know not

SPEAKER_89: crashing this feel like a good idea san francisco the city to do this of all cities that's exactly

SPEAKER_00: what i thought i was like wow i mean it is bold a lot of these driverless car companies are doing their testing in las vegas and like phoenix arizona is good yeah great open you got a nice grid san francisco is like a ball of hair with lots of homeless people in the street and hills you can't

SPEAKER_30: see over like oh god help them this is um i'm going to make a prediction here this is not going to turn

SPEAKER_03: out well yeah i have a feeling we're and i don't know what the scale of this is and i don't think they say but this could be two cars that they're testing with 10 employees so there might not be so many of these on the road that we get a lot of um you know uh videos of it doing weird stuff

SPEAKER_29: but this is not going to work in manhattan or san francisco now this seems like a really bad idea as much as i'm pro technology i just think the pedestrian situation in a city like san francisco

SPEAKER_27: at this moment in time you brought up the homeless and in some cases you know we might be saying homeless we might be saying people who are on fentanyl passed out in the street so yeah this is like

SPEAKER_30: i mean it's not to make light of the situation it's not in this reality there are a lot of

SPEAKER_00: unintended human interactions in san francisco and that it's that it's in the road it's in the crosswalks it's not in the crosswalks like it's a it it's a scary thing to what's interesting about this video too is that it's like a lot of um techies trying to put the stamp on it so in the video is twitch ceo emmett sheer jamie quinch from uncommon capital y combinator president michael seibel i mean it just points to the fact that driverless taxis and fully autonomous vehicles the mob project it's a mob project it is something the mob really wants to work everybody wants this to work eventually

SPEAKER_02: sure it is but i mean there's been no indication that driverless car technology is actually this far

SPEAKER_29: law by anybody what i would like to know maybe somebody who works at cruz or pr at gm or something can tell us is there a safety driver remotely monitoring these cars i'm gonna guess there is

SPEAKER_03: so what that would what that would mean is it's a self-driving car but it's kind of running autopilot in other words there's somebody ready to take over at a home base looking at a computer somewhere in real time because that is what i think is the great bridge here one one minute out of every i don't know 50 to 100 is going to be really challenging for these cars and maybe there'll be 48 minutes 49 minutes out of every let's say out of every hour there'll be 55 easy minutes three or four

SPEAKER_27: modestly challenging and then one minute of we need an intervention here because somebody jumped in front of the car or there's a double park car or whatever a bicyclist is doing something crazy that's when a human needs to take over or at least monitor the situation and kind of backseat drive the the the ai yeah and i think that's what waymo might have been doing in arizona is that we're remote

SPEAKER_106: people uh but it's coming it's definitely coming to be down i don't want to be down on it to be clear

SPEAKER_107: like right i am not in the la cosa nostra we're joking i'm trying to make this happen now i do want

SPEAKER_00: this to happen the mafia and i think it's very cool that cruise like cruise is trying to build a build a purpose built vehicle that will essentially be small but mass transit ready right like this is a great future for transit awesome um it's going to be uh interesting to see how this experiment goes

SPEAKER_02: it's a start let's do it but everybody i'm gonna set the over under at 37 days before a video is

SPEAKER_29: released that trends of a cruise car in san francisco having a unique interaction yeah would you take the

SPEAKER_104: under 37 days before a video is released or over 37 days under taking the under i probably would have

SPEAKER_48: taken the under my own line but i'll take the over there's your bet everybody somebody got to keep

SPEAKER_27: track of these bets thinking in bets uh you know we have to think in bets here we have to always be handicapping as investors so i think we're going to see like literally a homeless person fight a cruise car or a bike you know god forbid like ramming into the side of it or yeah you know somebody slamming

Chamath Palihapitiya: their horn and yeah but i think it's my my bet is you know in a in a grid-based city we could see these uh being delightful um in the next five years and you know yeah just to set up our uh upcoming

SPEAKER_00: interview with raf from gopuff potentially great delivery vehicles so yeah let's get to the interview

SPEAKER_68: with uh gopuff co-ceo ruff great guest cloud infrastructure costs are one of the biggest expenses for startups and they're also some of the most unpredictable it's no wonder that many startups get lured to the major cloud providers with the promise of all these free credits only to wind up locked into unpredictable cloud bills and outrageous costs i've had this happen myself well

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SPEAKER_29: growth you can apply to the rise program today as a startup at linode.com twist that's l-i-n-o-d-e dot com slash twist thank you so much to for linode sponsoring all these great uh startups and for the rise program it's really a great service and it's great that you're of service to the startup community i

Jason Calacanis: really appreciate that lino.com twist we are excited today to talk to rafael or raf ilishayev ceo of go puff which is instant as i understand it instant commerce like no pressure some people are doing commerce some people are doing delivery go puff is like no no instant really fast

SPEAKER_134: like super fast uh welcome to the program right thanks uh thanks so much for having me jason molly good

SPEAKER_138: to see you so let's define how fast you get products to people and what exactly you're delivering

SPEAKER_140: um how long has go puff been around and what is the mantra in terms of how quickly you get

SPEAKER_141: various uh items to people's homes what's the goal here yeah why don't i i start a little bit about the

SPEAKER_143: origin story tell you guys how we started this thing and uh you know no no no no tell me the answer to my

SPEAKER_145: question first yeah no no no this pr speak where i know that somebody media trained you to tell me

SPEAKER_148: the origin story i don't care i want to know the brass tacks how quickly do you get stuff to people's

SPEAKER_143: doors what's the goal so we on average our delivery time is 17 minutes uh across the board uh in newer uh cities like new york has been faster than that average delivery time in the low teens so very very

SPEAKER_152: fast uh but different to most folks coming from our micro fulfillment centers to our end customers uh

SPEAKER_153: uh that that's why the speed is 17 minutes is your average that's the real average 17 minutes in a city

SPEAKER_155: yeah it's very very very fast and in new york it's 11 minutes yeah it's in it's in the low teens but yes

SPEAKER_158: okay so now explain to me how that is possible because i would think just off the top of my head here putting a bunch of stuff into a bag takes five minutes so that gives you seven minutes to race it to

SPEAKER_49: somebody's house how do you do it walk me through the the minute economics here yeah so it took years

SPEAKER_161: of iteration we've been doing this for nine years to get from you know 40 minutes in delivery to 30 to

SPEAKER_143: then sub 20 uh but the reality is it's a combination of a number of things one it's the infrastructure that you build within a city so like for example in a city like manhattan we have close to 16 micro fulfillment centers and each micro fulfillment center has a certain radius that allows for a certain drive time or in the case of new york city a certain bike time so it takes an average just shy of two minutes to pack an order most orders do not go out with a single batch so like they'll go out with one two or three orders in uh in a run and then there's a very very tight delivery window uh the delivery zone around that micro fulfillment center that doesn't allow for a long run so the key is to make sure that you know the driver or the biker is not going too far and then the empty leg that they're coming back with is obviously also short as well so i don't want to oversimplify the problem but it's it's a lot of work on infrastructure and it's nine years of work on building the tech inside the

SPEAKER_166: micro fulfillment centers to enable for how big is a micro fulfillment center you said there's 16 of them in manhattan or manhattan brooklyn and the boroughs which boroughs are you in so we're we're in

SPEAKER_143: every borough but staten island uh we'll we'll be we'll be in staten island in uh in a month uh we cover every major dma in the u.s all top 100 dmas uh roughly 36 of the u.s populations explain what dma yeah what's a dma it's it's it's a it's a it's a master district so like so a hundred of the top cities in the u.s uh we'll cover and uh you know essentially you know just just shy of 36 of the u.s

SPEAKER_152: populations within a one mile drive of a gopuff micro fulfillment center wow how big are they square

SPEAKER_166: foot wise and then how do you pick them are they store are they former storefronts like i heard

SPEAKER_164: like sometimes you guys where some folks in the space are buying existing bodegas or corner stores

SPEAKER_143: so the smallest one is probably like 5500 square feet and the largest one is like 20 000 square feet

SPEAKER_169: that's a that's a bevmo so like you know kind of going all over the place but we have some some physical uh retail stores that we bought for the liquor licenses like in california we bought bevmo in kentucky we bought liquor barn for their liquor license and we use the existing infrastructure they're larger stores yeah sure i have a bad moma area yeah so we'll you we'll use their infrastructure we'll build a micro fulfillment center within inside of a bevmo and and then we'll

SPEAKER_143: deliver from there but everywhere else it's a standalone dark store or micro fulfillment center that we'll then use for delivery so anywhere between five and you know all the way up to 20 000

Jason Calacanis: square feet i mean i feel like this is where we should clarify that the other big difference in

SPEAKER_02: addition to a 17 minute delivery time between you and every other delivery outfit is that you are purchasing and holding and packing your own inventory what made you decide to invest in those you know real estate assets in inventory in curating that's you know it's a complicated undertaking

SPEAKER_143: yeah it's it's kind of what i wanted to hit a little bit about how we started because it is important so i know i'll allow the uh origin story um you know it's it's it's kind of hard to imagine nine years since we thought of the idea uh you care and i were in college and like the entirety of the delivery just didn't make sense to us everyone uh how they're handling delivery was through this third-party model i'm going to go to the store pick up from the store and deliver it from the store to end customers and it's the model yeah it was a shitty experience all around you had no inventory controls you had these crazy service fees there's markup on items deliveries took too long none of

SPEAKER_169: it made sense to us so we knew that we wanted to go first party from day one right we're in college solving our own problem you care and i and we knew we wanted to open up our own micro fulfillment centers we just had no idea how and we had a little bit of an unorthodox kind of beginning we didn't raise any money for the first two and a half years and we started up the business by

SPEAKER_188: finding uh office buildings that were throwing away all of their furniture and we would take all their furniture pack it up in the storage unit and then sell it we ended up accumulating like fifty thousand dollars that was like our seed round so we started the business and then for the first two and a half years we just operated a profitable business uh we opened up in philadelphia uh it was just one micro fulfillment center for the entire city so delivery times were a lot longer back then uh then we opened up boston washington dc austin texas raised our first round and

SPEAKER_169: then when it's re it's really where we started kind of expanding a lot better and you know opening

SPEAKER_191: up and building more tech and more infrastructure but the premise of the business is we were solving our

SPEAKER_194: own use case right so how much do you charge for a delivery two bucks two bucks so and are all of the

SPEAKER_140: the runners or delivery people full-time staff or are they contractors like door dash door dashers

SPEAKER_198: for them for the most part so our european business they're full-time employees um and

SPEAKER_200: then the u.s business for the most part they're independent contractors got it and so those

SPEAKER_164: independent contractors how many deliveries do they do per hour how many can they do and then what do

SPEAKER_203: they make how do they get paid so it's all across the board depending on the tier of the market so

SPEAKER_143: anywhere between like three and five deliveries per hour three and five deliveries a bike you can make and like the the pay varies from like 17 bucks an hour all the way up to like 30 an hour depending on the on the tier of market you know how many orders are drivers doing how efficient the driver is but like we're paying well above what i would say the industry norm is and it's not because uh you know are our drivers you know the the model per delivery actually is very similar to what you would see

SPEAKER_181: in the traditional repeat player somebody can i jump in because i still want to i i still want to go

Jason Calacanis: back to what made you decide because why you decided to buy your own inventory because sure instacart and doordash and uber eats and whatever like it might be suboptimal in some ways but it's still doing pretty well and so i still want to get to like why you were so committed to this this big investment of buying

SPEAKER_200: and curating your own inventory so there's two reasons one is that the experience at least for

SPEAKER_143: us the 20 year old version of ourselves was really really freaking right it didn't make sense it took

SPEAKER_211: too long the you would never get what you guys are very spoiled you've never had anybody do your

SPEAKER_213: shopping for you before and you're like we can't live like this they're not picking up the right apple

SPEAKER_140: the issue is they give you the wrong thing the personal shopper on instacart i think we've all been through this yeah you asked them for like i was ordering those chocolate uh haagen-dazs bars because chamoff was eating them one night i was like let me get those for the girls and they brought me chocolate

SPEAKER_158: ice cream haagen-dazs chocolate ice cream i was like no i specifically picked the chocolate bars like how

Jason Calacanis: do you get that wrong well and we're teasing you but the producers point out this was 2013 2014 the experience was probably very different yeah it was it was it was very different they always get stuff

SPEAKER_143: wrong that's the bottom line they always get stuff wrong and and then the other thing is like you know we're we were raised in kind of as first generation americans right both of our parents

SPEAKER_169: came here had us working from a young age and the reality is like they're like you need to build a business that freaking makes money right and the 3p model doesn't make any money doesn't make any money on your unit economic basis people talk about you know what their path to ebitda is we were ebitda profitable for our first two and a half years right before we raised them in a single dollar do you do

SPEAKER_140: substitutions then like how do you deal with that because that seems to me to be a major friction decision point where you're like i want strawberry you know yogurt and they're like up strawberry's gone you would you like raspberry can we substitute it for you and then instacart was like doing that in real time with the shopper i don't know i always found it like just get it right or don't

SPEAKER_225: give it to me was my philosophy so do you guys do that like swap it out thing and then back and

SPEAKER_143: forth with the users no not really uh because we we owned in the the entire inventory management

SPEAKER_169: part of the business we own the supplies we're completely vertically integrated so we have real time understanding of what's in stock and what's out of stock so like our like an industry metric that a lot of folks use is like a miss pack rate like our miss pack rate is 30 basis points right now it's under half of a percentage point of all orders one in 300 orders you miss packs them

SPEAKER_230: even less than that yeah one in 300 correct yeah uh you're right your math is better than mine

SPEAKER_143: back to this thing um so the re the reality is it's very very low and it's getting smaller and it took a lot of years of building really really strong tech within the four walls of the building to get there right this doesn't happen over you know over one or two or three years a lot of learning and a lot of iteration before we started getting it right so it took a lot of

SPEAKER_234: discipline a lot of building of makes sense to me because if you're like hey listen here's the

SPEAKER_140: yogurt it's in order we're not going to have you know if you look at yogurt at whole foods there might be 20 brands of yogurt i'm assuming because you're doing micro stores you're like we're going to pick one yogurt brand and have it in stock so it's less skews is that part of the magic is less skews and then the store is organized in a much more sensible way so whatever the most often ordered are are you know on the lower shelves and the less order on higher shelves and it's just harder to make

SPEAKER_175: a mistake for the packers is that what's going on here yeah so when we started right we were in this like convenience category right we're going to disrupt the convenience store so we're going to

SPEAKER_169: have convenience store type of skews by the time we got to like 2015 2016 we realized the opportunity is just a whole lot bigger so we started calling it instant needs right so anything someone needs from an immediate everyday basis we'll deliver to them so we expand into ice cream and then alcohol and over the counter media yeah over-the-counter medication pet food baby food household essentials we launched a scope of kitchens business where we have full-blown commercial kitchens inside of our micro fulfillment centers that we're using to uh to deliver and now expanding into grocery in a in a

SPEAKER_188: much deeper way so like the the way that we think about category and assortment expansion is basically on what our consumers want so it's not like what's predefined by traditional brick and mortar retail right if like if something doesn't like neatly fit within grocery or convenience or drug they don't kind of

SPEAKER_140: introduce you don't have the room for it i mean you got a 5 000 to 15 000 square foot place you just do not have the luxury of having what a supermarket might have well we could fit a lot more shoes per

SPEAKER_169: square foot than a supermarket can because we have no one walking in there so yes it could be narrower

David Friedberg: and taller yeah people are not getting on ladders in their super so you can think think like four to

SPEAKER_169: six thousand skews is what generally fits within our micro fulfillment center and like as much as we're

SPEAKER_143: introducing items and really being aggressive on introducing new items the stragglers we discontinue

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SPEAKER_252: garages and anywhere in between our crowd identifies innovators so you can invest when growth potential is greatest and that's early so here's your call to action if you are an accredited investor you can join our crowd for free at o-u-r-c-r-o-w-d.com slash twist and review the current deals that's our

SPEAKER_188: crowd.com slash twist to sign up for free so we we focus really well on like you know how do we make sure that the the skews that matter most to our customers we're introducing in a really meaningful

SPEAKER_169: way right we did it with alcohol in the beginning it was really freaking tough because getting liquor

SPEAKER_188: licenses here in the us you can imagine is not an easy challenge by any stretch of the imagination you know today we own just shy of 400 of them so that that took a lot of years of again of building of getting it right and it just doesn't happen overnight the same thing when happening with the

SPEAKER_143: gopuff kitchens business today you know the the most requested item on gopuff was hot pizza and we're like oh well not easy how the freak are we going to deliver hot pizza so yeah and you got

SPEAKER_188: domino's does a pretty good job well it's the the reality is it's people want a one-stop shop people don't want just hot pizza they want so they're like right that's why you see like doordash

Jason Calacanis: for example like you can order some food and then you can tack on in the next 10 minutes some ice cream and some cold medicine and whatever talk to us about margins though um you know i mean you raised a billion dollars at a 15 billion dollar valuation this is not what we think of with delivery companies let alone ones that are vertically integrated and own all their own assets in this

SPEAKER_00: way like how are you are you marking up the price on items how are you able to what do your margins

SPEAKER_169: look like here so margins and traditional kind of brick and mortar retail are really healthy for these kind of items right they're in the high 30s low 40s usually once you add in delivery that's like where it starts up yeah so the the two dollar the two dollar fee is a direct pass through to uh to to our drivers plus the tip so if you look at like our established markets right you know even our most established markets still growing 70 of year over year which is philadelphia but like even if you look at our you know pre-2017 markets right they're operating today in the 15 ebitda margin right fully loaded even a margin so like if you're if you're looking and kind of uh identifying you know your comp markets and your established markets are producing strong ebitda on a per order basis it kind of gives you all the confidence in the world to continue to open up a massive amount of buildings expand into new countries and continue to do it so it's like it's been our mantra from kind of day one it's nailed this business model produce really positive unit economics and then scale it and it's why investors have been so excited about gopuff right it's kind of the opposite of everyone else's approach

SPEAKER_140: well you get it in 17 minutes it's convenience store items like 7 11 which have you're saying a 30

SPEAKER_225: margin what's the average you know order size 20 30 40 bucks yeah just shy of 30 dollars okay so we take 30 bucks 30 percent you're making nine dollars on the delivery or thereabouts 30 percent so that's pretty healthy because these are items that are convenient so you it's not supermarket it's convenience store

SPEAKER_167: right like 7 11. so it's it's not exactly right so we started on on the convenience store space right we had like eight 900 skews similar to what a convenience store has right today we have closer to

SPEAKER_169: you know 4 500 skews so we're kind of across the spectrum right between over-the-counter medication pet food diapers baby food uh you know we're getting into groceries so like a hundred percent of our new york stores have a full-blown grocery store mint today right so like you're talking about fruits and

SPEAKER_230: vegetables so the gopuff of 2013 and go above of 2022 are two very very different gopups you're

SPEAKER_140: maintaining that 30 then the driver can do three or four of these an hour let's pick three they get the

SPEAKER_225: two bucks you're saying it's passed through so it makes six bucks and then what is the what is the average tip in manhattan or a place like that if it's a 30 ticket people do 20 tip six bucks it's

SPEAKER_165: kind of across the board right tipping is across the board it's in the it's in the mid single digits

SPEAKER_272: mid single digits so five six bucks so let's say you made five four five six bucks you do three of

SPEAKER_164: these orders in an hour three times four is 12 you get the other six that's 18. so that's what gets you to 18 are you having a hard time finding those drivers because one of the themes we're hearing about is that there's a dogfight for drivers 18 is double the minimum wage of the country well more because it's i think it's seven and change is the federal minimum wage and then new york city is 15 now i think so you're 30 higher than men wages it's so hard to find drivers is that

SPEAKER_274: the gating factor for the hardest part of your business not not quite as hard as kind of we're

SPEAKER_143: hearing the news come out from the industry so like 90 of gopuff delivery partners only work for

SPEAKER_169: gopuff right and that's not because we only force them to work for gopuff it's because their own choice to work for gopuff and i think what's really really unique about the gopuff experience is you could choose to be a w2 employee you could choose to be a delivery partner if you want you can apply and work for any one of our micro fulfillment centers we have tens of thousands of employees there they're working inside of our buildings that are full-time employees so it's like you have this option of do i want to be a delivery partner that goes back to like a corporately owned

SPEAKER_188: location every single day you're not dealing with coming mom and pop pizza store or anything else right you're dealing with gopuff employees day in and day out or you can choose to to to be a w2

SPEAKER_169: employee and work in one one of our buildings so it's this unique relationship that we have where a person can choose to be a delivery partner a person can choose to work in one of our buildings

SPEAKER_140: ah so the packers inside the building are full-time employees the runners right uh are freelancers so that

David Friedberg: is a unique opportunity because it's essentially a pretty similar job yeah some people prefer the

SPEAKER_230: flexibility of being a a driver a driver partner and some people prefer to be a w w2 employee right so

SPEAKER_143: it's like it really we we kind of give uh we give folks an option to to choose to partner with us as delivery partners or to work within our micro fulfillment centers as uh as uh it's depending on the job within the building right shift lead will make a different an operations associate than a receiver right there's different jobs within a building and are they all on bikes you said in

SPEAKER_279: manhattan it depends on the market right some are in cars some are in bikes and they they bring their

SPEAKER_35: own i assume bikes and cars just like everybody else does yeah that's right um is that a headwind

SPEAKER_02: for you at all the question about labor like certainly that's been an ongoing conversation about whether you're gonna have to reclassify it seems like that's died down some during the pandemic because everyone's so desperate for delivery is that a little bit of a boon yeah i mean listen i'm

SPEAKER_143: i'm squarely focused on our customers and our delivery partners right like what's best for our

SPEAKER_169: customers and what our customers want is what we're gonna do so the reality is like we've paid attention to what's been happening kind of with the classifications of 1099s and kind of kept our close ear on it but the reality is the vast majority of our drivers are really really happy

SPEAKER_284: right like what if your customers wanted your drivers to be employees just to poke the bear a tiny bit

SPEAKER_143: uh i don't think i don't think the it matters for the customers either way how the drivers are classified as long as they're happy right and uh the reality i agree with that do you disagree

SPEAKER_289: molly you think like there's customers who care no i think that's true yeah no i think that's

Jason Calacanis: totally true but like i mean i think as long as the drivers have are happy is a is an important

SPEAKER_225: qualification yeah in europe you have to make the drivers full-time though they have to make them

SPEAKER_274: and and most countries in europe you do yeah so this and that affects the business how you just have to charge a little more for delivery you have to instead of two bucks you charge three or four

SPEAKER_143: uh the the price point is the same uh the price of the goods kind of varies a little bit depending on the market uh but the reality is is that we're very very competitive still in those markets

SPEAKER_169: and like we're not we're not going to launch remark there's two basic tenants that we have on like kind of launching new countries new states whatever it is we won't launch in an area unless we believe we could be the number one market player in that area right we've done that in the u.s right if you look at third-party data you just released a study we have 73 share in this instant needs category right quick commerce whatever you want we call it instant needs uh here in the u.s so we're trying to replicate the magic we have here in the u.s uh in europe as well we're not

SPEAKER_188: going to enter a country unless we can be the number one player there and then two it's like

SPEAKER_169: we're not going to operate and lose money forever right this business was built on the tennis of really really strong unit economics and profitability so we're not going to go out and open up

SPEAKER_188: markets and lose money for years and years and years especially on a unit level and not produce a profit on the unit level so um we're examining all of that and kind of every market that we're entering into and then kind of making strategic decisions along the way and what makes most sense

SPEAKER_293: both for you know our customers first and foremost and then two how unit economics play out and does

SPEAKER_140: this model will this model ever work in the suburbs obviously it won't work in the country where like you know people might be 30 minutes 45 minutes from a store they can i guess order amazon if they really want delivery wait two days but they're not going to get 17 minute delivery so we assume if you live in the country in the boondocks this isn't for you in the city it obviously is but what about the suburbs you start to get out to new jersey or white plains from new york or long island where people are it's obviously not going to be 17 minutes but it might be 27 minutes 47 minutes how

SPEAKER_225: are you thinking about the suburbs you care or you just want to be in the metros yeah suburbs is our

SPEAKER_169: largest opportunity today right we see larger baskets more loyalty higher retention in the suburbs which is uh which is pretty spectacular and uh well we look at it two ways right we look at urban adjacency so like areas that are like immediately outside of the city might be classified as suburbs might be still classified as urban areas and then kind of pure play suburbs so like the entirety of 2022 is focused on

SPEAKER_164: those two categories give us the pure play suburbs how do you attack that you just change the expectation because in those places people are probably looking at a two four hour window right yeah so gopuff is

SPEAKER_169: instant no matter what but it's not going to be you know in the in the teens from a delivery

SPEAKER_188: standpoint but to your point in the high 20s early 30s from an average delivery time in the suburbs but

SPEAKER_02: we've proved it out there's like lots of cheap real estate in the suburbs right it doesn't seem like it would be that hard for you to actually pop up micro centers that can bring down that time

SPEAKER_303: fixed costs are really really inexpensive yeah uh labor is generally cheaper yep uh and it works really well so we tested it actually uh when we acquired devmo and we acquired liquor barn there was

SPEAKER_169: a lot of stores within the suburbs so we tested how the model would work we already have the real estate you know i mean we already have the liquor licenses let's see how gopuff works and it was a phenomenal success and we already had a few stores kind of in pennsylvania and outside of washington dc and arlington that were in the suburbs that were working well this just gave us even more confidence on this is an area that we want to make a massive investment in and again like what i tell you in 2022

SPEAKER_02: it's a massive focus for us yeah i mean that's where i feel like your business model is just poised to

Jason Calacanis: slay because people in the suburbs or even like you know i'm in the oakland hills which i call herb urban like i'm attached to a major metro area and most places will not deliver to me and that's insane and the idea that you're in the position to have the real estate and the infrastructure to actually crack

SPEAKER_285: this market where people are desperate for delivery seems like a huge win for you yeah i mean and listen

SPEAKER_143: this is like a freaking hard business to scale it's a reason why we didn't make any like if you guys know a lot about gopuff kind of in the early days like between 2015 and 2019 we didn't make any

SPEAKER_188: media announcement there was no pr there was no press releases there's no media we did that because we were really figuring out how to scale this business in a really massive like all the infrastructure and tech it took to get to a place where you can open up a building a day right we were we're opening up 30 buildings a month uh in the last couple of months right that it's impressive and the team has done a lot of really great work to get there but it took years of planning and years of tech build up to get to a place where you know we could stand up a building a day

SPEAKER_169: mm-hmm and it was given it what gives us the opportunity today to kind of be a dominant player

SPEAKER_164: in kind of urban adjacencies and in suburbs the uh acquisition of bevmo got you i think 160 170 stores in one acquisition 300 million or 350 million 2 million per store take me uh how you went through that decision was it because they already had liquor licenses or all lined up or was it more efficient to

SPEAKER_225: just get 166 of those stores for 2 million each than to stand up your own micro facility so in the

SPEAKER_208: u.s it takes anywhere between six months and like three years depending on the state to acquire a

SPEAKER_169: single liquor license oh my lord and uh each one this is not a money equation it's not like you could throw more cash against the problem and speed up the regulatory process to acquire liquor life and

SPEAKER_188: then there's certain states that are quota state i'm not going to get too deep into the alcohol framework but there's certain states there are quota states where you have to buy uh from an existing player so you have to buy a local mom and pop or someone else shut them down move the license to your place and then you can start delivering uh in the case of california it's it's a particularly difficult state to acquire liquor licenses and acquiring the market dominant player in california to give us kind of

SPEAKER_169: uh i think it's like 60 percent of all of california's population are within a mile and a half of the bevmo uh so to give that kind of infrastructure boost right i think we could have still opened up the buildings very fast i don't think we ever would have been able to replicate the regulatory and liquor framework that that most built yeah i'm talking about like even five or six or seven years out and

SPEAKER_164: like you said those stores are completely inefficient designed for consumers so if you just took the back third of the store i'm not sure if this is what you're planning and made that not available to consumers but made it 12 because they tend to be high ceiling you made it 15 foot high with ladders for the delivery business going out the back door man that could be powerful that's that's the plan i

SPEAKER_140: guess is to put your go puffs inside the back of the of the or the front of the bevmos yeah 110 of the

SPEAKER_151: stores are already converted so out of the 161 110 have full gopuff capabilities all of la's turned on

SPEAKER_188: all of san francisco's turned on san diego so we we've uh the plan the original plan uh i'll share with you guys uh that haven't we we never released it was 45 stores in 2021 and uh we clearly went above and beyond that on uh on our approach because the more we open up these bev modes and make gopuff available and the consumer demand the more excited we got we're like man we really need to change the plan here and press the accelerator and don't forget we acquired a business that was doing hundreds of millions in revenue right so we had to do this while doing no harm to the bevmo business so we are able to grow uh the traditional business by just you know doing some really basic blocking tackling on the retail side right on the assortment side introducing some items that they they just didn't have and you know so we grew the retail business by doing again really really basic blocking tackling and the delivery business i think has surpassed everyone's expectation

Jason Calacanis: on what we did in california i mean it's so refreshing to talk to you and just have you be like yes we have nailed the business model we are totally profitable we're making baller moves coming in buying bevmo what comes next like you have got to have people beating down your door to go public

SPEAKER_143: yeah i think you know we're gonna do what's uh what's we've been doing this for a long time right i mean i think you guys know we can't talk about that but uh we're gonna do what's right for for ourselves and for our customers and for the company so you know we've been we've been doing this

SPEAKER_188: for a really really long time uh we've raised a whole bunch of money we have a lot of really really great shareholders we got lucky kind of halfway through our journey to be really really selective

SPEAKER_200: with the the shareholders that we got uh on board right and right now we're just focused on our customer in the business and you know you figure out the business model right you feel confident in

SPEAKER_140: the margins and the predictability of the business correct yeah so i think as long as the unit

SPEAKER_188: economics remain so profitable on the comp side it gives me all the confidence in the world to invest in buildings and infrastructure right so like the biggest investment in this bill in this business is you got to open up a building you got to acquire a liquor license right which again could be anywhere

SPEAKER_169: between five thousand dollars and three million bucks per store and uh then you have some operating cash loss in the building before switch to prop to break even and then profitability so you have a hundred percent of your cut markets that are producing profit today so we define comp as 18 months or

SPEAKER_188: older so as long as those trends remain true you care and i are going to continue to invest in the business in a really really massive way right where we've been seeing some really crazy growth on the back half of that and if those trends don't remain true then we won't invest in growth right we'll we'll switch the profitability lever again we're in a very fortunate position to be able to pull the

SPEAKER_190: lever and like say hey we want to go back to an ebit up position we could yeah i mean you're you want to

SPEAKER_42: grow you want to take market share but you know the predictability you know in year two at some point

SPEAKER_164: 18 months whatever it is could be 12 could be 24 you can hit profitability which is what the public markets are looking for the public markets do not want inventory as we've seen that are not predictable

SPEAKER_140: or have a path to profitability and you clearly have that now the name is go puff here and you have ease and meadow and a bunch of other players out there delivering cannabis cannabis is legal in the majority of states you started in a lot of college towns uh some college people might be known to have a drink or a puff as it were i don't know if go puff was uh in any way related to puffing but uh you sell rolling papers and hookahs and other stuff so talk to me about cannabis and how you view the cannabis

SPEAKER_274: market and why you're not in it if you've bought bevmo why wouldn't you buy easer meadow seems like a no

SPEAKER_169: brainer for a go puff so we've uh we've been getting into kind of regulatory products for quite a while right clearly uh this alcohol world is very very complicated it's a state-by-state issue

SPEAKER_143: but i could tell you about cannabis is it's a category that we won't touch until it's federally legal there's just there there there's too much complexity for a business of our size kind of our

SPEAKER_169: magnitude the i'm not going to go through like the banking issues and the regulatory issues with yeah

SPEAKER_42: even with alcohol no we know about the banking ones i mean and the regulatory with alcohol those

SPEAKER_188: two things combined cause a problem you think uh it's just not something that we're considering until it's federally legal right we we looked into a number of regulatory categories uh this is one that we're not going to step into until the federal government decides what it wants to do with it

Jason Calacanis: in terms of legalizing or not legalizing what are your potential headwinds i mean this is you know despite all of the positives here on your balance sheet a very competitive business like

SPEAKER_334: what could come along and be a problem for you yeah i mean listen we the thing that i already don't sleep a lot at night but the thing that really the thing that bothers me kind of jason's like good

SPEAKER_169: that's how it should be it's not as a founder uh paranoid yeah more than anything else is like the next generation of people right so it's like we've been able to come in here right we've done a lot of

SPEAKER_188: good right we we've got to 73 market share in this instant needs category the largest we're the number one seller of ice cream and e-commerce we're approaching to be the number one seller of alcohol and e-commerce here in the u.s right we have a lot of really great wins under our belt uh if the next generation of people are not the same level of scrappy the same level of uncomfortable finding copper into discomfort you know someone will come and out execute us it's it's it's i think it's a fear that a lot of founders have and you care and i spend a lot of time on the people portion of this

SPEAKER_169: equation you guys can think it's crazy up until like 18 19 months ago you can i still did every single interview right it was our entire weekend crazy i mean i if you want to set the culture of the

SPEAKER_164: company if you interview everybody that's great you know you're going to keep the culture and they

SPEAKER_344: get to meet you and then tens of thousands aware of microsoft fulfillment center it was it was getting

SPEAKER_188: out of hand right so um we we we did a leveling exercise i think hr came in and said you know you guys are killing yourself it was our entire weekend right it was 10 hours back to back each each day for

SPEAKER_169: saturday and sunday that we reserved for interviews we still do kind of level five and level six and up

SPEAKER_155: uh for everyone that's joining uh those would be executive team members directors and above vps and above we we do senior managers and above right still 20 that's a smart move yeah yeah uh and we

SPEAKER_169: we set a really really strict framework uh the kind of folks that we let into the organization and

SPEAKER_188: really making sure that we could scale it's why i think the european business has been really freaking

SPEAKER_143: kicking ass right the the folks that we got on board first we we made two acquisitions in uh in the uk uh both of which for were essentially from aqua hire perspective right that's a good infrastructure but we bought it because of the founders we loved kind of their their kick-ass attitude and you know whatever it takes kind of approach and alberto who was uh was the ceo of of deja is running the uk market for us right now i can tell you uh uk is like 7x higher from a run rate perspective than we had

SPEAKER_164: forecasted amazing so tell me about uh speaking of kicking butt mr beast uh obviously who runs youtube at

SPEAKER_29: this point uh yeah exactly uh he's gonna do a brand on your platform he obviously did mr beast burger

SPEAKER_164: and rolled his own uh you know uh distributed food and he and he's a very entrepreneurial guy i met him

SPEAKER_303: uh what are you doing with mr beast the mr beast is launching an awesome chocolate bar uh it'll be

SPEAKER_188: available in two places it'll be available on his website and on gopuff and i think uh you know gopuff has

SPEAKER_143: become like the go-to platform for celebrity influencer products right uh this mr beast is

SPEAKER_188: just really the latest and one that we're really really excited about emmer chamberlain launched her coffee on on gopuff and that was an awesome success selena gomez's serendipity ice cream actually one that we co-invested with her we invested right from gopuff's balance sheet uh introduced chris paul uh launched a put me on campaign uh with gopuff which basically is all under like minority and underutilized brands cbg brands kind of across the country that applied on gopuff so even though it's not a celebrity brand it's one that we did with with chris paul and we have a whole slew of

SPEAKER_346: other how do those deals go down is it the yeah you just reach out to the influence influencer influencer reaches out to you you talk to their management how does it go down so like 2017 2018

SPEAKER_143: there was a lot of gopuff reaching out because like so like here here's what's crazy like in the last

SPEAKER_188: 18 months we opened up more square footage than we did in the previous three years combined together so like we had a lot more coverage in the us in the last 18 months and again it took a lot of years of work to kind of get there but because we have so much representation in the us and gopuff

SPEAKER_143: has become such a dominant player we went from like hey we're reaching out to folks and kind of telling them hey you get it on gopuff to when folks reach out to us this is something that we'll

SPEAKER_188: do we'll blow it up we'll make it good but it's it's going to be an exclusive for a while so a lot of folks that have reached out to us as a byproduct have gotten really really amazing launches and you know you get one success and then kind of success starts piling on yeah so after we launched the first brand and the second brand came along and then third brand and then this selena serendipity thing was gangbusters and uh and then you know this i think this this mr beast partnership

SPEAKER_293: is going to be if not the best one one of the best ones we ever had well i mean if you if you think

SPEAKER_145: about it from their side they're making a product you're giving them distribution you're moving

SPEAKER_164: product for them and then if people happen to not know about go puff net uh already or maybe they heard about it but didn't download the app you know you get their entire audience to hear the

SPEAKER_225: word go puff five times in a you know in a youtube video or instagram or tick tock they might go try it

SPEAKER_143: right so yeah it's for sure win-win it's something that uh that everyone's excited about and like you know you get it to you know a third of the u.s population and like here here's the thing right

SPEAKER_169: like we don't have uh the same barriers that traditional retail has right all these resets and we can only introduce things once a quarter or anything like we get from idea to our brain to

SPEAKER_188: it's available nationally is like 10 to 14 days so we we can move very very fast on product

SPEAKER_169: introduction and product curation in a way that just you know traditional brick and mortar just

SPEAKER_02: can't this is a generally a question about i'm sorry do you have a follow-up on that no no go ahead

Jason Calacanis: i have generally a question about uh expansion as but also it's somewhat selfish because i really liked the mr beast burger and i'm on your website and i see that you're in omaha and orange and orlando but not oakland so as part of your like herb urban strategy how are you thinking about expansion and also come on man cross the bridge just just one little bridge it's coming soon i

SPEAKER_188: can promise you i mean we have this we have this tool that we built it's called gma it's a go but market optimization tool and essentially it'll it'll drop pins all over the country and tell us how much

SPEAKER_169: customers and potential revenue we're missing by not being in a geo oh interesting so what are the metrics what are you pulling from to determine so we're we're looking at intent to purchase it's the number one metric right so it's folks that are getting onto the platform trying to order go up but can't order go before they get the message that you know we're not in your delivery zone so that that piles in then we build look-alike audiences so like we'll we'll see what a gopuff customer looks like in the geo and then we'll match it to the demographics in that area and say like there

SPEAKER_188: there's a higher likelihood than not then this person would be a gopuff customer and here's what their

SPEAKER_164: ltd would look like here's what uh what determines a gopuff customers if they're like a certain phone they use or android or ios more likely is it age is it single versus families yeah it's it's more

SPEAKER_143: demographic based so the average customer the average group of customers 30 years old uh even

SPEAKER_169: though like we have i love bringing this example of our number one customer in phoenix uh you know i

SPEAKER_143: spoke to her actually a few months ago uh is a 75 or 76 year old woman who uses go up three times a day

Jason Calacanis: wow okay well that's an addiction yeah but how would but how would that target audience change per market because like you said the suburbs are a huge opportunity but that doesn't necessarily track

SPEAKER_02: i'm generalizing of course but that doesn't necessarily track with 30 year olds so we'll

SPEAKER_293: find a market so the tool i mean is doing it now automatically i want that mr beast chocolate bar

SPEAKER_299: is what i'm trying to tell you it's it's coming you send me the address after the podcast i'm gonna make sure we prioritize it um the the realities we'll find a market that looks like similar

SPEAKER_188: similar enough to it uh that's either closed by there's no market that looks similar enough to it then we'll just use intent to purchase um and then it'll give it'll give us a revenue miss so what

SPEAKER_299: we what we've been seeing a lot more is gmod gets better the more data you give you you input it right so like the more markets that you expand into the more data you have in different areas the better

SPEAKER_188: gma becomes so the reality is we've been expanding to more suburbs all of a sudden the suburbs within our our market optimization tool started looking a whole lot better because the the the tool got a whole bunch more data that this is working so you know there's been a lot more pins and a lot more kind of red heated areas and places that we really need to expand into noticed you're starting to

SPEAKER_164: compete with the people whose products you carry by having your own you know house brand and amazon basics if you will it's called basically uh purified water pretzels batteries no one trademarked that

SPEAKER_158: isn't that crazy that's crazy that basically i mean you have amazon basics but it's different than

SPEAKER_140: basically but basically it's a great brand um so does this let you maintain margin while lowering

SPEAKER_175: prices is that the intent here so this started with uh out of a consumer insights uh report so our uh

SPEAKER_143: we had a we had a report that came across my new cure's desk that 80 of gopuff customers would love to see a private label brand on gopuff that's high quality and affordable so a line that's that's more

SPEAKER_188: affordable than kind of your traditional cpg but still super high quality so not you know any paper

SPEAKER_293: towel or toilet paper or you know like a pollen spring type of water so to speak yeah um no fun

SPEAKER_143: intended um so from our perspective we looked at that and we're like hey this is something that our consumers are asking for and it's a high margin opportunity it's kind of another kind of win-win situation for us so we started exploring it uh we hired a lot of the folks uh from the brand

SPEAKER_145: list team um oh yeah the brandless team right that was a softback bank team as well yeah sharky was

SPEAKER_225: there i talked they were on the pod and it didn't work out for them but i always thought what a brilliant

SPEAKER_279: idea brandless was a great team to acquire totally to do basically a version of that but with a much solid more solid foundation behind it yeah yeah so i mean like again like the the key around gopuff

SPEAKER_143: it's not it's not like this one trick pony right it's not just private label or just alcohol or just the kitchens but it's the combination of all of these things that makes gopuff so great and it's very very very rare that a gopuff customer is just ordering from one category so like what we see is that when the person comes on to go but for the first time they come in with a pretty clear intent like i'm having a craving for ice cream or you know i really want this snack or i want a 12 pack or beer whatever else it is and as their life cycle kind of develops there's a kind of direct correlation between 10 year and basket size and the that that correlation is growing with like multiple category expansion so like once a customer gets like their second third fourth order they're

SPEAKER_188: ordering from multiple categories at once and like in your active customer base it's in low single digits percentage that someone's just ordering from one category so they they come to go but because they they heard that we have something and then they you know go ahead and explore and add a whole skew of other you know products that that we have as well amazing how are you thinking about i'm starting to

Jason Calacanis: try to ask every single founder that we talk to how they're incorporating sustainability and climate change into their business because especially when it comes to delivery that's actually something

SPEAKER_02: consumers are pretty sensitive to and i wonder how you're thinking about that in terms of getting things to consumers and packaging and the whole shebang yeah something that uh is top of mind we

SPEAKER_280: actually had a meeting about it like three hours ago so really really top of mind that would be

SPEAKER_143: top of mind yeah that's pretty much uh that and then this boom um so in europe uh our packaging is there's no plastic at all right it's all paper uh in the us we're in a we're in the process of switching all together so like even our plastic products are entirely recyclable they're they're they're recycled and recyclable and it's like a 50 50 mix between recycled plastic and your uh your non-recycled material right like uh cornstarch or you know the you're you're biodegradable the problem is with like a pure play non-plastic bag that's not paper uh it's not strong enough to hold

SPEAKER_407: the products like i'm again i'm not i don't want to get to to to uh too tactical of issues but it

SPEAKER_02: rips oh we love the tactical i love that i was just saying that in slack i was like i love how specific graph is like you are not no vague vagueness i mean let's be honest tactical was what it's all about

SPEAKER_164: when it comes to this so like yeah you know but i see the packaging you know packaging sucks like

SPEAKER_412: everything is over packed so can you influence that yeah i mean we're switching to an entirely paper

SPEAKER_188: model right and that that that's that's the one that seems to work uh we want to do it in a way that still makes sense for the customer so it's something that we're doing so we plan to you know flag on the ground that this is something that we want to do now it's like how do you do it in a way that doesn't piss off customers so uh where there's a lot of a lot of minds that are that are working on this problem right now a lot of people that are a lot smarter than you care and i uh that that are

SPEAKER_299: working on it and it's something that we're going to do uh but we're going to do it in a way that really

SPEAKER_418: makes sense for our customers yeah what do you think molly i love to hear it i love to hear it

SPEAKER_164: you just think about what the impact could be you've got young people starting companies

SPEAKER_140: you can dictate hey we want electric bikes uh we want electric scooters not gas vespas we want priuses if you drive a prius we're going to give you an extra 50 cents or per order you can really incentivize people and sort of trend things the right way and then if you think about packaging you know one of the things i love about amazon is they have frustration free packing and i would like to see more of this because you know if i'm ordering toothpaste like does it need to come in a box

SPEAKER_225: and then the box need to be wrapped in plastic like it's it's getting overkill sometimes and then

Jason Calacanis: consumers really want it i mean they really are demand like the fact that you had a meeting about it three hours ago and the fact that like every time i get you know i get hello fresh i think and i get these surveys like why are you skipping and one of the options is too much packaging like it is on people's minds and and there is an opportunity for a company of your size and scale to like

SPEAKER_188: really make a big difference yeah i mean listen it like this is one i keep talking about customers and

SPEAKER_169: customers even if customers weren't requesting this this is something that you care and i would lean into yeah and and what it's just like an added benefit that the customers also want this right that uh that this is something that you know i think public sentiment has shifted that this is

SPEAKER_299: something that's really really important so it's something that we're focused on we're going to do we're going to do it we want to do it in a way that that makes everyone happy yeah i would love to

SPEAKER_164: have a button to give feedback and say i didn't buy this because of the packaging that would be amazing you know and then i don't know if you know this molly uh riff um when you're in europe the supermarkets are required to take the excess packaging from you so in europe people will if there's extra packaging when they get their bags on you know take their toothpaste out of the paper

SPEAKER_158: box in the plastic and leave that at the store rather than bring it to their homes and the store

SPEAKER_188: is required to take that yeah i mean listen there's a long we haven't got a long way to go uh but by no stretch of the imagination i'm sitting here and saying i've got everything figured out uh you know we got a lot we got a lot to go a lot you're a great guest i have to tell you you get

SPEAKER_413: into the details you're tactical you're honest you dropped a couple of f but i mean i've had bombs

SPEAKER_429: a couple ish bombs you got a couple jokes all the time i do that all the time it's great uh great

Jason Calacanis: guest i think great guest molly huh i could not agree more raf thank you so much raf ilishayev ceo of go puff coming soon to oakland what what what send me your address i'm gonna i'm gonna take

SPEAKER_433: care of everything oh you're the best no freebie oh actually for molly can take freebies i guess

SPEAKER_435: it's okay now um we have a no uh griff rule we buy everything and you know why i do that sometimes

SPEAKER_436: i was just gonna see when we're gonna be available for your address okay oh okay there you go i think

SPEAKER_440: he's sending you mr beast bars because of me hey mr b send molly a case i'll i'll dm mr beast right

SPEAKER_20: now so i will expect molly to get a case of these chocolate bars just send us the timeline and we'll be happy great great great guests great business love to talk to you raf i just downloaded the app

SPEAKER_225: i'm gonna order some stuff i'm gonna order some frosted flakes oh way to rub it in i'm ordering some

SPEAKER_446: frosted flakes oh look mr beast chocolate bars oh every dark chocolate with nuts this freaking guy oh

SPEAKER_450: oh maybe i'll order and then i'll send an uber with the bag over to you i'll throw it in an uber

SPEAKER_452: x wasteful about that at all no just i'll order it to my house and then send 50 bucks sending you

SPEAKER_447: an uber i'll send it in an uber black to you molly i'll drive my i'll drive my uv to you you guys are hilarious like escalade anyway all right we'll see you next time bye bye bye