Building a Startup Is Not About Building a Product, It's About Solving a Problem - Avni Patel Thompson of Poppy

by Y Combinator9/21/2017

Avni Patel Thompson is the CEO and Founder of Poppy.

At the 2017 Female Founders Conference she shared how she struggled with her first startup but eventually discovered a problem many people had that was unsolved.

You can watch the other talks here.

If you’re curious about applying to YC, Avni recently wrote a great post called “Is Y Combinator for me?“.

And here’s our FAQ and application page.


My name is Avni, I’m the Co-Founder and CEO of Poppy. We’re building the modern village by connecting vetted caregivers to families when they need childcare.

I started Poppy, not because I’m an expert in the field or because I have a deep passion for childcare, I started Poppy for two people. These two. The older is my daughter Saaya and the younger is my daughter Aria. I was so tired of feeling panicked and anxious every time I wasn’t 1,000% sure of who was taking care of my girls. And I couldn’t believe that so many of us are dealing with this every single week. And then I couldn’t believe that all the people, all the amazing people that are taking care of our kids, they need more recognition and opportunities. So I decided to build it with Poppy. We’re serving thousands of families in Seattle right now, and it’s incredible thing to be a part of, especially because Poppy almost didn’t exist.

One of the reasons I’m so excited to be here today is because two years ago I sat in your seats. At the 2015 FFC, I sat there and I listened to all these incredible women telling their stories about bold visions and amazing companies and I desperately wanted to be like them. Only in that moment, nothing seemed further from reality. I was in the middle of shutting down my first startup, after spending years working on it and sinking thousands of my own personal dollars into it. I was so ready to give up and just head back to my successful career in brand management. Only this afternoon just inspired me so much, and I headed back and I decided to give it another shot. But not only that, I set a goal. And this is a little bit crazy, but this is my journal from that night. And I said, crazily, “In 2017, I wanna be on that stage giving the talk instead of sitting in the audience.”

When Kat sent me this email asking me to be one of the speakers, you’ll notice the date. And it says April 30th. I was so honored, obviously, because this was a goal and it was just one of the biggest parts of my story to actually try again. But the other crazy kind of ironic part was that she had sent me a different kind of email two years earlier. And this one was when she told me, and she crushed my dreams, and she told me that YC wasn’t gonna be funding Poppy. And so this is the story I wanna tell you a little bit about today. What happened between my first failed startup and Poppy, which is funded and growing today, and what happened between Kat’s first email and then me standing in front of you today. My hope is that maybe you’ll learn a little bit from my mistakes, but I hope that in hearing my journey, you’ll be able to connect it to yours and figure out a way to start and then just keep going.

My startup journey starts about five years ago. I had my first daughter, and I was struggling to figure out a way how to pass on my rich Indian heritage and the traditions onto my girls. A friend and I started talking and we thought, “Well, we could figure out a solution to this.” It was about 2012 so subscription boxes were all the rage and so we thought, “Well, if we just curate something, you know, to do with culture and we would have the language and food and all these amazing things, why couldn’t we do that?” We worked on it on the side while we still kept our jobs and we built business plans and financial models. For two years we worked on it on the side.

Then finally, in March 2014, we both decided we were gonna quit our jobs and work on this full-time. It felt incredible but at the beginning, it was, “What are we gonna focus on?” Well, I’d heard all of these things about MVPs and working on product and getting it out. And so we worked on the product and we thought about what we would want to have in this box. We figured it out, in three months we were able to put this beautiful curated box together of things that we thought were gonna solve the problem because that’s what we wanted. We thought that was exactly what you were supposed to do. So in June, we launched, and it felt incredible. We had friends and family, everyone texting us and emailing us and saying, “Oh wow, this looks amazing.” We even had a bunch of orders. And so we thought, “This is amazing.”

A few weeks go on and the orders start to trickle a little bit slow. And we were like, it’s a little bit concerning but we think, “You know, that’s probably just because we don’t have enough products. So let’s work on more products and get them into the shop.” So we worked on that. Now it’s the fall and we’re quickly running out of money. We had both invested about $20,000 of our own savings, and we had figured if we launched then we’ll just be able to raise money then and it’ll all be wonderful. That wasn’t the case and we were quickly running out of money. We decided to try everything we possibly could. We did Facebook campaigns, we did Google AdWord campaigns. We even went and partnered with some of the best brands out there like the Tea Collection, just trying to figure out how we could kick-start growth and get people to buy this amazing box that we had done.

After the holidays, it became clear that it wasn’t working. The cost of acquiring these niche customers was just way too high, and it didn’t make sense for the one or two boxes that they were buying. We made the hard but right decision to shut it down. I don’t think we talk about this enough, but these were some of the hardest times of my life. I felt like a failure. I felt like I let everyone down, including myself. And I had lost money that our family could use for the mortgage, and the nanny, and college funds. I couldn’t really see my way forward.

The worst part was that I didn’t know why I failed. I think it’s one thing to make a wrong decision or a wrong turn, but I think it’s another thing to not learn from it. And so where do you go when you need to figure something out? The internet. I started reading everything I could about how to start a startup, or how do successful startups do this. I came across a whole slew of Paul Graham’s essays and how to start a startup from YC. I devoured everything. I started to realize just some of the ways that I might have been thinking about this in a little bit of the wrong way. Instead of following your passion, you know this whole concept of living in the future and building what’s missing, this whole idea of talking to your users instead of other folks, and just building using that to build your product. And then, I love this one but just finding the 100 people that really loved what you were doing versus focusing on everybody else that were out there. And then the simplest but hardest one, I think, was just grow 10%. Every single week just grow.

Based on this, I thought, “You know what? This is the blueprint that I’ve been missing the whole time.” And I wanted to try again. By this time I’d come to the Female Founder Conference and I was so inspired, and I decided I needed to try again. So I started talking to parents, parents that had bought some of our boxes, parents that were just in the neighborhood. I talked to them and I asked them, “If Papaya and Post, if this box is not what you need and it’s not solving a big problem then what are some of the big problems in your life?” I think you’ll find if you’ve ever worked on a product that people just don’t really need, you have this real intense drive to then work on something that everybody needs.

The topic just kept on coming back to childcare. And I couldn’t believe it because, I mean, I lived that. With two careers and two kids and no family in town, my husband and I would just wake up every morning and hope we didn’t have to do the calendar shuffle. You know the thing where, you know, your nanny texts at 7 a.m. and says, “I’m sick,” and then you and your husband pull out your phones and say, “Okay, if I can move this meeting I’ll take the morning and you can cancel that and I’ll take the afternoon?” And it sucked. And the fact that so many of us were doing this, for me it was just it just caught my curiosity. I wanted to figure out, what would it take to fix it? And sure, this is one of the most crowded categories you can find out there. So I had a lot of people saying, “Are you sure this is what you want to be looking into?” But for me, it was that if it was solved, if all these people were doing it then we wouldn’t have such pain over here.

And as I started talking to different people, I realized that the thing that they didn’t need was a parent connecting to a sitter. The thing that wasn’t being said was that we were all missing our village. Everyone says it takes the village to raise a child, but with all of us moving around for our careers and our jobs, we’re all missing our village. And so I thought, “Well, how do you recreate something so human and so emotional as village with something so rational as data and code?” Well, I found my undergraduate degree in chemistry coming back to me and I broke it down into a tidy equation. I thought, “If village is a function of trust, someone you trust, is a fit for your family and is available when you need them to be then could I approximate it with something that provides vetting, a matching algorithm of some sort, and then a scheduling mechanism?”

It started to come all together in my head and I could see how this could be a beautiful app. There was only one problem. I wasn’t then and I’m not now a programmer. And I really struggled for weeks. I tried to figure out, “How can I build this without a programmer?” I’d spent the $20,000 that I had devoted to startups and I had about $200 left in my business bank account. Not enough, by the way, to pay a programmer to build you an app. And so I was about give up because I mean, what are you supposed to do? And in the dark of putting my five-month-old to sleep, you know, it takes a long time, there’s a lot of time to think, it came to me, “SMS. Why couldn’t I use SMS because parents and sitters are already using texting to…and so why can’t I use that to approximate the experience?”

So I sat down and I wrote out the whole flow. And I tried to figure out if I could somehow approximate the experience using already available tools and tools that were either free or had free four-week trial periods so I could stretch my $200 for just a four-week test to see if I was onto something. So this was my tech stack. I had a landing page on Squarespace, signups, and feedback forms were done through Typeform, Stripe handled the payments, I did scheduling via Goggle Calendar, communication with SMS and my database was Excel. So I could see how all of this was gonna come together. I got to work finding and vetting three University of Washington students, and I found 15 families in my local neighborhood on a posting board that was just posted about needing childcare. I sent them an email and I just said, “Hey, I know you need childcare. I’ve got these three amazing people if you need someone this week just text this phone number.” And I gave them my personal phone number.

That day, I got my first booking, and that week I got my first four. Every single week I just set the goal to see if I could just grow 10% or 20%. Well, that next week, instead of just five, I hit six. A week after 7, and a week after 10. I was blowing past these 10%, 20% a week goals. And I can’t tell you how different that felt versus my first startup and the whole time I was trying to push this boulder up the hill. And this one it was just parents were telling other parents. And it wasn’t easy by any stretch of the imagination but it just felt different.

The end of the four weeks, as luck would have it, YC was accepting applications for the Summer ’15 batch. And so I thought, “What the hell, I’m gonna apply.” Because I knew I was early. I knew I didn’t have a co-founder and a team, but I also knew that I was building something that people wanted. So I applied. And truth be told, I didn’t put a lot of hope into it because I had applied for my first startup. I’d spent weeks writing the perfect application and I didn’t even get an interview. I’d also heard that YC was the place for that 23-year-old white programmer, which clearly I’m not. But still, I applied because I believed in the truths that I’d read in some of those essays. So imagine my shock when I got invited down for an interview. I excitedly got all ready. I went down for my 10-minute chance, and I sold my heart out to Kat, Kevin, and Aaron. Nonetheless, at the end of the day, I had this email waiting for me in my inbox. And I’d be lying if I didn’t say I was disappointed. But the next day I woke up and I decided to focus on that last paragraph. The one that said, “We would love to see you reapply next batch.”

And I focused on two things. One, they thought I was onto something and that if I just showed more growth and brought a team on, that I could reapply. And the second thing was regardless of what YC thought or said, I had a growing company and I had growing…I had customers to serve. So I got to work. I pretended as if I’d gotten to YC anyways, and I set myself the goal to just grow by 10% to 20% every single week for that whole summer. Parents would text my phone number and asked me, “You know, hey, is someone available tomorrow from noon to 4:00?” I would consult my high-tech day planner and I’d see who’s available and I’d text the sitter and then I’d text the parent back. And if you wanna know what my first product looked like, I’m almost embarrassed to show this, but if you can see in the left-hand margin, the numbers that are circled, that was my goal. And so every single time I hit the goal. And in the boxes were all the bookings. I don’t remember what the color coding was now, but this was crazy. But this was all I needed to get this up and off the ground.

And then I started to outgrow the day planner. Shocking, I know. And so I moved on to Excel. Again, it was super simple and it was just enough to get the job done. By now I knew that we were continuing to grow and I knew that I had to find that technical partner to help me build this. But it’s not as easy as it might sound. And I’m sure there are some of you out there that are, you know, struggling with the same thing, about how to find that perfect co-founder. There’s a reason that YC says not to start working with someone that you’ve just met. You’re trying to find someone that is a good complement for you and is a good fit with your personality. Somebody who has the right experience and can have a passion for the mission. And then finally can be a partner in the trenches through the ups and downs. It’s a pretty tall order. So I talked to everyone. I asked for every single intro to any engineer. I talked to tens, hundreds of people and still nothing.

By now it was about August and I was exceeding my ability to just do all this on my own. And the crazy ironic thing was I was about to grow my company to death. I couldn’t handle anymore. And so I doubled down and I asked…I kept on asking people for more intros. Finally, through a friend of a friend of a friend, I finally met Richard. And when I met him, what struck me was that our backgrounds were really different, but the thing that connected us was that we had spent our career in pursuing the things that made us curious. He’d done really interesting but different things. He’d worked on a social media company, a dating app, and a bitcoin payments company, which, I know what you’re thinking, is the perfect match for my wholesome family company. But when I started talking to him there was just a fit. It was just easy. We would just connect on what the vision was and how this could all be built. And it wasn’t until later that I actually realized his experience was just perfect. What is Poppy if not building community? I mean, there’s the matching algorithm involved, and we were definitely taking payments.

But in those early days, it was really just a leap of faith, and all of this is just a leap of faith. So we decided to just work together for six weeks, just like a project, and see how it would go. He built the first version of our platform in a way that was just more nuanced and more sophisticated than I could have even imagined. And in that I found a partner to be able to build Poppy. In October, we decided to make it official. We even hired our first employee, Sarah. She actually comes from the childcare industry. And so she was tasked with the most important part of our company, which is finding those really amazing caregivers. Where they are, what they…what kind of experience they have, what kind of vetting needs to be done? So she came on and joined the team. I’d always thought of Poppy as sort of a three-part thing. There’s a parent side, there’s a sitter side, and then there’s the tech that connects it between it. We now had the team. Finally, I felt like we were getting some momentum. We had the team, we had the ability to build the platform.

Now, though, we didn’t have any money. I couldn’t believe I was in this position again. This time we had payroll and we had just the regular expenses of a growing company and we needed cash. As luck would have it, winter…YC’s Winter ’16 application was just open, and so we reapplied. And this time the application basically wrote itself. I mean, we had done everything that YC had asked us to do. And more than that, we had just pretended as if we had done YC and we just continued to grow. We had even more users that loved what we were doing and we had the team. So we were so excited when we, again, got the chance to interview. Richard and I practiced all the questions and we made our way down to Mountain View. I knew that the hardest part of our application was the fact that we had only worked together for three months. So I was prepared for those questions. What I wasn’t prepared for, though, was that as we were walking in to register for the interviews, in behind us walked the founders of our key competition.

I walked into the restroom to just gather myself and I thought we had just come too far to just quit. And I thought if I was gonna go down I was gonna go down swinging. So we got in there and we just told the partners about Poppy. About what we were building, about what we saw, about our growth. About how our users just loved what we were building and needed it, and then about our team and how we were the perfect people to build this. We walked out and I didn’t know how it was gonna go but I knew that we had given it our all. I hopped on a plane because I had to get back, and I checked my email like a lunatic just waiting for that inevitable rejection email. By the time I got home, it was…just gone in time for bedtime and I figured, “You know what? What will be, will be.” And I got ready to just get my kids ready with their pajamas and I heard the phone ring. YC wanted to fund us. I didn’t really hear the rest, but it was a stay of execution. I knew that we had bought the time to be able to figure out the next thing.

And as luck and hard work would have it, a seed VC firm in Seattle also decided to fund us. So the week before heading into YC, that was the bank dollars in my business banking account. And my brother, over the holidays asked me, “Why weren’t you more happy, excited, celebratory?” And it didn’t hit me then that the money is not something to be celebrating. It was more relief because the money buys us time and time to run those valuable kind of experiments, and to be able to figure out the next thing. So we started YC. And even when you find reprieves, they’re only temporary. So we just focused on putting our heads down and just continuing to grow. I talked to the users and parents, and Sarah just kept the great caregivers coming, and Richard just built the product. Slowly by slowly, we kept on growing.

By demo day, sure we had the really nice growth curve, but more importantly, woven into our company’s DNA, we had this really nice two-week drumbeat of building and then hitting a goal, building and then hitting a goal. Our company still has that drumbeat. We still use that loop, that two-week loop of building and advancing. We closed our seed round shortly after demo day a little bit over $2 million. And we came back to Seattle in May, and we moved into our first official offices. And I remember being just so grateful that after all of that we now had this incredible team, and we had the money, and most importantly we had the time to be able to just work on Poppy and prove what it could be.

So is it all roses now? Definitely not. Every day our job is to build something that people want as measured by our growth. Every day we’re working on just growing the company and putting our heads down. Even now there’s things that we’re working on that I can’t see how it’s gonna all work out, but I know that if we return to our roots of talking to our users and starting with just something really small and then iterating our way forward, we’re gonna figure it out.

So I want to leave you with the five lessons that I’ve learned between my first startup and my second. The first is when you’re just getting started, you’re trying to figure out, “Is this an idea I should be working on?” And I think you should ask yourself whether it’s passion driving you or curiosity and frustration. The tricky thing about passion is that it can make you confident. It can make you feel like you know the answer. But with curiosity, it keeps you humble and it keeps you asking the questions. And frustration just gives you the motivation to get going.

In the beginning, being a founder, as I’m sure so many of you guys know is lonely. You need to talk to people, but just which people? In the very beginning, because we’re both first-time founders, we thought, “You know what? We’re gonna talk to the experts. We’re gonna talk to advisors, and investors and people who have been in the startup space.” Here’s the thing. You’re trying to do something that’s never been done before. There are no experts. The only way you can do this is by talking to your users and then iterating your way forward, inching forward.

Product. I’ve talked about this but I can’t emphasize it enough. Building a startup is not about building a product it’s about solving a problem. The product can be far from pretty and definitely far from perfect. It just needs to be the thing that can solve the problem.

When it comes to funding, I think I approached my first startup a little bit more like my big company days. I thought of it like a budget to spend, so it wasn’t really a shock when we ran out of money relatively quickly. I now know that the money is just this valuable time to run these experiments. These experiments are hopefully so that you figure out a way to get to either profitability or to showing the things that you need to to be able to raise that next round, get to that next level.

The last thing is about focus. As founders, I think this is the hardest thing. “What do I focus my time on?” In the early days with my first startup, I thought it was all about product launches, you know, something tangible and I could do that, but I’ve since realized that it’s all about growth. You need to pick that one metric that is just so important for your company and then decide to grow it just consistently week by week. For my company, that’s booking filled. If we are growing our booking filled number then we’re doing our job. That means we’re bringing on more great sitters and we’ve got a lot of great families and we’re connecting them together really effectively. So pick your one number and choose to grow it consistently.

The thing that I wanna end with is that I think you guys as founders have two really important jobs. The first is to start and the second is to keep going. I know how hard it is to start but then stop and then start again. And I know how daunting it can be. But my challenge to you, if you haven’t started, can you find a four-week period this summer and just commit, just try to launch something and see if you can grow it by 10%, 20% every single week.

The second is to keep going. I applied to YC three times before getting in. Poppy is my second startup. I am standing here on this stage because every morning I choose to be a founder. I choose to keep going. And I know for so many of you, you might be in a place that you’re not sure whether you can just keep going, and there’s just so much adversity and there’s so many setbacks, but part of it is on you to figure out how can you just keep going? And part of that that makes that easier is you have to find your people. I definitely would not be here today if not for my incredible team that has devoted their days to join me in this journey to build this thing. But for me personally, it’s also about my family, my husband, my kids, my parents, and our incredible nanny. For me, they’re the ones that enable me to create this space for me to be the founder that I need to be. So if you guys are in anywhere in a similar situation, you need to find your people and build your own village so that you can create the space to be the founder and keep going.

It’s been an incredible three-year journey so far. And if there’s one thing that I know for sure, it’s that the world needs more female founders. Two years ago, I sat in your seats with nothing more than a desire to be a founder. There is nothing special about me, and I am proof that if you set a goal and you start, and you choose to keep going, then you’ll figure it out. Thank you.


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