by Y Combinator12/9/2015
The co-founders of Lugg on hustling for their first users, learning by doing, and the adrenaline rush of solving people’s pain points.
Y Combinator: Lugg has attracted a lot of positive attention recently, including a $3.8 million seed round shortly after you launched out of Y Combinator this past summer. But here we’d like to concentrate on the earlier days. Can you tell us about how it got started?
Jordan Brown : The idea came from solving our own pain points. I wanted to build my own desk, and it was a huge pain to get the wood back from Home Depot, because I didn’t have a truck. Another time, I was moving from one tiny apartment to another. All the moving companies cost $300-$400 with a 3 hour minimum. I was like, “All I need is my mattress and dresser to go to this new location across town.”
Eric Kreutzer : We’ve known each other so long, and we always talked about doing a startup together. It was always in the cards, and we’d always be texting ideas to each other. One day, Jordan texted me saying, “What if there was an Uber for just moving stuff?” And right away it was a no-brainer sort of concept. It’s a clear problem that’s happening everywhere.
How did you get the service off the ground? Starting a marketplace from scratch can’t be easy. We’ve heard there was a lot of sweat involved.
Jordan Brown : I started building the app while I was still living in Utah, where we’re both from. In October 2014, I came out and moved to the Bay Area to start getting users and to be closer to Silicon Valley. I slept on a friend’s floor in Concord, and just put the app in App store.
Every morning, I would go rent a truck on Getaround or RelayRides and go to Ikea. I’d watch people, and approach those who were struggling with tying stuff to the top of their car. I’d say, “Hey, instead of doing all this, what if you could just push a button and get someone with a truck to do it for you?” I’d also go up to the people who were waiting in line to schedule delivery to their homes.
They’d download the app, push the button, and I’d run into the parking lot and get in my truck and do the delivery. They’d be like, “Oh hey, it’s you!” It was really a hustle.
That sounds intimidating, to approach people cold.
Jordan : I did have some people say, “How do I know you’re not just to run away with my items?” There were a number of times I gave people my drivers’ license, as collateral.
Eric : And we got a lot of nos, for sure. It was challenging. Ikea wasn’t necessarily happy with us either. We eventually got kicked out, after about two months! But by then we had started getting Luggs through the app, without being in the Ikea parking lot and talking to people.
Jordan : There was one time that I was eating at the Ikea cafeteria — I was spending a lot of time there, I could tell you about the whole menu — and I got a Lugg notification for that same Ikea. It was an organic request. I had never talked to that person before. I threw away my food and ran downstairs to the parking lot. I was like, “Oh God, it’s working! I didn’t even have to bug this person!”
How did it start catching on like that?
Jordan : It was a lot of the word of mouth, in-person thing. Once we’d do a Lugg delivery into a home with four roommates, the other roommates would say, “Hey cool, how did you get this new couch here?” Or a customer would walk into a store and use Lugg to pick something up, and the store owner would say, “Hey, what’s that service you’re using?”
We also started to see the same users do more and more requests. There was a person I onboarded at Ikea, who requested a Lugg from Costco the next week. He said, “This is something we were going to buy two months ago, but we live in the city and don’t have a car, so we didn’t have a way to get it home.” Once people start using it, they become repeat users.
How did you come to be in YC?
Jordan : We’ve always known about YC. We actually got rejected the first time we applied. I just had a prototype, and we weren’t even in the App store yet.
Months later, we did a Lugg for someone, and ended up talking with them about our startup. We told them, “Oh, we’d like to do YC, but we got rejected.” It turns out that they were friends of friends with Sam Altman. They made an introduction, and he encouraged us to apply again.
Being in YC was like having a compass, telling us to only build what’s going to impact growth. We took that to heart. And the network was amazing. We are two Utah guys who knew absolutely nobody. We didn’t go to a prestigious college, we didn’t have any connections. We’re no success story yet, but we’ve been able to come really far in the past year, and I think YC was a big part of that.
It sounds like from the beginning it was an especially lean model.
Eric : Yes. At one point, we were both working and living at a friend’s office loft. There was no shower there, so we would try to make it to the gym at 8am to get a shower before Luggs would start coming it at around 9am. We were living in an Airbnb for a while, too. We’ve always just done the bare minimum of what we needed to go to the next level.
Jordan : At the time that we were renting Getaround or RelayRides trucks for weeks at a time, someone once asked, “Why don’t you guys just buy a truck?” But we knew that if we’re really building something that’s a marketplace, we shouldn’t be doing that. We wanted to build a platform where people who own trucks and vans could make money themselves. If we got into the business of owning trucks, we’d be going against what we were trying to accomplish.
Aside from the obvious financial savings, were there other benefits to doing all the Luggs yourselves in the early days?
Eric : The big benefit was that we collected so much feedback every day. We’re going into so many homes, and so we’re able to build exactly what users wanted. They would say, “I wish we didn’t have to do this by swiping my credit card with Square,” so one of the first things we built was a Stripe integration so the transaction could happen in the app. Some people were very vocal, which was great. There were times we would sit down on the couch we just delivered, and have a 30 minute conversation about what we should build next.
It’s allowed us to focus, and learn about what users wanted outside of just the app. We learned quickly how important it was to onboard Luggers who are trustworthy in your home. We could have just built the app and contracted with professional movers to do the Luggs, but I don’t think we would have figured as much out. We would have been talking to movers instead of users.
Jordan : Doing Luggs ourselves also helped us to really identify the qualities of what Luggers should be. The people that are on the Lugg system aren’t people you’d see on other on-demand companies. You never see the Luggers we have out also driving for Uber, or working for Postmates. Moving is such a different thing. There are born and bred movers. A lot of them, they get adrenaline off of helping people. When they do the impossible, and at the end, the customer is just so ecstatic — they just solved a pain point for that customer that’s often been there for months.
These Luggers, after a good Saturday of doing a ton of Luggs they go home fulfilled. It’s very satisfying. You’re really interacting with people. I still to this day love to Lugg. It’s also a great workout. (Laughs) I’ve been feeling out of shape lately, now that I’m doing fewer Luggs than I used to.
Eric : We realized that our biggest focus needs to be that the Luggers are good. If they’re not good, the app doesn’t matter. It’s cool that we can get you a truck in 15 minutes. But if you don’t have that top quality of service, no one will care about how fast they’re going to get to you.
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