From Pizza Delivery to On-Demand Delivery | Favor & Sunroom CoFounder Ben Doherty

So without further ado, let me welcome Ben Doherty. Oh, wow. Hey, Mike. The crowd has grew. I can't believe— how many people are in the class now? How many? 80? Can I sit down? I feel a little uncomfortable just like standing up here. Is this cool, guys? Can you hear me all right? I wonder if you can hear me without the mic. Can you hear me? No? Need the mic? It's a little hard. Is it? All right, well, I know I have a pretty loud voice. Maybe I can sit, get on your guys' level. I need like a beanbag or something. Yeah, so I think, so the topic is how to pick the right investment partners. I think that could be broadened to just how do you work with the right people in general? I don't. I'm not really. I mean, I know a lot of this stuff I could tell you guys about. You know, you could. You could read in books. I'm sure. You know, I don't. I could first by start by telling you guys about what books I think have helped me the most. I mean, there's. I could easily talk for an hour on this topic much and probably much much longer. Mostly because I've worked with a lot of. How do I say this? Not the best people. So I guess I've learned, like you guys were just saying, the Draper Code. I've learned a lot just because I've worked with people that I wouldn't choose to work with again. Now that I'm on my second company, I'm definitely avoiding those type of partners that I worked with on my first. But I think I'm gonna open it up to sort of just questions before I— I have a bunch of notes and things that we could go over, but like I said, I think a lot of this stuff you guys could learn in books. But I do have tons of personal experiences and very, I guess more specifically, when you're really actually trying to vet partners, what are sort of the right questions that you can ask when you're trying to vet those partners? And then also, What are sort of like some tricks to look out for where if you might end up, it might be sort of some red flags that they might not be the right partners, or not necessarily even that they're the right partners, but ways to just sort of navigate around those things, those pitfalls that these other partners might throw in your way. But yeah, let me just tell you guys a little more about myself, and I'll try to keep it short. I could certainly talk for an hour about this too, but I'm gonna, I'll talk for like 5 minutes just so you guys know why I'm up here. So I was actually in this building, let's see now, easily 7 years ago now, or I guess 6 years ago, and I was actually in the first company, I was the first company in the first class or first tribe Of Boost, which I'm sure you guys all— everyone knows what Boost is, right? Because it's posted up right next door here. So when we were first staying in this building, it wasn't even quite even set up for us to stay here yet. I remember we actually went over to the city of San Mateo and actually sort of tried to rally so that Draper University could even be a thing. So when I was staying here, up front there was actually a bank. And now I think it's turned into like the Draper University School, but we were actually trying to office out of there. And that's what the state of this was about 6, 7 years ago. But anyways, the reason why I originally got into Boost was I was going to Cal Poly down in San Luis Obispo, California. I don't know, is anybody here from Cal Poly? Oh, wow. Oh, we got one maybe? No, nobody? Okay. But I was a pizza delivery driver. Okay, so definitely not the most exciting job, but I had this crazy idea, and this was before Uber or Lyft or anything, the whole on-demand economy. This was in 2011. And my crazy idea as a pizza delivery driver was, man, wouldn't it be cool if I could deliver from any restaurant? And then I started thinking more. I was like, oh man, like if I could deliver from any restaurant, that would be a way more efficient way of doing delivery. Because when you're doing delivery, you have this, you know, you have a return trip. If you're only delivering from one restaurant, you go out, you take your deliveries, but while you're driving back to the restaurant, you're empty-handed. And the customer is essentially paying for that one way or another. It's just sort of hidden in whatever fee or whatever the cost of the pizza is. And so my crazy idea was, man, if I could deliver from anywhere, that would be a way more efficient way of doing delivery. And then I took it a step further and I was like, wow, as a customer, that would be really, really cool. We could get anything delivered. Now, that doesn't sound like that exciting of an idea because we basically have had tons of different companies working on that for the past decade. And so the company that I actually started was called Favor Delivery, and we were competing nationwide for a little bit with a against DoorDash and Postmates, and this was prior to Uber even launching Uber Eats or doing anything like that. We had gone on to raise a little over, I think it was like $40 million total is what we actually ended up raising. It was small amounts compared to what the DoorDashes and the Postmates of the world ended up raising. What we ended up doing was we had dominant market share in basically all of the major markets in Texas. We were just, we were like number 2 or number 3 in a lot of the other cities that we were trying to compete with nationally. Like I was saying earlier, we didn't necessarily, we didn't pick the best partners. I can explain how we sort of ended up in that scenario where we needed to end up with those investment partners. The other guys ended up working with much better investment partners, and I think that's a big reason why they went so much further. We ended up shutting down all of our cities outside of Texas and just doubled down on Texas, which may not seem like a big deal, but Texas actually has a, they have a larger economy than the entire country of Canada. So that puts it in perspective. Us winning Texas is kinda like winning a place bigger than Canada, which isn't that exciting if you're an entrepreneur who— wants to build the next great X company that's the best around the world. That's kind of how we felt about it. A little earlier on this spring, we ended up selling the company to the largest grocery store in Texas. It's called H-E-B. It ended up being a really good exit for everybody. Those investment partners evolved. They all made money. Us as founders, we made money even though we sort of got pushed down along the way, and everyone did really well. And the exciting part is the whole brand gets to stay intact. If you guys ever visit any place in Texas, chances are, you know, you go get food at any restaurant, you might see one of our branded blue tuxedo t-shirts, which all the delivery drivers wear there now. We have about— now where the company's at, we have about 50,000 drivers. We've done over 10 million deliveries, and it's still growing really, really quick because now it's backed by that grocery store, you know, the largest grocery store, H-E-B, and they're continuing to scale. I left the company like leading up to this sort of knowing what was gonna happen and started a new company, which they mentioned, which is called Sunroom. And with that company, essentially what we're trying to do is, is we're trying to make it incredibly easy for you as a renter to go see any sort of single-family home or basically any rental house that doesn't have a leasing office. Right? So most people, when they think about renting, they think about renting an apartment. Renting an apartment's relatively easy. You just walk into a leasing office and they'll show you around the place, and then you can apply and actually lease the place out. But it turns out only about— only 2/3 or only 1/3 of all of the US renters live in those sort of properties. About 2/3 of the renters in the United States, so we're talking about 70 million people, they live in what I call single-family home plus, which is essentially rentals that have less than 10 units and don't have a leasing office. So it can be really hard to actually get someone to go show that property to you. And also, the whole process of trying to apply to get into that rental and then go on to actually sign a lease can be a real pain in the butt because you're working with a lot of old-school landlords and real estate agents.