Building a Startup is About Solving a Problem - Avni Patel Thompson of Poppy

Hi everyone! Good afternoon! How's everyone doing? Oh, this is really great. I'm so excited to be here today. My name is Anne. I'm the co-founder and CEO of Poppy. We're building the modern village by connecting vetted caregivers to families when they need child care.

I started Poppy not because I'm an expert in the field or because I have a deep passion for child care. I started Poppy for two people: these two. The older is my daughter, Saia, and the younger is my daughter, Arya. I was so tired of feeling panicked and anxious every time I wasn't sure of who was taking care of my girls. I couldn't believe that so many of us are dealing with this every single week.

Then, I couldn't believe that all the amazing people that are taking care of our kids 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 an 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.

This is a little bit crazy, but this is my journal from that night, and I said crazily, “In 2017, I want to be on that stage giving the talk instead of sitting in the audience.” Thank you.

So when Cat 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 going to be funding Poppy.

So this is the story I want to 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 Cat'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.

So 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 around 2012, so subscription boxes were all the rage.

We thought, “Well, if we just curate something, you know, it could do with culture, and it would have language and food and all these amazing things; why couldn't we do that?” So we worked on it. 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 going to quit our jobs and work on this full-time.

It felt incredible. At the beginning, it was, “What are we going to focus on?” Well, I'd heard all of these things about MVPs and working on products and getting it out. So we worked on the product, and we thought about what we would want to have in this box, and we figured it out. In three months, we were able to put this beautiful curated box together of things that we thought were going to solve the problem because that's what we wanted, and 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, 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. They slow, and we're like, “That’s a little bit concerning,” but we think, “You know, that's probably just because we don't have enough product, so let's work on more products and get them into the shop.”

So we work 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 would just be able to raise money; then it would all be wonderful. That wasn't the case. We were quickly running out of money and decided to try everything we possibly could.

We did Facebook campaigns, we did Google AdWords campaigns, and we even went and partnered with some of the best brands out there, like The Tea Collection, trying to figure out how we could kickstart 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.

So we made the hard but right decision to shut it down. I don’t think we talk about this enough, but this was 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. 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, and I came across a whole slew of Paul Graham's essays on 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. I love this one, but just finding the hundred people that really loved what you were doing versus focusing on everybody else that were out there.

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 had 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 Poppy 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 start to have this real intense drive to then work on something that everybody needs.

So the topic just kept on coming back to child care, 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 your nanny texts at 7:00 a.m. saying, “I'm sick,” and then your husband pulls out his phone and says, “Okay, if I can move this meeting, I'll take the morning, and you can cancel that, and I'll take the afternoon”?

It sucked. The fact that so many of us were doing this for me was just it caught my curiosity, and I wanted to figure out what would it take to fix it. Sure, this is one of the most crowded categories you can find out there, and so I had a lot of people saying, “Are you sure this is what you want to be looking into?” But for me, if it was solved and if all these people were doing it, then we wouldn't have such pain over here.

As I started talking to different people, I realized that the thing 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 a village to raise a child,” but with all of us moving around for our careers and our jobs, we're all missing our village.

So I thought, “Well, how do you recreate something so human and so emotional as a village with something so rational as data and code?” 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's only one problem: I wasn't then, and I'm not now, a programmer. 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.

So I was about to give up because, I mean, what are you supposed to do? 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 too, so why couldn'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.

This is 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 Google Calendar; communication was with SMS, and my database was Excel. So I could see how all of this was going to 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 child care. I sent them an email and I just said, “Hey, I know you need child care. I've got these three amazing people. If you need someone this week, just text this phone number.” I gave them my personal phone number.

That day, I got my first booking. That week, I got my first four. Every single week, I just set the goal to see if I could grow 10 or 20%. Well, that next week, instead of just five, I hit six. The week after, seven. The week after, ten! I was blowing past these 10% to 20% a week goals.

I can't tell you how different that felt versus my first startup. The whole time, I was trying to push this boulder up the hill, and with this one, it was just parents were telling other parents. It wasn't easy by any stretch of the imagination, but it just felt different.

At the end of the four weeks, as luck would have it, YC was accepting applications for their summer '15 batch, and so I thought, “What the hell? I’m going to 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.

Truth be told, I didn't put a lot of hope into it because I'd 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 a truth 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 and went down for my 10-minute chance, and I sold my heart out to Cat, 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.” 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 customers to serve.

So I got to work. I pretended as if I got into 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 ask me, “Hey, is someone available tomorrow from noon to 4?” 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.

If you want to 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. 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; this is crazy, but this was all I needed to get this up and off the ground. Then I started to outgrow the day planner. Shocking, I know! 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 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 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!

So I doubled down and asked. I kept on asking people for more intros. Finally, through a friend of a friend of a friend, I finally met Richard. When I met him, what struck me was that our backgrounds were really different, but the thing that connected us was that we had both spent our careers pursuing the things that made us curious.

He had done really interesting but different things. He'd worked on a social media company, a dating app, and a Bitcoin gambling 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.

It wasn't until later that I actually realized his experience was just perfect. What is Poppy if not building community when there's a matching algorithm involved? We're definitely taking payments. But in those early days, it was really just a leap of faith. 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 child care 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 kind of experience they have, and what kind of vetting needs to be done. 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. 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, YC's winter '16 application was just open, and so we reapplied. 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. I practiced all the questions, and we made our way down to Fountain 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. I thought if I was going to go down, I was going to 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, 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 going to 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 about time for bedtime, and I figured, “You know what? What will be, will be.”

I got ready to just take my kids and get them ready with our 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. 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 balance in my business banking account, and my brother over the holidays asked me, “Why weren't you more happy and excited? Celebratory?” 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 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. 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 are things that we're working on that I can't see how it's going to 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 going to figure it out.

So I wanted 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? 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 were both first-time founders, we thought, “You know what? We're going to talk to the experts. We're going to talk to advisers 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 on product. I've talked about this, so I can't emphasize it enough: building a startup is not about building a product; it's about solving a problem.

So 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 able to raise that next round and 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, and there was 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 bookings filled. If we're growing our bookings 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 want to 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 and 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% to 20% every single week. The second is to keep going. I applied to YC three times before getting in. Poppy is my second startup, and I am standing here on the stage because every morning I choose to be a founder. I choose to keep going.

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 so many setbacks. But part of it is on you to figure out how you can 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 the space for me to be the founder that I need to be.

So if you guys are 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's 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!