Season 1, Episode 9
Dealing with trust and Covid-19 in a travel industry marketplace with Jacob Wedderburn-Day (Stasher)
About this episode
Jacob Wedderburn-Day started Stasher straight out of university with his roommate. Four years later, after promising growth, they have just raised $2.5M in funding for their travel industry marketplace when Covid-19 hits, and bookings grind to an absolute halt. Jacob shares how they dealt with this extraordinary setback and how they are preparing for whatever will be the new normal. He also shares how they built an experience that is reliable enough so that users trust it with their personal belongings. And of course, how they got started (Spoiler: they used a platform you all might know).
Resources mentioned in this episode
Jacob Wedderbur...: [00:00:00] It was quite scary I think, as like a young founder, you know, you spent like four or five years building up this business that obviously means a lot to you, and this pandemic seem to just be a genuine existential threat to it. Like we took no bookings in April, a handful in May ... Speaker 2: [00:00:24] Welcome to Two-Sided, the marketplace podcast, brought to you by Sharetribe. Sjoerd: [00:00:34] Hi, I'm Sjoerd, CMO at Sharetribe and I am your host. For this episode, I talk to Jacob Wedderburn-Day, CEO and co-founder of Stasher, which is a marketplace that brings together travelers who need short term storage for their luggage and businesses who have extra storage space available such as hotels, news agencies and 711s. I regularly refer to Stasher actually when I discuss marketplaces with people, not only because it's an easy problem to identify with, all of us who have traveled to cities and stayed at Airbnb and other short term rentals or recognize this problem, but also because I think it's such an unlikely idea. I would have never come up with that, but it functions really well as a hyper-local marketplace, as a result of a couple of properties that we'll discuss in the conversation. We'll also discuss how Stasher builds trust. Again, we talk about trust because also for this marketplace, it is super important. And Jacob shares openly about how Stasher dealt with the blow of COVID-19. As you can imagine, a marketplace solely relying on travel has gone through some serious rough times. I won't hold you up any longer, let's listen to Jacob tell us about the journey of Stasher. Hi Jacob, welcome to the show. Jacob Wedderbur...: [00:01:51] Hey, thank you for having me. Sjoerd: [00:01:52] We have met actually before, once, even in real life. And there is some history with Sharetribe, which we'll maybe go into at some point, but for the people at home who don't know who is Jacob, could you tell a little bit about what you did before you founded Stasher? Jacob Wedderbur...: [00:02:07] Sure. Yeah, it's a fairly quick answer because I was 22 when we founded Stasher, so, [laughing], I've done a hell of a lot of interesting things before then. Ever since summer, we graduated from university, it was a summer, we had the idea and yeah, we built our prototype using Sharetribe obviously, which you alluded to. So yeah, before that I studied economics at university, is where I met Anne and we were really good mates there. And that was when we kind of first sort of floated the idea of going into business together and I guess took a little bit of luck to strike the right opportunity. But before that, school, you know, there's really, really not too much to get into, but I always had a passion for entrepreneurship, I think. And yeah, it's been really, really cool to be lucky enough, I guess, to find an idea that kind of had the potential to take it the way that we have. Sjoerd: [00:02:54] Yeah. Well actually, could you tell me a little about what is Stasher, especially in terms of like the market place components, you know, what is supply, what is demand, et cetera. And then also I would love to know how did you get the idea because people often ask like, oh, aren't you afraid that all the good marketplace ideas are taken? And I always take this one as an example of like, oh, well this is something I would have never thought up in a thousand years actually. Jacob Wedderbur...: [00:03:15] It is. Sjoerd: [00:03:16] But yeah, my first question was, what is Stasher actually? Jacob Wedderbur...: [00:03:19] Sure. So Stasher is a marketplace for storage and I guess specifically it's for short term storage. The easiest way to explain it is probably to tell you that story of how we came up with the idea. So if you cast yourself back to 2015, Anthony and I have just graduated, we've both moved down to London. Me to do a master's for a year and take in a job at a digital marketing agency. We're trying to think of ideas for something we can build a company out of. I have a go at sort of making a business and we notice that people kept making requests to leave things at Anthony's place. He used to live really, essentially. He was like next to Euston and King's Cross station. They're two of the busiest stations in London. And it was funny. It was one of those things where it was a little bit of a light bulb moment. I think it probably, it was either me or another friend, we're at Anthony's and said, "Oh, do you mind if we leave this back here today?" And he made a joke about charging us and we were like, hang on a second. [laughing] That's actually a legitimate idea in there. And we've been talking about like the Airbnb kind of platform marketplace model before that and thinking, you know, the sharing economy has just opened up this whole new sort of like scope of opportunity. And yeah, and then we saw storage is a market that was actually completely untouched by it. As far as we could tell them, we know sort of storage marketplaces that were already out there. And the original model was slightly different to where we've ended up now, because originally we were thinking, we didn't impose any sort of time limits. We said, you can store whatever you want for as long as you want. And we opened like the very first prototype on Sharetribe, literally had my flat and Anthony's flat, and that was it. Those are the two things that you could book. [laughs] And we were trying to persuade friends and family and other people to list their own places and that was the idea. It was quite more literally like Airbnb for storage, where we've ended up. And I think what makes a lot more sense is, you know, we didn't mind running around, opening up our flats to so let people in and out for their stories needs, but we figured that it wasn't quite the same opportunity as Airbnb where it can become practically, you know, a side job or a full-time job to just manage an Airbnb. What we've instead done, so we started signing up businesses like hotels and shops that had storage space and figured that, you know, they're paying plenty enough for an, or whatever to lease these spaces, they want to make every square foot count. If they can monetize the storage space, it's a sort of win-win model where they're bringing in customers, we're helping them to bring in customers and they're getting paid to provide a service to them. And it just all sort of really came together in that moment. And it took us a little while to sign on the first shop, since it always does. I think when you've got a completely new and baffling idea, people are like, what? Sjoerd: [00:05:51] Yeah. Jacob Wedderbur...: [00:05:51] But we got it rolling. And yeah, I mean, looking back, you know, five years old and we have about a thousand, well, we had 1,500 pre-COVID, still remain to be seen post-COVID how many of them, uh, still going, but it will be over a thousand- Sjoerd: [00:06:05] Yeah. Jacob Wedderbur...: [00:06:06] In cities around the world. So ... Sjoerd: [00:06:08] Yeah, so that's cool. So, because I often ask the question, like, how did you constrain the marketplace initially, but you already sort of alluded to that a little bit because it usually goes like either geographically or by category. So first you had like unlimited storage for everything, so you narrowed it down to like short term storage. But also what I really like about your model is that it's really like hyper-local. At least if I recall from a previous time that I talked to Anthony, maybe that it was really just around certain tourist spots. So can you tell a little bit about that? How did you start, like from a geographical perspective and how did you expand there? Jacob Wedderbur...: [00:06:43] Yeah, totally. I mean, we kicked things off in London and it was very much as you say, we were trying our best to predict where demand would fall and like where the hotspots were. And actually there was a pretty easy clue was just in terms of where the station lockers used to exist. And, you know, there are still a handful of those left, they're really expensive and that was part of the driver for us was we were like, you know, we could charge half the price and potentially a better service here and be in way more locations. So we identified the major train stations and I guess, you know, it becomes fairly obvious as you sort of think about it and as it evolves and as we've spread it across the different cities. In London there are sort of eight to 10 major stations and you want to have locations ideally with good hours, preferably 24/7 that surround it. And then you've also got this tourist hotspots that might not necessarily be right next to a station, but you know, you think of things like ... Then you've got events, you've got like Wembley Stadium and tons of other stadiums around again, that's been a bit sort of COVID impacted. But you know, we'll see the return of events at some point. And that was a whole sort of other big driver for us. And yeah, so it was, I suppose, quite geographically targeted in some ways, you know, we've always had an application form where anyone can apply any business or hotel could apply, but actually buildings supply has been quite curated in that sense. Maybe curated is a little bit strong, but yeah, that's one of the approaches that we've taken. Sjoerd: [00:08:06] Yeah. So did you then just go out into the street, like let's say, so you started around one station, I guess you went to the next station. Did you just go out into the street and just walk around and see, where is the store? Like, what was your approach? Jacob Wedderbur...: [00:08:19] Literally. Yeah. Sjoerd: [00:08:19] Oh, really? Jacob Wedderbur...: [00:08:21] Exactly like that, you know, we've got better methods now, but the, the early days, and to be fair, it does work was just, you know, we'd pick an area and we'd just walk around and we'd see like see a promising looking business or hotel and we'd go in and we'd either have the meeting there and then, or we try, and set up a meeting, you know, if management wasn't around. It was actually, it was amazing sales practice. I still feel like it's the kind of training, every time we hire someone new at Stasher, we make them do at least like one day of just kinda like foot sales like that. Sjoerd: [00:08:48] Okay. Jacob Wedderbur...: [00:08:48] Just cause it's such good business training. And for us, I think, especially looking back at the really early days when we only had a handful of hosts on the platform, it was quite important to have that kind of in person sales experience of understanding, you know, what it was they liked, what it was they didn't like, what we pitched that sort of made them excited. What we pitched that made them nervous and try, and strike that balance in the way, cause that ultimately feeds back and helps you inform the product as well. Sjoerd: [00:09:14] So what was it for them? Like what is, say we imagine a 711, what's the benefit for them? Jacob Wedderbur...: [00:09:19] Yeah, I think we eventually hit on a sales pitch that goes something along the lines of this, which is that, you know, as a shop, you depend on regular footfall of traffic. You want as many people coming in as possible. And what we're offering you is a way of getting footfall that you're actually getting paid for. Like it's an acquisition channel that you get paid to have running. As long as you've got storage space that's got capacity and you really don't need very much. I think people often overestimate that in the early days they used to think, you know, I don't have a whole spare room. I've just got my storage room and we'd say, you know what? Just, if you make that corner available, you could serve 10 customers on any given day. 10 customers could add up to as much as 800, 900 pounds in a month. And that 900 pounds can be, you know, that can be a major dent in whatever your rental payments are or any other costs that you have and scale across a year, it really starts to add up. And I think, you know, we've seen some spectacular cases of shops or hotels and really primaries with good hours. They take thousands of pounds a month, it's really nice to see because it's such a smooth operation when it works well. And I think that's the only thing I really like about it, is it just like customers really like it. And it's relatively seamless once the host is sort of familiar with it. Sjoerd: [00:10:25] Yeah, because that's the, the other reason why I often refer to whenever I discuss market places with people and we come to this, why I like actually the idea so much, because it's like a, somewhat of a classic idea where that storage space, it's like perfect example of like unused high value assets where like they're already paying for it. They have it, there's nothing more to invest. So, so I would imagine that it's rather easy to convince people to become a host on the platform. And another thing, what I really like about your idea is that in most cases, your supply and demand sort of naturally appear in the same area. They don't have to do anything. They're already, where there's people with suitcases, there will be news agencies, 24/7 stores, any kind of those places, hotels. So yeah, I was getting, like I said, because often- Jacob Wedderbur...: [00:11:12] Yes. Sjoerd: [00:11:12] ... like that is the problem of bringing those two together, right? Like there's not that many where there is an overlap that comes naturally. Jacob Wedderbur...: [00:11:18] Yeah. I see what you mean, because you can often have it the, the people who have the assets that the marketplace sort of provides, you know, they're not easily co-located. Whereas as you say, I mean, we're targeting supply in prime tourist locations, which mean one, there are definitely tourists looking, but two because their tourist locations, so you've got those businesses on hand and that makes their space all the more valuable. Sjoerd: [00:11:38] Yeah. Jacob Wedderbur...: [00:11:38] So it's a great way to sort of monetize that. Sjoerd: [00:11:40] Yeah. And then in how many locations are you now, or countries actually like? Jacob Wedderbur...: [00:11:45] Countries, we are in 36 countries- Sjoerd: [00:11:47] Okay. Jacob Wedderbur...: [00:11:48] ... And the numbers are changing a little bit, day to day right now, given the circumstances. Sjoerd: [00:11:52] Of course. Jacob Wedderbur...: [00:11:53] ... But we have over a thousand locations on the platform and we hit as high as 1,500- Sjoerd: [00:11:58] Yeah. Jacob Wedderbur...: [00:11:58] ... before all this. So hopefully we'll get quite close back to that. Sjoerd: [00:12:02] And then you mentioned that you had some method of like, sort of deciding the next one. Like, could you tell us a little bit about that? Because I can imagine that over time. So like, okay, I assume that it's almost a location, it's maybe there you are because you partner up with a bigger hotel chain, so you automatically add, but how do you decide on where to go? Do you run some numbers? Is it like, how do you decide? Jacob Wedderbur...: [00:12:21] Yeah, that's a good question. The analysis, I suppose, we're kind of following the procedures that Airbnb would have followed with the benefit of also following them so, [laughing] we can see where they do well. And that's generally a good indication of the fact that, you know, you'll have high demand for our kind of service because Airbnb, vacation rentals at least to sort of give it the broader category, tend to be creators of this problem, so to speak, they're the ones who have the guests who need somewhere to leave their luggage and can't necessarily leave it at the vacation rental. And actually, I suppose one thing that bodes well for us in the future is that with the sort of new hygiene measures in place, it is going to be a greater concern for travelers because some hotels may sort of impose strict limits and certainly vacation rentals will want to make sure that everywhere is sort of fully cleaned between guests stays. So- Sjoerd: [00:13:08] Oh, yeah. Jacob Wedderbur...: [00:13:08] Silver linings. Sjoerd: [00:13:10] Yeah, somehow. Yeah. Jacob Wedderbur...: [00:13:11] Yeah. But to bring it back to your question, yeah. We tend to try, and be quite logical and quite numerical about it. And that tends to involve analyzing Airbnbs performance, looking at sort of general tourist numbers too. I suppose the one difference between us and Airbnb is that Airbnb can quite literally be sort of anywhere, rural, urban, whatever. We're very urban in focus. I don't think, I think just by virtue of the fact that if you're traveling somewhere remote, you'll have got there on four wheels. Sjoerd: [00:13:38] Mm-hmm. Jacob Wedderbur...: [00:13:38] And the problem for us really rises in cities where you just don't want to be taking stuff around. So that's good because that allows us likewise to really focus our efforts. And, you know, we started in London, we expanded across the UK because originally our ambition is a little bit more local in that respect. And then actually we saw London was just driving so much of the UK's bookings, London and Edinburgh. So then we launched Paris and saw Paris kind of match, start to match London and [inaudible 00:14:05], and from that we figured, you know what? There's an exponential kind of curve here. And you can tell whether the big, really big cities are going to be and those are the ones that are worth focusing on first. Sjoerd: [00:14:14] Yeah, no, actually I realized that. We discussed everything about supply, but of course the trick here is that, how do you get the demand on board? Like how do you get people to know about Stasher, that this is an opportunity, how do you get them to book, et cetera, et cetera? Jacob Wedderbur...: [00:14:27] It's a good question. I'm just going to answer a slightly different question first- Sjoerd: [00:14:31] Sure. Jacob Wedderbur...: [00:14:32] ... which is just that I realized most marketplaces on the supply side have that kind of chicken and egg problem of you need the supply to unlock the demand. But sometimes you need demand to unlock supply, right? Sjoerd: [00:14:41] Yeah. Jacob Wedderbur...: [00:14:41] You need to have interested parties in order for suppliers to have an interest in listing their stuff. And I suppose that's because most marketplaces require slightly more active participation on behalf of like, you know, if your suppliers really need to like manage their listing and stuff, then it does become very much a kind of juggling act. And one of the benefits that we've had is because we're providing an ancillary service to our suppliers, you know, we can get them set up and then actually they don't really need to do anything after that point. They can just sort of manage it fairly passably and as bookings come through, they fulfill them. And I think that's quite nice because there are pros and cons. I mean, it makes them slightly less invested than they would be if they were sort of managing it day to day. But at the same time, it also means that you can sign them up and they can be quite patient about, you know, it might take a month before they get that first booking, but it's fine because you won't have lost them by that point. And sorry, that wasn't the question you asked at all. Sjoerd: [00:15:29] Yeah. But I mean, that's a great introduction to it, because I mean like the chicken and egg was one of the names that we were considering for the podcast, but- Jacob Wedderbur...: [00:15:35] [laughs] Sjoerd: [00:15:35] Because that is the sort of quintessential problem that all market places running into early on. Jacob Wedderbur...: [00:15:39] Yeah. Sjoerd: [00:15:40] And usually indeed also what I've learned from interviewing people and also just by looking at the many Sharetribe customers that we have, it's easier indeed. Like you explained to get supply on board because they're a little bit more patient, and in, in your case, indeed. I can imagine that they are extremely patient, but then- Jacob Wedderbur...: [00:15:55] [inaudible 00:15:56]. Sjoerd: [00:15:55] Yeah. Jacob Wedderbur...: [00:15:55] So there's a number of channels that we've found work really quite well for this. And I suppose the two most obvious ones are just online search, be that through paid advertising, through just ranking well on organic, et cetera. And then also through partnerships and we have tried in the past various different methods of like activating social or channels sort of more along those lines. It's never quite worked out for us. And I think the conclusion we drew fairly early on was that we're more of a sort of utility products, less of an aspirational one, and I can see social working really well if you sort of selling a brand that's a little bit more aspirational, if it's like buy this great product because it's going to change your life in these ways. Because really all we want is when people have a problem with storage, they know about Stasher and they come to us. Sjoerd: [00:16:43] Yeah. Jacob Wedderbur...: [00:16:44] And you can do some sort of awareness marketing around that, but it's just not going to be quite as punchy or effective as you know, just making sure you're top of search when people are looking. Sjoerd: [00:16:52] Mm-hmm. Jacob Wedderbur...: [00:16:52] Or making sure your well-integrated into partner flows when people are physically experiencing the problem with another travel company like their Airbnb host manager or the management company, they go to check out and the host says, oh, you know, you can't leave you back here. Book with Stasher, that's a perfect kind of partnership. We've tried to set up hundreds of those. Sjoerd: [00:17:11] Yeah. Jacob Wedderbur...: [00:17:12] And that can, I think really apply to basically any trouble company that has a customer experiencing this problem. We have a referral program. It makes it really, really easy to set that up and refer customers to us. And our big selling point there has been around trust really because we've dedicated a lot of time and effort to making sure reviews are really good and customer experience is high. And therefore the selling point to those partners is, you know, make sure your guest ends their journey with a five star experience, not a really bad one. So those are the two sort of methods that we found quite effective for generating demand. Sjoerd: [00:17:43] Yeah. And that's again, a nice assist for me to head in my next question, which is about trust because I'd referred to it already, I think in the beginning when I introduced you that I saw you talk at the SharOn Academy Global Summit, I got a fantastic talk about how you have built trust over the years in Stasher. And of course, you know, if I leave my belongings with you, it's a rather important thing. Jacob Wedderbur...: [00:18:03] Yeah. Sjoerd: [00:18:03] So maybe you can talk us through what you shared there, because I thought it was super interesting. Jacob Wedderbur...: [00:18:03] Geez, yeah. Sjoerd: [00:18:03] If you still remember. Yeah. Jacob Wedderbur...: [00:18:03] Yeah, I do, I do. It was, no, it was fun. It was really good meeting you then actually as well. It's been an interesting process building trust. I think we were right to identify early on quite how important it was. I mean, you mentioned your personal belongings are something that you really do sort of feel quite strongly about looking after. I mean, people are funny enough about like just personal data. So their actual personal property is like, you've got to make sure that is super secure and yeah, there's a few different things that we found have worked really well. Fundamentally the essential thing is just to make sure the service itself is secure and the foundations are in place. And that is a question of betting the right places and having the right kind of customer service just in the event of problems and making sure the website is really effective. Tech, I think plays a fairly big role. Like you can design for trust. Joe Gebbia from Airbnb has a nice talk along those lines, which I remember watching when we first were building this. Other things I think that make a big difference, it talks about reviews and that's certainly a really clear signal of trust. At the day I talked about co-branding with trusted brands. I don't mean that so much as a marketing exercise, so much as like actually being partnered with brands that you trust makes a big difference for us. I remember Premier Inn was a major win in the UK, like working with them to provide storage I think it was a huge conversion factor for a lot of customers to see a brand like that, that's so recognizable and I think the same goes on sort of demand side. We have an integration with hotels.com. Again, you know, having these really big brands that connect with you, I think is an excellent way to sort of pass on that trust. Sjoerd: [00:19:44] Yeah. I remember that, that you mentioned because I'm also going to hook in that earlier because reviews, right? Like there's a lot of talk about fake reviews, there is this review farms. How do you see that for Stasher and how do you counter that? Or how do you plan to counter that? Jacob Wedderbur...: [00:19:56] Yeah, that really annoys me actually. [laughing] I think Google should- Sjoerd: [00:20:00] I think it annoys everybody. Yeah. Jacob Wedderbur...: [00:20:01] Yeah, Google should do more to police this kind of stuff. Google have a setting at the moment where you can just enter your own review score as sort of like metadata directly and have it list stars against your name. And there's no verification in that process. And I do think that verification is a really important aspect. I sometimes wonder how much your sort of day to day customer necessarily appreciates that. I think it's very easy to just post stars and have them kind of trust that, but we've always used Feefo, Trustpilot do exactly the same job. You've got places like TripAdvisor, TripAdvisor don't necessarily have verified reviews to be fair. I'm not sure, you gonna have to fact check me on that one. Sjoerd: [00:20:36] Yeah. Jacob Wedderbur...: [00:20:36] But Feefo, I've always really rated because, pun not intended, sorry, they, they provide like a really nice service for just, you know when you see one of those reviews that it's real. And I think we've always felt, you know, there's no real need to hide negative reviews. I think you do see that in companies, you see they'll post reviews with basically no sort of one or two stars. And I think that's kind of unrealistic unless you just serve very few customers and you do it really well. In a business like ours, it's an inevitability that you're going to have some bad experiences and partly that's because we can't totally control the in store experience. We can just try, and manage it as best we can, but it's really great feedback for us as well. When we see negative reviews, it's a signal that we need to sort of act and remedy something. And that's how we want the marketplace to function really. We don't want to sort of like sit, sit over it like tyrants and kind of ... Sjoerd: [00:21:24] No. Jacob Wedderbur...: [00:21:24] We want it to kind of like give us feedback organically so that we can kind of continually improve it. And so, I mean, yeah, I've always thought being quite transparent with reviews is really important and having a verified system in place, I think is something that it would be great to find a way to place more value in that. But I think it's key. Yeah. Sjoerd: [00:21:42] Yeah. And then any event something goes wrong, do you have an insurance system or how does it work? Jacob Wedderbur...: [00:21:47] We do, yeah, I should have mentioned that too. That's another key element of trust. We've got a really nice deal with the guys from Guard Hawk insurers. They're a good sharing economy insurance provider, but in essence, your bag is completely covered, uh, up to a thousand pounds against loss, theft or damage. And it's, you know, in sort of half a million bags stored, we've only ever had one or two claims, which is a really nice rate of incidents. Sjoerd: [00:22:09] Yeah. Jacob Wedderbur...: [00:22:10] And we try, and be really proactive about customer support as well. So, you know, I lost a theft or, or like serious damage is really rare, but places opening late or stuff going a little bit wrong, that happens from time to time. And I think we've always tried to be just super proactive about like, if someone's unhappy, it's better to just refund them the difference and make sure that they go away from that as a sort of positive ambassador for your brand. You sort of think, oh, I need to like take the money from their booking. And then you've got all that sort of bad will out there in the world against you. I just, that's the view that we've always taken. Sjoerd: [00:22:42] Yeah, no, I support it. Like we tried to do the same with Sharetrip, I could of course tried to be fair always. And if there's like unfair accusations, we've tried to sort of pass that out. But yeah, I totally agree indeed. Like the speed of support and it's better indeed if you have someone leave maybe unsatisfied with the service, but happy about the brand than the other way around. So yeah. Do you remember, let's see if there's an interesting question because we have looked with Sharetrip also a couple of years ago about how to do insurance in market places. Was it an easy find for you? Because back then, it was quite a big disaster, like not too many insurers want to underwrite marketplaces with its own specific problems. Jacob Wedderbur...: [00:23:18] Yeah. It was tough. It was not an easy find. I think we were quite lucky to stumble across the guys from Guard Hawk cause they were at a similar point in building this startup to where we were, which meant that they were kind of happy to take a bit of a punt on us. And no, as I say, I mean, we've been really lucky. I know there's a few like them now out there in, in at least the, sort of the travel industry, the short term rental industry specifically, I suppose that's because Airbnb host cover has become quite a big field just in and of itself. And then there's related ancillary services around like key exchange and like a storage is obviously where we belong and a few others. But general sort of marketplace cover is, is tricky. I think we did look at a number of sort of bigger firms before we stumbled across Guard Hawk. You know, we just ended up with some tricky paperwork and expensive quotes in it. It didn't quite work out economically. I think that's, I guess where the challenge is, especially when you're a young market place is, you've got to be quite sensitive to the unit cost of running your business. And if insurance becomes too big a chunk of that, unless it's really, really like essential and you're expecting a lot of claims in which case, [laughs], you've probably got bigger problems, but like- Sjoerd: [00:24:24] Yeah. Jacob Wedderbur...: [00:24:25] ... it's a challenge. Sjoerd: [00:24:26] Actually, I wanted to get into that as well, because I think it's a great question always to ask of any kind of marketplaces, because it's something that most marketplace entrepreneurs are very concerned about, disintermediation or marketplace leakage. How's that for Stasher? Jacob Wedderbur...: [00:24:40] You know, it's really hard to know. It's probably one of my bigger concerns about the whole model. I suppose it's because it's one that we can't exercise too much control over. Sometimes I think the best approach is just to not worry about it too much, just accept, like even in the really big brands, you know, you're going to get some, uh, like not even in marketplaces. I think, you know, I remember my girlfriend used to work at Asus and she said there were endless amounts of sort of customer issues where people would order stuff and then make sort of fake returns or return much less valuable items. There's always ways that sort of value can leak out of the company. And it's frustrating. And I think it's tempting to try, and limit that as much as possible. The way that we've tried to mitigate it has generally been, the one thing we do on the platform is we don't sort of actively publish the addresses of the locations. We sort of leave that as a bit of a signal of like, you know, you got to make a booking and then we'll show you the full postal code. Like you can see roughly on a map where you're booking so you know it's roughly in the right area, but that's just a sort of way of mitigating that. You can understand that there would be a sort of temptation to just go and book directly. You know, you can see that sort of thing in marketplaces all the time. I think where we're lucky is that unlike something like tutoring, perhaps a customer and a host are never going to form a sort of like particularly longterm relationship in something like this because the storage need is quite short term and fairly irregular. So we're not worried in that sense that like, you know, people might just sort of meet via the platform and then continue to have this sort of relationship off platform. But yeah, there's definitely some amount of risk that people just sort of use the website to navigate to somewhere near, an unscrupulous host might just take a sort of cash transaction. And obviously the other way we mitigate against that is we say, you know, only bookings made through the platform are insured and nowadays particularly cash transactions are burned because of hygiene. Sjoerd: [00:26:33] Yeah. Jacob Wedderbur...: [00:26:34] I think that's the best you can do really is sort of put sensible policies in place and kind of trust people to obey it. And there will be some amount that don't and I suppose that's just the way it goes, which is a shame. Sjoerd: [00:26:43] Yeah. I mean, I can imagine in the case of Stasher where, I mean, the fee is, what is a average storage cost? Jacob Wedderbur...: [00:26:50] It's pretty cheap. It's six pounds per bag or, you know, six Euros in most of Europe, $6 in most of America. So ... Sjoerd: [00:26:57] So I mean, that's like, that's a really negligible amount of money for which you would like to risk losing your insurance and other things. Jacob Wedderbur...: [00:27:06] Yeah. Sjoerd: [00:27:06] So I would also assume that if I would be in your place, I wouldn't be too worried about it. I mean, your doing everything from what I can hear and see, because when we met in London, I had actually booked- Jacob Wedderbur...: [00:27:16] Oh, yeah. Sjoerd: [00:27:17] ... a Stasher. Yeah, because it was like this broader posh, like the Lloyd's building. And I wasn't sure if they wanted to hold a luggage, they ended up holding it. But there's a couple of rules always. And I'm saying this more for people listening than for you, but there was a couple of rules always in my experience how to avoid this intermediation is that indeed like make the product a worth like paying the money and you do that through the insurance, then sort of try to make it a little bit less easy. Now, you do this sort of fuzzy location for the places. And then also, yeah, the amount of value that's gets transacted and the amount of effort that people need to make to get the value is so low that it doesn't really leave much room unless you really are keen to get that six pounds back. Like it seemed unlikely, I would say. So now we're in a kind of a special time. And I remember a couple of months ago you posted a really honest review of how did COVID affect Stasher and I thought that was very brave and very inspiring. Uh, could you share that with the audience? Like how has COVID infected Stasher and how do you hope to perform post-COVID? Jacob Wedderbur...: [00:28:18] Thanks for saying that about the article. It was quite tricky to write actually, but I think I felt like I'd seen a lot of sort of slightly fake optimism around that period. And I just sort of thought, you know what? I think someone needs to sort of put down an honest account of what it's been like. It was quite scary, I think, as like a young founder, you know, you spent like four or five years building up this business that obviously means a lot to you and this pandemic seemed to just be a genuine existential threat to it. Like we took no bookings in April, a handful in May. It's been really encouraging to see June and July has really picked things back up again. Certainly July has been quite a big step up from June and we're seeing a path again, clear back to like the targets that we wanted to hit. But because obviously travel restrictions, quarantines, all these things were put in place to limit movement and limit the spread. Inevitably a consequence was just that travel was decimated and we kind of got doubly hit because our supply also small businesses who were forced to close and, you know, a lot of them have gone out of business. I say a lot, that's not true. A handful of them have gone out of business during this period. And so we sort of, you know, we were like, on the one hand demand is plummeted. On the other hand, we're a little bit sort of confused as to what the state of our suppliers. So there's been quite a lot to rebuild. On the other hand, it's not all negative. I think the thing that gave us at least some kind of sense of reassurance was we were lucky in terms of the timing of our fundraising. So we'd raise this round end of last year with a view to like, you know, having a big exciting 2020, which is now delayed to a big exciting 2021, 2020 that we're- Sjoerd: [00:29:55] Yeah. Jacob Wedderbur...: [00:29:56] ... just gonna survive through. And it knocked a lot of our plans of course, a little bit, because we were hoping to, you know, we just started getting into a bit of a hiring spree and I desperately wanted to avoid letting good people go. I think it's ultimately, you sort of have to put business concerns first, but it just still feels terribly unfair to have people who are doing a great job on the basis of sort of talent and the hard work they're putting in and the entire economic conditions are actually sort of what's dictating it. So we've, we've done our best, you know, the furlough scheme has been fantastic. I have to say that. In fact, the government support generally has been really good because to see your income drop from sort of thousands of pounds a day to zero, it's alarming, but then we've been really able to save on costs and bring expenses right down. And I think there are some real positives to all of this. And one potentially we were going down a slightly sort of dangerous path of spending a lot of money because we were in that sort of startup high growth phase. And that's a lot of fun, but it's not always the most effective way to run things. So there's a lesson in that. The second thing is actually the time it's given us has been, it's been quite valuable. It's been something I've appreciated cause you know, we'd come off the back of quite an intense fundraise. We were working really hard in the early months of the year. It's the first time in like five years I've had this much time, like not to worry about customers or [laughs], like just to sort of step back from things a bit. Sjoerd: [00:31:20] Well, yeah. Jacob Wedderbur...: [00:31:20] So it's given us the chance to put some new plans in place for other services that we'd had on the back burner that we've been meaning to launch. The one that we're getting really quite close with is luggage delivery. And this is exciting because we've been looking at government guidelines and a prevailing sort of rule is that it's not yet a rule, but they're really encouraging people to avoid sort of luggage in airports as much as possible. Ideally if you can ship bags rather than have it sort of checked in and put through the plane and all this sort of handling that, that involves- Sjoerd: [00:31:48] Yeah. Jacob Wedderbur...: [00:31:48] ... it's a much better process for everyone. It's a sort of hygiene recommendation that they're starting to publish more and more. So it's a market that we've wanted to get into for a long time anyway, and we sort of took the opportunity while things were quiet to get that sort of launched and ready to go and hoping to launch that next month. But yeah, stuff like that I think is actually really positive to reflect on. It'd be nice to, I think we'll come out at the end of lock down and the website and apps will look better than they did and we'll have a few things like that. And so, you know ... Sjoerd: [00:32:15] Yeah. Jacob Wedderbur...: [00:32:15] Silver linings. Sjoerd: [00:32:16] Yeah, so there's one way. So again, sort of coming back through the constraints matrix, so geography on the other side, services, products, categories, whatever you would like to call them on the other side. So you just now discussed about adding sort of a category of products there being delivery. Do you have any other expansion plans in terms of geography or is there more of these plans into pipeline that you could share? Jacob Wedderbur...: [00:32:39] Yeah. When we closed the fundraiser, I remember that was the big theme of all the PR that we put out at the time was all about geographic expansion. We had a really bold headline that said that we were going to expand to 10,000 cities. [laughs] So I couldn't even name 10,000 cities. Right? Then supposedly Airbnb is in 60,000. So we were like, you know- Sjoerd: [00:32:57] Okay. Jacob Wedderbur...: [00:32:57] ... it's not actually as crazy as it sounds. Sjoerd: [00:33:00] Yeah. Jacob Wedderbur...: [00:33:00] And we were in like 250. So, you know, it's only 40 times what we've already got. Sjoerd: [00:33:05] Yeah. Jacob Wedderbur...: [00:33:05] We will probably just be going about that a little bit slower than we otherwise would have. And I think as I kind of mentioned in the last answer, there was a pressure to sort of spend and grow and burn quite fast. And that pressure is sort of been lifted by the current climate. You know, there's a bit more of an emphasis on sustainability and that means that we'll have to sort of be a bit more resourceful about the way that we expand, but we can look at sort of where it's going to be most effective. At the moment I can actually tell you what our top next expansion destination would be. It was definitely America was the target for this year originally. And I think we're just going to have to play it by year really and see how is sort of, how often travel situation evolves in different countries. But it's encouraging to see Europe is certainly looks like it's on a much better footing. And hopefully when this comes out, that'll still be true. Sjoerd: [00:33:51] Yeah. I also too. So we got like, well, we went nicely through, through the journey sort of up until now and even into the future. If you look back at the last, did you say five years? Six years, Stasher? Jacob Wedderbur...: [00:34:03] Five, yeah. Sjoerd: [00:34:03] Five years. Jacob Wedderbur...: [00:34:03] We founded this in September 2015. Sjoerd: [00:34:04] All right, cool. Is there anything you would've done differently or you feel like, oh man, if only we would have done this or if we only, we wouldn't have done this, that you can share it as like instructive for anyone listening? Jacob Wedderbur...: [00:34:18] Yeah. This might be quite a unique one, but we were originally called City Stasher, as you might remember from our Sharetrip days, that was the domain that we were running. Sjoerd: [00:34:25] I do, I do. Jacob Wedderbur...: [00:34:26] And we stumbled onto a bit of a trademark issue with it. There was a company called City Stash that provided like warehousing in America. And we just decided, you know, we were going international and we wanted to expand, and this was going to become a bit of a problem for us. And so on the one hand we were sort of trying to negotiate if it was possible to work around the trademark. On the other hand, we were like looking for new names. We were actually, we were lucky because we came across the stasha.com domain for a pretty reasonable price. And we were thinking, you know, that rebrand makes a lot of sense. At the same time, we just started sort of like building this kind of custom tech platform. We made the spectacular mistake of launching new domain, new brand, new website, thought we'd like roll it all into one and that'd be a really great move. And it backfired horribly in terms of our organic rankings. Sjoerd: [00:35:15] Oh, yeah. Jacob Wedderbur...: [00:35:15] Like Google was just like really confused by it. And it took a long time to sort of recognize that the citystasher.com domain that it used to rank quite highly had in fact now completely transferred to this new domain under a new name and everything. And yeah, that took some real recovering from, that was quite painful. Sjoerd: [00:35:31] Yeah. Jacob Wedderbur...: [00:35:32] I don't know how many other people are going to find themselves in a situation like that. But certainly I suppose the message there is just like, you gotta be quite sensitive to your channels. You've got to look after them. And it was annoying because it was something we anticipated, we thought of, and we thought we'd done the right thing, we'd done the correct redirects, but there were some mistakes in there anyways, yeah. Sjoerd: [00:35:50] Yeah. Oh, that sounds like a painful one. Yeah. Because especially if like, I mean, especially organic because it's such a great channel. You don't- Jacob Wedderbur...: [00:35:57] Yeah. Sjoerd: [00:35:57] You know, you don't pay per acquisition and if you lose that, that would be very problematic. Yeah, I can imagine. Jacob Wedderbur...: [00:36:03] It came back after a few months, but yeah, painful months. Sjoerd: [00:36:06] Yeah, yeah, yeah. Alright. Anything else that you would like to plug regarding Stasher or yourself? Actually, I can recommend your podcast, if I can plug it. I just listened to it yesterday, which is called Should Billionaires Exists. I can recommend everyone to listen to that one. Jacob Wedderbur...: [00:36:22] Thank you. Sjoerd: [00:36:23] But can you give it a plug? I actually forgot the name already. Jacob Wedderbur...: [00:36:25] It's the Morality of Everyday Things. This is just something that, and I set out for fun during the lockdown, because we don't have lots of sort of conversations along those lines. Anyway, thinking we're being all very clever, just like chatting about ethical issues, but applied to real world situations. You know, there's, there's actually, now is a particularly interesting time for conversations like that and just sort of thinking about morality as applied for the modern day. Anyway, so that's the theme and we, we look at different issues each week. We looked at one around sort of billionaires and like wealth and equality during COVID, we looked at like one around sort of protests and violence. We're planning to do one quite soon around sort of the cost of lockdown, which promises probably to be a bit controversial, but- Sjoerd: [00:37:07] Yeah. Jacob Wedderbur...: [00:37:08] Yeah, it's been good fun. Sjoerd: [00:37:10] And then any professional plugs regarding Stasher? Where can people find you? Where should they go? What should they do? Jacob Wedderbur...: [00:37:16] Yeah. We are on all the usual social media channels, me myself, I'm quite active on LinkedIn. So by all means, please, I'll be on there, it's Jacob Wedderburn-Day. Stasher is all over sort of Facebook, Instagram. Twitter I think it's at Stasher Official and yeah, please download our apps as well. They're on the iOS and Android, the sort of Apple and play store, whatever you call them, what are they? Sjoerd: [00:37:39] Yeah. Jacob Wedderbur...: [00:37:40] And you can download the apps and yeah, please do. And think of us next time you go traveling. Sjoerd: [00:37:43] All right. Thanks Jacob, this was great. Jacob Wedderbur...: [00:37:45] My pleasure. Cheers, thanks for having me. Speaker 2: [00:37:49] Thank you for listening to Two-Sided, the marketplace podcast. If you enjoyed today's show, don't forget to subscribe. If you listen on iTunes, we'd also love for you to rate and give us a review. If you got inspired to build your own marketplace, go visit https://www.sharetribe.com. It's the fastest way to build a successful online marketplace business. Until next time.
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