Vested Capital
Vested Capital

Episode · 1 year ago

Danielle Lewis: Founder Of Influencer Marketing Platform Scrunch.com Explains Why It Took Five Pivots To Find Product Market Fit

ABOUT THIS EPISODE

 [ Download MP3 | Transcript | iTunes | Soundcloud | Stitcher | Spotify | Raw RSS] Danielle Lewis and I first connected back in Australia when we were both active bloggers. At the time, Danielle’s blog BrisbaneThreads.com was a side project where she featured and fostered the local fashion scene. The plan was to go national, […] The post https://yaro.blog/29813/danielle-lewis/ (Danielle Lewis: Founder Of Influencer Marketing Platform Scrunch.com Explains Why It Took Five Pivots To Find Product Market Fit) appeared first on https://yaro.blog (Yaro.Blog).

It didn't work. You know,we decided to move forward with that idea. So, yeah, that was thehouse and the savings go on. We actually sat around and went,Oh my God, we just lust everything. It's not working. We've got tomake a decision. What do we do here? I have money,so how do you get money? And we bankically went oh, well,we can just borrow some money and keep going. Did it work? No. Welcome to Jarrow's podcast, where you'll discover the stories behind world class performers, business builders and enlightened leaders. Hello, this is Yaro and welcome to anentrepreneur's journey podcast, or really a great origin story of someone who I'vebeen in touch with for a long time now. I was actually trying towrack my brains how my guest and I first met. I remember things wedid in Australia because there were a lot of fun going to things like fashionshows and but I can't exactly remember our first connection. So I'd like towelcome Danielle Lewis to the show, who's the founder of scrunch right now,which is a social influencer platform and also a mix of an agency. Lookingforward to talk about those two different sides of our company. But long beforescrunch happened, we've known each other. We bumped into each other in SanFrancisco, in Australia. Danielle, do you remember how we met? Canyou go back in time? And well, thank you firstly for having me.It's very exciting to actually be on the side of the show now afterI've been stopping you online for so long. You know what, I almost thinkthat's how it was that you were so I, you know, startedmy online journey with a blog and I have a feeling that you were oneof, you know, the people that I followed online all the way backwhen, God, it's maybe like fifteen years ago when I started that blog, and I think maybe we just connected online first and then realize that wewere actually living in the same city at one stage, and that's yes,it online became in real life. Remind me, was blogging your first thingthat we connected on? Like I feel like you've had your hands in differentbusinesses. I know fashion has been a thing. Now you're in social media, but I for some reason I feel like there's more that you had going. Yeah, well, I mean the yeah, blogging, I think,was the first way in which we met. So I had a blog in Brisbanecalled Brisbane threads, which has been around for a very long time.But you're right, over the journey that we've known each other, I meaneven scrunches, a business, which is what I'm known for now, wentthrough, you know, three or four major pivots. So you know,I'm sure each time I talk to people and probably talking about something else,but yeah, I think blogging was the first thing that we connected over.I think it's because we talked every two or three years. So naturally there'sa lot happening every time and I feel like you've had an APP at somepoint, although I definitely get the feeling that scrunch has been around for awhile. It's, you know, solid business. You guys are really buildingsomething great there. So I'd love to talk about that. But let's brieflygo back in time, as we do on my show, Dannielle and areyou born and raised in Brisbane? Yeah, absolutely so. I've done lots oftravel in my life but always come home to Sonny Brisbane. Okay,so born and raised in Brisbane. For those who don't know, I wasborn and raised in Brisbane to although Danielle has the proper accent for Brisbane.I don't. I have the I have the Canadian one. Now Brisbane,I know growing up for me wasn't exactly a hotbed of entrepreneurial passion and influence. I can't remember, you know, really being overly exposed to business ideasand people doing business as I guess, and this I actively sought out booksor obviously looked maybe to not even Sydney, but really to oversee you. Sowhen you were growing up, did you have any kind of entrepreneural influenceor you just kind of naturally do your own thing, or were you reallyjust a career girl? You were kind...

...of going to go to university,get a job and all that as the original plan. Yeah, I wasa total career girls. So I grow up in a family that was,you know, mom and dad worked in the same job like thirty plus years. I didn't know anything about starting business. I didn't know you could start abusiness and no, I just, you know, did well in school, went the university. You know, as crazy as it got was thefact that I studied fashion because that's what I was most passionate about the band. But as I was studying, I ended up getting a full time jobat tell Stra and yeah, became a total corporate ladder climber. So Iwas there for ten years in sales. So I worked my way up theranks and absolutely, you know, value that time. But it's funny thatyou talk about seeking out books, because that's exactly what I did as well. So I don't even remember how I stumbled upon it, but it wasand it's so corny, but it's the you know, the for our workweek. By to embarrassed, you probably did a review of it or something, and I read that book and I was like, Oh my God,you telling me that you're actually allowed to design this magical life that you wantand you can start a business and you can do all those things. AndYeah, it was that point that I just became absolutely obsessed with online businesses. Wow, I didn't realize. I keep I was tell Stra and Tesla. Now I get confused between the two since I left Australia. But forthose who don't know, tell stories of a telco, the telephone and internetcompany in Australia. So your background then, will you you said it was sales. So yes, you know when you came across the fo our workweek and you started thinking it's an at business. Were you thinking, isthere something I can take from my current or my background now of a decadeworking in a company and start a new business? Or was it really Ihave a totally different interest than I want to follow that kind of path?Yeah, so I was not that club. I only fly. became a tuneto my skills much later in my online business, this journey. Soback then I you know, basically after reading that book, I kind oflooked at where I was and I'd studied fashion and being working in sales,obviously didn't get to kind of have that creative outlet. So for me atthe time I did with every girl did back then. I started a fashionblog and so then I became obsessed with a how to monetize that through onlineadvertising and we ran these cool sales and we didn't get into the sponsorships aroundlike traditional influences kind of do now. At that time it was all aroundlike, you know, building products and attracting an audience and and that typeof thing. But yeah, it's it certainly didn't start out with me realizingthat I had an amazing sales talent or appreciating the fact that I've been workingon that sort of skill for the last ten years. It was kind ofjust total experimentation. I just became obsessed with looking at what everybody else wasdoing online and trying to figure out how you could actually replace at full timejob with an online business, and that's what led to registering Brisbane threadscom withthe plan to cover fashion in Australia, it was, or even just Brisbane. Was that the goal? Yeah, so the very original idea was basicallylooking at celebrity trends and outfits and then figuring out how you could get thelook in Brisban, so if you wanted to wear something similar to your favoritecelebrity or whatever. And then it kind of morphed as my interests changed.So I became less and less interested in fashion and more interested in, youknow, things like food and travel, and so Brisbane threads then evolved intocovering kind of like fashion, food, travel and like amazing people in Brisbane. So we've blogged about that for a little while and the plan is totake over the whole of Australia. So have like path threads, Adelaide threads, Sydney threads and, you know, become a giant conglomeration in the bloggingspace. But yeah, but that kind of didn't happen because when as Iwas starting to sell advertising on the blog, I met my cofounder, a scrunge, and that was about ten years...

...ago. So that kind of kidwashed prison threads, because grants absolutely took over. MMM, I feel likethere's a definite, for lack of a better word here, a thread betweenBrisbane dreads is obviously there's an overlap in, you know, it's media. Youare no doubt interacting with influencers through Brisbane threads, so you would havebeen exposed to this concept of an individual personal brand having a sway over anaudience and then being able to monetize that by connecting them with brands. Probablythat was your kind of goal with Brisbane threads, Sydney threads for threads aswell, on some levels, like swapping the audience for for advertising. Canyou maybe explain, like I'm actually kind of want to step a back,to take a step back as well, because obviously Brisbane threads is a largechunk of your life and you must have learned a lot from that. Thateventually also led to what came next. So, without talking about and threatsfor the entire podcast, can you maybe a highlight, you know, whatyou take away that worked well with Brisbane threads and what did not work,that you wanted to change and may have led to what you did with scratch? HMM. So back then everything is really about experimentation and you know,big part of our traffic came from social media and you could, you couldreally have social media back then. It was really easy to build a followingonline and so I just became obsessed with, you know, all of those littletactics to growing a following, growing an email list, and I thinkthat's where my passion for marketing kind of started. So I had a salesbackground, which is very much a facetoface, you know, understanding people, connecting, building relationships, and when I moving online, it's I then becamereally interested in the marketing side of the business and how to connect with peoplein the digital round rather than in the real life. So, yeah,for me it was just about learning well as learning marketing, and I hadto build a business, but then starting to learn. I guess, yeah, I guess key business factors as well. So I you sort of when youstarted a small business, you can kind of wear every hat. Soyou have to understand invoice seeing, you have to understand how to price yourservices. You know, I learned a few lessons on being kind of takenfor a ride for something the jobs that we did. But you know,but at the time it was kind of like that was the experience and that'show you found out that you weren't charging enough, where you were charging toomuch has is by actually executing on that deal and learning the lesson the hardway. I also learned that it was a giant hustle. So at thattime I was actually still working at tell Stra, so I was starting tobuild it on the side. And yet so the idea of the fact thata small business was not going to be in a nine hundred twenty five replacement, it was going to be every minute of your life replacement was the besttime. I learned that lesson as well. Wow, okay, so you know, hearing that it's like, HMM, maybe you don't want to start anotherbusiness and he should stick to an hundred twenty five. It almost soundslike it's easier on some level. was there anything between Brisbane threads and scrunchor was it a fairly, you know, smooth transition? Yeah, it wasa fairly smooth transition. So I held on to Brisbane threads for alittle while and you still kept working on it because it's kind of it waskind of my baby, you know, it's the first thing that I created, and so I kind of held on for a while and tried to JuggleChristan threads, starting scrunch and working at tell Stra and I probably did thatfor a couple of years and my cofounder at the time was pretty very coolabout the fact that having three businesses or three life passions was probably not sustainable, and he was right. And so that one day they decided to letprismon threads go and then, of course, when when scrunch started to take onexternal funding, I had to let the whole time job go as well. So right, yeah, it's kind of always been a bit of anevolution, so to tell us. What exactly was the idea of for scrunchoriginally? Where to come from? Yeah, so, and it's funny because,you know, we talked about did...

I transfer the sales skills and buildersand threads and I was like no, in really, if you can understandwhat I had at the time. It was kind of the same with scrunch. So we didn't start out as an influencer marketing company. scrunch actually startedout in a completely random space, the virtual change room space. So myexperience at the time was in fashion. I've had that fashion degree and mycofounder was in fashion retail and we decided that we wanted to build an onlinehub for fashion designers, photographers models and then build this virtual change room wherepeople could actually try, virtually try on clothes before they shopped online. There'sabout a twenty five percent return rate in online shopping and we thought that wewould be the ones to solve that problem through d technology and yes, soto render and simulate a D garment online ten years ago. Well, there'snot to their theo was not there. Yes, it was very ambus week. Being to non technical cofounders, we thought why not, we build thosedifficult things. We can then gone and it didn't end well. It's wehad ended up building a D and then a d prototype, but at theend of the day we realize that it was a giant comcialization R and dproject that would require millions and millions and funding and probably several years. Sowe decided to make up first pivot. Okay, pivot one. So justto clarify, did you have any finance at this point? Were you raisingcapital or not? No, it's so right. At that moment in time, we I had been set, you know, because I was a goodcorporate ladder climber. I had been saving for a house. So I usedthe deposit on my house, or my imaginary House that I was going tobuy and, like programmed at the time, used his savings and we engaged adigital agency to help us build the first version of scrunch. We allin her. That's that's very scary, if nothing else right, I know, fortunately, I was a little bit younger and the stupid all, soI was. I was very risk tolerant time. Yeah, but I meanit was a bit of an eye opener because it didn't work. You know, we decided not to move forward with with that idea. So, yeah, that was the house and the savings gone. Well stage. How didyou manage to know, not just come up with the pivot but emotionally handlepivoting, because, you know, my gut reaction would be like, okay, maybe I should go back to the job, have a steady income andI've got no savings. Now might be a bit depressed. You know,where's the energy coming for something else, like how did you continue to moveon, as all good entrepreneurs do in the face of adversity? Any off. Wow, yeah, it's really interesting, I think, because I was thiswas kind of my first foray into technology start up. So I guesscrews and threads was the first online business, but it was. So it wasvery low risk. You know, it's you can host a website fortwenty dollars. You know, that's about the risk that you're taking. AndYeah, with scrimes it was the first time that we really had to investin technology, in staff and, you know, people that we didn't havethe skill set to obviously build a D product. So it was I guessI'll first for I too text startups and all the good things that come alongwith that. But again, because we're a little bit naive at the time, we were still just really hungry to make something work and the pivot didn'tfeel like a moment in time where we actually sat around and went, Ohmy God, we just lost everything, it's not working we're going to we'vegot to make a decision. What do we do? We've always been thetypes of people that are just just look far enough ahead to make the nextdecision. So at the time we fortunately we've been building a almost like adiscovery engine to house the D technology on and the the kind of decision aswell. This d product isn't working. Let's sort of close that down andfocus all of our attention on this discovery...

...platform, which was kind of likea social network for fashion. We were aggregating the world's top fashion bloggers andprocessing all the texting their articles to the term and the brands and products thatthey were talking about. And Yeah, so we kind of made the idea. You know, it was definitely a pivot and we definitely decided to closedown one side of the business and focus on another. But it would didn'tfeel like it didn't feel like this kind of crazy moment in time. Wejust kind of went, well, that it's not working, let's double downon this. And Shit, you're at have money, so how do youget money? And back then, you know, our next kind of bestthat was credit cards and personal lines. So we say, and we basicallywent, oh well, we can just borrow some money and keep going.Yanks. Okay, yes, so you did. We did. So webasically just yet both went out and got personal lines and I cup out ofcredit card each and went come, we can keep going. This is thisis good. We're all get we're all good. I kind of feel likeI might have seen one of these early versions. But going back to thispivot, and especially because you're getting loans out, do you see a pathto income from it's like at that point? Or was it more a case ofbecause it sounds like you're building almost like a platform, and that oftenmeans you're not making money until you build up enough of an audience, youknow, for network effects and so on? So what were you seeing as yourpath out of the hole that you seem to be digging yourselves into financially? Yes, exactly. So I know, and this is kind of, youknow, almost spoiler on the next pivot, it was a social network. It was really yeah, it was that kind of audience or revenue first, kind of predicament that we found ourselves in the so we looked at theplatform that we went okay, well, we can make money in a coupleof ways. You know, we can have affiliate revenue because I've got allof these articles and all these products, or we can do advertising revenue,but we don't have the eyeballs yet, you know. So we were franticallytrying to get people to blog in like sign up so we can get theemail address and start getting out a daily views up and all that kind ofstuff. But it was also the moment in time that we kind of realizethat we'd picked a business model that potentially we were excited about as well.Wow, okay, so I'm a little curious about the nuts and bolts ofthis. Maybe take us forward. So you have this tech and then youdo go out there and just try and tell people about it to get themto sign up so that you actually have an audience to make money. Isthat what you do? Yeah, that's exactly what we did. So wehad to strategy. So we ran influencer events. So that was kind ofthis first inkling of around influences. So we had a little event where wewould announce what's front was all about and, you know, then follow that upwith a little email and ask them to sort of blogging and create theirprofiles, because these functionality kind of like social media, almost like interest atthe time, where you could like save your favorite articles and create, know, this beautiful profile page for yourself. And then it was all about theblog articles that we featured, so getting the article owner that we had featured, so the blogger to you know, create their own profile and talk abouthow they've been featured on the top twenty nine charts of strutch. And Yeah, it was kind of it was really difficult. It was some, youknow, a lot more difficult to build an audience on the platform that itwas that we had found, to build, say, a social media following.And yes, it was kind of we were starting to look at thatand got and kind of go, okay, well, a B Toc play rightnow dust doesn't seem that smart or that exciting. How can we usethe technology that we already have to potentially build more of a Betab offering?And that is due to next pivot. That's amazing. Keep going forward.I love how many pivots you guys are doing. You've got, yeah,got, whist, Bud and yeah. So what happened next? Oh God, yeah, so, so we look...

...at the technology that we had andso what we were doing is we're aggrogating well top blog content and pulling outthe brands and products that were featured, because the idea was you would takethat product and you address your virtual model and then shop online. So thenthe virtual model goes away and now we just have these blog articles that pullout these brands and products that you can discover or the calling at this discoveryplatform, and now we're going, okay, well, what we want is reallya an avenue to sell a subscription service to a brand. What dowe have? Actually, we know a lot about their products, and sowe kind of then started to reflect on our own experiencing the fashion space,and one of the key things that interested us at the time was that abrand might have say they have fifty online stock us and if they wanted toknow where their stock levels were out with any of those stockers to tend sellmore product, that would actually pick up the phone and make fifty phone calls. Kind we were kind of like, well, hang on a second,when we can just tell them so, because we were at the time,we were scraping the ECOMMERCE sites to get the product information. We were like, well, actually, we can tell them that information. So we builtaboard that listed all of their products and all of their online stores and puttheir stock status, if they're in stock, out of stock, if they wereon sale. So as a brand, you could come to this really simpledashboard and literally within seconds, find out which stores were out of stockof your items, so you can make two phone calls and try and makesales rather than make fifty phone goals. So just to clarify, because thekey thing you were doing there was actually collecting all the data by scraping allthe retailers, because you need to do that anyway for your your engine,for just to show content. And then you knew the inventory of all thesedifferent websites because of that research, and then you could then sell that tothe actual suppliers of those products. Andever got that right exactly. Yeah,it was kind of a moment in time where we actually started to think aboutwell we were doing, we know, more of a commercial sense and andyeah, realized that we had a access to a lot of data that couldpotentially be valuable to brands. Okay, so I know because I've spent alot of time selling to consumers, but when you switch to business, Betbas you're saying, it's a whole different type of selling, right, likethe you're going to maybe look for a big your deals, but there's alonger lead time and presentations, negotiation. It's not just like here's a product, by it online. It was that. Would you then faced? I'm assumingbecause you have the sales background to you, maybe you're more familiar withthat. Yeah, and that's sort of probably where I was more comfortable,was actually picking up the phone and creating going and actually talking to someone aboutwhat we had. So the idea of moving into that felt a lot moretangible to me. It kind of felt a little bit more within our controlrather than the building of the audience and then trying to sell to advertising.So the actual advertising world and was something that kind of mystified us a littlebit. We kind of knew how to build an audience, knew that itwas going to be a lot of work, but didn't really know how to tapinto advertising spend as much. So then the idea of moving to beto be where we could just, you know, create a list of brands, find and create value and then go and talk to them and build arelationship. Yeah, felt a lot more comfortable to me. Did it work? No, so this is the moment in time where we learned to notbuild things before you talk to you customers. So we went out to try andsell it. And the fashion industry back then was a lot more relianton free interns. So at the time they say, well, why wouldI pay for this dashboard when I can just get a free intern to makethe fifty phone calls and sell the product that way. So it was ahuge eye opener for us. And and it is really, really interesting becausethese kind of products now exist. So there are dashboards for inventory tracking andstop tracking now in in time, but...

...back then, when free interns werekind of a little bit more prevalent in the fashion industry, now you canget in a bit of trouble at these free informs. But yes, Iwas kind of just the wrong time. I think it was a really greatidea, but we didn't talk to our customers bossing. That was the biggestlesson, of biggest kick in the bomb that we learned was that, yeah, don't spend money building technology if you don't know that you're consuming actually wantsto buy it. Now, this sounds like many years of your life.Or righty, we've covered before. We hit on the crunch. That startsto work and we you still working your job because you were going into debt. So is that how you were kind of keeping the finances going, youknow, personally? Yeah, so up until around this point I had beenworking as well, but it was a bait. I think it was aroundnow that we started to bring on external investment. So just as we weremoving into this inventory dashboard and then just starting to do so, there's alittle import o thing and medium monitoring kind of comes next, thank God,in this story. Okay, but yes, this is now the time where we'retaking on external funding. So this was the moment where I had beenworking. So I was I had a paycheck coming in to start to youknow, to be able to pay off those lines and to keep things going, but it was also the time that I had to stop that job becausewe were going for external funding, and if you do that, they wantyou all in to tell me about that. So what were you pitching and whodid you pitch it to? Do you head off? I know wemet in San Francisco. Is that when you were like pitching, or thatafter that? Yeah, I think that might have been it. Definitely.I'm just trying to remember how long that was ago. It feels nice loveyears ago, at least five years ago, because I was in San Friend infive years ago. So yeah, this must have been around the firsttime that we were pitching for funding, because the scrunches we know it nowis about five years old. So the first five years was kind of thiscrazy, oh my God, what are we doing, trying new things,learning all the lessons the hard way, and then we kind of got outof stuff together. And Yeah, so that was when we probably a firstlooking for funding and we looked anywhere and everywhere. We literally had no ideawhat we were doing. We were googling how to raise funds, had towrite a pitch deck or that kind of stuff. So at one stage wedid have a friend who was kind of connected into the US scene, ifyou will. So they were amazing and kind of shopped US around to afew different people. But ultimately that all that whole us troupe was fairly fruitless. So we ended up raising all of our capital back in Australia and that'sunusual. Had you that? Yeah, so we ended up doing something thatI would not recommend about. We've gotten so much hard advice and we werekind of actually, really really running out of funds, and so we connectedwith a broker who essentially could introduce you to investors at the time, andthey took basically a very large lack of money to create your investment memorandum oryou're off the document and introduce you to a bunch of investors. And thatwas kind of, you know, not psych gid recommend doing now, buta decision we made at the time because we just didn't know who to goto. I kind of say to people at the time I didn't know someonethat could lend me a hundred dollars. Little own invest a hundred thousand dollarsin my business. So we just really had no idea who to go to. A movie, just really coming up stuck and I think you know,to your point earlier in the scene in Brisman was very quiet back then.There was nothing going on in the startup space in Brisbane and that's kind ofwhere we were from. And Yeah, we were having no luck. Sowe connected with a broker down in Melbourne, I think, and yeah, thengot short of shopped around to Sydney and Melbourne investors and fortunately we hadpeople say yes. Okay, so I'm guessing these are angels right. Sotalking sort of six hundred thousand dollar. We're not talking about series a,five million, ten million kind of amounts.

It's just like seed funding to essentiallystart a business, even though you're ready five years into it. Youwere kind of pitching a fairly new start up. Now, when you wereputting that together, was that the scrunch that was building the inventory management tool, or is that in you vision for a new scrutch that you were tellinginvestors about? Yeah, so it was essentially it was. It was somethingagain that I don't recommend, but we'd not let go of the discovery platformor the inventory solution or we had to end. We had just started tolook at medium monitoring because it was kind of another thing that used the sametechnology that we had and could show the brands their social media posts, loggersthat had mentioned them online. So we were actually pitching this platform idea wherewe had three products essentially. Yeah, which was a very hard cell.And Yeah, and I think through that process, as well as where wekind of learned that we really needed to start to focus and really needed tounderstand our customers quick, smart and to be honest, I think we werepretty lucky to get investment. I think that people invested because we're I don'tknow, I think we're pretty parismatic people. We can tell a good story andwe yeah, but I think if we tried to do that now andthis market, there'd be no way people that invest in this. You know, three different things that weren't making any money that had been around for likefive years. I think you would be like what are you doing? Sois this now the birth of scrunch that we know today? Yes, soessentially what happens now is when we was went all in on talking to customers. So we were we were showing them everything and we were trying to dois figure out what people would actually pay for. And the biggest thing thatsurprised us well was so with the inventory dashboard, you could toggle and basicallysee the article that the product had come from or the social media posts ofthe product could come from, and that's kind of what blew everyone away.They were like, Oh, hang on, they this is very fashion industry mentality. Don't care about selling verdugs the like all, but you can tellme when vogue talked about me online or that blog of talked about me onlinelike yes, why is everyone so interested in this media on the during kindof idea and we kept hearing the word influencer and blogger come up. Andit was the same moment in history that I think the first social media influencer, they would bloggers back then, they weren't really influences, or don't calledthat, had started to like made a million dollars online. So I thinkthe whole world was starting to stand up and take notice of influences and thetype of power they might have on people's brands. And it was really,you know, interesting that I was a blog that years before that. Idon't want didn't. I put two and two together now, but we justwant to hang on a second. We really on this something. Not onlydo we have the technology and the experience and have learnt all the lessons,but we now have customers saying what is this? We're really interested in it. And then the market forces were saying this influence of thing is going tobe a big thing. So it was kind of a melting pot of fiveyears of work and figuring it out and the market being right ready to takeoff. That is when we yet could in one last time and through everythingin the Bin and became the influencer marketing platform that everyone knows today. Whatis that tell us? What'scrunch does today? Sure, so to scratch. Todayis a global multi tunnel influence of platform and team of experts. Sowhat that basically means is are a software platform that connects brands and agencies toover twenty million influences globally. But our really our value proposition is understanding audiences. So essentially we've built the technology that can go out and follow an influencesfollowers and determine all the key demographic data that you might want to know beforereaching out to that brand to the influenza. So one of the big problems withinfluencer marketing is transparency and scale.

So you know, you see thisshiny blogger, youtube or instagram or facebook or whatever it might be, andthink wow, that for all these followers, their content looks great, but reallybeing able to understand they speak to an audience that you're interested in connectingwith or painful, has kind of been a big road block the brand andthen the idea of scaling it. So you know that is a very timeintensive process of figuring that or out. And it's not like a google addor a social ad where you can really optimize it and spend a small amountand test copy and images and those types of things. You've got to paythe influence of the post before you know if it's going to work. Sowe're really interested in how we use data to D risk that the brands sothat they can, you know, really understand and the audience that they're buyinginto. First had to be able to scale that long term. But aninteresting part of the story work, where the team of experts, all thisagency sided a business came from, was that another lesson I learned was thatsoftware development takes a really long time. So I said, you know what, this time we are going to listen to our customers and were going todo what they want manually. We're going to set it up like a sciencebusiness and get them to subscribe, but we're actually going to, you know, friend Flintstone, run under the table and make everything work. And thatwas the best decision we ever made because what it allowed us to do isfeel the pain of running an influence a campaign so that we could build softwarethat solved those key problems for our customers, because we essentially were the customer.So yeah, that's and then the team of experts. So that kindof agency or, you know, more manual side stuff around, because then, as we scaled and the software did all the work, our bigger enterprisecustomers didn't want to use a piece of software. They just wanted somebody totake all of the pain away from them and their internal team. So westill serve as some pretty sizeable customers on that side of the business is justusing our own software to do the job. Danniel, I love your story.It's like a textbook case of learning, trying everything, making all the mistakesto reach the point where you do what works and make it work.From from trying to build software that no one wants to you know, isinvesting money to realize that it no, we should don't build anything. Let'stry and just manually deliver it by hand and then build something around that need. Just for clarification, though, because I know this some of good listeningthis who are finding maybe this idea of influencer marketing what you do a littlebit confusing. Let's just say I have a product I want to sell.I've got a lampshade and I'm thinking of you doing influencer marketing. How doI interact with scrunch to sell more of my lampshades? Yeah, absolutely.It's a really, really great questions. I think whilst we think influencer marketingis a well established it is really new concept for a lot of different businessesand brands. So essentially, the LAMPSHADE company would come to strench and theywould sign up and they would start searching our directory of influences for a numberof different keywords. So they might search for lampshades and find all the lampshadeinfluences or people talking about lampshades. So they might find interior of in interiordesigners or renovation people, people that are interested in kind of home and that. Essentially, it's not shortlisting their influence a list. So the twenty millioninfluences on our platform would very quickly become, you know, a few thousand influences. They might then think about their customers, so they may only shifttheir lampshades in the US. So they would filter the directory down by influenceswho maybe live in the US and have an audience that's based in the US. And then they may find that the you know, it's really a femalebuyer. So they then want to look at the audience that is female.So then they're going to have their top, you know, hundred influences for theirlampshade brand and then they can dive into each one and have a lookat their content make sure that they're seemed like they're on brand or whatever estheticthe lamp shade brand is going for, and then they can start to reachout to that influenza. So they've got...

...all the analytics on the strange platform, they've got they contact details. They can start to reach out to thatinfluencer and say hey, I've found your profile and I'm really interested in connectingwith you. I'd love to know how much you charge for a post orto work with us, or I'd love to send you a free lamp shadeand get you to review it. They can start the sort of broker idealfrom there. So your platform gives me the analytics and the data behind theinfluencers and then I can choose to direct message or email and influencer to setup a campaign. But you also have the agency side or you do theapproach for people like if I had a budget, I sell lamb shade.We got a hundred thousand dollars to spend an influencer marketing. What I cometo you and say, help me spend this. Yes, exactly right.So we would then, because that's the thing, then plants a marketing isthey are quite a lot of stakeholders and steps. So the reviewing the analyticsis almost part one of the whole influencer marketing Jenny pipeline. So yes,that lampshade business could come to us and say, Hey, I've got ahundred dozen dollars. Has Been in the campaign. Can you help me sellmore lampshades by finding the right influences, reaching out, doing all the contractnegotiations, getting all the content together and and then, of course, recordingat the end. So the scrunch platform all so does some campaign reporting.So a brand can, once they've got all of their post live, theycan couple of the urls to that can falsify, see and get all thestats on those posts. So we kind of provide so some of the analyticson the front end and then the analytics on the back end of the compaign. Awesome. Okay, very clear in my head. Now I understand whatscorings does. You've got the two sides, the research and the software tool,and then the sort of done for you agency service. Makes Complete Sense. Sounds very hip and cool for modern marketing right now to, I haveto say, influence some marketing is probably the most modern format of online marketingavailable today, since, you know, people have grown up with banner adsto paper Click Advertising to now a very unique type of I won't call itsponsored content because that almost seems to devalue it a little bit like I feellike it's way more organic than that, where you've got custom campaigns built specificallyfor a certain influencer and it's almost like a former media. So I thinkthat's very cool. But we're running out of times. Any I know youhave to get off to another meeting. I'd love to kind of wrap thisup with this. Maybe a couple of questions about entrepreneurship, since you've runthe Gammeut with scrunch. If there's a person listening into this who wants totake away the right way to start a start up, especially, you know, maybe in the kind of space or format that you've done, you know, software platforms, networks or even agencies. How would you do that today,given the current environment and what you've learned from everything that didn't work towhat did work with scratch? Yeah, so my biggest takeaway, and ifI ever started all over again, would really be around identifying a customer needand figuring out your revenue model first. So being able to actually sell something, whether you've built it or not, or you be delivered manually, likethe actual mechanics. And, you know, I think a secondary it's really like, can you get somebody, can you get a customer, to payto solve a problem? That's the biggest thing for us. You know,we raised capital and did going to get the dude spend the money, thesavings and all that kind of stuff before I really understood that and that justcreated this huge amount of pressure. And you know, when you've got investorsin, you know, investors are very everone talks about it like it's reallysexy thing. Pal It has is create prosc to perform, you know.So you are now beholdings to share holders and potentially aboard, depending on howyou structure things, and if you haven't figured out how to make a customerpay you to solve a problem, things get very stressful very quickly. Youknow, they want to see your company growing and scaling so that they can, you know, potentially exit one day. And if you're delivering on that,you know you start to do get a little bit clouded and stress andI think, yeah, so if you...

...can kind of put that first,that would be my biggest piece of a guy. Okay, Nice. Whata scrutch look like? Today? It's you, your cofounder, and whatdo you do every day? And how big is your team? Yeah,it does. Twelve of us now in a little, I'm not so little, office in West End in Queensland. Awesome, and my old hood.It's so cool. Yes, I love it. It's awesome. So rightnow it looks like you're really in a scale phase about business. And sowe've got some amazing clients around the world, like music called under Rama and nine. Yeah, it's absolutely incredible. But for us, actually Amazon aswell. So way in this amazing time about business where it's all about scaleand driving efficiencies inside of our own business. But for me it is almost ascrazy as it was on day one. Every day it's completely different. Someyou know, I still very heavily invalid detales we still do raise capitalfor the business. You know, it's all about, you know, keepingthe team happy, because our team are absolutely amazing and I think people arelike the make or break inside good business. So figuring out how to find amazingpeople in retaining them is a new adventure for me, so that everyday is completely different and it's completely crazy and stressful as it was ten yearsago. But you still love it right Downiel, absolutely wouldn't trade that,wouldn't create it for the Goover Korea. Let me going. Okay, that'sgreat. Well, thank you for taking the time to share the sixteen pivotsthat you did on the way to making sis work. Of course that's awesomeand I think it's great to demonstrate the resilience that you guys have as foundersto find something that works in a market that you guys love. So keepup the good work. A wish scrunch all the best, and hopefully thelisteners will feel inspired even to something's not working that the right model could bejust a pivot away, following that sound advice you said about finding the problemand making some money. So thank you very much, Dannie. Ye're worrieshaving done anytime. Thanks for Everyway, and it's scrunchcom right, if theywant to check out your work. Yes, that's the best place. Okay,that's what'll put that with the links. Thanks everyone for listening in. We'lltalk to you in a future episode very soon. Hey, this isyarrow and thanks for being a listener. Now, in this episode, ifthere was something you think could benefit a friend of family member or colleague,maybe an entrepreneur that you know. Maybe was something to do with getting trafficor launching a product or just coming up with an idea, make sure yousend this episode to them. It could change the trajectory of their life andI'd really appreciate the introduction to my show. Also, if you're not a subscriber, make sure you click that subscribe button, whether it's in Google orapple or youtube or spotify, and you'll get my episodes as I release them. Thanks again for being a listener. Thanks for listening to Yarrows podcast.For more episodes, visit Yarrow Dot blog and subscribe on itunes or Google.

In-Stream Audio Search

NEW

Search across all episodes within this podcast

Episodes (83)