Sramana Mitra: Did you go with offshore or onshore?
Nevin Shetty: Since it’s very high-touch front-end stuff, we wanted someone we could meet with. We chose a dev shop in New York. They had done e-commerce before. Frankly, they just had very good project management. We were able to talk with them and think through things strategically. It was very helpful because we didn’t know how to architect the website. They were seemingly helpful with that.
Sramana Mitra: How long did it take you to get a minimum viable product out?
Nevin Shetty: I would say it took seven months.
Sramana Mitra: What was the next step?
Nevin Shetty: We put out the MVP in February of 2014. In terms of wedding cycle, that could be a little too late because most couples register products for their registries six to nine months in advance. We wanted to put a product out there and see if people liked it. We put it out there. The people who found it really liked it and asked for more features. After that first wedding season, we were like, “We’ve generated a little bit of gross sales. This is worth taking further.” So we went and raised a friends and family round.
Sramana Mitra: What was the time window between launching in February and raising this friends and family round?
Nevin Shetty: We started raising in October of 2014.
Sramana Mitra: How many customers did you acquire in that time window?
Nevin Shetty: We acquired only 84 people.
Sramana Mitra: How did you do that? How did you get those 84 people?
Nevin Shetty: Mostly on social media. We didn’t do much paid spending; it was mostly organic. Mostly, word of mouth. Of the 84, Liz and I probably knew 40.
Sramana Mitra: It was essentially brute force.
Nevin Shetty: Absolutely.
Sramana Mitra: There was no customer acquisition per se.
Nevin Shetty: Correct. We didn’t know what that was. I had a meeting in middle of 2014 with a very well-known VC. He asked me what our acquisition cost was per user. I didn’t even have an answer. Looking back, I’d say, “That’s the thing you need to know.” We were bootstrapped from day one. We would just look on Facebook for people who are getting married.
Sramana Mitra: How much friends and family did you raise, and what was the next step?
Nevin Shetty: We raised on a convertible note, and we started in October of 2014. We almost raised for a full year. That was a huge problem as well. Since Liz and I were still working at our full-time jobs, we were doing this on the side. We just kept an open convertible note round. Ultimately, that proved to be counter productive, because you can’t allocate your capital correctly.
If you get $100,000 here, and you don’t know when the next check is coming, you can’t allocate that correctly. We raised $720,000 over a period of a year. It sounds like a lot for us. When you think about it, you’re getting a $50,000 check one month and then another check and another check. Because of that, we couldn’t allocate it well.
We had to stay with certain things that maybe won’t be working. We had to stay with this development firm even though we might have known they were not the best for us because we didn’t have enough capital to go out and switch and change. Ultimately, it became counter productive for us in hindsight. It was a long process then. We were meeting people all the time. That was all I would do. This most recent round was even worse. Raising money is a beast in itself.