In nearly every story about Hukkster — an online shopping tool that tracks products for users and notifies you when those products go on sale — the product’s origin story is cited. And why shouldn’t it be, it’s pretty amazing, and certainly imparts a lesson to newbie entrepreneurs.
Founders Erica Bell and Katie Finnegan shared their origin story and more about their rapid growth startup over lunch with EnterpriseCorp’s Lisa Bajorinas and Nicole Eovino and myself while they were in town to keynote the EnterpriseCorp Signature Event.
First, Bell and Finnegan identified a problem: It’s hard to know when that pocketbook you have to have goes on sale. It’s not just a matter of checking in on a regular basis to see a retailer has discounted the product; it’s also sorting through the dozens of coupons and coupon codes you get via email every day. Maybe the pocketbook is still full price, but the store has sent out a 40 percent off deal via email. Or maybe it’s gone on sale AND there’s a coupon too.
Bell and Finnegan wanted a solution to this problem. But neither of them has a coding background (The Wall Street Journal called them “definitely not brogrammers“). Finnegan attended Colgate and studied history and religion; she later got an MBA at Duke. Bell went to Barnard and studied English and French.
They considered taking on a technical co-founder but eventually decided to just bootstrap it and “become the product” for the beta version, says Finnegan.
“You have to ask yourself, ‘What do I have and how can I apply it to my solution?” What Bell and Finnegan both had after short careers as merchandisers and managers for retail names like J. Crew and the Gap was a fairly extensive mastery of Excel spreadsheets.
So, essentially, Bell and Finnegan became the application they wanted to create.
They spent four months working with 10 women who were beta testing Hukkster. The women submitted the items they wanted Hukk to track on a website (that was really just a Google form questionnaire). Bell and Finnegan would get the item’s SKU and use a data crawler to search for sales.
The pair kept their management consulting jobs with A.T. Kearney, but would get up at 4 a.m. to manually check for deals on each of their users’ lists. If they found a deal, they emailed the user — also manually. They kept track of everything via Excel.
Retailers paid commission to Hukkster every time they facilitated a sale.
This was labor-intensive, but it paid off. “We loved it,” says Bell. On Sundays their “office was Katie’s couch.”
The best part was how intimately they got to know their users. It allowed them to interact with customers a lot. They sent out frequent surveys and got a lot of feedback.
Finnegan says, “If we’d not done this down and dirty solution, we probably would have built a different product, then spent a lot of money to change it down the road.”
The duo always knew in their hearts they had a solid idea and business model, but their users’ enthusiasm for the product was a turning point. But it was the enthusiasm of an investor that allowed them to quit their full-time jobs.
Finnegan was on a panel of entrepreneurs at an event held by her alma mater Colgate and was asked to pitch her business. General Catalysts’s David Fialkow, a fellow alum and an investor in Rue La La, was so excited that at the end of her pitch he offered to invest. And then he solicited investments from the rest of the crowd. Finnegan described the event as feeling like “an auction.”
The New York Times financial blog describes Hukkster’s investment journey:
They introduced a test version in May 2012 and raised $250,000 that same month from a group of angel investors that included Tumi‘s chief executive and the president of Henri Bendel. At first, the company operated out of Ms. Finnegan’s apartment in Manhattan’s West Village. But in November 2012, Hukkster announced a $750,000 investment, led by Cameron and Tyler Winklevoss, and has since relocated to its investors’ New York offices. Last April, the Winklevoss brothers led an additional $2 million investment in the start-up.
At the this week’s Signature Event, an attendee asked what it was like working with two of their earliest and biggest investors — “celebrity” venture capitalists the Winklevoss twins. Bell responded that the twins have helped with PR and marketing a lot because they are so high-visibility. For example, they talked about Hukkster with Matt Lauer on “The Today Show.”
Another turning point was when what they thought was a casual conversation with Meghan Cassady of Forbes turned into a very flattering article and netted them close to 10,000 new subscribers.
They’ve spent the past few years developing the site and now have more than 300,000 subscribers who’ve saved many millions using the site. Hukkster partners with more than 300 stores and works very closely with 50 or 60 of those to provide Hukkster-exclusive deals.
Both Bell and Finnegan stress the importance of the people in their lives who have helped shape Hukkster, both mentors and investors and the Hukkster team.
Other female entrepreneurs have been very supportive of the Hukkster founders.
Alexandra Wilkis Wilson, co-founder of Gilt Groupe, for example, has become “a resource and an advisor,” says Bell. “We’ve reached out to established female founders and they’re all willing to help us. Maybe because they’re the underdog, they pull together.”
Surprisingly, she says, the New York City tech entrepreneur community feels like “the underdog,” too.
“Finance still rules the show in New York,” says Finnegan.
And New York is very much a part of the Hukkster company culture. Their new offices are located in trendy SoHo.
“Our asset is our people. Company culture is key,” says Finnegan. “You really want to maintain your talent. The cost of recruiting someone is so expensive.”
For now Hukkster is a team of fifteen “rock stars.” Finnegan says it’s so hard to build a team for a startup because you need people with high-level skills who are also willing to take out the garbage.
“Once you get a rock star, you need to keep that rock star,” she says.
So when Bell and Finnegan make it out to Silicon Valley, they make it a point to go to other tech companies’ HQs and check out their company culture to see what they can bring back to Hukkster.
Later in the day at the Signature Event, Bell joked that Hukkster probably wouldn’t be offering its employees “free, dried mango slices” like Twitter does because their budgets are different. But Hukkster does what it can to keep the team happy, and it’s one team member’s job to oversee company culture. Not full time, but “we’d love to have a Chief Fun Officer,” says Bell.
Keeping the “rock stars” happy includes buying the whole team lunch once a week. “Everyone loves free food,” says Bell. During the summer, everyone works remotely on Friday so they can extend their weekend plans. They’ve also provided free massages in the office. And every month there’s a team event after work: a pizza-making class, a painting class, rock climbing.
Bell and Finnegan repeatedly mention Hukkster’s “Work hard. Play hard.” ethos.
“We’re a very capital efficient company,” says Finnegan. She sees the team expanding to 25 ot 30 people in the next year. But even their five-year plan only makes room for 60 people. Hukkster wouldn’t need more than that “unless it morphed into a totally different business,” she says.
What is the harshest lesson they’ve learned in this process? “It’s the first time in my life that I’ve gotten more ‘no’s’ than ‘yeses,'” says Finnegan.
Bell says, “The harshest lesson was learning to do what we could with a fixed amount of resources. At the beginning those were us… and Katie’s couch.
Time Magazine included Hukkster on its 50 Best Websites list for 2013 list. There’s also a free app in the iPhone store.