From Selling Scoops Of Ice Cream To Founding ZeroCater

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Editor’s note: Arram Sabeti is CEO of ZeroCater. Follow him on Twitter @arram.

When you throw a rock into the water, it will speed on the fastest course to the bottom of the water. This is how it is when Siddhartha has a goal, […] This is what fools call magic and of which they think it would be effected by means of the daemons. Nothing is effected by daemons, there are no daemons. Everyone can perform magic, everyone can reach his goals, if he is able to think, if he is able to wait, if he is able to fast – Siddhartha by Herman Hesse

Five years ago I moved to the Bay Area because I wanted to start a company. I came here armed with that single goal and the education of a dozen Paul Graham essays. To me, determination has an almost magical quality. I’d always felt that with enough of it I could do absolutely anything.

People say startups are risky, but for me, working at a job my entire life seemed like the worst possible outcome, so starting a company was the least risky thing I could do. I think that’s what people mean when they talk about founders being a little crazy. I realize this is an unusual personality trait.

To fund my adventure, I sold my car and bummed a ride to the Bay Area. I spent two days on the Berkeley public library computers looking for a place to live. I convinced a retired dentist to give me the keys to a cheap studio in El Cerrito before he’d seen any money or even gotten my signature on a lease. Looking for my apprenticeship, I started applying to startup jobs.

It turned out that 21-year-olds with no degree or marketable skills weren’t in great demand. As luck would have it, a paper I picked up told me it was the worst summer for jobs in a decade. Eventually my cash ran so low that I walked to downtown Berkeley and went into every business with an open door asking for job applications. Even there the response was abysmal. A week later I had exactly one offer. It was from Ben & Jerry’s, which I accepted.

A few days later I saw a job opening on Hacker News for a Community Manager at Justin.tv. I remembered reading about the founders when they sold their last company on eBay, so I excitedly emailed them and soon got an invitation to interview.

I spent the train ride across the Bay figuring out how I’d stand out from other applicants. When I got there I pulled out my notebook and made sure to interview them as rigorously as they were interviewing me. I even said “Just to be fair, I should mention I’m going to quit in a year to start my own company.”

Over three interviews, the candidates were whittled down from sixteen, to six, to me and one other. At the end of the third interview, Justin Kan asked, “how much salary do you need?” I told him ”I’m only in it for the experience; I only need enough to live. 

I got the call that night. “It was close, but we want someone who’d be around for more than a year.” I thought I’d shot myself in the foot until he added, “but we want to create a new position for you.” I gave my notice to Ben & Jerry’s.

The job was a grab-bag of unwanted tasks. I tested new releases of the site, managed job applicants, and even ordered lunch for the team. The work was tedious, but getting hired at Justin.tv was the best thing that could have happened. I got to work next to the most capable people I’d ever met, and I learned how startups really work and met dozens of people who’d provide invaluable help and advice later. Two of the founders would end up as investors and advisors in my company.

One of the best things about the startup community is the incredible pay-it-forward attitude. It’s almost like the bond between war veterans. The individual circumstances may vary, but every founder can empathize with the struggle.

countdownt

After a year and a half at Justin.tv, I still didn’t have a startup idea, so I gave myself a deadline: I was quitting my job in six months, so I better have something paying for rent and ramen by then. I added a countdown timer to my desktop and changed my work password to “SixMonthsQuit,” something I’d be typing eight times a day. (You clear your cookies often doing site testing.)

The Promise Of Lunchtime Stress

I had lots of conversations with friends about potential ideas. Around that time Justin mentioned that a friend at another company had asked for the list of restaurants I was using for lunches. Maybe I could help them? At the time, ordering lunch was, surprisingly, the most annoying, stressful part of my job. My restaurant list had taken a year of trial and error to build. I got a meeting with their office manager, and she seemed incredibly relieved to hand off the responsibility. Managing company meals turned out to be a hair-on-fire problem. I started asking for introductions to office managers from everyone I knew and one customer became two, then three. I quit my job three months after setting the deadline.

I remember being deathly embarrassed that my “tech” startup consisted of 0 lines of code, an inbox, and an enormous spreadsheet. Eventually, I got over my embarrassment and learned that the first rule of being a salesman is being unashamed of selling. If someone at a party mentioned that their company ordered food, I pulled out my phone and got their email address right there. When I received emails from sales people, I’d flip the script: had their company considered having food delivered? Could I talk to whoever would make that decision? I’ll listen to your pitch if you listen to mine.

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Pitching became a reflex. When I was buying a phone, a Verizon employee saw my card and asked what I did. Not even expecting a sale, I started pitching by reflex, “ZeroCater makes it simple for companies to feed their people. You can just tell us, for example: We have 74 people, two vegetarians, and 1 vegan, and want lunch every Monday, Wednesday, and Friday. We create custom orders across a curated list of restaurants, food trucks, and caterers. Awesome food just shows up and you never have to think about it again.” When I got home, I found that all the Verizon stores in San Francisco had signed up to feed their employees during the new iPhone launch.

The beginning was the hardest, when only a few customers stood between me and not making rent, but a year went by and the company grew. The spreadsheet I used for scheduling grew to five hundred columns and the processes I had in place started to break. Billing grew to take 20 hours a week. I started looking for a technical cofounder to build software. Unfortunately, most of the developers I knew already worked at promising startups.

Eventually, I convinced a developer friend to join me. We applied to Y Combinator and got an interview. Luckily, Paul Graham loved the idea. “You help companies with their number one problem: recruiting!” He then turned to Jessica Livingston and asked, “How do you like managing catering for Y Combinator events?” “I hate it!” Despite this, we were still too nervous to get any work done until we got the acceptance call that night.

Near the end of Y Combinator, an investor heard about us through someone we were trying to recruit and asked for a meeting. We spoke over coffee and he emailed us the next day: “Good news- we discussed ZeroCater as a team and we’d like to move ahead with a term sheet. […] We can do a convertible note or a “bridge” equity round (assuming you’re not ready for Series A), and we’d also like to know if you’re willing to go up to $1mm.”

The view had been breathtaking but it was at that moment that my roller coaster reached the top of the tracks. The next day my technical cofounder told me he was quitting.

It had been a stressful three months and we were often leaving the office past midnight. I had been talking about building a billion dollar business, and I think that’s when he realized he didn’t love the company enough to give it 100% of the next 4-8 years of his life.

There are two things you don’t want to be when you’re trying to raise money as a tech company. You don’t want to be a single founder, because everyone knows startups are too much work for one person, and you don’t want to be non-technical, because everyone knows that a business guy with an idea has no inherent value.

I was both. It didn’t matter. I was going to build a company.

Demo Day was approaching, where I’d pitch my company to a room full of investors.

After I’d tried several rewrites, two days before demo day, Paul Graham suggested the ending of my presentation: “more and more companies are feeding their employees, and we want to ride that wave, a wave of food.” Looking for a way to wake investors up from the 44 other presentations they’d be sitting through, I found an artist who could create a painting overnight that would illustrate the “wave of food.”

My presentation ended with “We want to ride that wave,” where I’d pause, flip to the painting, and say “a wave of food.” This got a lot of laughs.

wavefoodI must have practiced that presentation over 150 times, right up to the moment I went onstage, much of it in the Y Combinator parking lot, where a friend came up to me and said “Arram, you know there’s such a thing as over practicing.”

There’s a great quote from Teller (of Penn & Teller): “Sometimes magic is just someone spending more time on something than anyone else might reasonably expect.”

I presented, and ZeroCater was voted #1 at Alumni Demo Day.

Alumni Demo Day

A few investors balked at the idea of investing in a single, non-technical founder but fortunately most were enthusiastic enough that I raised $1.5 million – more money than I’d planned.

Over the next two years we built the team and kept on growing. We now feed over 350 companies each month, including Sony, ZipCar, Yelp, and eBay and have served well over a million meals.

boat!!
Team ZeroCater on a boat.

Paul Graham has written that one of the surprising things they learned after starting Y Combinator is that determination is the most important factor in predicting success, even more important than intelligence.

I think of Bill Walsh, coaching the 49ers, with the worst record in NFL history, trying and failing to break an eight-game losing streak against the Miami Dolphins. I think of him sobbing in the dark on the flight back to San Francisco, while his assistant coaches shielded him from being seen by any of his players, and nearly submitting his resignation before changing his mind and going on to win three Super Bowls.

I think of Buckminster Fuller, broke, seeing his daughter die of polio, and on the verge of suicide, before deciding to embark on “an experiment, to find what a single individual could contribute to changing the world and benefiting all humanity.”

I think of Tony Hsieh selling LinkExchange to Microsoft for $265M, eventually investing in, then joining a struggling shoe company called Zappos. I think of him investing more and more of his own money until he went broke and sold his apartment at a loss just to make payroll before being acquired by Amazon for nearly $1B.

I think of Elon Musk, on his third failed rocket launch, after putting his entire fortune into his three companies, having to borrow money to pay rent, with just enough cash for one more launch before successfully reaching space and closing a deal with NASA.

Musk describes it best: “It’s like chewing glass and staring into the abyss.” In the worst times, the pain is both physical and mental. There’s a part of his 60 Minutes interview I watch at least once a month, where Musk is asked if he considered quitting after his third failed launch. He replies in a quiet, understated voice: “Never. I don’t ever give up. I’d have to be dead or completely incapacitated.”

There’s a reason Musk is on the very short list of people who’ve founded three separate companies worth over a billion dollars, and that moment captures it perfectly.

You determine the greatness of your accomplishments by the amount of pain you’re willing to pay down. The more ambitious you are, the more glass you’ll have to chew. Everyone has their grind, even people doing what they love.

Anyone, given health and a reasonable amount of intelligence, can accomplish goals on a global scale. I really don’t think there’s an upper limit. That’s what my five-year experiment has confirmed for me: You can do anything with enough grit.

I’ll leave you with a quote from Marc Randolph, the Founder & CEO of Netflix:

I keep saying how brutally hard this is. Each time you crest the rise in front of you, it just makes it clear the size of the even larger hill that looms beyond it. It goes on for a long time. I pissed blood for years keeping Netflix alive while we figured that shit out – as did every other successful entrepreneur in the valley.

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