Revolutionizing same-day grocery delivery in Toronto!

Our friends at  Investors Angel recently showcased Urbery as part of their ongoing series of covering disruptive start-ups. Part of the exercise was an in-depth interview with our CEO, Mudit, and his journey from moving to Canada to starting a new business!

You can read the entire post here on our blog!

PS: Our team absolutely digs all the graphic work the team at Investors Angel did on this piece!

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Insight

Mudit Rawat grew up in India, where everyone had their food delivered to the doorstep by the local merchant. Today, Mudit has reinvented this old tradition by bridging it with today’s P2P technology, offering customers a personal grocery “guru.”

When Mudit Rawat moved from India to Canada to pursue his MBA, he realized that the culture gap was vastly different, particularly when it came to how groceries are purchased and delivered.

Mudit Rawat, Founder and CEO of Urbery

“It took me a while to adjust to the fact that I had to actually go grocery shopping and there weren’t any options available to get on-demand deliveries,” Rawat explained.

In today’s world of instagratification, startups like Uber and AirBnB are becoming synonymous with the sharing economy. People are looking for more and more options to outsource their daily errands to other people. Be it a personal butler, a dog-walking service, teaching someone how to use Photoshop etc., people are embracing the nascent P2P economy while becoming more dependent on each other for various services. Consumers are also looking to buy things online and receive it instantaneously or at their convenience.

However, “online grocery shopping today hasn’t evolved to the current needs of the consumer,” explains Rawat. “They either cannot buy from multiple stores on the same platform or can’t have everything delivered to their doorstep within 2 hours.” In addition, cost of delivery, quality, and freshness of produce are also major concerns for many would-be users.

So Rawat quit his old job working in the grocery retail industry and decided to build a startup that address these problems using a lean business model that does not involve spending capital on warehousing. Instead, Urbery uses a fleet of crowd-sourced, trained personal grocery shoppers known as “Gurus” who do all of the shopping and leg work for the customer.

Now Urbery is not looking back as it plans to expand to the rest of Canada and beyond. The only regret according to Rawat is that he wishes he had quit his corporate job sooner,  started focusing on his startup full time and assembling his team quicker because one of the most important things to have is “the right people working for the same goal,” says Rawat.

In brief

What does the company do?

P2P grocery and alcohol delivery service using crowd-sourced shoppers who deliver products to customers.

What is unique about the company?

  • Uses a crowdsourced personal grocery shoppers (Grocery Gurus) to pick groceries;
  • Lean business model with no warehousing, logistics and distribution expenses.

What big problem does it solve?

Saves time and hassle of shopping.

How big is the market opportunity?

  • US$30 billion market by 2024 in North America alone;
  • Plans to own at least 15% of the global on-demand grocery delivery market by 2020;
  • Expects annual gross revenues of US$250M in the next 5 years.

Interview

Investors’Angel spoke with Urbery founder and CEO Mudit Rawat to gain deeper insight into the company.

What does Urbery do?

Mudit Rawat: Urbery is a p2p grocery (and alcohol) delivery service that uses a fleet of crowd-sourced personal grocery shoppers, Grocery Gurus, who shop and deliver customers orders. The order is routed to a Grocery Guru, who are experts in picking groceries. Unlike the traditional online delivery services, Urbery does not invest capital in warehousing, logistics and distribution, making the model extremely lean.

“Online grocery shopping today hasn’t evolved to the current needs of the consumer.”

What big problem does Urbery solve?

MR: Grocery shopping is an inconvenient necessity. It’s extremely time consuming and includes carrying heavy bags, making trips to multiple stores, navigating through busy traffic and fighting bad weather (especially during snow storms). Consumers are also looking to buy things online or on their phones and get it delivered instantaneously or at a time that’s convenient to them.

Urbery address each of these problems using a unique business model that does not involve spending capital on setting up warehouses, but uses a fleet of crowd-sourced personal grocery shoppers who shop and deliver customers’ groceries.

“The North American grocery delivery market is expected to grow to over US$30 billion by 2024.”

How big is the market opportunity?

MR: The North American (US & Canada) grocery delivery market is expected to grow to over US$30 billion by 2024. The market is going to be even bigger in Asia (India, China, Middle-East, etc.). For example, In US alone, between 2013 and 2018, online grocery sales will grow at a compound annual growth rate (CAGR) of 21.1%, reaching nearly US$18 billion by the end of the forecast period. For comparison, offline grocery sales will rise by 3.1% annually during the same period.

Urbery Market Data. Part 1

How big can Urbery get based on your analysis?

MR: Our overall vision is to become a Canadian player, i.e. deliver groceries to our customer’s’ doorstep in every major city in Canada by 2017 – something that is very achievable due to our lean operational model. We also want to enter the US market and the Asian market in 2017 as we see a lot of opportunities still exist to capture market share. In all we want to own at least 15% of the global market share when it comes to on-demand grocery delivery services by 2020 and become a major force. We anticipate annual gross revenues of US$250M in the next 5 years. We want a team of 200+ full-time employees across the world who are managing operations and helping evolve our technology everyday.

How was the team assembled?

MR: I met Urbery’s current CTO at a retail conference where we talked about our passion of solving everyday problems by using new technology tools. Our COO came to our office to network and learn more about our business and as we started talking, it became very clear to us that we needed him to join our team and help us build robust processes that would help us optimize and scale our business across. The problem of spending time at a grocery store and carrying things back home was a problem that all of us related to at a personal level and became a common bond between the 3 of us.

We are people with strong technology/product development background and retail and operations background. I come from a consulting background with a focus on technology (Oracle and CGI) and retail (Sobeys Inc.) and along with the experience of working with business models and financial management. Our COO, in his 12+ years of work experience has launched international brands and new business models at a global scale for companies such as Adidas and Natuzzi. Urbery’s CTO comes with 10+ years of experience in building web and mobile platforms for large corporations such as Pepsi to startups like Urbery.

“Our Gurus are trained to be product experts.”

Why would anyone want to become a Grocery Guru with Urbery?

MR: The benefits for the Grocery Gurus are immense:

  1. Flexible schedules: you work when you have the time and not based on when we want you to work;
  2. Does not require special skill sets or a fancy degree. Though, to be a Grocery Guru you need to have love for food and willingness to go above and beyond to fulfill the customer’s order with accuracy and quality;
  3. Get paid for grocery shopping: our Grocery Gurus earn commission based on the size of the order and they also receive 100% of the tip that customers give during their order (avg. 5% of order size). Larger the order, higher the commission per order.

How many gurus do you have now?

MR: We have 26 registered gurus on our platform and we get at least 30-40 new applications every week (we are picky in who we select).

Is there any interaction between Grocery Guru and customer?

MR: As the Grocery Guru starts shopping for our customers order, he activates an in-app messaging feature which opens a live text window with their customer. The customer is notified with an initial text saying “Your Guru, [name], has now started shopping for your order. This is a great time to let them know of any special preference you may have about your order (e.g. expiry dates, ripeness of fruits, etc.].” This in-app interaction gets over 95% of our customers to respond back to our grocery guru with their preference and has seen some amazing positive feedback.

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Corenne Taylor, Grocery Guru

Interview with Grocery Guru Corenne Taylor

How have you become a Grocery Guru? What was the main reason?

Corenne Taylor: I’m self-employed, and as such, my income is not dependable with substantial ebbs and flows. I was looking for a way to supplement my income during the down times and wouldn’t take me away from my business.

What first attracted me to the Grocery Guru position was the flexibility it allowed, I could work as many or as few hours as I wanted. Secondly, it was so easy to start. All I needed was a car and a smartphone!

I was a little intimidated at first by the amount of knowledge required to pick out groceries for other people, but the training was great and very thorough; once I’d delivered two or three orders, it was second nature.

How much do you earn as a Grocery Guru?

CT: I get paid based on the number of deliveries I complete. I think on my best day, I completed 7 deliveries and earned $150 – not bad for 5 hours of work. Typically, I deliver orders that are around $80-$100, for orders that size I get paid $10 as my commission and generally receive a tip from the customer.

How much is it possible to earn if you work on a full time basis?

CT: I think reasonably, someone pursuing this full-time could expect to make about $2,500 a month.

Can Grocery Guru become a profession in future?

CT: I think so. A person with the right skill set can definitely do this as a profession as long as they understand grocery stores and know how to interact with customers. The team provides us with extensive training for the grocery shopping part of the job, but there’s another part – the people part – that is something you will excel at only if you truly enjoy engaging with the public. The majority of my interactions with customers have been positive, but occasionally you do get someone who is not satisfied with their order, as a Grocery Guru you need to be able to think quickly on your feet and resolve that issue for them on the spot.

Grocery Guru definitely fits the criteria of profession and I think as the industry and demand grows, so too will the opportunities for Gurus.

How did the training look like? How much time did it take?

CT: So the training was two-fold. In the first stage, I attended a general on boarding where several members of the Urbery team took myself and other Gurus-in-training through all the basics – the various aspects of my role, scheduling my shifts, and using the back-end app to communicate with customers. In the second stage, I was matched with an existing Grocery Guru and shadowed them for several orders (typically three, but really you can participate in as many as you like until you’re comfortable with the process). I even got paid for those training orders!

From registering to going out on my first delivery took about 3 hours.

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“We envision that the smart supermarket chains will look at their current customers and eventually partner with companies like us.”

Do you know that Uber already delivers food in some cities? Why do you think people will use Urbery instead of Uber?

MR: Yes, Uber does deliver in Toronto too under UberEats. But there is a huge difference between what Uber is doing versus our grocery and alcohol delivery service. Under UberEats, Uber is disrupting the restaurant delivery business (GrubHub, JustEat, Seamless,etc.) and getting people’s lunch from restaurants in a very quick time. We are going after the customer base that wants to cook at home and cares about quality and freshness of products. In the Uber model, their drivers are picking pre packaged food and delivering to customers. Picking a ripe avocado and having knowledge of grocery products is a completely different ball game – something Uber has stayed away from.

“Over 50% of our customer base happens to be young families who are also time starved.”

What geographic/demographic markets are you targeting in particular? Are you planning to expand to the US?

MR: We are based out of Toronto, Canada, which is where we intend to be for 2015. Our current target customer includes:

Young Professionals: Typically Millennials, working/living in the downtown core, like spending time with family and friends, involved with lot of activities, love technology and food.

Young families: Working parents, higher disposable income, busy schedules, looking to save time, looking for a personalized experience and heavy focus on fresh products

Seniors: Seniors who don’t drive or have difficulty lifting heavy loads.

CPGs: To promote their products on our platform.

2016 is when our plans for Canadian city expansion and international expansion is going to kick in. We have already started the work in identifying key cities across the globe (including US) where Urbery’s offering will be relevant. Our technology and operations team is busy building solutions and processes that can be easily dropped into different cities.

How has customer feedback been in general so far? Have you learnt anything you weren’t expecting?

MR: Customer experience so far has been amazing. Our average customer satisfaction score since we launched is 4.8/5 on all our deliveries so far. One common feedback theme has been on the exceptional customer service and the quality of products picked by the grocery guru – something the entire team is extremely proud of.

“Our average customer satisfaction score since we launched is 4.8/5 on all our deliveries so far.”

Urbery Market Data. Part 2

Have you received any criticism or negative feedback from users?

MR: One of the criticisms that we received when we launched our service was the lack of products that we carried on our platform (we started with about 1,000 products).

We have now expanded our catalogue to over 5,000 products, added a whole new alcohol section (after receiving our alcohol license), improved product discoverability as well as added a feature, which allows customers to manually add products they couldn’t find on our platform.

This has really helped us in improving the overall platform experience, which in turn has helped us significantly in customer acquisition.

“Our aim is to build products that integrate with current Internet devices of our customers and allow them to place orders from anywhere.”

What was your biggest mistake so far? What would you do differently if you were to start again?

MR: I would say that I should have personally decided to quit my corporate job and move full-time into Urbery sooner and started rounding up the team faster as it’s so important to have the right people working for the same goal.

What kinds of innovation/improvements are you considering for the future development?

MR: Currently, the team is busy with putting the final touches on our iOS app right now, after which we will be working on launching the Android version. In addition to that, some of the features we are excited about are:

  • Predictive analytics and machine learning: the app and the platform learns about customers buying habits and showcases products based on their preferences;
  • Internal dashboard for CPGs to create campaigns and track performance;
  • Incorporating new payment options such as ApplePay, Bitcoin to our eco-system;
  • Creating an integration with other devices (such as refrigerators) allowing it to order for the customers.

Our aim is to build products that integrate with current Internet devices of our customers (watches, TV, phones) and allow them to place orders from anywhere. We also want to build such a customized experience that makes them feel that the app understands them and is able to predict what they need to eat right when they have thought about it!

How much funding are you looking for? What are your plans for these funds?

MR: We are currently raising US$1.6M to fuel our customer and grocery Guru acquisition, optimizing technology build, as well as expanding our model into few new cities across Canada. Our technology is ready and our operational processes are quite robust and we are ready for making Urbery a household name in Toronto and beyond!

Interesting facts about Urbery

About Urbery: Urbery is an on-demand grocery and alcohol delivery service.