The 1099 contractor model is favored by on-demand companies like Uber, Lyft, and Postmates. The Alfreds - named for the butler of Bruce Wayne/Batman - are all employees of the company and not 1099 contractors. The value proposition is higher when you're like, no, I can't get on-demand groceries." Ditching the 1099 model And if our desire was to link all of those together, we'd want to first learn how to do that in a place where people are not used to on-demand services. "SF is an anomaly - it has the most on-demand services out there. The founders avoided initially launching in San Francisco because "New York has a higher population density and a higher availability and accessibility of the kind of vendors we want to use," Sapone says. Not only had they shown great metrics - like customers loved it and all that stuff - but their obsession to detail was extraordinary." Basically, they were profitable even before they had raised any venture capital. "Even before they raised any money from VCs - our round was before they won Disrupt - they had bootstrapped the company themselves they had put flyers out. They're super passionate about what they're doing," Bijan Sabet, a general partner at Spark Capital, told Business Insider. "When I spent time with Jessica and Marcela, I was immediately taken by a few things. The entire Disrupt speech was written on Post-it notes and I practiced it over and over and over again until I could do it until it didn't matter how many people were in the room." "But you have to remember, we had a year's worth of data running the business, so the one thing we had going for us was we had a ton of conviction. We did a lot of our prep work the weekend before," Sapone says. The only thing we were trying to optimize for was not to look silly. "Getting into Disrupt was kind of a surprise. In September 2014, Sapone and Beck left Harvard and Boston and flew out to San Francisco to take part in TechCrunch Disrupt's Startup Battlefield competition. "People were paying $400 for Alfred's service in Boston when we first started." "The entire world reaches out to you when you win"Īlfred launched in Boston in May 2013. "This happened from the point where people were paying $25 a week all the way up to $90 a week for the service that we have today," Sapone says. But any time the founders went to their customers and told them they were considering pumping the brakes on the company to focus on school, their customers would freak out and offer to pay more and more money to keep Alfred's services afloat. Sapone and Beck were still in business school while they built their company, and it wasn't easy. "We created a bunch of postcards with different prices and different bundles of services, and we put them under the doors in all these different neighborhoods in Boston, and we got our first 10 customers that way." "We really thought about it as a smaller business," Sapone, who is CEO of Alfred, said. Alfred has raised $12.5 million from investors including Spark Capital, New Enterprise Associates, SherpaCapital, and CrunchFund.īut when Beck and Sapone were still in Boston, they weren't sure Alfred was a company that even needed venture capital funding. You pay $99 a month for the service, plus the cost of things like your groceries. Today, Alfred is a startup that hires employees - Alfred Client Managers, or just "Alfreds" - to run weekly errands: things like buying your groceries, sorting your mail, dropping off packages, and taking care of your laundry for you. "It was a little bit of an accident: We built the product for ourselves, and over time people in our apartment building said 'Hey, can I get in on that?'" Sapone says. Account icon An icon in the shape of a person's head and shoulders.
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