Starting a (failing) business but still having fun and learning along the way
It was the spring of 2021. Hope was in the air. The vaccine was released and people were excited to get back to a life of normalcy. However, COVID-19 still loomed, and people were hesitant to immediately revert back to their old ways.
At the time, my girlfriend and I just moved to Hermosa Beach (a welcome change from our tiny apartment in cramped NYC). One of our favorite activities was to try the local cuisine. After dining out a handful of times, we began to notice a trend - restaurants frequently took a long time to deliver us a check when we were ready to leave. We hypothesized what the reason might be: limited and less experienced staff (due to COVID-19), laziness, an optimistic staff thinking we would order more food if they waited long enough. Regardless of the reason, we knew there had to be a better way.
Side note: if you ever find yourself in Hermosa Beach our personal favorite restaurant was a cozy local Italian restaurant called Fritto Misto on Pier Ave. We recommend you come hungry as the portions are gigantic.
When talking to my parents over the phone one day, they said they just visited a restaurant in Marin County that had installed QR codes to order. They said it was as simple as scanning a code at their table and ordering. I thought, “Wait a minute. All the restaurants around here could use this - in fact they need to be using this.” I thought this could solve 2 problems in one - faster ordering and make the experience touch-free (which was important in the times of COVID).
I told the idea to my girlfriend and she was immediately in. Our business was born.
How did we build it?
Not being developers ourselves, we used Upwork.com to find developers to help build our app. We were courted by many developers across the globe. We met a 23 year old from Ukraine who said he could build the whole app himself, extremely quickly, and charge us a fair price. We were skeptical. Eventually we decided to go with a group of developers from India. We pitched them our idea. They congratulated us on such a novel concept and assured us our idea is destined for greatness. We were pleased.
What did the app do?
The app made it easy for restaurants to build out electronic menus that could be shown on a customer’s phone after scanning a QR code. This way, customers could order and pay for their food ahead of time, eliminating the hassle of having to wait for the check when the meal is done.
We called the company dinz - a short, fun-to-say name that kinda resembles a “speedy dinner” if you squint at it long enough. We decided to get the URL dinz.app (it’s still running today if you like to visit it, at least until September 2023). I had my highschool friend build out the website. This turned out to be one of the best “hire for work” decisions we made. He did a great job for a very reasonable price. If you are looking for a site developer I highly recommend him, and happy to make an introduction if interested.
The website was connected to the app itself. Therefore after restaurants registered through the website (and agreed to pay the $5/month fee), they would be given access to use the app itself.
With high hopes, we walked to our local Chase bank and opened up a business account, complete with a fresh new Chase credit card. We celebrated with drinks that night.
Drama Ensued
Unfortunately, the good times did not last. QR code menus began popping up at restaurants all across our neighborhood and in broader Los Angeles powered by Toast and Square. Their systems were robust and connected to other systems throughout the restaurant - the display in the kitchen, the point-of-sale system.
We knew we couldn’t compete, so we quickly started to brainstorm how our app could be used in other ways. Food stands at baseball stadiums. Restaurants at airports. Little league snack shacks. We were dead set on finding the right setting that would have plenty to gain from having its customers order from a QR code, but also would face little competition.
Eventually we landed on QR codes for hotels. We figured hotels could have many use cases for QR Codes (and not just limited to ordering food). Hotels could use our app to build out a QR code menu at the hotel bar or for room service. They could also use our app to easily post popular workout routines at their hotel gym, or have a QR code stationed in the bedroom to make it easy to order another towel or cot. Based on this, the pivot to hotels was made.
While initially optimistic, after a few key speed bumps, things quickly took a turn for the worse.
How the Business Failed
The business eventually failed from a lack of customers, well 0 customers to be precise.
Developers were slower to meet deadlines than advertised (who knew India had so many holidays?). After a month of working, the developers were difficult to reach, and went through a few one or two week stretches where zero work got done. This prevented us from pivoting quickly to our new hotel idea and eventually made us settle for a product that barely worked.
What Would I Do Differently
There are a few key things I would do differently. In retrospect these reflections seem basic, but still a good learning experience.
Talk to more customers face to face: I spent time calling and emailing many potential customers. In hindsight, my time would have been better spent actually visiting and talking to our customers at their storefront or hotel.
Build and record a solid demo: We should have built a solid demo to “WOW” potential customers and help land our first customer.
Understand the competitive landscape: While I didn’t initially actually see other QR codes at restaurants, if I had done a little more research upfront, I would have discovered that Toast and Square were building out a similar product that would get released soon, and probably would not have rushed into the idea.
Understand how our product interacted in a larger ecosystem: While ordering was a piece of the puzzle for restaurants. I should have understood how important it was to have this order system be connected to other systems throughout the restaurant (ie. kitchen display, point-of-sale system).
Do something that you yourself can contribute to and build on: I think this is especially important in the early days of a company where you’d much rather trade time for saved money. In our case of building out an app we should have been able to write the code ourselves (or find a co-founder that could) instead of relying on a 3rd party for help. This also gives you more flexibility and the freedom to change course if needed.
Overall, I learned a lot from the experience and I’m happy I did it. I’d like to try to start a business again someday. If you have a great idea, please feel free to drop me a line!