As more companies crowd into San Francisco and Silicon Valley, and the road from to idea to venture financing gets harder, the startup hustle is getting even more challenging.
The first thing Jason Coleman did when he finally decided to start Yarden, the urban gardening business he had dreamt about, was to drive 40 hours per week for Lyft, shuttling passengers between Oakland, Berkley, San Francisco, and Silicon Valley.
The connections just rolled in. Coleman says he met a trade Fair Trade business manager who offered to help with certification, an investor from AngelList, a community manager at FundersClub, a food bank partner (this was after stopping to talk with volunteers handing out fresh fruit to homeless in west Oakland), two software engineers who asked about joining the company, and several prospective customers. I was the second journalist he had talked to about profiling his company. That was the first week.
“My Lyft driving experience has been stellar, and I don’t think I’d be making business progress nearly as quickly without it,” Coleman wrote after our discussion. “I’m not one of those guys who can make a couple phone calls and get funded.”
As more companies crowd into San Francisco and Silicon Valley, and the road from to idea to venture financing gets harder, the startup hustle is getting even more challenging. Unproven newcomers are struggling to raise even early-stage funding, and the war for talent is escalating as successful startups amass massive war chests with payrolls to match. For founders without a multimillion-dollar acquisition or IPO behind them, meetings with prospective customers, investors, or collaborators are often difficult to arrange. Ride-sharing does a neat end-run around this, offering the chance for a brief, informal chat with a captive audience. It’s a new venue for the classic elevator pitch.
Nathaniel Kelso, a former Apple cartographer, says one of his recent Uber drivers turned out to be a CEO who was working on his 10th startup—and pushing his employees to drive as well. “The whole point of driving for Uber was figuring out how to…market the product and how to scale,” Kelso said.
Indeed, ride-hailing companies deliver a steady stream of passengers who fit the target demographic of many founders: relatively affluent, early adopters with an easy way to connect by phone. This being Silicon Valley, passengers are often connected to the tech industry, and some would be nearly impossible to schedule meetings with through standard channels. Plus, every hour founders spend driving around the Bay Area helps fund their company. (Coleman says he clears $1,400 per week.)
Coleman is readying to launch Yarden in early 2017. He says Lyft is key to securing the 1,000 customers and 40 Bay Area yards he needs. Meantime, he says he’ll continue to drive—”or hire a salesperson and have them drive,” he says—because “it’s a great way to talk to our customers and to get feedback,” he says. “It seems to be working.”