HN Office Hours with Michael Seibel and Aaron Harris

We're learning. Move fast & break shit doesn't work on Wall St. We knew how to build the best financial sentiment NLP in the world, but we had no clue about the space we would eventually sell into. It's cautious, slow to act, skeptical, very sophisticated and secretive. We had to find a client who knew exactly what to do with our data without any handholding and was a bit forward thinking, even experimental in that they take chances on startups. We found that perfect client (actually they found us!) and they could see the value of what we built right away, probably better than we could. They loved us so much they eventually invested in us so we knew we were on the right track and they've been helping us ever since. Growing client #s required us to become experts in a number of different areas so we took our time getting them right.

Yes we make money per client. Large ARR contracts

The way we've figured out so far is really learning from a failed past experience. We built a product in the past which was a kind of Yodlee or Plaid competitor (http://spout.co) and learned alot of what consumers cared about along the way while never hitting an actual nerve with clients who were willing to pay us money.

I think we started like most people would here, by partnering with existing banks. So we have a signed pilot with one major bank and are working on a partnership with another one. But knowing how slow they move we started looking at other avenues that could make a more immediate impact.

The pilots are around lost or stolen cards and being able to have your autopayments as proxy cards so when the number of the card on your Target or Home Depot account gets stolen the number of the card in your wallet doesn't have to change and vice versa.

What we're working on now is a way for people to identify bills in their email that we can then process and remind them when they're due and how much money they may have left in their accounts when paying them. This allows us a couple of opportunities.

1. To get consumer eyeballs on something and to see if people would like to pay bills via a simple Venmo-like product.

2. Building a base of potential users for an actual bank launch.

In that vein some of the underlying tech behind an actual bank itself becomes the most interesting part of the problem once a transaction is approved.

But until we get behind the kimono we really don't think theres a way to know how much we'll have to build or improve with the underlying tech and systems but we suspect what is built can be leveraged in several ways.

What we do expect is a complete questioning and re-thinking of how every single thing is done from how customers deposit money to how we issue new accounts and how underwriting is done on loans of all types.

Over the past six months we've been writing an Android framework with two uses. One use is to spin apps off of the framework. The other use for the framework would be for the ultimate goal of publishing a spreadsheet app for Android from it.

We just published our first app based off the framework yesterday (linked in parent post). The framework work we have done so far was put into yesterday's app (a browsable, searchable spreadsheet-like front end to the Android device's call log, text messages, calendar etc.)

Our next step will be to implement in the framework the feature to save and share a document. The spreadsheet ultimately can use that, but it can also be used in the nearer term for spinning off an app to save an Android phone's text message history.

We also plan to have an app using this framework which can handle Microsoft Access databases. The features needed to do that will help in the ultimate goal of a spreadsheet.

The main prioritization conflict for us is how much work to do on these cast-off apps, versus how much to do on our ultimate long-term goal of a spreadsheet. Especially work which can't be rolled back into the longer term goal.

So the question is if the game plan of writing a framework with an ultimate goal of a spreadsheet, casting off apps from the framework on the way to that ultimate goal - does that sound like a decent game plan?

Thanks for your reply!

The largest cheating scandal (that happened about a year ago), had $250k up for grabs[1]. With that said, the exact number is difficult to quantify, as if the cheater is successful, then no one is the wiser.

[1] http://www.ign.com/articles/2014/11/25/csgo-esports-communit...

We started out wanting to do a similar model as Eaze/Meadow - but we found we weren't adding enough value to existing dispensaries/delivery services to warrant a decent fee/percentage (since they already had customer bases and we were starting from 0 with no outside funding like the other companies).

Then after running everything in-house for a while, I realized that it was actually a much better model to handle everything in-house because then we have complete control over product quality, customer experience, drivers, as well as being more profitable (we we profitable within our first two months). We've tried a few partnerships with outside delivery services and it never worked out because they were never able to replicate the very high standards of service that we require (coming from a background in hospitality management myself). I know there are all these companies purporting to be the "Uber for weed", but that's not really that accurate. If Uber were doing the same thing as these other startups in transportation, then the proper parallel would be Uber partnering with existing Taxi companies rather than independent drivers. Uber cuts out an established middle-man, but the other on-demand marijuana startups are partnering with established middle-men rather than cutting them out of the value chain.

However, I think the single biggest reason to go in-house is that services like Eaze/Meadow can never compete with us on price. I consider our prices to be somewhat high right now, since our cash flow is still so fragile, yet we are still undercutting Eaze by around 20% on most products even as they have over $11 million in funding.