How Veeper plans to disrupt online shopping
Nowadays, virtually all businesses offer some type of customer loyalty program to incentivize sales. However, as the pandemic began to spread across the United States, many businesses suspended their programs and customers were unable to redeem their outstanding points. One of those customers, Jordan Williams, had a $200 voucher from Southwest Airlines and over 6000 points from Chipotle that he forfeited.
With this problem in mind, Jordan founded Veeper, a customized loyalty program for online stores that rewards customers with incremental discounts. In my conversation with Jordan, I sought to understand how his personal experiences with shopping and loyalty programs informed his decisions in building Veeper — and how his startup aims to disrupt online shopping.
You’re from the United Kingdom and started a startup in Kansas City. What an interesting combination! What set of experiences led you to starting Veeper?
I’m originally from Bristol, England. I came to the United States to play golf on a scholarship at the University of Missouri. After I graduated from Mizzou, I worked at my best friend’s startup as Head of Sales. I loved the startup dynamic and always had an entrepreneurial bug.
After I went back to get my MBA, COVID happened and I had a $200 Southwest voucher and over 6,000 Chipotle points set to expire. I wanted to create an app where my rewards didn’t expire, so I dove deeper and thought, “Honey is so successful because they are applying automatic discounts with ease. How can we make that even better and more optimized for the merchant so my discount grows and never expires?” And that’s how Veeper started, while I was at school in Missouri.
How did you meet Julian and Wasim, your two co-founders?
Like myself, Julian is from England and came over to play golf. We met in 2012 and became graduate assistants together while getting our MBAs. Now we’re best friends and roommates. He’s a math wiz who created our discount formula and does everything from finance to legal work to operations.
We recently brought on Wasim as our co-founder and CTO. He built 15 apps beforehand, and has brought on seven developers with him. Wasim came to the United States for college and got his PhD here. Fun fact: NASA and the U.S. Air Force still use his technology, and that’s how he got his visa!
Veeper’s focus is on retail and e-commerce businesses. With the pandemic serving as an inflection point for many e-commerce businesses, how has COVID-19 affected the trajectory of Veeper?
Initially, we were thinking of becoming a mobile app targeting brick and mortar stores, bars and restaurants, etc. WithCOVID-19, we saw the momentum of Shopify, e-commerce, and online shopping. At that point, it was a no-brainer to switch to a Shopify-app or API. Going door-to-door to get brick and mortar businesses was no longer possible with lockdown restrictions, so being online-first as an integration or API was a far more scalable business.
How do you think about platform risk with Veeper’s focus on Shopify? Have you given any thought toward diversifying your different channels?
We’re starting with Shopify, but we plan on building integrations with different platforms — first with platforms like Wix and Squarespace, and later with BigCommerce, WeCommerce, and Magento. We also want to have a Shopper Login; right now our target audience are the merchants themselves, and we are able to acquire the shoppers for free. Over time, we will become more customer focused so we’re driving a sense of social pressure for merchants to offer us.
This past month in particular, we’ve also been establishing partnerships. Larger applications are looking for integrations with our discount formula to optimize incentives through SMS and e-mail. Those are white-label integrations that we could build for those platforms.
Have you employed any strategies that have been uniquely successful in acquiring merchants to use Veeper?
When I speak with merchants that have promo codes on their website, I say, “I see you’re offering a 10-percent discount, how did you arrive at that figure?” And usually they would have a deer-in-the-headlights moment. Instead of merchants throwing out fixed discount codes of arbitrary values, they would use our alternative. We use artificial intelligence to determine what the optimal discount rates are to attract each customer and maximize profit. Once merchants realize our product allows them to understand conversion, retention, and other customer metrics, that’s how I hook them.
Also, our partnerships have been incredible. We have about 20 partnerships and counting, from Trustpilot and Omnisend, to digital marketing agencies that work with stores directly. And these partnerships have been a great way to get in front of customers for free.
How did you decide which stores to test Veeper in?
Initially, we thought we were going to focus on clothing because I have some friends that have opened up their own boutiques. But we’ve since worked with a coffee brand, a plate brand, and other types of stores. We discovered that replenishable goods like coffee, soda, shampoo, hair gels, and more actually had strong profit margins since they were being purchased so frequently. That’s a really great market that we’re looking to capture, so we’ve been working with a wide variety of stores that fall under this criteria.
As you’ve gone through the process of fundraising, I’m sure you’ve gotten asked time and time again on how Veeper differentiates from incumbents like Honey. Let’s hear it for (hopefully) the last time; what is Veeper’s competitive advantage?
Veeper’s discounts are personalized to each shopper and grow incrementally as they shop. We’re applying the smallest discount code that each individual customer would need to convert. Meanwhile, Honey simply scrapes codes from the store so every shopper uses the same codes, regardless of their elasticities.
Also, the shopper doesn’t need to download a Chrome extension or anything else. They get to use Veeper for free because it’s already implemented in the store where they are shopping. Once a store downloads Veeper, they no longer need to create promo codes and as a result, Honey will no longer have a supply of codes to apply at checkout.
What has been the most surprising lesson that you’ve learned since starting Veeper?
It sounds like a tautology, but the amount of work that goes into a startup. One might think it’s just building an app and sales, but there’s also legal, accounting, meeting investors, having to fundraise, etc. It seems like I’m adding five things on my to-do list every day. But we know we’re building something meaningful, so it’s really fun.
In the world of tech and venture, where it seems like everyone is always “on,” what strategies do you utilize to avoid burnout and find some semblance of balance in your life?
Working out has been a huge stress reliever. So I go to the gym from around 3 p.m. to 5 p.m. and get back to work into the night. I also play golf; that’s probably the best stress reliever. When you’re golfing, you can’t afford distractions or you won’t play well. My co-founder and I play golf together so we can shift our focus from only talking about Veeper to only thinking about golf. Having a few beers also helps.
Do you have any advice for students in college that are currently building?
First, if you’re not technical, trying to run a tech company without a tech person is really hard. Find that tech person — the risk of someone stealing your idea is overblown. Second, it’s all about networking. I used to dislike posting on Linkedin and social media. But I’ve found that if you post and keep a steady routine of doing so, the investors come to you. You really can’t overshare what you’re building. It shows you have passion and are making progress updates on what your target audience would like to see. So keep posting!