365cups

Describing itself as the “independent link between consumer and café”, 365cups is a business based on the idea that customers should be able to place a coffee order on the internet or via their mobile phone.

Launched in January this year, former flat mates Simone Eyles and Mariusz Stankiewicz are the brains behind the operation. Eyles talks to StartupSmart about the challenges associated with aligning software and service.

What was your business idea?

The business came about through a conversation with a friend, Mariusz, who is now my business partner. I’m a graphic designer, he’s a computer programmer and we thought, ‘Wouldn’t it be cool if you could order coffee on your phone?’

How did you go about setting up the business?

The first place we started was making the decision to really commit to it and doing everything by the book.

We went and saw the BEC (Business Enterprise Centre) and we found out what you have to do to start a business and we registered our trademark and set it all up. As we were doing that, we were simultaneously discussing how it would work and how we would proceed.

We worked on it every day until we got through all those bits and pieces and then we built the test system. We tested it and we did some consultation and then we thought, ‘we’ve got to get some clients.’

We put it out there and the first person I spoke to about it – we went live with them two days later with our system. It was really fast but it was ready to go.

And because of what we have, we needed a real client to iron out any issues because what we have made meets halfway – we’ve got our system and people can use it but they can tweak it to suit themselves.

How does the system work?

We have developed software. We’re selling to cafés on a subscription service. They log into our system and put their menu up, and that database drives an iPhone and a web version of the menu.

All people need to do is have the iPhone app or have the menu and pre-order. It’s a very sophisticated, very complex system – as in the programming – but the idea is very simple.

How did you fund the business?

With our own money – $10,000 between us. In addition to compliance costs, we’ve bought some hardware – iPads and iPhones – and we’ve paid for some point-of-sale material.

What challenges did you face setting up the software?

Mariusz is a very talented computer programmer and he’s got over 15 years of industry experience.

We started with an idea and we just kept developing it. We’d do something and then say, ‘No, we should do it like this’.

For him, the hardest part was writing the code for the iPhone app. It was very tricky. And then of course when you build an iPhone app, you have to “to and fro” with Apple.

You have to apply for the developer’s license and you have to go through all of these processes. You speak to Apple and you send off your information, and then you just wait until they get back to you; they don’t give you a timeframe or anything. That was probably the hardest process.

Once the software was set up, how hard was it to secure your first client?

It was hard because I’m not a salesperson, and with our first client – Premium Coffee Roasters – I went in there a few times and I knew who the owner was and I was just buying my coffee and I was like, ‘We’ve got this system and I really should show it to you’.

Probably over a good two month period, I kept having this conversation with him but there was never really a good time to discuss it properly.

When the system was ready, I actually went in and I saw him and I said, ‘I’d really like to sit down and show you the system’ and then we made an appointment.

As soon as I showed it to him, I knew by his reaction that he instantly got it and loved it. Two days later, we went live with his menu.

How did you decide on the name?

I think we went through about 80 different names. Obviously, we needed to buy the domain name and all these cool names that we came up with were all bought with placeholders.

So we had to keep going and going. The 365 refers to the internet – it’s there every day of the year. We’ve had a lot of really positive feedback about our name, which is great because it was such an agonising process.

You and Mariusz live in different locations. Has that always been the case?

I live in country NSW and he lives in Sydney, so yes it has always been the case. It works really well because we email, we talk on Skye, etc so we can actually communicate a lot better because we’re not bound by a physical location.

How much time went into building the business?

About a year. We spent about 20 hours a week working on the business. It started with a lot of conversations – I reckon we’ve got about 4,000 emails between each other.

When we went live or public with it, we had a very overwhelming response but those first few days were just nerve-racking.

What was the industry reaction?

A lot of people we speak to in the industry have been saying to us, ‘We’ve often wondered why there’s nothing like this available’.

We can respond to that straight away – people who run cafés can’t write programming for computers.

Did you have any bad sales experiences?

The hardest part is getting to the right person in the first instance. I’m the one who has taken on the role [of salesperson] and I just try and treat people how I’d like to be treated.

I can usually gauge from their reaction whether they’re interested or not. If they are, I try to make an appointment and then I do a demo with them.

Is the business generating any revenue?

We’re probably not that far away from generating revenue. We’re not at the stage where we’re drawing wages yet but it’s looking like it will turn into that soon.

What are your revenue projections?

We’re aiming to double our customers every month and we’re aiming to get 100 clients this year. If we meet our targets, there’s no reason why we shouldn’t be aiming for about $80,000.

How many staff do you have?

It’s just the two of us. We’re looking at forming some agent agreements because we’re going to come to a point where we need more staff.

What’s the biggest risk you face?

Competition and people copying our idea. There are a few people talking about [starting similar businesses].

What will be your points of difference?

We’re telling our clients that although we’re an internet-based business, we’re not a faceless organisation. Our success depends on their success, so we have to look after them and their customers.

We really have to be on our game to solve any problems that arise. If the customers aren’t happy, no one will order, so that’s probably our main focus – we are aiming to provide outstanding customer service.

Do you have any advice for other start-ups?

You need to do your research. Also, a lot of people will tell you what you should and shouldn’t do. Believe in yourself and go for it.