Nail It Before You Scale It With David Dustin

Transcript:

Transcript 

Jared Ward 00:06

Welcome to our latest episode of Ops and Filter. Today we have a very special guest, David from Ship Insure.

David Dustin 00:12

David, how's it going? Man Great to be here. Jared Excited to do it.

Jared Ward 00:15

Yeah, thanks for coming on. We had this plan for a while. Last one got canceled. Thanks for being flexible and pivoting your schedule. I always prefer doing in-person podcasts because I think we can have a lot more authentic of a conversation. Absolutely yeah. So how's everything going with Ship Insured these days?

David Dustin 00:32

Man, it has been really wild. We're incredibly young. You know we just crossed like 1.3 million just barely Hawk Media yeah, we're stoked about it. Hawk Media, who has 5,000 clients in our space. They have a venture group. They basically invest in companies and then refer a lot of business to them. They just barely put a 500K investment into us and we're really stoked about that. We view it as like a 10 year partnership and we feel like they're going to over deliver in every way. We're really blown away.

Jared Ward 01:07

Okay, and just for reference for us, David is the CEO of Ship Insure. Real fast for everybody listening. What is Ship Insure? What do you guys?

David Dustin 01:15

do yeah. So Ship Insure is an option that customers can add at checkout. Brands add us to checkout, typically on Shopify. They install the app. Their customers get the option to protect their order at checkout.

01:27

The cost of protecting an order is a buck to a couple bucks and when it's available for a customer to check out, about 60% of customers will choose to protect their order. If that order has an issue let's say it gets lost, damaged, stolen, a myriad of other scenarios that happen between it leaving the warehouse and getting to the customer we do a repurchase. The brand makes a second sell.

Jared Ward 01:52

So you cover the cost of repurchase A hundred percent.

David Dustin 01:54

So the brand actually makes a full second, sell full revenue. Oh, okay, I got it. And the customer solves their problem in a few clicks. And so imagine like a damaged package scenario. The customer usually ships that back to the brand. They no longer need to do that. They just take a picture. We do the repurchase. The customer has a much easier experience.

Jared Ward 02:12

You're also doing the customer service on those.

David Dustin 02:18

Yeah, so we handle the claims, do the service on that. If it's stolen, it's a really awkward conversation for the customer to tell the brand it's stolen and for the brand to handle that conversation. It's much easier to do it in this format and the customer you know it guarantees that you're gonna have a smooth experience. The brand has uh, you know, delivers that great experience, has a makes from everywhere.

Jared Ward 02:35

They would have lost forever now oh, that's amazing, cool, well, but before we dive, we're gonna dive way deeper into ship and share what you guys do, how you guys have scaled. I'm curious right off the bat. So you guys just crossed 1.3 million in the air, are?

David Dustin 02:48

yeah, and it's like year one of business for us, so that's, that's amazing that's so, and is this first 500 000 around?

Jared Ward 02:56

is this your first round to have you guys fundraise before this?

David Dustin 02:59

so we have a client who really helped incubate us, okay, and so they put two million into us a year ago and, uh, they've been an absolutely amazing partner and do you mind saying what customer that is? Yeah, it's tanga, tangacom they're a daily deal site and a really incredible group of people and they're a big part of our story, amazing.

Jared Ward 03:21

okay, so they help incubate you guys, but honestly, as somebody else who's in SAS, crossing 1.3 million that fast, I'm sure we're going to. I'm curious how you did that. So, if I and probably a lot of that plays into your experience before in other companies Um, but I know you guys have a unique playbook on how you scaled to 1.3 million so fast. Um, yeah, so yeah, before we dive into it, david, we have you on because you have a unique journey in the tech industry. You've been at a lot of different companies that a lot of people in the Utah scene have definitely heard of, so like Loop Boostability, orange Soda, and you played a pivotal role in the scaling of all those companies. So tell me a little bit about your journey. Like, which of those companies did you start out with? What did you do? Like, how would you describe your journey and your career in retrospect?

David Dustin 04:11

Yeah, so I would say that back in 2006, and I feel like I've had multiple careers at this point, but back in 2006 at Orange Soda, I started out there as basically the team lead in sales and a year in, uh, they put me in charge of cells and at that time it was basically like five reps, cold calling, and I saw it as my window. I didn't think anyone was ever going to like hand me an opportunity. I saw that as like my one window and so I poured everything into it and pretty quickly and about it. With over like a year we figured out how to take five reps and cold calling up to 40 reps on inbound and it was all inbound leads and orange soda became you know.

Jared Ward 04:50

What gave you the confidence to go to upper management and push for that type of scale? I feel like if I'm ever in a position like that, I'm always going to be timid, Like well, things are going good with just the five reps. What gave you the confidence to push for such scale?

David Dustin 05:08

I think that what really happened in this scenario is that there's multiple pieces that we uncovered here. One was that like I'd spent a year just selling this product all day long, starting from the beginning, when I was like just on my phone doing $300 a day, and I got to pitch it all those times, and so the first thing that happened is I taught the group how to sell like a really custom product, and I knew exactly how to teach that. And then, secondly, we, you know, we went to, we had some strategies on our lead gen. We'd find a widget that worked, something that worked to convert. So we had as an example, like a submit your website to Google or a free website analysis, those types of examples, and we just deployed those through every channel to generate leads. And when that model was working and converting and the numbers were there, it was like everyone's just like consensus let's hit the gas and scale that up, and so that's how it came about.

Jared Ward 06:03

So you got a great lead magnet that you pushed across all channels and you already had really good reps that knew how to sell the free users that came in.

David Dustin 06:13

We figured out how to take a really custom product and sell it and teach people how to do it.

Jared Ward 06:19

And real fast. Can you explain what was the product? Yeah, so in that case it was mostly search engine optimization.

David Dustin 06:25

Okay okay, and the benefit that I had in that role is that I'd spent every day pitching it. I knew the pitch inside and out and, uh, there's a lot of discovery that goes into that, a lot of education that goes into it, and we were doing a pitch where it would typically be like a single call or a two call.

06:41

Close okay and so there's a like. There's a like. It was both an EQ and an IQ pitch and we got really good at teaching people how to do that and driving them leads that were not smoking hot but at least warm, and they'd roll into it. Do discovery, do education, create emotion, create a vision, resolve concerns close and, uh, assumptive close, and we that was like this is going back 20 years now, but that's what we did.

Jared Ward 07:08

Amazing what? What are? So that sounds like a very transactional sell. Um, I'm I'm always jealous of people that sell transactional things. Like I sell freaking ERP. It's like minimum six phone calls. Um, that's interesting. What did you learn from that first experience that taught you that? I guess, yeah, what are some of the lessons you took away on scaling that organization to what you did? I think?

David Dustin 07:34

that one of the biggest things we did at both Orange Soda and Boostability is we built a direct model first and once we had a really efficient, great business, we then went out and got partnerships and scaled those businesses out. So you nailed it before you scaled it, yep, and so we both businesses we went to where we had 30,000 active customers wow and we brought in customers like people like GoDaddy, american Express, yp companies that white-labeled a product and took it to their clients. And we also found another unique model that was a big part of both those companies and it came about because we started working with Network Solutions. They were a hosting company. They had a hard time selling the product when they tried to be a reseller, and so we came together and we came up with a model where they outsourced our sales team to sell a mix of our products and their products to their customers.

08:32

And what happened with that is that we took things that happened in their system, like maybe someone just added a shopping cart to their website. We considered events like that leads and so instead of just going after like let's call this group of customers that are in this category, we called based on a hand raise. It was some kind of action the merchant took and we consider that like an event and we called based on that and we were able to develop the 500k of MRR off of that partnership with Network Solutions. And we then did pods with a bunch of other companies and when we started Boostability, we developed a model kind of like that with SEOcom and that was a big part of Boostability getting its founding. So we developed our direct channel. We brought in co-branded partners and white label partners and we were able to scale those out and I would say that, compared to the SaaS world today, we had just a extremely high partner centric approach and how we built those companies.

Jared Ward 09:29

Two questions that number one how, how do you even approach a company for a partnership like GoDaddy, Like how, who do you reach out to? How, what's the pitch? Like cause, even when I hear partnering with such big names, I think even somebody like me in my shoes sometimes I feel intimidated to go to like a Shopify or, in this case, like a GoDaddy. Who do you approach and what do you say to them?

David Dustin 09:55

Yeah, I think that this is part of why the nail it before you scale. It is part of the equation. I think that as you develop a really exceptional system for what you're doing and you can point to your team and say this is why we're great at it, this is why you want to work with us, these are the results that we have, this is who we're already working with. Uh, if you've nailed that, then it's easier to go have that conversation and they can look at and be like man, there's no way we're going to do that. We need that benefit, and so I think it's what you said before it's know it and scale it.

Jared Ward 10:24

So it's the confidence comes from actually having an exceptional product that you know you can plug into a big ecosystem like GoDaddy. A hundred percent, okay, um. Second thing so obviously you you went over some of the things that you learned um, mainly regarding partnerships and and and scaling um more of a transactional sell. When I hear your story, that is such a creative way to get more leads through the door. What advice would you give to other SaaS founders, ceos or salespeople on? I guess let me rephrase that question, on I guess let me rephrase that question what is, from your experience, what is the number one piece of advice that you think is missing in most SaaS companies?

David Dustin 11:13

go to market. Well, I think that the first part of that is just that every company is different, and identifying the mix of go to market that's going to be the right answer is different for every company, and so I think it's. I think it's helpful to just like compare every model that's out there, think about, think about if it like could this apply to our space? And one I think, like starting from square one, I would go to Google and look at every competitor that's in your space and look at everything that they're doing. Uh, I would benchmark off of everyone. And then I'd think about, like what are other spaces out there that are like semi-related? And I'd go look at how they're doing all their go to markets?

11:54

And I'd look at, like I'd try to see, first of all, like what's every way that everyone is going to go going to market and which one of those actually apply for us at our stage. Which ones can we do right now? I think that's like a way to get started on it. And then, ultimately, I think, the belief that if you're passionate about something, uh, if you care more about it than anyone else, you can find some way to do something better. Right, and so just having like that belief that if you spend passion and time on that idea and like when you wake up, it's like what comes to your mind when you're in the shower, so come to your mind. If you're in that kind of a mode, you're going to unlock those kinds of ideas.

Jared Ward 12:29

God, I think you you being the CEO of Ship Insure and your explosive year of growth yeah, a hundred percent was because of the experience that you've had in the past. What specific things did you apply to ShipInsure in this explosive year?

David Dustin 12:49

Yeah, what I would say is that, first of all, ShipInsure is really born out of experience that we've had, and first of all, a few years ago I got to run sales for Route from the beginning there and then build partnerships there, and after that I was recruited to Loop Returns, which is the leading returns app on Shopify.

Jared Ward 13:11

Is there some big names?

David Dustin 13:13

For Loop. It was honestly a humbling experience because I went there. They're a Series B company. They brought me in to run partnerships and they had built such an incredible product already and built deep integrations already and they had an incredible team that had great relationships with their customers and when I went there, 3% of their closed-run business was coming from partnerships. And the initiative that I took while we were there was to be a net giver out to partners and the core of that there's a lot of ways to drive value to partners, but the core of it is driving leads out to them and we made that a huge focus. We had support across the company to do that, uh, and as a result of that, we were able to drive revenue for partnerships up dramatically 20 months and once 21 months from when I got there, partnerships represented representing 60 of closed one.

14:03

Wow, and there's a lot of amazing people that were involved in the decisions that happened there.

14:09

Aaron Schwartz, who was the president, was a big believer in the net giver strategy. He gave us full focus on that and helped us do that and really, having had that experience and looking back on the shipping protection space, what we felt like is that the way the space had been done so far was platform-centric, and we believed that if we went and made the merchant the hero, focused on their needs, customized around the experience that they needed for themselves and for their customers and for what would impact their bottom line, we believed that that by itself would help us build deeper relationships. And then, secondly, we believe that by building deep integrations in the space that added real value and driving value out to those partners, that we could become the product that merchants love the most, because we're serving them and allowing them to have a seamless experience. And then, secondly, that on the partner side, we can create incredible relationships there and become the first company in our space to really become like a core part of the Shopify stack.

Jared Ward 15:13

How do you? By the way, I love this net giver attitude. It's something that I'm really learning a lot about as I'm trying to expand partnerships with them. But with this net giver strategy, how do you choose who you give to, um, how?

David Dustin 15:28

do? I can how?

Jared Ward 15:28

do you dictate okay, like this is the partnership we're going to go to like, for example, if I don't know, see, there's a ton of order management systems out there. How do you choose which one you're going to build an integration to and which one you're going to start sending needs to?

David Dustin 15:43

yeah, I think the the first decision is like which verticals are we going to build an integration to and which one you're going to start sending needs to? Yeah, I think the first decision is like which verticals are we going to focus into? And the very heart of that is the partners that you integrate directly into are number one. And so, for us, we integrated into Helpdesk, as we integrated a gorgeous. If a customer, if a merchant is using gorgeous, their service reps are able to see the status of a claim, file a claim right within that platform. It solves a huge crosstalk problem, and so the heart of that is that we are better together. We have a better together story, and so our integrated partners we have the strongest story with, and that's the number one place to focus is on integrated partners.

Jared Ward 16:20

But you, you wouldn't. You guys wouldn't choose one person in a specific vertical.

David Dustin 16:26

You'd integrate with all the best ones yeah, I think that you typically do that and then, like, we integrate right now into gorgeous zen desk, fresh desk. That said, we drive the vast majority of our leads out to gorgeous, and that decision, specifically, is that Gorgeous is a great partner to us as well and we believe in what they're doing. We believe in the product we have together and we work really well together. We help each other all the way through the process. We connect not just at the top of the like, at the top of the chain, down the chain account managers, sales reps we connect there.

17:02

And so, number one, like, we focus on places where we have, where we truly serve the merchant, and then we we only work with as many partners as we can deliver value out to, and so, in the agency space, for us right now, that means that we only choose a few agencies. We drive value out to those agencies. We don't go after a hundred right now because we can't drive value to a hundred agencies, and so we we try to match it to what we can actually handle and we're great with working with a small partner as long as they're very like, dedicated and working back and forth with us, and uh, and then we take the first step with partners to try to drive leads out to them. Number one we just give first.

Jared Ward 17:35

Yeah, give me, give me an example of this net giver philosophy. What's, what's a recent example of this philosophy and how it served your business?

David Dustin 17:43

Yeah, so I think that number one. We've done this with gorgeous and so we go out to trade shows with emergence of the boost. We have a lot of success with that and one of our reps, jason Kazarian, goes to a show as soon as we get our integration. He finds two or three merchants. I think he found three merchants in the first two weeks to refer to them just while we're out and about talking to merchants, and he makes three referrals out first.

Jared Ward 18:07

So just being intentional on like, okay, we're integrated with him. I'm going to show them we can drive value.

David Dustin 18:14

Yes, and for us, like we have a value prop together, like there's a reason for us to pitch this and we believe in being a giver and that belief is known across our entire company. We believe in being a giver and that belief is known across our entire company and, at the end of the day, we let our sales reps know that that's an expectation that they're driving leads out as well. One thing we did at Loop is that we started paying for every referral out and doing a competition every month on who could drive the most referrals out, and we do that at Loop as well. We have incentives, the partners offer incentives, and those are all things that we do to help us drive leads out. Okay, interesting.

Jared Ward 18:49

Yeah, honestly, whenever I hear this. I'm glad that you're sharing this message on the podcast because, as a founder of a tech company, your strategy is very creative and it resonates with me, because I'm not somebody who really has a background in partnerships and and um, talking about this. Like life, isn't this zero sum game where one person needs, like, you need to take all the leads to yourself. So it's really interesting that I think for most tech companies in e-commerce, enablement, um, we can adopt this philosophy and it'll probably serve all of us much better. We don't need to hoard all the leads and you know, only choose who we should give leads to. Like, everybody can be connected. Everybody can win here.

David Dustin 19:34

I think so a hundred percent. And if I was to describe like most of SaaS, what comes to mind is account-based marketing and most of the like. A lot of great SaaS companies have grown out account based marketing. We use account based marketing, but I think that a lot of times, the way that companies set up account based marketing and partnerships, it feels like they're opposed to each other. And what we believe is that if you build incredibly deep partnerships, you can actually use the account based marketing to further unlock those partnerships. You can actually use account-based marketing to further unlock those partnerships. And so when you start looking like down for the organization, you say, hey, this enterprise account manager is managing a book of business on our partner's side. How can we solve problems for their current customers that are mutual for us? How can we work together to like make them the hero to this customer of theirs?

Jared Ward 20:25

See, what, what, what really hits me as you're talking about this is it's all around the intention of leadership and it's very much a cultural thing, because I can tell how you've pushed that attitude down into the organization, where you're intentionally giving to these partners and it's set up to like it's not like guys, we're not just selling ship insure, like we're actually caring about the merchant's needs and we're seeing where we can align with our partners and help them out as well. But I, I would just say like, I, I, I I'm seeing like a really big difference between that attitude and then another type of attitude that exists in sass, kind of what you're talking about, where, where it's mainly account-based marketing and partnerships and them being totally separate. Honestly, even as you're sharing this, it pumps me up as the founder of Luminous to be like man. We could be doing so much more. We could have so much better intentions for our partners.

David Dustin 21:20

Yeah, I think for us it's a core value for us. Like, be a net giver's a core value for us. Like, be a net giver is a core value for us and, uh, it's a really powerful thing because we want to be a net giver to our customer. We also want to be a net giver to our partners and at the end of the day, like, the question gets asked like, if you're not giving, how do you make money? And uh, and what I would say is, like, number one, it's an attitude. And if, uh, if, if our people go into those calls and they know that we want to give out to partners, that that is like who we are they're going to feel emboldened to like, take steps to give. And when we reach out and give, like, like, we create a magnet.

21:55

And so I think it's important that we start by like, make the merchant the hero, give them value, drive value together. Like, let's have a better together story, let's do something together that creates even more value for the customer. And then let's give to the partner. And what we believe is, if we give to that partner and focus on the partners that we actually have better together stories with, we can develop an ecosystem there where we're all creating more value together and what that leads to is a bigger client base. Using integration leads to like a second integration with even more value. It leads to even more value for the customer, and so you end up driving additional value, additional lead flow, additional merchants and uh, we look at it as a as a growth lover uh, but really like is the best way to drive value to customers Interesting.

Jared Ward 22:44

At Luminous what we do is because on the ERP back in inventory space, it's a really complicated market. There's a lot of tools out there. There's a lot of point solutions very few that are like true ERP that can solve a lot of the needs of supply chain that you need in a supply chain and op system. The route that we go is we get on the phone of the prospect or merchant and where I think a lot of ERPs go is they try to. The main purpose of that phone call is for you to say my product is a good fit for you. Here's why, for us, we've definitely adopted the route of we listen to what their needs are and if we're not a good fit, then we're not a good fit.

23:35

I'll refer competitors to them. Like, there's so many times where I've gotten a phone call and I bet all of my competitors have been like why is Luminous? Like we've never talked to Luminous, like why are they sending us leads? Like I send leads to Katana, I send leads to Cogsy, I send leads to FlexPoint, like all of these competitors. And it's just because, like we've done our market research, we know where we're deficient or maybe not deficient, just like we're not really focusing on and it's all good, like if they're better fit. Like I, I don't want somebody on our system who we're not going to serve Um, so I think it's a big takeaway from this conversation is um we have, like the, we have this education and merchant first mentality, but there's no infrastructure for partnerships though.

David Dustin 24:24

Yeah, I think well, first of all, what I've seen from your team is just like a absolute relentlessness to solve like an incredibly hard challenge.

24:35

And you know, I I had a brand, uh, you know, mostly from 2014, 2020.

24:42

Uh, but we had like 3000 skus because we were selling kids products that have tons of sizes, and trying to switch an erp or change that kind of product is incredibly challenging, like we're talking about like life flattening to your business if you do it wrong, potentially, and your team's like relentlessness on solving that problem's been amazing and what I would look at is that as an erp, you're touching so many different solutions and you do have like, if they can work smoothly with you, that's a value prop to the customer, and so I think you have better to clear the stories like up and down your company and there's probably you probably key in and you're like you know what these three pls are great for us and for loop logistics became like our number one referral channel interesting, uh, and it started off as our lowest channel.

25:31

We found we could drive leads out to the three pills better than any other channel and since we were driving three leads to them incredibly well, we also got a leads back, a lot of leads back, got it this is a little bit of a side tangent, but, um, obviously you've been in e-commerce, enablement and uh, tech sales for a really long time.

Jared Ward 25:52

You just said that you, you ran your own brand for a long time. Um, and how did that help you gain more empathy for the merchant?

David Dustin 26:00

Yeah, I think that's what it like Empathy is the word because you know we the amount of challenge we had and like managing that number of SKUs of like rain boots and fishing waders and rain suits, all these products, that some of these products are like heavy products, and the shipping costs were a big part of our cost and the efficiency in that process was a really big deal. And so to me, when I talked to a merchant and like like we talk about damaged products or like returns, and I picture like the returns that were stacking up in my warehouse and I picture those scenarios like like it is a it's picture, those scenarios Like like it is a it's it's still like I can still feel the emotions of, like those scenarios.

26:47

Uh so it's massive, like understanding inside and out, like what are they actually doing on a daily basis? How does that feel to them? What does that look like to them? What are they going to expect out of us on how we perform to make their life easy and to actually solve a problem for them? Like, up and down, there's a huge amount of empathy. Yeah.

Jared Ward 27:00

It's. If you've ever been in e-commerce operations, you realize how many problems they're all to solve, which is why there's room for all of us in the e-commerce environment.

David Dustin 27:11

There's so many problems A hundred percent and I would say that, as a merchant like I think we all know this but like you're managing like 20 functions in a small business, it's absolutely wild and definitely Shopify creates a whole stack for you. But the more that we can be efficient, solve what we're supposed to do, maybe solve multiple problems for them, I think that's a big deal for merchants and I think that we're going to see a scenario where merchants are going to want us, as solution providers, to solve a scenario where merchants are going to want us, as solution providers, to solve a stack of problems together, and I think we're going to see more and more movement towards that.

Jared Ward 27:47

That's really interesting, I agree. I think you're uniquely positioned to answer this question. What advice would you give to merchants when picking out back-end solutions as they're scaling? Merchants when picking out backend solutions as they're scaling Because that's a big piece of this podcast. I always ask this question. We talk a lot about ERPs, but you've had experience as a brand and also a lot of different backend tech. What are some mistakes that you see merchants make?

David Dustin 28:18

Yeah, I would say that, whoever you're using some of these I'm sure this is like everyone's playbook. But number one, like if you're going to evaluate anything before you spend too much time, get right into doing test orders and see how this test orders flow, see if they do everything that you want them to do see how they affect every system that you're attached to and see how they affect your actual experience that you're delivering.

28:43

And I would say that, like you can have lots of discussions, but people can put lipstick on anything uh, get right into doing test orders and see if it really does solve problems for you and uh and work smoothly with everything that you're doing.

Jared Ward 28:56

Oh, I love it. That's great advice. Um, going back intoippensure for a little bit, now that we've gotten your background, we kind of understand what drives you. I understand your strength as a CEO. Tell us a little bit more about Shippensure. Why did it get started?

David Dustin 29:24

What motivates you to keep going with Sh and sure? Yeah, I think that, uh, ship and sure was completely born out of the belief that we could serve the merchant so much better in this scenario, and our belief was that that in the shipping protection space more so than maybe other any other space that a someone who really made the merchant the hero could. There was just such a large opportunity for it, there was so much need, and that was number one, like the belief that we could make it so much better. I also believe that shipping protection itself is a part of the stack that I would say is undervalued currently, and the way I would say it is that you've got like Gorgias as a help desk. They solve service issues. You've got returns platforms.

30:07

I think that the way that shipping protection has been done so far makes it seem like a smaller problem or a smaller solution than it actually is, and that if you go out and actually dig deeper into that partnership, you actually create a more custom solution, you create more value for merchants. So Dig deeper into that partnership, you actually create a more custom solution, you create more value for merchants. So it becomes like, I believe, that it becomes a core part of the stack that they have to have and that it bridges service issues and returns in a beautiful way and becomes like an incredibly core component, and so I believe the entire space becomes more valuable by doing it right.

Jared Ward 30:37

Where, specifically, is the industry of shipping protection or order protection missing the mark?

David Dustin 30:44

I think that number one it's been that the focus has been on the platform being like the hero, the platform solving the problem. And if you look at like how shopify is built or how loop returns built, the whole solution is on the merchant, creating their experience. And so I think that the shipping protection space has fundamentally missed that mark.

Jared Ward 31:06

Even subscription. It's like subscription platforms.

David Dustin 31:09

Yeah, so it's fundamentally platform experience or merchant experience. We're enabling the merchant to build their experience and they can deliver a beautiful experience to their customers, while also making the decisions that improve their bottom line, like that, are core to them. I like that a lot.

Jared Ward 31:27

Because I'm familiar with the space Meaning. Like I know, there's so many competitors.

31:35

Like it's mind-boggling how many order protection companies. So I was always curious like okay, like what are you actually doing differently? That makes total sense, because anybody who I've met in the space not everybody, but most people I've met in the order protection space it's very much described as like oh yeah, dude, it's, it's so easy, like you, just you turn it on and then like they make an extra million dollars to their bottom line and like it's like pretty easy to make money. And I'm just like that doesn't sound like revolutionary at all, like like it sounds like they should just shut the high. You know what I mean. So yeah, I think it makes sense. I understand what you're saying yeah.

David Dustin 32:11

For us, the way I would look at that scenario is we don't want a scenario where we're winning and the customer is not winning. We would consider that like negative. We want, we want to ensure that we're driving massive value out. And I think that when we talk to customers, I think they come into this, these conversations, some of them, like they're familiar with the space, thinking it's like a bidding scenario. And for us it's not a bidding scenario, it's. It's let's truly understand what your needs are. Let's build this for you. Let's go as deep as we need to to make this like something that you want to keep forever and let's keep modifying to make it better and better for you. And what I would say is like there's an amazing guy here in the Utah tech scene Matthew Holman.

Jared Ward 32:52

Yeah.

David Dustin 32:54

Subscription prescription. He, first of all. He is a great example of a net giver. We had our first conversation with him. We told him that we were going to do things differently. He's now been at a bunch of our events. He's also brought a lot of people to our events, but he's, you know, come back and said that every person he talks to in our company he's felt the difference like up and down, like five different events and uh and uh, I do think that, like, as we talk to merchants, it's a different scenario for them and once we get like under the hood of it, I love that.

Jared Ward 33:26

That's awesome. Um, talk to me a little bit about because now I understand what you're going after in this market. You want the merchant to be able to um, customize and build their checkout experience. What's on the roadmap, as much as you can talk about? What are you expanding this industry to? What else are you adding?

David Dustin 33:53

to the suite of products. So there's two things that are coming out this year, and the first one is, uh, something that will increase loyalty for the merchant and drive up the date of the next purchase, and, uh, that one's about five weeks out and we're really, really stoked about it. And then the second one is what we believe will be the first true enterprise product in this space and, uh, it's something that allows them to use our technology to build the experience they want and has a financial component to it for the merchant. That doesn't exist anywhere and if, like L'Oreal or Home Depot or anyone else is going to use this model, it's going to be what we're launching late this year on that side of it.

Jared Ward 34:44

Okay, well, that's super exciting.

David Dustin 34:45

Yeah, we're really stoked about those. The space is changing, shopify is changing. Shopify merchants have to work harder and harder to make sure they're efficient and they're making money. We are driving as fast as we can to put ourselves in the pole position as that space changes and put ourselves in a spot to delivery like just continue to drive even more value to the merchant Interesting.

Jared Ward 35:10

Um, let me see what time it is Okay, we're good One sec.

David Dustin 35:17

Take your time.

Jared Ward 35:22

In in this space, in the order protection, shipping insurance. By the way, is it shipping insurance?

David Dustin 35:30

I've heard things like you're not allowed to say that or something. No, you can say whatever you want. I think the problem to solve is order issues, and order issues is like bigger and more painful than than just like the original loss, damage and so on. That was being solved Like brands and customers fill it Like they know. The answer is like order issues are painful. The truth is that stack of problems are being solved like in a myriad of different ways and a lot of them are still painful and we're solving a lot of them today and like, as we continue to build, uh, we want the customer and the brand to actually like hey, there's one solution that actually solves that. That's what we're solving or issues.

Jared Ward 36:08

I really like how you frame that. It's this, it's order issues. We solve all of your order issues yeah, and I agree.

36:14

I think that's how you become the first enterprise, um, enterprise software in this vertical. You hey, we can solve all of your order issues and we can solve all of your order issues and we plug into all of your existing tech. That's really interesting. Why do you think? I'm going to inject my opinion here a little bit? So this is just my opinion. In my opinion, this space has attracted a lot of competitors who are a little bit less merchant focused and more um, let's call it what it is. Like this, this space, you can have insane cack to ltv like and the barrier to entry at least what, from my perspective, what I saw? Route lightning in a bottle, yep, exploded people. You can make money like that what?

37:10

and then a lot of people were like I could build that product in the sprint. So then they did that like and, and the product, what it created was you know 10, 15, 20, 30 competitors who same business models routes like click this button, it goes on, it increases your bottom line and we make a crap ton of money on the back end. Um, what, what do you think is the future of this space? Are a lot of those competitors going to slowly get weeded out and slowly get taken over by the more merchant centric focused or merchant focused competitors?

David Dustin 37:47

Yeah, I think that the, the answer is to give more and more and more to the merchant, to find out how to drive additional value and to anchor on, like, maxing the value out for the merchant, and uh, I think that's the absolute answer. And that value is received like monetarily. It's received in, uh, the actual ease of use for them, the actual experience it creates for their customers and the, the total stack that they're getting out of this scenario. And so I absolutely believe that the answer is to drive maximum value out and, ultimately, shipping protection is a part of the stack and I think the ultimate answer is that, in the long term, it's part of a broader stack and it'll need to be part of a stack to be a long-term solution. Cool.

Jared Ward 38:39

I really like that take. Let's go back to Route for a little bit Route lightning in a bottle yeah, Lightning in a bottle. What was it like just being a part of that?

David Dustin 38:50

Yeah, well, first of all, like Route was really interesting for me personally because I spent the five years prior to that out of tech and building a brand. And Route was like a true SaaSass scenario and we built like orange soda and boostability, but we did them a really different way. We did a, we did, we built those companies like with a very partner-centric approach and we drove a lot of warm leads. Uh, like I've done a lot of cold climb, but the teams that I built at orange soda and route were like mostly on warm and inbound. And so, first of all, for me personally, like building route was interesting.

39:27

I was the VP of cells and and uh, it was definitely like the model to go out and do a SAS play and so there was a lot for me to learn. And uh, I would say that like number one, like I worked with a lot of great people, learned a massive amount. We I was a VP of sales through that first year, okay, and uh, through the series a and afterwards, and you know, we got to the point where we had like 20 reps that were really, really successful during that time and uh, it was just incredibly, incredibly cool the first day that I heard about like. When I talked to them, I thought I was just going to go in to help a buddy brainstorm on go to market and it ended up being like a discussion where they're asking me to be the VP of sales.

40:12

It's not what I planned on and when they told me about the model, like to me it was like if merchants and customers want this, then it's unstoppable. Yeah, like that was my impression and very, very quickly, like we found out that both those things were true and what I would say is that we weren't able to do it the way that the merchants were asking for it, and I have a lot of love for the entire team at Route and I also, you know, had the chance to go to Loop and have a different experience there, and we've been able to go out and, you know, and execute on what we think customers were always asking for Interesting Well, and I guess we'll see how this plays out at Ship Insure.

Jared Ward 40:58

Yeah, because I truly think you guys are focusing on the needs of the customer. It'll be really interesting to see how your product expands Because, it's funny enough, it's actually a very untapped market, like the use cases are just so narrow, because I don't think they have the same vision as you guys. Awesome, awesome. First off, I need to. I think route, route sales created, created a bunch of sales reps with what's the word?

David Dustin 41:50

I'm not gonna, I'm not gonna pull you out of this one.

Jared Ward 41:52

I'm trying to think of a slogan here. It's like route Ruining sales reps' expectations since 2016. Yeah Right, so many route sales reps because there's a lot of route sales reps, because you guys were crushing it. It's like what's so funny is that you guys were so good, or at least like the SaaS product in the industry at that time was like lightning in a bottle. Any route sales reps that I've talked to or interviewed it's like what you mean? Like I can't just press the sequence button and people sign up and I get a fat check. Yeah, I mean that world has changed completely already.

David Dustin 42:32

Yeah, and I think honestly like there's a big shift going on across the board in all of SaaS and the model of like do a series A hire this many salespeople, do a series B hire this many salespeople, that model, I think, is also going away.

Jared Ward 42:51

Totally agree with you there.

David Dustin 42:53

And I think that I think sales have a massive role to play, but I think that, like organic referrals, partnerships and really like building a product that, like, has its own attraction and being able to build a community around that, I think those are going to be bigger elements of the future and being obsessed with providing value.

Jared Ward 43:23

Yeah, amen, yeah. I just feel like that's where so many companies sort of fizzle out. It's like, well, they stopped really caring about the merchant. At the end of the day, that's who we're building towards and that should never stop, no matter how big you get.

David Dustin 43:39

A hundred percent and I think that for us every day, it's just like what are we doing today that's going to make the merchant the hero. What integrations can we build? What problems can we solve? What are our customers asking for? How can we reimagine this to create even more value for the merchant? And as we talk to merchants and have that kind of perspective, I think there's a magnetism to it.

Jared Ward 44:02

Okay, and we have about nine minutes left.

David Dustin 44:06

Well, we've covered a lot yeah okay.

Jared Ward 44:20

so let's let's uh, let's just imagine, let's do imaginary scenario. Let's just say I'm a 50 million dollar year brand and I'm selling apparel. How can Ship Share help me? And let's say I have a 3PL. Maybe I have two 3PLs, I don't know.

David Dustin 44:35

Yeah, I think that number one like I love the scenario that you brought up that you're an apparel brand, and what I would say out of the gate is that we acknowledge that different brands get value from this in very different ways. Different brands get value from this in very different ways. And if you are an apparel brand or let's say that you're a wine merchant you're going to care about different items and so if you're a wine merchant, you know the repurchases, the refunds, the experience for your customers are an absolutely massive impact on your daily business, on your customer, on the bottom line. If you're an apparel merchant, all those items still matter but you don't have as many damages. It's just the reality. Like you might be, like man, yeah, we get that, but it's not that big of a deal. And so with an apparel merchant, uh, you dig in massively to understand, like, what is your current experience? What are you? What are you delivering right now? Understand, like, what is your current experience, what are you delivering right now? And, uh, you know we, we look at it and we say you know what? Like you have what portion of your customers are women? Uh, about 70% of women choose to protect the order when it's available.

45:41

There is an anxiety there, there is a nervousness that they have. How can we actually, like, make this problem easier for them? How can we ensure they have an incredibly smooth experience? Like, how do they like it when they like it when it's a damaged product? What is that like? How many touch points is that for you? What is the cost of that damaged product coming back to you? Uh, what if that customer just took a picture and click the button and that problem was solved? Like, how, how many more five-star reviews would you get? How would that matter to you?

46:10

And then, at the end of the day, for an apparel merchant, your bottom line is getting squeezed everywhere. What's the price that the customer would be thrilled with? Where you could still make a rev share? And let's customize that price to be the fit for you, let's make it valuable to you. And, by the way, like which, which help desk you use, use, gorgeous, perfect, we're integrated there, uh and uh. You know that would be a lot of a fear in apparel merchant and, to be candid, like apparel merchants, we work with apparel merchants that are getting the majority of their profit from our product. Um, we work with, you know, merchants in every category where that's the case. Some companies out there. They might be doing $40 million a year in revenue. They might be getting like their profits are getting squeezed. They might be getting half their actual profit from what we do. It's a big deal to them.

47:04

There's a like they probably can't afford not to have it be a top line item for them to share.

Jared Ward 47:09

I didn't even know that certain industries like this is a big part of profitability it's becoming, I think it's becoming a like.

David Dustin 47:17

If done right and if you're delivering massive value to the merchant, it becomes an essential part of the stack. Like you can't turn it off, if you turned it on, that's really interesting.

Jared Ward 47:26

I didn't know that and I didn't know it was that big of a deal.

David Dustin 47:29

It can be a big deal because I know of an apparel company. They're doing $40 million a year. Last year they did $1.3 million in profit and $1 million of it was from this product.

Jared Ward 47:47

My goodness.

David Dustin 47:48

Now that was a down year in profitability for them, but this product is very important to them.

Jared Ward 47:52

Wow.

David Dustin 47:55

I had no clue. Yeah, it can be a big deal.

Jared Ward 47:57

Okay, wow.

David Dustin 48:02

I don't know if we used that clip or not. I actually think that was a great clip, yeah.

Jared Ward 48:10

Yeah, okay, this will be my last question, unless you want to dive into anything else. So something I'm. You touched on something before. I'm also a believer that go-to-market for SaaS companies is fundamentally different. Go to market for SaaS companies is fundamentally different. I'm a big believer in founder-led content and company content. I think part of this organic strategy is promoting yourself and your team as individuals Like, no matter how quirky or weird they are like just like here's my team.

48:52

We're up to some cool shit, here's what we're doing. Um, and I think more than ever, especially as AI continues to emerge, people want to buy from people and we compete with a lot of robots in our space, meaning like you, like you know, there's there's no faces on the website.

49:13

It's like if I go to netsuitecom you know that with luminous it's like we're doing some cool, we're solving a relentless we're solving a problem that's really hard to solve and we're doing it relentlessly. Yeah, like, come, yep, come, look behind the curtain. Like we're doing some cool stuff. Um, it helps, it helps. Anyways, my whole point is I think that is going to be a fundamental part of go to market. You hit on something that, um, honestly, is like a big takeaway for me is this idea of scaling, the old way of scaling being like you get traction, then you do series a, b, c and it's just. It's literally just a formula of cactal tv with number of sales reps and aes. I agree, I think that's. That's broken, and the one part of the equation that I was missing, personally, was that I totally agree with you on is partnerships and ecosystem. Like you have to carve out your way, you have to carve out your space in the ecosystem. That is a big deal now, and that's my biggest takeaway from today's conversation where I'm lacking.

David Dustin 50:24

Well, and I would say, on the mirror of that, that, like the founder led growth and you being out there and your voice being out there and your company being out there, like I admire that about how Luminous approaches it, and I think, in your space specifically, that it's incredibly stark.

50:42

And, having been at Loop, we worked with a whole stack of ERPs and most of that is, you know, really, really painful interactions, and an ERP that you can actually connect with and work with and speak with and solve problems with and that like opens itself up to the ecosystem and operates that way, I think stands out in a huge way. And I would say that for me personally, like you know, being out, being out there, uh, being the public figure, like it's probably the least comfortable thing to me, but I do agree with you that it's like the right way to do it and something I want to embrace a lot more yeah, I honestly, just to give you some feedback from this conversation I think you have a um, you have a natural energy that this idea that we were talking about of just being a giver.

Jared Ward 51:35

I think you exude that energy and I feel it, like I really do, honestly, just from our interaction, like something was conveyed to me that wasn't before. So I would encourage you to put more content out there because, like that really helped me. That's awesome. I got a ton of value out of this conversation and it really showed me from your experience and how you've built things in the past, like where we're lacking and where we need to focus on. So very helpful.

David Dustin 52:04

I appreciate that. Yeah, I appreciate that.

Jared Ward 52:07

Yeah, anyways, guys, that's the episode. Like and subscribe Jared Ward , o ward ops unfiltered. See you guys later.