Awaken* newsletter

June 27, 2024

SHARE:

If you’ve ever ordered boba, you’ve probably used Snackpass before. Snackpass is a fast-growing startup that operates a social food-ordering app alongside a suite of software and hardware solutions for restaurant operations.

Boasting a $400 million valuation, Snackpass is backed by a slew of the best investors around, including Craft Ventures, a16z, General Catalyst, First Round, and Y Combinator. I had the pleasure to sit down with Snackpass’s co-founder and CEO, Kevin Tan, to talk about his background and experiences.

JOURNEY TO BECOMING A FOUNDER

My first question was if Kevin did anything entrepreneurial before Snackpass:

I had multiple projects before SnackPass. As a kid, I shot a movie with friends and made a comic book to sell. In college, I picked up programming, which sparked my interest in technology startups. I started that in my sophomore year. I tried a few different projects or companies and started SnackPass in my senior year.

Back in college, Kevin actually majored in Physics, not Computer Science. I asked Kevin what made him decide to pursue software over a career in Physics, and also why he decided to start a company as opposed to joining a big tech company:

I actually initially started in the humanities. After a year of humanities, I went and moved into Physics and started programming at the same time. I chose software because I felt that things were a bit more fast-paced in the world of technology. Also, I didn’t feel that I was going to be a top 1% physicist–though I still really enjoy Physics. As far as pursuing a startup instead of big tech, I did actually apply to Google for an internship, but I didn’t get in. One of my favorite things about startups is that you don’t necessarily need to impress any gatekeepers who hold power over your next job, you can go make your own! That’s something that made me super excited about startups.

STORIES AND THOUGHTS ABOUT SNACKPASS

I remember sometimes to get to the restaurant owners, I would set up a meeting and then trek across campus in the cold and in two feet of snow only for the owner to say “Oh, I rescheduled”, yet I always followed up and went back to meet them.

Kevin Tan

In an article by Free Ventures about Snackpass, I read “In the beginning, they partnered with restaurants by going door to door to mom-and-pop shops and talking personally with the owners. They also posted a bunch of flyers around campus and created referral mechanisms on the app to get the word out.” I asked Kevin what that experience was like:

Back then, we didn’t have any funding. We got rejected from Yale’s incubator, let alone venture capital. But we were able to get pretty far because I was able to code and go door to door to bootstrap our first set of customers. I’ve always had a very determined attitude about things and am willing to brute force it if I have to. I remember sometimes to get to the restaurant owners, I would set up a meeting and then trek across campus in the cold and in two feet of snow only for the owner to say “Oh, I rescheduled”, yet I always followed up and went back to meet them. Obviously, there needs to be a more efficient way to do that, but if you’re trying to learn something very quickly. That’s one way to do it. 

Even to this day, we’ll go to new installs and try to embody the customer as much as possible. It’s very hectic behind the restaurant counter. To make a product like ours work, we have to get very deep into how the staff interacts with our tech and how they are receiving orders. Like, were the printers printing? Were they able to confirm the order or did it get missed? 

As Kevin hinted in his answer, Snackpass started at Yale, then expanded to other colleges, and is now expanding to all restaurants. I asked Kevin how he decided it was time to expand to new markets:

There’s this blog post from Marc Andreessen about how there are two phases of a startup. One is before product-market fit, where you should do everything to find it. The second is after product-market fit, where you should do everything you can to exploit it. I think you don’t want to scale anything up before you have really strong product-market fit and a repeatable engine for driving revenue or growth. You can have an amazing product, but if you can’t get it out efficiently, that’s going to be a problem. 

Whenever I think about the restaurant business, one of the first things that comes to mind is the pandemic. I asked Kevin how the pandemic affected Snackpass:

It was definitely a huge curveball. At the height of the pandemic, people were asking if college campus restaurants would stay in business. People went back home. We saw a big dip in our volume in the same way a lot of local marketplaces did. We used that time to ask how we were going to expand outside of college campuses. The pandemic motivated us to shift our whole business model. We shifted into focusing on building an operating system for these restaurants, and we’re still playing that out today. 

I asked Kevin how Snackpass’s go-to-market motion has evolved over the company’s lifetime:

In terms of target customers, we’ve grown from just SMB restaurants to having some multi-location mid-market brands using us. In terms of how we acquire new customers, we get some inbound by being a market leader. Having a brand name and social proof is very important. Other channels that have worked for us are referrals and social media such as Instagram and Tiktok.

In a previous conversation I had with Gusto’s cofounder, Eddie Kim, he talked about the idea of sometimes needing to turn down larger customers and contracts to remain focused on the target customer. I asked Kevin if he ever thought about this:

Yes, we’ve definitely had to turn down some large potential customers. As a rule of thumb, larger and more enterprise-y customers tend to have more requirements, move slower, and want integrations and things that are not standardizable. These are often one-offs so we don’t get as much leverage with what we’re building. 

Unless your strategy is enterprise-focused, you probably want to focus your angle of attack on one segment. There’s a good book called Crossing the Chasm. One point it makes is that the market you go after should be a single entity, one with a common set of characteristics and needs that you can address as a whole. We’ve definitely had to find our niche because there were customers asking all sorts of things. In the world of restaurants, especially, there are so many different varieties operation-wise, that you can get pulled in many different directions. Sometimes it’s tempting to chase revenue, but that can easily lead to a very overreaching product surface area. It’s better to have a narrower angle of attack, generally speaking.

A key differentiator of Snackpass compared to other food-ordering apps is the social components of the app. In Snackpass, you are able to gift points to a friend with each order you make. Once you accumulate enough points from someone, you hatch a mini digital chicken–sort of like a minigame. I asked Kevin for some cool or surprising ways he has seen people using these features:

Oh, there are tons. There’s a feed where you can see who’s sending gifts to whom. The idea behind the feature was to give users a social way to figure out what restaurants are interesting or popular, but we’ve heard some people use it to see who’s flirting with whom. It’s kind of a sneaky way to get a closer look at some people’s relationships. Another cool one is that we’ve heard many anecdotes of someone sending points to all their co-workers in an office and then they not only try out Snackpass but also try out the restaurant the person ordered it from. It’s a win-win.

BUILDING A TEAM

I’ve talked to many founders and culture is brought up time and time again as something that is extremely hard but important to get right. To kick things off, I asked Kevin how to fire people in a way that minimizes the negative effect on the wider team:

I believe this is something that I, and probably many others, can always improve upon. I strive to excel in this area, though I’m not sure if I’ve reached that point yet. Having clear expectations, like a Performance Improvement Plan (PIP) process, is crucial. This way, it’s not a surprise when someone is let go. If we fire someone,  even though they may not realize it yet, they’re better off being successful somewhere else than being unsuccessful here.  It’s painful at the moment to be rejected or to reject someone, but it’s a necessary step to ensure both sides are in a situation where they can thrive.

I also asked Kevin what Snackpass’s cultural tenets are, and what he does to implement those tenets in practice:

Our slogan is that we are humble and hungry. On the humble side, part of it is being easy to work with, which facilitates collaboration. It’s also about asking questions, acknowledging fallibility, and striving to prove yourself wrong. It’s about starting from a position where you just want to learn and get closer to the truth. Having an ego can blind you to the truth, I’m also guilty of this. Sometimes pride prevents you from admitting you’re wrong, even subconsciously. You have to put that aside to find the right answer. That’s the humility side. The hungry part, obviously, we’re a food company, but we also look for people who have a chip on their shoulder and are willing to work hard. There’s nothing more demotivating than having part of your team that’s really hard-working and driving towards success, and then having others who are indifferent about it. So we generally want a team that is really hungry, ambitious, and genuinely cares about the outcome.

Some founders say they want to be completely authentic with their team, sharing their concerns or fears. Others want to always project confidence to avoid worrying the team. I asked Kevin how he prefers to show up:

I tend to wear my emotions on my sleeve and I’m quite transparent. If I’m excited or annoyed about something, I’ll show it. My co-founder, on the other hand, is better at separating her outward expressions from her inner feelings. It’s just a stylistic thing. I’m quite transparent. My co-founder and I balance each other out in many ways, including our aptitudes, styles, and communication methods.

Being a founder comes with a lot of very low lows, so I asked Kevin how he copes with the lows:

I realized that being unhealthy doesn’t make you better at your job. So, I started going to the gym and running. I see time away from the computer as just as valuable. Sometimes, you might be working hard in the wrong direction. It’s better to pause and think for a moment. The concept of working smarter, not harder, is crucial in technology and startups. You can spend years going down the wrong path. It’s important to always be asking questions and self-correcting your direction. This doesn’t always require hours of grinding. Sometimes, it just takes a clear head. 

I asked Kevin if his reflection time always took the form of exercise, or if it was anything away from work:

It could be taking walks or reading. There are some really good books that provide frameworks that expand the problem space even further or help me view problems from a different perspective. I like to read a lot. I also like to exercise and play music. It’s just something that isn’t focusing on the immediate problems in front of me. Sometimes, you can think really hard about something, but once you talk it through with someone or test it, you get so much more information quickly. You get out of the narrow set of parameters you’re working with.

ASIAN AMERICAN TALK

Anecdotally, I’ve noticed that a lot of places that use Snackpass are Asian restaurants. I asked Kevin if this lined up with reality, or if it was all in my head:

No, it’s not just you. We’re at a lot of Boba shops, for example. Part of it is because we initially launched on college campuses and there’s a lot of Boba near colleges, especially at Berkeley. I think it’s one of the most dense Boba areas in the country. We started off with just mobile order and pickup, and that has evolved into self-serve kiosks and digitizing the experience without a human in the loop. This has been particularly popular with Asians, especially Boba shops. It’s an interesting question as to why. I think we’ve found that Asian owners and operators are very practical. They see that it saves them money and increases efficiency, so they adopt it.

Next, I asked Kevin to tell me about his Asian background, and how it has impacted his own life journey, especially as a founder:

I was brought up by Chinese parents. They came from China for grad school. My dad arrived with only $50 in his pocket. My mom worked a full-time job while also taking care of me. I also spent a lot of time with my grandparents since my parents were working full-time, so they were also hugely influential for me.

I grew up in Ohio, where there weren’t a lot of Asians, so I grew up with a deep-seated feeling of being different and being an outsider. As a child or a teenager, I wished to fit in more with the mainstream. At some point, I learned to embrace going against the mainstream and being different. To this day, all my heroes are people who are counterculture and really go against the grain. As a founder, having a strong STEM background is helpful and I thank my family for that. My grandfather taught me math several years ahead of what I learned in school. It’s cool to see Asian-American founders like Jensen Huang or Tony Xu rising to the top. If you look at top leadership, a huge amount of them are Asian American, so I’d say that there’s a good match between tech and our culture. But, there’s also a sense of a bamboo ceiling. It takes time to break through that. The more examples there are of successful Asian leaders, the less of a bias there will be.

You know, the recent popularity of Asian culture has been incredible. Take K-pop for example, it’s like the new Hollywood in Korea. I feel like the 20th century was a century of unspeakable suffering for a ton of Asian countries. Our parents, my dad grew up in the cultural revolution and his dad went through the worst century of humiliation. Now, in the 21st century, I feel like they suffered for us to really thrive. Maybe this is the century where you see Asians globally–not just producing semiconductors or T-shirts–but being the cultural center of the world. 

SHOUTOUTS

Leaning into the cultural aspect, Kevin wanted to shout out a few of his favorite Asian American artists, namely EDM artist ZHU and the 88rising crew, especially Joji, please go check them out!

Also, if you ever find yourself looking to order food, consider using Snackpass! They often have great discounts and you can earn loyalty points which can be used to redeem free items. You can download Snackpass on any of the major app stores.

 If you own a quick-serve restaurant, please check out Snackpass’s offerings at https://www.snackpass.co/. Snackpass’s platform is trusted by many mom-and-pop shops as well as brands such as Sharetea, Somi Somi, and Pokeworks.

Thank you for coming to the newsletter, Kevin!

Related Articles

Image Source: Forbes

Uncategorized

Korean Startup Dongnae Makes Apartment Hunting More Affordable And Accessible

Its key product, Dongnae FLEX, offers short-term, fully-furnished rentals with low deposits, appealing to fresh graduates or travelers unable to cough up the hefty deposits typically required of Korea’s apartments.

Former WeWork executives Insong Kim and Korean-American Matthew Shampine founded Dongnae in 2020. They are “Making it a better experience for the brokers, for the landlords, and especially for the tenants,”  Shampine said in an interview.

Dongnae has welcomed local and global investors. Its $21m series A funding round in March included Lyft and Doordash backer NFX, Airbnb backer MetaProp, and Korea’s oldest investment fund Daol Investment and Hana Financial.

More than 80% of Korean household wealth is in real estate, but it’s increasingly harder to become a homeowner. In Seoul, South Korea’s capital and most populated city, the average apartment price doubled between 2017 and 2021.

The startup company began as a listing platform for renters to book agency visits, but it was unsuccessful. Shampine believes the business model’s early failure generated “good and healthy” but painful reflections. According to Forbes, conversations with customers, brokers, and team members on the ground informed Dongnae’s goal of “becoming the supply, instead of hunting for the supply.” 

The firm switched to serviced apartments in July 2021. At the end of its current investment, the business had 60 apartment buildings; now it has 80 across 12 Seoul districts.

Dongnae wants to offer more home services to its residents in the future, taking advantage of Korea’s booming market for furniture and other lifestyle goods.

Image Source: gerryrobert.com

Uncategorized

Lush Enterprises CEO Kim-Manzolini Took Trading To The Next Level To Build Her Empire

Who wouldn’t want to engage in something that generates value? It took a while before you could achieve something like this. You had to be determined and keep going to get through the process. 

Think about how CEO Sun Yong Kim-Manzolini runs Lush Enterprises as an entrepreneur and, at the same, an investor. After working in the medical field for 33 years, she transitioned into entrepreneurship and trading options. She used her same can-do spirit and created opportunities.

All of her struggles, Kim-Manzolini told the USA Today, have helped to mold her into the woman she is today. She grew up as an orphan in Korea and was adopted by an American couple at 14. As an adult, she got into an unhealthy relationship but eventually got the courage to leave and move forward.

Kim-Manzolini knows that changing careers requires a great deal of hard work and self-control on her part. For years, she dedicated many hours per day to studying the ins and outs of the options trading industry and eventually mastered it. She simply had faith that she could pull it off, so she gave it her all without holding back.

Trading options expose investors to a diverse range of potentially significant risks. Even a single misfortune can completely wipe out a trader’s profits on the foreign exchange market due to the high risk associated with trading. But Kim-Manzolini did not let the challenges she faced discourage her, as she started gaining a new perspective on the situation. Instead of questioning why her experience was challenging, she adopted the mantra “Why not me?”

And as a result, she made $178,000 in her first year of live trading. Kim-Manzolini is now the owner of a multi-million dollar business. Her understanding of how to trade successfully was aided by the incredible commitment and sacrifice she made. 

The fact that Kim-Manzolini didn’t give up when it would have been simpler to do so is something for which she is grateful. She decided to focus on the positive aspects of the situation rather than ruminating on the potential downsides. She also put in a lot of time and energy and came up with a unique approach.

Image Source: Voyage LA

News

29-Year-Old Wedding Guitarist Made A Pandemic Pivot To Real Estate Earns $245K A Year

The best part is that playing weddings “doesn’t even feel like working. We’re just partying.” Moses Lin told CNBC Make It’s Millennial Money series.

Early in Lin’s career in 2016, he played at a coffee shop for three hours and got $3 tips. Today, his work takes him from New York to Hawaii, even to Cancun, and earns $175,000 before tips.

In the last two years, Lin has invested most of his wedding earnings into real estate.

Before becoming a real estate investor, Lin left college with just one semester left to pursue music full-time back in 2017. Several months later, Disney saw his YouTube videos and hired him to play in Disneyland’s hotels and restaurants. He took the job and decided he was never going back to college.

In the same year, Lin played a friend’s wedding as a favor and enjoyed it. He then charged $250 for his first wedding booking. After learning that wedding musician rates are $1200, he doubled his prices. Despite raising his rates, clients kept coming. Now, he charges $4,000 to $6,000 per wedding, depending on when the couple wants him to play. 

Lin became interested in real estate investing in 2014 and bought his first property in May 2020 as a “pandemic pivot” when Covid restrictions slowed his wedding gigs. He found a 4-bedroom house for $120,000 online and put down 20% plus $10,000 to renovate. His wedding earnings helped him buy a $40,000 home in Little Rock, including closing costs.

He rented the house for $1,425 and quickly found a tenant. He liked the process so much that he decided to buy a second property before the end of the year.

Today, Lin owns and rents out four properties in Little Rock. Lin didn’t turn a profit on his rental properties in 2021, but is in it for the long haul.

His goal with real estate is to get to a point where the passive income from his rentals pays all of his bills.

Lin pays a property manager to handle things on the ground, “so I’m able to focus 100% of my attention on weddings [and] on music, and real estate just makes money on the side.” he tells CNBC, “My whole master business plan is make money in weddings, dump it into real estate and let that grow itself.”

CONNECT WITH MOSES LIN

Instagram: instagram.com/moseslinmusic
Website: moseslinmusic.com

Image Source: kr-asia.com

Uncategorized

GGV Capital’s Jenny Lee: From Jet Engineer To One Of World’s Best Venture Capitalists

Recognized as one of the world’s top 100 venture capitalists by Forbes for 11 years in a row, Singaporean venture capitalist Jenny Lee stayed in her hometown to raise money for four new funds launched by her firm GGV Capital at the height of the pandemic in 2020. 

For four months, according to Forbes, the veteran VC barely slept as she made 250 zoom calls and remotely raised $2.5 billion from investors around the world. Lee and her team raised the most capital in GGV’s 22-year history, boosting assets by 27% to $9.2 billion. 

Long before she became one of Asia’s most powerful businesswomen, she earned a bachelor’s and master’s in Electrical Engineering at Cornell in 1995. She became an aviation engineer at Singapore’s ST Aerospace, where she modified F-16 fighter planes.

In 2001, the company sent Lee to attend Northwestern University’s Kellogg School of Management where she earned an M.B.A., but she had wanted to be a venture capitalist for a long time, so she quit her job that same year to follow her hidden passion.

Lee paid ST Aerospace $300,000 for not finishing the 11-year scholarship bond that paid for her bachelor’s, master’s, and M.B.A., but she has no regrets. For her, it was the best move.

She got her start as a venture capitalist at Morgan Stanley and Jafco Asia, but she made her name in China after joining GGV to create its office there in 2005. One of Lee’s more successful discoveries was the mobile phone maker Xiaomi before it had sold its first handphone.

Today, Lee is one of GGV’s top-tier managing partners along with Singaporean Jixun Foo, an early Grab investor. Hans Tung, who’s been on the Midas List 11 times. And VCs who have U.S. investment, industrial, and entrepreneurial expertise.

GGV’s 354 firms are balanced between Asia-Pacific and the Americas (GGV claims its investments include more than 85 unicorns). With the U.S. having more investments, at roughly 130, and 77 in China.

The company’s assets under management have expanded more than 50 times since its founding in 2000.