Go People founder Wayne Wang on raising millions, being adaptive and getting a helping hand from Amazon
Thursday, August 16, 2018/
It’s seen three iterations of its name, raised $5 million in capital, and weathered the storm of Amazon entering the Australian market. Sydney startup Go People has survived by adaptation, reacting constantly to an ever-shifting retail landscape and changes in customer demand, according to co-founder and chief executive Wayne Wang.
Born out of a desire to bring the sharing economy concept into the courier industry, Go People was launched by Wang and co-founder Sam Wang (not a relation) in 2014, as PPost. The name was later changed to People Post, before the founder finally settled on Go People in 2016.
Go People delivery drivers, or ‘runners’, provide on-demand courier services for both businesses and individuals, while the technology platform behind the service offers machine learning-enabled route guidance, and tracking for both the sender and recipient.
The startup now has 25 employees in its Chatswood office, and saw 300% revenue growth over 2017, a figure Wayne Wang puts down to additional demand coming from the entry of retail and delivery giant Amazon into the Australian market.
Earlier this year, Go People raised $3 million from unnamed investors, and Wang says that money has been directed primarily to research and development, and expansion of the startup’s product range.
“We’re feeling a lot of demand, continuously, from the market,” he says.
Competition is going to happen
Part of that customer demand has simply come from awareness, and Wang says he may be one of few that has benefitted from Amazon’s entry into Australia.
The global retail giant with a market cap of more than $US900 million ($1.24 trillion) launched in Australia in December 2017, quickly offering next-day delivery in major cities, despite market predictions that such speedy deliveries would take years to come into effect.
That said, when Amazon launched its Prime service in Australia in June this year, it was with free two-business-day delivery, rather than the same- or next-day delivery available in the rest of the world.
This may have been a troubling time for Australian retailers, and Amazon could have been considered competition for Wang, but actually he says the shakeup of the market has been helpful “in terms of educating the consumers and the retailers about how quick their deliveries can be”.
In the past, both retailers and consumers have been very used to a “laid back, three- to five-day delivery service,” he says. As a result, getting retailers on board with a faster delivery model has been challenging for Go People in the past.
“Retailers don’t think they need to change,” he says.
“We need to agitate them,” he adds. “This can be a whole new experience to your customers — a completely different level of service we can offer.”
Since Amazon has been on the scene, it has been “much easier for [Go People] to approach sellers”, Wang says.
“Local retailers need to realise the competition is going to happen,” he says.
“If, for some reason, they don’t want to play with Amazon, they have to come up with some equivalent service, if they want to survive.”
What the market wants
The approach Go People has taken in expanding its offerings has been to float the idea of a new service, based on perceived market needs, and then validate that service against the market.
Go People started out with its GoNow on-demand delivery service and GoSameday, which bundled multiple deliveries into one trip but still delivered within the day.
In the early days, Go People worked primarily with florists and food retailers, transporting flowers, cakes and doughnuts, which “require a strong point-to-point delivery services”.
But vendors looking for delivery of fashion or electronics items have different needs, as do larger companies with higher volumes of deliveries to make.
Wang says he realised the market Go People started with was too small.
“It would be difficult to survive if we just stuck with that service alone,” he says.
In 2017, following the startup’s R&D efforts, it launched GoShift, for larger clients, whereby Go People would supply a delivery driver on a shift basis, providing the same services, but for bulk deliveries. Now, Wang says this service accounts for about 70% of GoPeople’s total revenue.
Most recently, Go People has released GoShift Pro, a Software-as-a-Service platform for companies that have their own delivery drivers but want the software for managing, routing and tracking their deliveries.
The development of the additional products came from listening to customer feedback, which Go People is “constantly collecting”, Wang says.
“The first product we put up isn’t always the one the market wants,” he says. Work goes into refining everything, “to make sure it’s the right product we’re delivering,” he adds.
“That’s what entrepreneurship is all about — listening to the market, listening to the customers, making sure the service is right.”
If Wang has one piece of advice for aspiring startup founders, it’s to do as much market research as possible.
“Do more surveys of potential customers before making the product itself,” he says.
If founders can get a better understanding of the market as a whole, they can “avoid a lot of errors they are about to make”, he adds.
“A lot of time and energy can be saved just by asking a few questions.”
The danger is you can put a lot of money into building a new product, just to find that that’s not something the market needs, he says.
“To make a few phone calls first — that’s actually really efficient,” he adds.
“If you hear more positive feedback than ‘no-nos’, then you can do something about it.”
“We could have done better”
Today Go People is recording 11% month-on-month revenue growth, but Wong admits launching and growing the business was “not as easy as I thought when we started”.
Especially when the team was small, Wang and his co-founder were managing everything — from product development to marketing to capital raising — themselves.
“We had to keep going and stick with what we started,” Wang says.
“The courier industry needed to be improved. We knew it could be improved by the sharing economy concept … we focused and put our faith into it and continued taking in the challenges and making improvements.”
In particular, Wang recalls the startup’s first capital raise, when it secured $1.25 million in July 2016, as a tricky time.
The founders had their minimum viable product, but it wasn’t yet validated against the market, Wang says.
“Money was about to run out. We had to find investors to get up and running.”
New to the fundraising game, Wang says he was out of his comfort zone.
“I didn’t understand the process, business plans, how things could happen, how to speak to investors,” he says.
Go People had originally planned to raise $3 million in that first round, but ultimately opted out of a funding deal following due diligence. However, it bagged another $825,000 in investment just months later, and to date, has now raised more than $5 million.
Wang says he’s also faced challenges in keeping good clients on board, and has lost a few along the way. But more importantly, perhaps, he says he’s learnt how important it is to keep up good relationships with his investors.
“You don’t speak to your investors as much as you speak to your customers, and you don’t realise until one day they start asking questions,” he says.
In Wang’s case, Go People was working on a new product, but hadn’t explained what that product was, or why they were doing it.
“There were miscommunications,” he admits.
If you want investors to be supportive, you have to keep them updated, he says. Everything worked out in the end, he adds, “but we could have done better”.
It can be easy to feel deflated when things go wrong, Wang says, but “when you think about your achievements, they will motivate you”.
Such achievements include securing funding and being recognised by industry awards — Go People took home the Transport and Logistics Business of the Year award at the Optus mybusiness awards 2017, and was awarded a merit certificate at the 2018 iAwards in New South Wales in June this year.
But it’s also about celebrating the smaller, everyday wins, Wang says.
“Staff here share their joy whenever a customer posts a good comment on Facebook or Google — they’re the best moments, when we know we’re doing something right,” he says.
“And there are a lot of those moments.”
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