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show, I remember our CTO, calling me and saying, look, if this continues, we won't be able to sustain ourselves. Our website won't be up and running in a matter of days. This was an insurmountable challenge. That we faced when we were entering covid, we saw that the demand for
Our service was first growing a 10% week or week, which at our scale was very significant and very quickly, we realized that it wasn't just that it was growing at 10% day over day. The only thing that's going to matter for us is how we respond to this crisis. We had a choice to make.
That's a poor of a meta founder and CEO of instacart. He saw a future of tech enabled, supermarkets years ahead of others. And with covid-19 lockdowns instacart became an essential Service as online grocery and delivery demand boomed. I'm Bob, safian, former editor, Fast Company founder of the flux group and host of Masters of scale rapid response. I wanted to talk to a pour-over because a year after an extraordinary and stressful period of adjustment and growth.
Art faces yet. Another Crucible moment with vaccinations. Proliferating in the u.s. many are hopeful that in store, buying will revive a porpoise bet, is that the advantages of digital access to groceries will retain and extend their appeal, well, beyond the pandemic, for his own model to shine in a post lockdown World. He'll also have to outpace a slew of competitors including Behemoth Amazon,
We'll start the show in a moment after a word from our exclusive brand partner. Capital One business
We had the store that data structure was from the 1880s. This is like old wood floors. We're in this open-air
markets and these stores were lined up and there was the fruit guy and the meat guy
that's Jeff Braverman CEO of nuts.com and that open-air market was home to his grandfather's not business founded in 1929. But when Jeff was just four or five, the store got bulldozed, he moved into like the skin dorm wall as a kid. I would work the cash register. We actually had a roaster. So we would be
Freshly roasted peanuts,
three generations,
roasted peanuts in that shop until the dawn of the internet era, gave the youngest one. An idea I've said to
my data model, hey, maybe we can sell
knots online, that pivot to online sales, turned out to be a Lifeline because wait for it, their store got bulldozed again in the early 2000s. How did Jeff and his family faced these moments of fundamental change? They just kept innovating in an Cave of Capital. One business sees this all the time with the entrepreneur, she
works with the open-air market that generation. It has ended the retail Market. Maybe that era has ended great entrepreneurs and business owners know how to react to change and that's one of the reasons they can see possibilities when others may see closed doors. What is The Nut Shop 3.0 look like today? We'll find out later in the show. It's all part of Capital One, businesses look at entrepreneurs who are persevering with courage and innovation.
I'm Bob safian and I'm here with apoorva meta, CEO of instacart, poor is joining us from his home in California. As I ask my questions from my home in New York forever. Thanks for joining us.
Thank you for having me Bob.
So, last year at this time, you are in the midst of a frenzy or remaking instacart on the fly. As covid. Demand was surging added, 300,000 Shoppers five years of growth in five weeks.
It's a year later. How are things now? Are you? Is it Comer? It's been an exciting year for us.
The company experienced exponential growth in such a short amount of time that everyone in the company had to respond to that in a way that we've never done before. And so what we are seeing now is that the company has a new resting heart rate. Everyone is more focused, everyone's more cohesive and so we are seeing that the company is performing at a much better place than
We've ever seen before.
So, like a different kind of metabolism sort of
set in, I think that this was sort of an insurmountable challenge that we faced? When we were entering covid, we saw that the demand for our service was first growing at 10% week, or week, which was at our scale was very significant and very quickly. We realized that it wasn't just that it was growing at 10% day over day. And I remember our CTO, calling me and saying, look, if this continues, we won't be able to sustain
Ourselves. Our website won't be up and running in a matter of days. And so the way the team had to respond to a challenge like that really brought everyone much more closer together, it sort of gave us the confidence that we can take on bigger challenges.
Yeah. I mean, it was a moment of extreme need on the parts of customers. It was also a moment of extreme opportunity for you at the same time. Like if you grow too fast that can create its own problems.
Are there lessons when you look back about managing that balance, that
trade-off the way we thought about this Bob was that we had a choice to make which was to continue down the sort of exciting roadmap or to completely sidetracked that and say the only thing that's going to matter for us is how we respond to this crisis. And having that maniacal focus on this. One singular thing was critical for us so that we were able to navigate the ups and downs of the pandemic. And so, the key lesson to me,
It was at what point do you declare that with the whole company? So, there's a lot of clarity that emerges in the teams and they're able to do a much better job of coming together, much faster. And so, we recognize that at the beginning of February, but I don't think we'd recognize how significant of a change. This was going to be
mmm. We've had guests on the show from Airlines and hotels and movie theaters that saw their business has dropped by 80 or 90 percent. And now, their struggle is figuring out how
how to ramp back up, right? And others have had booming, pandemic, demand, and are now trying to calibrate whether to ease back on the throttle as things reopen. And, you know, maybe habits are going to shift again. How do you think about this for instacart for your business?
Now, if you step back, there's about a trillion dollars worth of groceries that are bought every single year. People eat 21 meals a week, most of those meals come from grocery stores and despite the fact that such a large industry, it's very
Plea under penetrator from my online perspective, most people still buy their groceries offline. You know over the last few years, what we have seen is that online, adoption of grocery shopping is growing and what we saw over the last year is this massive acceleration of this adoption. And what we're seeing now is that this has been sort of a permanent change in the way they are shopping for their daily needs and increasingly we're seeing that people are not just shopping for their groceries but they're also shopping for their pet food.
And cosmetics online customers were primarily, young professionals were using instacart before. But now we're seeing people who would be less of early adopters of services like this. Over the last year we have onboard at 300,000 seniors at his own to the Instagram platform. They're now able to use instacart because it is much more accessible and we've built products specifically and that helped them Place orders on Insta card. And so we're seeing there's been no sort of a sea change in the adoption.
Online grocery shopping.
So I want to unpack all those things that you just touched on. So you're a grocery business. But your broader than a grocery business? Yeah. And I guess the other part that I was listening, there is a lot of consumers, think of you as a delivery business, like, you know, about the people and it sounds like your business is as much about the software that's happening on the backend, as about the people that might be showing up with the delivery. Am I understanding that, right?
That's correct. The reality is instacart Sir.
Of a four-sided Marketplace. Most people think of us as a customer app and of course we are a consumer product millions of customers rely on us for their daily needs. But their groceries or whether they're shopping from or retailers like Sephora, Best Buy Staples and many, many others but that's just the one side of the market place behind the scenes, we have Shoppers. These are the people who pick and deliver the groceries, we have hundreds of thousands of people across North America, who are able to earn an income on a flexible baby.
So, through the instacart platform, we have also retailers, folks like Costco Wegmans, Publix Albertsons and many, many others who use Instagram platform to come online to bring their local brick, and mortar stores online and deliver to their customers. And they do that via the instacart app, the instacart marketplace, but they are also able to do that through their own websites. Today instacart Powers, hundreds of retailers, websites and apps. And in the fourth side of the marketplace is our ads business.
Honest folks, like Coca-Cola PNG Unilever in hundreds of other brands, use instacart to reach customers and engage with them on the Instagram platform as well. And so when we talk about instacart or talking about all of those things and even though from a customer standpoint, of course, they think about the instacart a bit on its own.
And so if I go to Costco's website, instacart is behind that website as opposed to Costco being behind it. And if there's promotion that I'm seeing
Products at Costco that that maybe being delivered through instacart as well.
That's right. So if you go to the Costco, same day. Website, that is powered by instacart and many other retailers out, there are using the instacart Technologies to power, not only the delivery side of their business, not only their pickups out of the business, but also their front end as well. So, if you go to a retailer like Wegmans.com, you'll find recipes and Deals and you'll find their stories about their brand, in addition to, of course, being
Able to shop and get those items delivered. All of that is enabled by instacart and this is a core part of our business is to lift up the retailers in the markets that we serve and enabled them to compete with the Amazons and the other Tech players in the world.
So it's not necessarily that the instacart brand has to be the central Marketplace for where this happens. The way Amazon sets itself up as being the central Marketplace, we
believe that the way we win is
By providing customers, the largest selection, and by ensuring that retailers are able to thrive online as well as offline. I'll give you an example, a retailer like by right in San Francisco. Is a cult favorite retailer, and I know Sam was a founder of that retailer personally, and I love that store. And then the products that they have now as a result of instacart and they are able to reach customers online and build their brand online and especially over the last year. Or so they've been able to navigate the pandemic in a
A much better way as a result of the support that our teams have been able to provide them.
And so the trends the possibilities that you saw before 2020, which is that more people are going to engage in Commerce this way. And more businesses are going to want to have this capability that that goes from whatever. I don't know. Three percent of the business to 10 or 12 or whatever it doubles or quadruples over the course of the year. Now you're at a place. Do you feel like how far along are
You I guess on this transition like how much further can it go?
That's a great question. The way we think about this is that over the next 1020 years. People are going to want things to be more convenient, right? People are going to want more selection, people going to want better prices and instacart will, we want to do is become sort of the essential infrastructure, that enables that to happen anywhere in that journey to make that happen. And of course, covid-19 was obviously a big accelerant in that, in many ways, the way I think about this is that, with SARS
Did for Ali Baba, how that was it? Such Catalyst for online adoption, for e-commerce in China we witness that happening in United States as well. We'll be back in a moment
after a word from our exclusive partner Capital, One
business.
We've been in Christmas season since
March of 2020
because every day was Christmas with the volume. We were facing, we're back with Jeff Braverman of nuts.com. And since the start of the pandemic, their e-commerce business has been booming. Keeping up with demand meant hiring, hundreds of new workers to prepare and hand pack things like white chocolate cashews without
roasted cashews toffee,
glaze them and then cover them with white chocolate. You can't just do that. The day before the order comes in
In Jeff quickly, hired workers to roast glaze and ship those nuts. But as he scaled, he learned that hiring wasn't enough. We have our production side of the river, filling all the bags, and that's where most of our labor is. Our two leads were out, if the leads aren't trained up while enough it requires me to be
on the floor. So we didn't have the right levels of
management. We know the right training we've had employees for such a long time, but you need to be able to elevate them properly. Give them the tool kit. It's a classic challenge.
Spy entrepreneurs. Coming out of the pandemic during the crisis leader, stepped onto the floor. But at some point Jeff says you have to step back, you need structure and you need process as you scale. Because otherwise you get into trouble
building structure to
elevate their teams. That's a challenge Capital One, businesses and Cave sees, and so many entrepreneurs, who scaled with unexpected speed,
there's a moment where they need to empower their teams as they start to think about innovating for the
future. How do we scale?
Our operations, our systems for this new normal Jeff knows he's got to focus on the big picture. Can he learn to share the rains will find out later in the show? It's all part of Capital One, businesses Spotlight on entrepreneurs who are persevering with grit and determination.
So you get this boom and demand. Last spraying your got a race to make sure that the site doesn't go down and all the core functionality. Works at the same time. I guess they're probably new parts of the product or new products that you wanted to roll out. Maybe that we're on the road map, maybe they got shifted. How over the course of the last year, did you decide which products should be rolled out?
Well, and instacart, we believe in extreme Focus during the pandemic. There are certain features
Here's that we thought were going to be absolutely critical for us to be a safe and reliable service. And so we launched features such as making sure that our Shoppers were getting safety checks every single day for our customers. We launched features that allowed them to get deliveries during a time when the demand outpaced the amount of Supply that we had by like five to one. And so we launched delivery options that allowed for us to batch orders, much more efficiently. We launched features like the senior support.
Outline because we knew that many seniors were having difficulty with accessibility on our product. And so we wanted to make sure that if in the event that they needed any support, they could call us, and we were going to be there for them. This was all under the umbrella of being a safe and reliable service during the pandemic, so that Clarity of focus was absolutely required for us to prioritize features like that over others, that may have been considered.
So you didn't have the same kind of support line. Say, for seniors who aren't necessarily Manning phone lines to get
June's beforehand. But now you're like oh that's something we need to meet this demand or this need right
now.
So Bob what we saw was that we were getting emails from customers saying that, the only reason they've been able to make sure that their parents pantries. And fridges are stocked is because of instacart. And so, it became very clear to us, that this was something that was such an important need. And as a result, the pandemic, there was this big unlock and like this demographic of the customer base that we needed to create products, specifically for seniors. And, of course, we have now continue to learn from that we've increased accessibility
Our product. We've also learned that a large population in the United States shop for groceries using food stamps. And so we've launched a EBT SNAP which is a food stamp program. And so it's sort of like when you grow so fast. There is of course, there's a lot that you learn in terms of scaling but you also learn more about your customers. What are the problems that they're running into? How can you solve them and being available and accessible for seniors being available and accessible for people on food stamps are few of the learnings that we were able to get
you.
And your Shoppers. I know you provided PPE. There's a vaccine stipend for them getting vaccinated. Meanwhile the environment for contract workers overall has kind of been in flux. Uber most prominently trying to adjust to an employee benefits relationship. How much is the instacart platform about people and its growth is about, like, increasing the volume of people of Shoppers versus about software.
We have millions of customers and
Thousands of Shoppers and anytime when you have such large numbers of people, the only way you're able to scale and solve problems for so many people inevitably becomes a software problem at the same time, we have to recognize that these are individuals for whom instacart is a source of their income. In many cases, they are able to pay a rent as a result of instacart. And so there's a huge responsibility that instacart has to those people. And so, we think, of course, is a software problem, of course, is the data
Problem. But, we have to be very principled about this and be very compassionate about this. Because these are individuals who rely on instacart or overall platform is growing so incredibly fast even post a pandemic that we think there's going to be so many more opportunities for people. Over the next few years, whether it's on picking from retail stores, picking from dark stores and taking from automated warehouses. And of course, the overall delivery business that we think there is going to create many more
opportunities,
You ended up bunch of executive talent in recent months scaling up, the corporate team from Airbnb and Google and Facebook and Amazon and so on. Why was that a priority?
The reality, is that the team that you built is the company that you build. I personally focus a lot of my time and energy on recruiting and developing the talent from within. I just think that's probably the most important thing that a leader can do that allows you to scale and so we brought in some wonderful Talent recently.
The reality is that our Ambitions continue to grow in order to be able to have a shot at achieving. Those Ambitions, we are going to want to build my better and better team. Your
business kind of straddles, both consumer and Enterprise areas, what's similar? And what's different about serving consumer business versus an Enterprise
business. We find that the time scales are very different for customers, for example, we're building new features and shipping them on a daily basis.
For Enterprise customers, the road maps are very long, there's a one-year two-year planning process. What we try to do is get the best of both worlds, and try to make sure that our customers are able to get the benefit of all the learnings that are retailers, have from the Decades of their experience and our retailers are also able to benefit from the fact that our team's learn on a daily basis, based on how customers are behaving, and we can bring that to our Enterprise side of the business as well.
I have to ask
Back Amazon, how do you win against Amazon? Like, are you trying to compete with them? Are they trying to compete with you?
But I believe that in the long term, the companies that create the most value for the customers win and you can see that with, of course, the work that Amazon has done. Of course, the work that companies like Costco and Walmart and many others have done. They have created such enduring Brands because of the value that they've created,
ETA for the customers and for us in our industry that comes from three main sources. It comes from having customers have access to the best selection. It means the customers have the best prices and it means that customers have the best convenience and we believe these are areas that are going to be enduring troops. And so, when we think about competition, when we think about, you know, what we want to do on our own, we think about the world in those three dimensions and
We believe that we have very strong advantages compared to other companies. We can have an incredible offering for customers because of the enormous selection that retailers like Costco like Wegmans like Publix like Kroger and many many others provide to the customers and we believe that is a better way to create value for customers. Then to sort of own this vertically integrated way in the way that in the perhaps, you know, other companies such as Amazon might be pursuing this
This we believe that gives customers a better selection. We believe that it allows for retailers to have an even playing field and we believe that there are more convenience and price advantages that we have as a result of that as well.
And it doesn't necessarily have to be a zero-sum game. As long as you're providing value to your customers, other people can provide value in other ways and that's not necessarily an
impediment, of course. So look, like I started this company because I believe that the smartphone could be the
I could have the future. I believe that this could create an incredible experience for customers when I was starting the company. Nothing like that existed, and I'm so excited that there is this whole economy that is started. There's this whole ecosystem of companies that has now emerged to help customers with this, and I'm so happy that instacart is playing a part in that. But we've seen companies emerge everywhere in the world that are trying to pursue the same vision that we have. And I think this is going to be a really exciting for the customers and over the next 20-30.
Thirty years. We're going to see so much innovation in this and I'm thrilled by that
listening to your enthusiasm excitement. I'm just curious the past year, has it been a stressful year, has it been a euphoric ear? Like how do you look back and describe? What you've and the company have gone through over the last 12
months. But I thought that the last year was a crucible moment for instacart where I think 20 years from now. When we look back at this time, we're going to think about
Covid instacart
in post covid instacart. These are two very different companies that do very different. Trajectories two, very different teams and I think that, of course, it was incredibly stressful, right? How could I not be? But at the same time was incredibly meaningful, we would get pictures from customers sent to us over emails where they would have on the front entrance of their door and say thank you instacart for keeping us safe. That galvanized, the team that motivate the team, they gave us a sense of purpose that kept us moving forward, even through.
Some of the most stressful times that I can think of in my entire life. So it was absolutely stressful, but at the same time was incredibly meaningful. I'm incredibly proud of the way that the team stepped up during this
time, how different will instacart. Look a year from now, from the way it looks today. I mean, it looks very different today than it did a year
ago. One of the things that I've noticed about instacart is that it is a different company, every six months. And at the same time, there's things that are going to stay the same. There are sort of a
Values that we deeply care about that. We want to make sure that there are consistent among our teams. But also consistent over time the value that I personally think about a lot is solving for the customer. I believe that the most enduring companies win because they are solving for the customer and it is very easy to get sidetracked from that and that is going to be something that we will try to keep constant. Despite all the changes that we're going to be witnessing.
Great. Well, thank you so much again for doing this for, right. I really appreciate it. Thank you, Bob.
and now a final word from our exclusive brand partner, Capital One business
We build a tremendous team in the plant and now it's like, we want to play ball. We're back one more time with Jeff Braverman of nuts.com. He's been telling us how elevating his team will improve operations as his business scales but he's also hiring at the senior management level and that's going to mean, letting go of some control to do what I want to do. I've made some strides
recently. It's not about me. It's about the team because I can't do the work of 50 people
anymore. What I'm
come on. I was hiring hiring the right people to frankly, make it more fun people,
who are openly smarter than I am. We have tons of ideas.
The key thing that we need to latch onto his now execution, sharing, the rains can be scary when you've got a family business and Jeff would like to keep it in the family. I'll get a contact by investors all the time, but it puts you on a path where you maybe lose optionality. I like the idea of keeping this independent. My son's will there be a
place for them? I would be nice. I think family business is a nice thing.
Nuts.com is come a long way.
From that stall in an open-air Market in Newark. New Jersey
in a dream a few nights
ago about being this little kid in the store. Gave me like the chills it was like so humbling. Oh my god. Look, what we've done. Look what we built and I think my grandfather would be really proud whether you're running a third-generation business, or a brand new startup building. A business that will endure is both a challenge and an opportunity. That's what an cave here is from the entrepreneurs. She works with at Capital, One to know what, Jeff's grandfather.
It created lives on and his grandson. It gives you Goosebumps. Well you may not always hear that it's going to be passed on to a Next Generation. You do here, how do we nurture this baby? Almost that is a business and how do you keep it continuing to evolve, stay relevant and create an impact for the future? I think that's the commonality
capital and business is proud to celebrate business owners as they innovate to unlock the next chapter of their success.
As with every ad on Masters of scale, the entrepreneur you just heard from was real and unscripted because Capital One is a financial institution. It's important to them to be transparent about the relationship with the business owners. We interview Capital, One did compensate this entrepreneur for participating in this campaign
masterda scale rapid response is a wait, what? Original the show is recorded remotely using sanitized audio gear. I'm your rapid response host Bob safian hose for masters of scale.
Is Reid Hoffman. Our executive producers are June Cohen and Darren trip. Are supervising producer is Jay. Punjabi? Our producers are Jordan, McLeod, Christina Gonzalez and Marie McCoy Thompson. Our music director is Ryan holiday original music, and sound design by Daniel nissenbaum. And the holiday Brothers, audio editing by Keith. Jay Nelson, Steven Davies, and Andrew null mixing and mastering by parent Bass tonelli.
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