How to Launch a Truly Disruptive Startup
Marcela Sapone, co-founder of Hello Alfred, is making good on this most-overused tech buzzword.
The term “disruptive” is so over-used in the tech world, we hesitate to even say it—but there’s no other way to describe what Hello Alfred is doing. In a world where you can have your apartment cleaned, groceries delivered and laundry done at the press of a button, Hello Alfred co-founders Marcela Sapone and Jessica Beck are going one step further by making all of these services, and more, automatic. They’re providing accessible, affordable hired home help to overworked young professionals—essentially, the butler you never imagined you'd have (and never thought you could afford), but so desperately need.
Marcela and Jessica’s team of Alfreds are vetted pros who take care of household chores and errands before you even have to think about doing them yourself, let alone having someone else do them, freeing up your time, energy and mental space. Not only is Hello Alfred’s product—affordable hired help that anticipates your needs— revolutionary, its business model is radical, too. Marcela and her co-founder made a decision in their company’s early days to hire W-2 employees; people who earn salaries and are eligible for benefits, as opposed to 1099 contract workers, who aren’t afforded the same rights. It’s a first in the on-demand space, and a rarity in the hired help industry as a whole. “We’ve essentially created a new class of jobs,” says Marcela.
Prospective investors and partners pushed back, saying that hiring W-2 workers would be more expensive and prevent Hello Alfred from scaling. Marcela points out in an op-ed for Quartz that, while it’s true that hiring 1099 contract workers costs less up front, it doesn’t pay off. Hiring contractors reduces a company’s cost and risk, but allows them no right to tell their employees when and how to do their jobs—not to mention the fact that employers aren’t obligated to pay contractors minimum wage or offer them benefits. Marcela and Jessica saw this set-up as a lose-lose, and set out to build their business differently, while still driving success and focusing on scalability.
In 2014, the year Hello Alfred officially launched, Marcela and Jessica won the prestigious TechCrunch San Francisco Disrupt startup competition and, to date, have raised $12.5 million in venture capital funding. They’re operating in three major cities (with more on the way) and will soon partner with a handful of New York City apartment buildings, where Hello Alfred will be a built-in building amenity. Marcela shared her advice on growing a truly disruptive company and sticking to your guns in the face of doubt.
1. Create the product you wish existed
I briefly worked as a consultant at McKinsey—my hours were long, and I had little time for anything else. Coming home after a long day to a messy apartment, wrinkled work clothes on the floor and an empty fridge wears on you. Jessica and I asked other busy professionals how they made it all work, and the near-unanimous answer was hired help. When we hired someone on Craigslist to take care of each of our our basic home-keeping chores, everyone in our building wanted to get in on it. It was the first iteration of Alfred. We started small and realized that there was actually a huge demand for accessible, affordable, automatic hired help.
2. Invest in your team
We hire talented, intuitive people—mostly stay-at-home moms who are looking to pick up work they can do on their own time—who can do the things you need to get done as well as you, if not better. When we made the decision to hire salaried W-2 employees, as opposed to 1099 contractors, we got a lot of pushback from potential partners and investors. It’s virtually unheard-of in the on-demand space (think: Uber, Lyft, Postmates). Hiring contractors is cheaper up-front. To grow organically, without lowering the quality of your services, you need to train people. With contract workers, you can’t do that. Having salaried employees communicates that our Alfreds are the core of our business. They take pleasure in their job, they’re compensated well and they’re proud to do high-quality work.
3. Launch in high-demand areas
In order to scale without sacrificing our employees’ salaries, we won’t enter a city or neighborhood that doesn’t have a high demand for our services. We could have gone the quick-growth route, hiring contract workers to fulfill orders in as many markets as possible, but that goes against our goal of providing the highest-quality services to our customers, and the highest-quality jobs to our employees.
4. Be patient in the face of pushback
We faced a lot of doubt from would-be investors about our business model. Things started to change for us when the California Labor Commission ruled that Uber drivers should be categorized as W-2 employees, not 1099 independent contractors, in June of 2015. From there, I wrote an article for Quartz about why our model was better not only for our employees, who earn good salaries and benefits, but also for us as a business. The piece was picked up by the courts, and I went to Washington to engage with lawmakers, urging them to consider making it easier for on-demand companies to hire W-2 employees. Then The New York Times featured us in an article about the relationship between tech and public policy. It gave us higher visibility, and people started seeing us and our business differently.
5. Let doubt make you more resilient
When you face doubt, that’s all the more reason to reinforce your convictions. Write down your overarching goal and come back to it every day; keep your company’s mission in mind with every decision you make. Ask yourself and people you trust why you’re getting pushback. Is there really something you could be doing differently? It forces you to make your case to others—and yourself—which will only strengthen your resolve.
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