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❌ Failed startup
✅ Successful startup

Delite: How and Why it Failed

Delite was a SaaS platform for B2B wholesale orders. It didn’t satisfy any necessity of customers. Just that thing in life you keep putting off.

United States
SaaS
Lack of Time
Not Practical

Patrick Walls

March 17, 2018

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Hello Pat! Who are you? What are you currently working on?

Hi, my name is Pat Walls and I am a Software Engineer living and working in New York City. Right now, I am working on Starter Story, a website where I interview entrepreneurs on how they got started, similar to Failory! 

In October 2016, two friends and I built Delite, a SaaS platform for B2B wholesale orders, which ultimately failed.

Why and how did you build Delite?

My roommate had the idea to build Delite in late October 2016. He owns his own business selling pet products and sells his products to hundreds of different retailers. The process of getting orders and invoicing all of those retailers was really time-consuming for his business.

He wanted the ability to send all of these businesses a secure web form where they could fill out their orders automatically without having to log in or anything. We called the company Delite and came up with the idea to create “delites”: customizable order forms that you could send to your customers.

I am a software engineer and he also knew how to code. We started building the product immediately. It took us about two months to build the MVP, which was basically the ability to create “delites” and send them to your customers, where they could fill out the orders and pay with a credit card.

We then spent about four months getting customers and adding features. We applied to Y Combinator and got to the video interview stage, but got rejected. We didn’t quit because of the YC rejection, but it was coincidentally the point where we evaluated the business and decided to shut it down.

 

Which marketing strategies did you use?

Once we finished the MVP, we thought it would be pretty easy to get people to start using the app. Turns out that was a lot harder than we thought. Our target customer was small to medium businesses, such as a small scale manufacturer that did most of their product sales in-house.

We started in the niche of pet products. We chose that niche because one of my co-founders was well connected in that industry, and a lot of businesses were not currently leveraging much technology. We built a list of potential customers based on anyone we could think of. We started cold calling/emailing these customers. Responses were pretty low, but we ended up acquiring a few customers. The sales process was long for each customer, including multiple emails, sales calls and live demos of the product.

We came up with some unique ways to get new customers. We went to a “health food” trade show in San Francisco and handed out personalized business cards, getting many leads and a few customers that way. We also found another trade show attendee list and email blasted everyone on the list, like 1000 people. We got a few customers that way too. 

In a couple months, we had acquired about 5-10 customers who were willing to try us out.

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How were you different and better than your competition?

To be honest, we didn’t really have any direct competition. The key feature of our product, ability to send wholesale order forms with no login, did not really exist at the time. Our target niche also typically didn’t have any technology they used for this process other than manual email.

You could compare us to some more enterprise solutions like Handshake and other wholesale management platforms, but our software was aimed at a smaller customer and had simpler features.

Which were the problems with Delite?

There were a few problems with Delite, in no particular order:

SCOPE

The scope of Delite was too big. The product was too ambitious. We tried to enter the world of B2B sales, which is a big market with a lot of complexity. One customer was looking for a possibly very different solution than another.

 

NOT PRACTICAL

Delite was a really cool product. It was a new way of doing B2B sales. Unfortunately, it did not really fit in how these companies work today. B2B sales are manual and personable. Salespeople are making sales over the phone, exchanging tons of emails, making special deals under the table, etc.

 

TIME

My co-founders didn’t have enough time to work on the business. We all had full-time jobs, so we were free to work on Delite on nights and weekends. That would have been fine, but all of our customers worked 9 to 5. So that means we had to jump on sales calls, answer emails, and do customer support while we were at our day jobs. I had to leave work almost every day and go to a coffee shop and take some sort of phone call. This was really stressful and it wasn’t possible for us to do that in the long term unless we quit our jobs.

 

NECESSITY

Delite was a “nice-to-have” for our customers. You know that thing in your life that you keep putting off, you know you need to do it, but it can wait? That was Delite for our customers. They knew they needed something like this in the future, but it’s something they are putting off to another day to implement because they were very busy.

 

REPLACING CORE PART OF THE BUSINESS

Sales and order management is core to our customers business. Using our product would change the way they operate in a lot of ways. It’s a lot of work to move to a new technology or learn how to use a new one.

 

TARGET NICHE

Our niche was not technology focused. We were selling to people that were bad with technology. Although that can be a huge benefit because it’s an open market of new customers, it also means they are really hesitant and need a lot of hand-holding. We had to have multiple sales calls and demos with each customer to convince them to use the product, and teaching them how to use the product was extremely time-consuming.

 

FEATURES

We did not have enough features, and we didn’t have any integrations with other software. A lot of customers want it to “just work” with Quickbooks, and about every other platform they have.

 

USAGE & RETENTION

Once we got users signed up and onboarded, we noticed that actual usage was low. They weren’t really using the product.

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If you had to start over, what would you do differently?

Building Delite was an amazing learning experience and I don’t regret anything. It was the most fun professional experience I’ve ever had.

But in a completely hypothetical situation, this is what I would do differently.

  • Find 5 or 10 customers willing to pay before building the product:

Get them interested and get their input on what they need. I would hack together prototypes as fast as possible using Typeform and do a lot of manual work behind the scenes.

  • We would have charged money for Delite from the beginning, and charged more than we “thought it was worth”:

We wanted to give away our product for free to our first customers. In B2B, a free product signals a bad product and you look desperate if you offer it for free. And if you think it’s worth $50/month, charge $100/month.

  • More cold calling and have a better marketing approach:

We were all over the place in our marketing, sometimes doing full days of cold calling and emailing, but never really following up multiple times and having a “real” sales process.

What's your advice for someone who is just starting?

First of all, if you have an idea, just try to build it. Sit down for a day and try to hack something together. You don’t have to know how to code to do that. You can use tools like Typeform and Webflow to build real applications.

If you’re reading this, you’re already doing it right. It probably means you are interested in entrepreneurship and starting your own business. Never before has it been easier to start your own app, brand, business, etc. You don’t need VC funding anymore to create a technology company. Sites like Failory, Hacker News, IndieHackers, Product Hunt, etc are creating a revolution in entrepreneurship and lifestyle. Just try to soak everything in and make sure you are always on the creating side of it.

Work on an idea that you are passionate about. I’m passionate about building apps and starting companies, but I wasn’t passionate about the idea behind Delite or the problems that Delite was solving. After our YC interview, I lost the motivation to keep working on it. I wonder if I would have kept going if I really believed in the idea.

Find something that can work for your schedule. Everyone has a different situation. For me, I have a full-time job so I now know that I should focus on something where I can move the needle on nights and weekends.

That’s why I started Starter Story. Not only am I passionate about entrepreneurship, but I can put in serious work on nights and weekends and get a lot done!

Which entrepreneur book would you recommend?

Traction: How Any Startup Can Achieve Explosive Customer Growth is awesome.

Where can we go to learn more?

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