Building an SMB SaaS Business: Stitch Labs CEO Brandon Levey (Part 3)

Sramana Mitra: You guys moved back to San Francisco at that point?

Brandon Levey: I was already living in the city. Michelle flew out here. She moved to Berkeley with my sister. One of my favorite stories from that year was, Michelle had no money. She would hop over the bar terminal because she didn’t have money to pay for the bar ticket. One Thanksgiving of 2010, she completely ran out of money and didn’t realize it was Thanksgiving. She went to go shopping but she had just $10 in her account. So she ate rice cakes and mustard. It’s a nice example of the hardships of early days of entrepreneurship.

Sramana Mitra: When you went to that trade show, you saw that people were taking orders on pen and papers and reconciling with Excel spreadsheets. Talk to me about who these people were who you talked to get a sense of what that opportunity was.

Brandon Levey: Do you live in San Francisco?

Sramana Mitra: I have lived in San Francisco.

Brandon Levey: You know how there are these fairs in the city.

Sramana Mitra: Yes.

Brandon Levey: It’s that kind of stuff. Most of the people there are crafters. They’re very small businesses. Occasionally, there may be a store selling from other spot.

Sramana Mitra: What did you ask them and what did they tell you?

Brandon Levey: The number one question I remember asking them is how they manage their business. The overwhelming response that I got was a combination of labor, post-it notes, and Excel spreadsheets. The most common response I got was, “I’m not very good at Excel, but I had a friend build me an awesome Excel spreadsheet.” Some people would say QuickBooks. If you asked them how they were using QuickBooks, they’d say, “I use their invoice.” They weren’t really using QuickBooks. They just had their customer in there and were creating invoices for their customer.

Sramana Mitra: Where in that did you decide to do your product? QuickBooks is a very large product. It has a lot of penetration in the small business market.

Brandon Levey: Right, but it wasn’t doing the trick. I was also a QuickBooks user, so I knew the pains of trying to manage inventory and all the other components. At that time, I had several thousand shirts in my garage. I was using QuickBooks for invoicing, but I had multiple Excel spreadsheets keeping track of my different designs. I was using Gmail to keep track of my wholesale relationships. I had my own website.

Sramana Mitra: They have a plug-in for inventory control.

Brandon Levey: This was back in 2007 and 2008.

Sramana Mitra: That’s the problem you chose work on? Were you working in tandem with QuickBooks or did you re-invent the wheel all the way?

Brandon Levey: No, it’s very important to note that Stitch Labs wasn’t founded to be this massive business. It was truly just an itch that I needed to scratch. The original Stitch was built not to solve the problems that I was having, but we used the problems I was having as a representation of the bigger problem. All it did was allow for contact management and product management. We technically didn’t have an inventory component at that time. It was something that did all three of those at one spot. It was built for wholesale transactions for microbusinesses.

This segment is part 3 in the series : Building an SMB SaaS Business: Stitch Labs CEO Brandon Levey
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