Building Significant Revenue with Inbound Marketing from Israel: Pepperi CEO Ofer Yourvexel (Part 2)

Sramana Mitra: Before we get into the new venture story, you mentioned that you ran two startups while you were in the US. Were they companies that you founded or recruited to run? How did those come about? It sounds like that’s where you got some of your entrepreneurial experience as well.

Ofer Yourvexel: The first one was an engineering company in the semiconductor industry. I was very young. It was a well-established engineering company in Israel. I was the first VP there. It was not a startup. It was more of an engineering company. Enigma was a startup. I basically knew some of the founders. It was more of a relationship. One of the founders who right now lives in New York has a Ph.D. from MIT. He’s a very good friend of mine from school. He offered me to manage the US operations, but I wasn’t one of the founders in that startup.

Sramana Mitra: But you had a bit of an experience of being in a small company?

Ofer Yourvexel: Yes.

Sramana Mitra: That brings us to about early 2000 timeframe? When you quiteAmdocs, what year was it?

Ofer Yourvexel: It was at the end of 2009.

Sramana Mitra: What did you do next?

Ofer Yourvexel: Since then, it’s been Pepperi.

Sramana Mitra: Tell me a bit more about the genesis of Pepperi.

Ofer Yourvexel: Pepperi was called WRNTY then. It’s a bit of strange story. It was a startup already for three years. It sold nothing, but the idea was great – to have warranties in the cloud to simplify the supply chain. The reason it was funny is because there was two major investors and they were searching for someone to make it a company because for three years, they couldn’t put together a product. The founder found me. The investors got the recommendation from two different people. One of them is currently working for me now.

They approached me and asked whether I’m interested or not. I decided that it is interesting although there were only three people and they hadn’t sold anything, I thought that it had great potential. I decided to take it. I moved over to be the co-founder together with the guy who invented the idea. We ran Wrnty for two years until the end of 2011. In 2011, we did a big pivot. For the last three and a half years, we’re doing something completely different.

Sramana Mitra: When you took over this company, what did the company do?

Ofer Yourvexel: When we started, the idea was to have warranties for consumers in the cloud. We wrote two patents on that. The idea was, when the consumer is buying a watch, for example, at the counter they will register directly back to the manufacturer in the cloud. This will provide the supply chain immediate information about sales, enabling them to replenish faster and manufacture better. It enables the consumer to have a warranty that he will never lose. They don’t need to keep a paper.

This was 2009. Smartphones were not as popular back then. We were counting on the counter as opposed to the smartphones to do it immediately. Today, I would do it a bit differently. We ran with this idea for about two years. The product worked and had two to three international contracts, but scalability was an issue. I realized that I will not be able to scale with the funding I had, and it would have been very difficult to fund this idea back then. Part of the solution was to provide the sales people of the wholesalers and the manufacturers with this information so they can replenish automatically without even visiting the stores.

It’s sort of an EDI. It’s enabling the manufacturers to keep a direct relationship with the consumers. It also had some marketing values. In 2010, the iPad came out. We designed this replenishment process on iPad for sales people so that when they visit the store, they see they can place the order. Because we’re a SaaS company, we can track utilization. We realized that they had become addicted to it. Actually, what our customers started to tell us is, “We don’t care too much about the warranties.”

For a small company, we needed to make a strategic decision because one of the things they wanted was that it would be completely offline as opposed to just an interface on the web. This required pivoting our resources and moving all the focus to that. We did it in at the end of 2011. The minute we released the application to the app store, we had four times more customers than we had in the first two years.

This segment is part 2 in the series : Building Significant Revenue with Inbound Marketing from Israel: Pepperi CEO Ofer Yourvexel
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