Bootstrapping with Services from Poland to a US SaaS Company: Stefan Batory, CEO of Booksy (Part 4)

Sramana Mitra: I thought you were trying to reposition the taxi company to doing a marketplace. How did you get to the software house?

Stefan Batory: I did not reposition the taxi business. I just kept it growing. At the same time, I was also running a small division of the software development house, which was a spinoff from that original software development house.

When we separated, I took the taxi hailing business and one of the divisions of that software development house. Then I spoke with Conrad. I told him about the idea. We started prototyping it. We started visiting salons together. It took us about three months to figure out what the product would look like and what it would do.

After three months of talking to hundreds of salons both in Poland and US, we decided to invest in that project. We started developing the platform for the beauty industry. That was in 2014.

Sramana Mitra: What happened to that business?

Stefan Batory: We started thinking about what the best way is to distribute it. Back then, we had various relationships with the classified media industry around the world.

We started reaching out and saying, “We have this amazing idea on how to help service providers. You have your advertising business. We know that a lot of them advertise in your publication. Maybe there is something we can do together.”

One of them, TheFlyer.com, was receptive to that idea. We had an arrangement with them that we would have a partnership. We would provide this technology and take care of the consumer side. They would take care of the acquisition of the supply side. They started acquiring salons for us. That was at the end of 2014 when we launched this project with them.

Back then, our business model assumed that we would take a small fee for every appointment that would go through the platform. They acquired a couple hundred salons. We started driving traffic and bringing clients for these salons.

We quickly found out that what works for all the other marketplaces like Uber and DoorDash doesn’t work for us because people are very loyal. 80% of appointments come from existing clients. Only 20% come from new clients. Salons didn’t want the existing clients to use our platform because then we would charge them for their existing clients.

At the same time whenever we send them new clients, we generate conflict on double bookings because they were not using our platform as their main calendar. They were just using us as a lead generation tool. We found out that we had a problem.

We started thinking about how to change it. At the same time, we had a barber from Los Angeles who contacted us. She asked us if she could use Booksy. Back then, we didn’t allow people to sign up with us outside of Southeast Florida. We said, “We can unlock the zip code for you but we won’t be able to provide you that much value because we are focusing on southeast Florida right now.”

She said, “I don’t mind. I’m fully booked. I have so many clients that I have issues scheduling them. I’m using Booksy for just my existing clientele.” She signed up with us. A day or two days later, she had 50 bookings. I called her and I asked her, “How do you like the service? How do your clients like it?”

It was nothing but positive feedback. The clients loved it. I started discussing with her what the best way was to charge her. It doesn’t make sense to charge her for her existing clients.

How about we just pivot using the exact same product? We’ll start a subscription business. That’s how we pivoted a few weeks after we launched. Then we opened up across all of the US. In the beginning of 2015, we started looking for scalable acquisition channels and learned how to acquire clients from all over the US.

This segment is part 4 in the series : Bootstrapping with Services from Poland to a US SaaS Company: Stefan Batory, CEO of Booksy
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