Small start-up takes an idea and runs with it
Last June, Leah Busque quit her job at IBM. It was the first job she’d had since graduating from college in 2001, and she was a software developer on the fast track there.
But ever since she and her husband had run out of dog food a few months earlier, Busque had become obsessed with a start-up idea: creating a network of “runners’’ around Boston who would take care of errands for busy people for a small fee.
“I was just passionate about the idea,’’ Busque says, “and so even though the economy was already in a downturn, I was really excited to take the leap.’’
The company she started, RunMyErrand Inc., is now at that juncture that determines whether any business will succeed or fail. Busque has built a website and assembled a network of runners around the Boston area. Early users seem satisfied. But without an expensive marketing campaign, will today’s trickle of customers turn into a torrent that can support a profitable business?
So far, the first-time entrepreneur has done just about everything right. She has a great origin story: One night in February 2008, she and her husband, Kevin, were heading out to dinner when they realized there was no food left for their Labrador retriever. Musing over Mexican food about the possibility of a service that would handle small tasks like buying and schlepping a big bag of dog food, Busque used her iPhone to check whether the Web domain RunMyErrand.com was available. She snapped it up, and spent the next few months researching the idea.
One person she talked to was Jeff Yolen, who had been involved with Kozmo.com, a dot-com era business that would deliver goods like pints of ice cream and rented videos from a warehouse in Brighton. That convinced her the right way to go with RunMyErrand was to limit the costs of inventory, overhead, or full-time employees to do the errand-running. (Kozmo had all three, and it survived less than three years.) Through a colleague of her husband, she arranged a 30-minute meeting with Zipcar chief executive Scott Griffith.
“Our mission is to enable simple and responsible urban living,’’ Griffith says, “and what I liked about Leah’s idea is that it helps you simplify your life if you live in a city and value your time.’’ Griffith offered Busque some free office space - no strings attached - at Zipcar’s Cambridge headquarters.
When she quit her job, Busque’s husband told her that she had six months to make something happen with the idea. “I locked myself in our house and just started coding the site,’’ she says. She launched it in Charlestown last September. One of the first groups of prospective customers she connected with was the Charlestown Mothers Association, which has an e-mail newsletter.
“I wanted to get people to use the site, and also gather feedback about problems so we could iterate and improve it,’’ Busque says.
Here’s how the service works: Once you register, you can post an errand, like having someone pick up a box of old clothes at your house and take it to Goodwill. You specify the price you’re willing to pay, and the errand goes out to the site’s network of errand runners. (There are about 150 runners registered through the site, though most work only part-time. New runners go through a background check.)
A runner can accept your errand, or come back with a counteroffer. Goodwill runs typically cost between $7 and $10. You pay the site with a credit card and the company takes a fee ranging from nine to 30 percent.
Early customers around the Boston area have been using the service for a wide range of tasks. Griffith says he has had a runner pick up a presentation for his board of directors that had been printed at a FedEx Kinko’s. A blind user requested an assistant for a shopping trip to the Haymarket. Another user paid $25 to have a lost mobile phone picked up at a farmer’s market in Beverly - along with a container of chicken salad.
Runners aren’t yet earning much from the site, but they say it can help them supplement their income when they have a free hour or two. “The most runs I’ve ever done is three in one day, all on my bike, and I earned about $30,’’ says John Ilyko, a retired chef in Boston who also works as a wedding photographer. “You’re not going to get rich off it now, but in talking to Leah, it’s ready to explode.’’
Finding runners hasn’t been a problem so far; there’s now a waiting list. Rather, Busque says that the big challenge is finding a way to attract lots more customers without a big marketing budget. She says that the site is receiving “double-digit’’ numbers of errands each day, although runners say the average is more like five to 10.
“The challenge for Leah is building awareness and getting people to try the service,’’ says Griffith. He says he believes in the company’s potential, although he hasn’t invested in the site. “Then, I think there is a big word-of-mouth network effect.’’
But figuring out how to nudge that network effect along, and where marketing spending can be most effective, will take a while. Right now, a user’s first errand is free. Busque has been talking to property managers about promoting the service to apartment and condo-dwellers. Partners HealthCare offers the service to its employees at a discount, as does IBM, Busque’s old employer. “The proposition is, we can help your employees get things done during the day - without leaving their desk,’’ Busque says.
By the six-month mark after she left IBM, Busque had the service up and running, and she felt she was close enough to raising money from a group of individual angel investors to ask for an extension from her husband. (The funding came through around March. Busque will only say that it was less than $250,000.)
In May, she hired her first full-time employee and also found out she was the only East Coast company accepted into an incubator program run by Facebook in California. It’s intended to help companies develop applications that integrate with Facebook - like being able to see which errand-runners your friends use and trust. Facebook makes a small investment in each company to help fund the development.
I asked whether Busque had ever second-guessed her decision to leave IBM, especially as the economy continued to get worse through the end of 2008. “I did think around September, ‘Oh God, was this the right time?’ ’’ she acknowledged. “But one of the most fun parts of this past year has been networking and talking to people and getting their perspectives and input.’’
It’s a lot different, she says, from her old, somewhat solitary job of writing and debugging software code: “This is my idea, and I want to do this.’’
Scott Kirsner can be reached at firstname.lastname@example.org.