Startup Old Markets a New Way
Aug 10, 2015
Recently I listened to a conversation between Kai Ryssdal and Farbod Shoraka regarding BloomNation, a successful startup, that co-founder Shoraka now CEOs.
BloomNation promises to be a very profitable e-commerce site that allows florists to sell directly to local customers online. It is an Etsy model website for a niche market.
As it turns out, the existing, large-scale flower brokers – who feel fairly secure in their role – provide services that don’t work well for florists or consumers. The big brokers are inconvenient. They add surcharges and junk fees to transactions. And, since they ship nationally and warehouse products, they often damage the stunning arrangements florists spent time creating that or wilt the flowers.
A part of Shoraka’s story really piqued my ear. The idea has to do with how BloomNation decided that they would likely succeed in disrupting the almost-30-billion dollar a year floral industry:
We knew [people weren’t happy] on the consumer side – right? Order flowers, they look crappy. On top of that if you go to these flower shops, which we did … every single one was frustrated with the service as well. … And I thought, that doesn’t make sense, where the two most important people are frustrated in the transaction.
What was the key factor?
That both consumers and florists were unhappy with their existing service. In such a scenario, a startup company that provides an existing service a better way will have an edge.
BloomNation didn’t have to create a brand new kind of website, or a brand new kind of product, and they didn’t discover an unseen market. They just decided to treat an existing market nicely. Shoraka said:
…we didn’t come with a sense of ‘I know what to do’, it was more ‘tell us what your problems and I’ll create a solution.