A Chat with Mike Rosenbaum from Spacer

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Gen caught up with CEO and founder of Spacer, Mike Rosenbaum. 

Mike is a self-professed tech nerd, serial entrepreneur and Founder of Spacer. With over 14 years of hands-on experience building tech startups including DealsDirect and Auction brokers, through to ASX listing and M&A activity. Mike brings immense passion, drive and a laser focus on the end-to-end customer experience.

Watch our video interview or read the transcript below:

Gen: Hey, gang. Today, I'm here with Mike, the CEO and founder of Spacer. Mike, how are you?
Mike: Well, thanks.
Gen: That's good.
Mike: How are you, Gen?
Gen: Good, thank you. Who the hell are you? I'm serious.
Mike: I was going to ask myself. Well today-
Gen: Yeah, who are you today, is probably a better question.
Mike: So, yes, I'm one of the founders of Spacer, the online marketplace for storage and packing. We've been around for just under three years now.
Gen: Nice.
Mike: And yeah, really enjoying the journey. I guess prior to that I was in e-commerce for over a decade, so one of the co-founders of Deals Direct, one of the early pioneering online department stores.
Gen: That's insane. 
Mike: That's why there's no hair left. Don't go into e-commerce.
Gen: Yeah. That's awesome. And how did you end up in that? Like, what sorts of things did you do over the whole decade? You would have touched a lot of different things.
Mike: Can't really remember.
Gen: Blocking it out.
Mike: We bootstrapped that business from 0 to about 100 mill, got a bit of investment later on. And [inaudible 00:00:57] business partner in that, Paul Greenberg, is now head of Nora, Nora Network. You may have come across him.
Gen: Yes, yep.
Mike: Definitely worth interviewing if you haven't already.
Gen: Watch out, we're coming for you.
Mike: So yeah, started off as a techie, support techie, uni drop-out, pretty typical sort of-
Gen: You've got runners on? Yes.
Mike: Typical entrepreneur sort of story, and just sort of learning by doing. So, moved across to the sort of marketing side and I guess business side of the business over that decade and yeah, still love-
Gen: That's awesome.
Mike: Still love being in tech and being around tech people, and the startup community.
Gen: Yeah, that's awesome. And what drove you to start that initial idea for Spacer?
Mike: [crosstalk 00:01:40] Yeah yep sure, after I exited Deals, Deals Direct, I was [inaudible 00:01:44] online about four years ago now I guess, I took a bit of a sabbatical, went to Silicon Valley. My wife was kind enough to let me go on a couple of trips, and did the rounds, met with entrepreneurs over there, went to some conferences like TechCrunch Disrupt in New york, which is great. If anybody gets the chance to go, I highly recommend it. Very high-tech, really cool, really inspiring, lots of astronauts from Russia and really stuff I couldn't understand. I was just in awe. But I'm serious, lots of really cool ideas and people. And I went over there thinking that I wanted to come back with an idea that I could implement in Australia, so something that was already sort of happening and specifically in the sharing economy. The sharing economy really just made sense to me, that there's all these unutilized assets sitting all around us, and why not sort of use technology to enable people to access them? 
Mike: So I was [inaudible 00:02:47]. I had a few in mind before I went, and that changed as I traveled, chatted to people and saw what else was out there and whilst I know storage is kind of unsexy, it's sort of a real need. That's what I landed on.
Gen: Definitely. And how did you I guess from the whole "okay, storage is a path I'm going to test out", what were the first steps that you took to really try that?
Mike: Yeah, so apart from I guess the idea resonating with me and having some experience. I didn't have this real personal experience with something except I have a job, I knew there was all these issues. I just had a little baby, that's why I've got bags under my eyes. But I know there's a need for nappy delivery because we don't have time to go to the shops. Well I didn't have that exact personal experience but I knew from my experience with Deals Direct in the early days, we didn't have a warehouse, and we used some self-storage. I knew how expensive it was. I knew how difficult it is to access sometimes, and so there was few bells that were ringing. I could also sort of see the macro-economics of real estate becoming very expensive, people moving to smaller living spaces but still wanting to have things around them. We live in a great country where there's lots of outdoors things to do, so people want to have their toys around them. The things they use outside: their bikes, their golf clubs, their boat, their jet ski - whatever it is. Kayak. 
Mike: So I was just putting a few of these threads together. I thought yeah, it sort of made sense. Now let's do the research. So I came back to Australia. I met my business partner Roland Tam. We did some research, so we sized up the market. I was [inaudible 00:04:38] did a lot of Googling, spoke to people, and yeah we sort of thought "yeah, there's something here".
Gen: Yeah. That's great. [crosstalk 00:04:47] Definitely, perfect. And what, did you guys just whack up a landing page to try and get people to start signing up, or did you go further and develop a pretty robust MVP, or, what was step one?
Mike: Yeah, so we used the Software as a Service marketplace to get started. We used, it's called Near Me, which I highly recommend anyone who's in the marketplace phase. It's a great system. Shout out to Adam Broadway, the CEO over there at Silicon Valley. He's an Aussie guy.
Gen: Oh nice.
Mike: He sold his last business to Abode. He's the real deal and a great guy. So that got us sort of speed to market. Of course none of these things are exactly plug and play.
Gen: Of course not.
Mike: They still take quite a bit of midnight oil to get them running.
Gen: Massaging to fit.
Mike: But that was a great way to get started.
Gen: That's awesome. And so can you explain actually the business model behind Spacer [crosstalk 00:05:35]
Mike: Yeah sure. Yeah so essentially it's very similar to the Airbnb model where people who have a spare garage or a spare car space, or any type of storage in and around their home an list it on the site. It's free to list, and they can make it available to others in their local neighborhood who need more space. Don't we all?
Gen: Definitely [inaudible 00:05:58]. How fast is the model [inaudible 00:06:02] marketplace growing then? Where is it at?
Mike: It's growing really quickly. As you've probably noticed speaking to lots of marketplace founders, it's really hard to get these things off the ground. The whole chicken and egg thing. And so the first year we felt like we were moving quickly but in hindsight, geez it was slow. And so we're sort of approaching about two and a half years since launch, and things are going really well now. But a lot of hard work from the team. We've got a team of 20 now believe it or not. We have significant sort of funding, and I don't think we could've done it without quite a lot of time and quite a lot of investment. And an amazing team of course.
Gen: That's great. And what was that process to then raise? What did you present, who did you target?
Mike: Yeah so we backed ourselves. We put some of our money in, which I think is always a good sign of faith, pure faith. We were fortunate enough to have a really strong network from previous businesses that we've been involved in, and then we sort of went out to market. And I guess as any founder will tell you, it's not easy to raise money in Australia, particularly with, off a PowerPoint. But yeah I think we've brought on board some fantastic investors mainly sort of angels and some strategics. And they've been really supportive and helped us along our journey.
Gen: That's great, and at what point did you decide it was time to go raise?
Mike: So we took the pretty unorthodox approach, I guess because I've been around the block a few times I thought well "we're going to do this, let's give this a real crack", so we raised money before we launched, and as I said we put our money where our mouth was, so we put our money as well. I don't necessarily recommend going down that path for all founders, but for us that was the right decision.
Gen: That's great. From taking on that investment, you guys also needed an acquisition. What made you decide to do that? Was that part of the deal going in to getting investment? How did you approach that?
Mike: So from day one, we wanted to be the marketplace, or the place for space as we're called now.
Gen: Hang on we'll make sure, put it in sight.
Mike: And so yes we started in storage, it sort of quickly evolved to parking. Our customers told us that. It's through their transactions that they were using garage or car units for parking as well as storage room. Makes sense, right?
Gen: Perfect, yeah.
Mike: And we have a pretty big aspiration or vision to be that place for space. Now some of that's going to happen organically. Some of that is going to be through acquisition, so yeah we sort of formed a friendship with the guys at Parkhound. They've done a really good job. Very early to market, and it was just right place right time for both of us, [inaudible 00:08:54] done a deal, so it was great.
Gen: And that set you up. Yeah, definitely. And what's the sort of the first day look like after you've done that deal? Trying to merge a company to then, first month, six months? It's a tough challenge.
Mike: Roland and I, we had some experience. We both acquired other businesses in our previous lives, so lots of learnings of what not to do. So the first thing we did was really just, obviously we did our due diligence over many months, but there's no better due diligence than understanding that business once you're actually living and breathing it, alright? So the first few months really we just sort of got to understand the business, got to know the team and got to understand what made it tick before we made too many changes. 
Gen: That's good.
Mike: And so that was the first thing.
Gen: Yeah awesome. And where is the business heading? Do you want to go international? Do you want to make it a really good Australian business? What's the vision?
Mike: Yeah we made a small acquisition in the US, I don't know if you were aware about that, we bought Roost very early on, maybe a little too early. But no, it's been really good. We've had lots of cross-learnings across the two markets and that business is going quite nicely. It's still very early days.
Gen: And what does Roost do? Is that for space, or car spaces, or both, or-
Mike: Yeah it's both. We rebranded it spacer.com in the US, and we have a small presence over there, and growing that business.
Gen: Yeah, at the same time. Fantastic, and there's lots of different things coming out, a lot of talk about data, with Facebook, GDPR laws coming into play, obviously data breach things, laws in Australia came out in February. What's your view on it, in the startup community in Australia? Do you think people are prepared? Not prepared?
Mike: Yeah it's a good question. I think trust is paramount in the sharing economy, so making sure that consumers' privacy and data is well maintained, and I think that's just a wake-up call for everyone. I think it's paramount to running successful marketplaces, and so I think it's just good for business really. It's kind of a no-brainer. I know there's been a lot of bad press around Facebook in particular. Look, I don't sort of dig into it too deeply but I guess ultimately, what's good for the consumer, ultimately that's what's going to win at the end of the day, right? So you've got to look after the customer, the customer data, be transparent about what you're going to do with it. Our model is pretty simple. But obviously we just have to protect their data.
Gen: Of course. And having that culture I guess through not only just the founders and the vision of the company, but also the team that's the same values, what they do with the data and how they treat it. How do you ensure a consistent culture across the team?
Mike: Yeah I think it's just education and awareness and keeping it front-of-mind. I think most startups do want to do the right thing. Of course there's some that get very large. When is a startup no longer a startup? Is Facebook still a startup? Probably not, one of the biggest companies in the world now, right? I think it is a wake-up call for everyone in the industry to clean up their act if it isn't already.
Gen: Yes of course. And so what's your team culture like now that you've merged two I sure very individual cultures?
Mike: Yeah, we've got an amazing team. Actually the cultures are not that dissimilar, and I think it's merged very nicely We've brought on some new team members as well to support the acquisition. Some of our team members work across platforms. And we really focus on that same purpose, which is really to help people monetize that spare space that they have around their homes, and to make it easy for people to access that space. So the culture has kind of grown organically I suppose. But I think my experience with Deals Direct but also at spacer, is also those early trials we were important to making sure there's a really good fit with the business, the vision, and the team. And that often sets that culture very early on. It's very hard to change later on. So, if you look at Uber for example, maybe they didn't start with the best culture initially. Probably look at the first team members.
Gen: Are you hinting at something?
Mike: And I love Uber. As a consumer I think it's a great app, but obviously the culture they're doing a lot of work on today. So we've got an awesome team, really passionate.
Gen: If any of them are watching. That's awesome. And so then you've pulled this team together, you've got some big visions of I guess what you guys are trying to achieve. What does the next 12 months look like for you guys?
Mike: Yeah I mean we're all running pretty hard.
Gen: And trying to have families at the same time.
Mike: Yes, the work-life balance is important, a few cappuccinos. We try. But yeah, we're just doubling down what we're doing right now, and really bedding down the acquisition. We've got everything on platform now which is great, so it's a lot more streamlined and we really feel like we're seeing this next sort of wave of growth. I guess startups kind of go like this, it's not that linear growth, kind of up, maybe down a little, [inaudible 00:14:09] sort of. But we're on this next wave of growth if you like, and I feel like we've got the right team to take us to the next level.
Gen: That's great. And measuring all these things is really important, getting your economics right, whether you're getting investment or even just to find out why you are plateauing before you can kind of take that next jump. What sort of tools are you guys using to really amplify that? Or track them?
Mike: Google Analytics is a great tool. Excel spreadsheets. They're probably the super-tool out there, right? 
Gen: Everyone find what works for them though right?
Mike: Yeah we recently hired a data scientist so we're going to get some more smarter stuff now. I don't confess to understand all of it, but luckily a lot of it is very visual, so it's easier to understand
Gen: Pie graph.
Mike: So yeah, we're starting to dig a lot deeper into the data. I guess early on it's just, got to move quickly, and just do whatever you have to do, look after customers, learn from their feedback, ad now to be more like "okay, we've got some real data, let's dig into it".
Gen: Understand what's making them tick.
Mike: Exactly.
Gen: Great. And what other startups are you seeing out there that are really, do you think, driving to the next level with how they're approaching metric, balancing that sort of time demand, because that is one of the biggest challenges for marketplaces.
Mike: Totally. Yeah well we're very fortunate to be a part of this sharing hub. I know you- [crosstalk 00:15:25]
Gen: So do you want to explain where we are?
Mike: Yeah so we're here in The Sharing Hub in Pyrmont. Please come and visit anytime- [crosstalk 00:15:29]
Gen: Turn around, something. The tour.
Mike: We've got about 30 different sharing economy businesses in our group. Five or six of us are located, co-located here. So we do share lots of learnings, we have meet-ups.
Gen: Cute puppies.
Mike: Yeah, there are a few around. So we've got Mad Paws, the pet-sit service. We have Car Next Door, peer-to-peer car sharing, Blys, if you need a massage which I do, Zoom2u for express parcel delivery. Who else do we have? Camplify caravan and car rentals, and a bunch of others. And I guess what we're seeing is, those businesses, they're all probably a little bit ahead of Spacer because we're only a couple of years old, but some of them are three, four, five years old. And they're all these fantastic trajectories. But I guess the learning from all of them is it's pretty hard to get off the ground right. That chicken and egg piece. And predominantly what we saw is that if it's an asset-based service, supply is the hard piece. If it's a task-based service, demand is the hard piece. It's interesting, right?
Gen: Yeah, that shift, definitely.
Mike: So that's been really interesting, and we just all sort of share learnings and you have good days and bad days and we kind of lean on each other and support each other and.
Gen: Go play with a Mad Paws puppy.
Mike: Yeah exactly.
Gen: Sorts everything out.
Mike: It does actually, yeah, definitely.
Gen: They always have the cutest puppies, I don't know why but anyway. That's cool, and so what do you think the importance is then of these communities like the Sydney Startup Hub? That's jumped in as government-backed. They've got so many different coworking spaces like this in one building. What do you think the impact of things like this is going to be in the community at large?
Mike: I know it's an overused term, but I think this building of real ecosystem, startup ecosystem, innovation ecosystem. When is a startup no longer a startup? I guess we're all trying to run and build successful businesses, right? And employ more people, provide opportunities for all, and I think it does help because it's certainly creating the energy and the infrastructure, the support systems. These meet-ups, you can really meet amazing people, founders that share similar issues that you're going through. It can be quite lonely as a founder and bouncing off other founders is often a great way to fast-track their learnings, hearing aspirational stories from others, whether it's a camp or [inaudible 00:17:56] or Will from Car Next Door, or people at different levels, stages in their business. I think that's very important.
Gen: It is. It's critical.
Mike: It's amazing, it's really only happened in the last few years.
Gen: Hasn't it? Yeah, definitely.
Mike: You know, 10 years ago no one knew what startup- It was very nerdy to be a nerd. Now it's cool [crosstalk 00:18:17].
Gen: Well even when I started OneShift that's what 2012, so six years ago give or take now, but it's incredible. There was [inaudible 00:18:26] was only just started in 2012. So there was none of those sort of spaces and so no one really knew what each other were doing and so it's amazing just the speed that that change has happened as well and people are really getting behind it, and corporate's even getting behind startups and whatnot and the impact that can have. I mean even with QANTAS with Mad Paws, that would be great to see the impact that can have.
Mike: A lot of corporate partnerships happening. That's definitely a big trend that we're seeing. I guess also there's a place for people who want to have a career working in startups or starting in startups. You can go to now whereas before how did you find a startup to work for?
Gen: Exactly. Or even trying to attract that kind of talent into your startup with the people who were like “oh, give this a last shot because I can't get a job anyway” kind of attitude, whereas now you can really attract so amazing talented people.
Mike: It think it's now a legitimate bonafide career path whereas- There's a light.
Gen: I know I always forget. I'm like “ooh, hopefully it hasn't cut out”.
Mike: Should have done my hair this morning. But I think it's legitimized as a career whereas maybe 10 years ago it was like “why are you-” 
Gen: “-doing that. You're dodgy, a little bit”.
Mike: There are different career paths you could take, and maybe you can learn working in a startup and then they go and start their own, or maybe become more hireable by a corporate because they know about innovation and stuff like that, right?
Gen: Buzz word buzz word buzz word.
Mike: But I guess it all helps, right?
Gen: Definitely. And mental health is something that's not really discussed that publicly anyway. What are your thoughts, how do you make sure your team get the headspace that they need? How do you as a leader make sure you get that headspace?
Mike: It's super important, right? I think a lot of it is just being in tun to your team and making sure that they're- There are times when you have to work pretty hard and burn the midnight oil to hit targets. But it's unsustainable to do that every day, right? So I know in the startup world there is this thing of [crosstalk 00:20:27].
Gen: Badge of honor.
Mike: Hustle hustle hustle, which I think is great. But I think there's got to be balance, right? And you've just got to keep an eye on your team and yourself as a founder. Take the time to breathe and work on the business as well as in it, and reflect. But one of the things that we've done at Spacer and Park Hound is that we, I personally use Headspace. I think it's one of the best apps to come out ever. And so we provide that to our whole team.
Gen: That's great.
Mike: And if they want to use something else, they prefer something else, we pay for it. But we really believe in the team's wellbeing and we keep an eye out to make sure that they're not burning out. So this is a marathon, not a sprint. We see it as a 10 year journey, potentially longer. It's not like a crash and burn-
Gen: Next week.
Mike: Yeah. So you've got to look after each other. That's really important. People that care about each other.
Gen: That's great. And how do you as a founder, or sorry as a CEO, make sure that you're continually having that personal development, that you can make sure that you are looking out for the right highs, make sure that you do know the right tools or areas that you guys should be heading to for growth?
Mike: A lot of it is collaborating in a space. So I certainly don't have all the answers. A lot of people around me do, it's crazy. So tap into that. But yeah I love learning by doing, and learning from others. So I chat to the guys in The Sharing Hub. “What are you guys doing? What's working for you? What's not?” We share with them, what's working for us, what's not. That helps a lot. Team members as well. A lot of it is through the network [inaudible 00:22:12] person. Or the other way is we work a lot with the universities. And so new grads, or people who are about to, what do they call it? In the penultimate year.
Gen: Ooh yeah, whatever it is, yep.
Mike: These buzz words, I don't know.
Gen: They're just smart kids. That's the main thing. Adults.
Mike: They're just smart. Super smart. And so some of our team have come through some of these programs, these innovation programs like there's one called Univative which different universities compete against each other and they [inaudible 00:22:40] project for different businesses. And we were the only startup. There was big companies like IBM, they were doing IBM Watson programs and then little Spacer. 
Gen: Shh, just a speck.
Mike: But feedback that we got was really positive, and one of our team members Emma came through that program and she's been fantastic. And yeah we've had others as well. 
Gen: That's fantastic.
Mike: So there's lots of different ways you can find great team members.
Gen: Yeah, and for yourself were there certain resources or podcasts or mentors that you have to make sure that you're continually learning.
Mike: Yeah. I mean again, a lot of it is sort of peer mentoring today I guess. In the early days when I was a bit younger and had a bit more hair and had sort of like-
Gen: One less child.
Mike: [crosstalk 00:23:25] gray-haired mentors. People who've been there, done it before. And that was really useful. I still keep in touch with a lot of them. But today I find the market moves so quickly that you actually need to be in tough with people who are actually doing it. So I think peer mentoring, whether we call it that or not, but it's something like it.
Gen: Just go for a beer.
Mike: Even like us chatting, right? It's good reflection.
Gen: Definitely.
Mike: A lot of the guys and girls in The Sharing Hub, we sort of bounce off each other. Some of my investors obviously are very successful in their own right and then they provide good guidance, my business partner Roland. I try to go to events from time to time. Not all the time because you can get quite absorbed in it. I try to get to the States once a year and learn from sort of what's happening over there.
Gen: Just stepping outside of the industry. That's really important.
Mike: And I do like Twitter. [crosstalk 00:24:22]
Gen: Do you follow Trump's feed?
Mike: Yeah well just for a laugh.[inaudible 00:24:29] Hopefully not soon.
Gen: Not this week.
Mike: There's some amazing people to follow on there, like other founders around the world. The big Cs. Just getting a feel for what's going on.
Gen: Yep. That's great. And so, I ask everyone this, so apologies for the left-of field. If you could have a superpower, what would it be and why?
Gen: Always throws everyone.
Mike: If I had a superpower.
Gen: Will Davies' from Car Next Door was that he can slice bread - this is already his superpower - he can slice bread perfectly. And I still can't get over that.
Mike: That's pretty cool, I'm going to go and check that out.
Gen: Yeah ask him to slice you some bread.
Mike: So one that I want? I do like my sleep. So if there was some way that I could freeze the clock and instead of getting, I generally get eight hours. If I could get 10.
Gen: And then, and nothing changes.
Mike: I would be like in bliss. If I could get those two hours back or something like that.
Gen: So you wouldn't need a Blys massage.
Mike: My wife would just [crosstalk 00:25:28] As well as still looking after the kinds and stuff like that. So maybe to be able to freeze the clock. Get that extra few Zs.
Gen: Yeah of course. It's funny, most founders are around getting more time, being able to get there faster or speed of light kind of things, right? So it all comes back to more time.
Mike: Yeah exactly. Well, it's the one thing you can't buy, right?
Gen: Definitely. Thank you very much for today, really appreciate it, and we look forward to keeping across what the business is doing.
Mike: Good. Thanks very much Gen.