Gen caught up with Pan Koutlakis from EatClub. EatClub is a world-first app that allows restaurants with empty tables to immediately upload last minute deals that you can redeem. Through EatClub, restaurants can fill their spare tables and customers can eat out for up to 50% off. It’s a win-win for both parties!
Watch our interview or read the transcript below:
Gen George: Hi guys, my name is Gen George. I'm from tamme, Like Minded Bitches, et cetera. Today we are here with Pan, from EatClub.
Watch our interview or read the transcript below:
Gen George: Hi guys, my name is Gen George. I'm from tamme, Like Minded Bitches, et cetera. Today we are here with Pan, from EatClub.
Gen George: Pan, how are you going?
Pan Koutlakis: Good, thank you. How are you? Thanks for having me.
Gen George: Thanks for coming along. It looks like it's beautiful weather in Melbourne?
Pan Koutlakis: Yeah, it's perfect weather in Melbourne. 24 at my house and sunny. Looking forward to getting out in a minute.
Gen George: Awesome!
Gen George: What is EatClub? What does it do?
Pan Koutlakis: Yeah, cool. EatClub is, essentially last minute yield management for restaurants. It allows restaurants to, all in real time, use dynamic pricing to field tables at times of the day where, I've got empty tables, or [inaudible 00:00:37] periods. Very flexible, and the restaurant is in control to use it whenever they like.
Gen George: Awesome.
Gen George: How did you guys get started with this concept?
Pan Koutlakis: A couple of things, really. We made beer [inaudible 00:00:54], I guess to start with, through [inaudible 00:00:57] unique experiences. My experience in hospitality, myself, for a long time, and confronted with the problem of off-peak times and how detrimental that is to profitability. I was in the bar space. You, effectively, do it on a very local level, giving people cheaper drinks to get them in earlier and get your night started. I was very familiar with the concept, there. My experience in food delivery, I guess, showed me that it was an amplified issue where restaurants had bigger periods of people not in the restaurant and that was affecting their economics.
Pan Koutlakis: Then, with our other co-founders, came to it through their own experiences, starting to dine at restaurants with lower levels of atmosphere, not being as fun and losing that feel that you go to a restaurant for.
Gen George: Yeah, awesome.
Gen George: On that concept, and realizing that challenge all together, how did you come together and put that first test to validating that?
Pan Koutlakis: As we were building the product, we spoke to a lot of restaurants. I guess we didn't really know until we had built up the MVP, and started selling it into restaurants. I think we're fortunate and the MVP was built well and the restaurants were happy to pick it up and become paying customers from day one, which was really good.
Gen George: That's awesome!
Gen George: Do you find that that was from your experience from the food delivery business, from getting out and talking to customers? Is that a lesson that you learned from there?
Pan Koutlakis: Yeah, the process of setting up this company was very similar to how you would launch in a city and other food type businesses like that. You need to go up and sign up restaurants, and you need to get the right density of restaurants, the right type of partners on board. Then you start marketing to your customers and get users on board.
Gen George: Right? The virtuous as they say, right?
Pan Koutlakis: Exactly.
Gen George: Is that your [inaudible 00:02:48] focus, then?
Pan Koutlakis: You cut out a tiny bit there?
Gen George: Sorry. Have you found that that is your focus and playbook, so to speak, in every city around the world?
Pan Koutlakis: Yeah. I think so.
Pan Koutlakis: We learned a lot launching Melbourne, which was our first city. We are now in four Australian cities and we've gotten better at launching every time we have had the opportunity to do it.
Gen George: What are the units that you guys track when you launch a new city? Would those metrics gauge whether or not that is a good city to be in?
Pan Koutlakis: There are some metrics we look at when we are opening a city. That, in a lot of ways, is super intuitive and is what is the population? How many restaurants are there? What are the density of restaurants? What is the propensity of the people in that country, or that market, to spend money at restaurants? Those are pretty basic.
Pan Koutlakis: When we launch, it is pretty important that we see, and we have done that in every market that we have launched, that we see the same economics that we are looking for, that we were able to do in our first market in Melbourne. Its just about replicating it and making sure it's in a similar position. Similar things like acquisition costs, similar pickup, and then reorder rates are really important over those first couple of months.
Gen George: That makes perfect sense.
Gen George: Are you finding that as you are launching more cities that people know about you? Then, you'll get a quicker uptake?
Pan Koutlakis: I wouldn't have thought so, and I didn't really feel like that until we launched Adelaide recently. We had a huge amount of, and this is just super anecdotal based on people commenting on our social media, and stuff like that. Heaps of people and all the Adelaide launch material were posting, saying, "Used this in Melbourne" and tagging their friends, "You gotta get on it". Using it in Brisbane, or Sydney. That was really great to see and probably wasn't expected for our size.
Pan Koutlakis: I guess we do have a reasonable movement of people through Australia. It's good to see. It's really heartwarming.
Gen George: That's great. The team drives this, and this growth as well. What does the team structure look like? How did it start? Where is it at now?
Pan Koutlakis: The team drives all of our growth and it's super important to build a really good team around it. We started off with four of us in the office, and all of those starting employees are still with us. One of them is our CMO, and two others, actually three others. Actually, there is five of us. One started about a month later, and are the City Managers in Sydney, Melbourne, and Adelaide. Their spread out and driving what we did in Melbourne and having the opportunity to start it up themselves and open up a new market.
Gen George: Cool. From a lot of scratches and bruises along the way, like any startup journey, what do you wish that you knew when you first started that you know now? So, for any other startup out there, thinking of starting something.
Pan Koutlakis: In hindsight, knowing that now, you'd say you'd just go harder and do it faster. More practically, I'd say, it was how we tackled the marketplace problem. How we built the supply and demand side by side, making sure they are always in unison. If you know something is going to work, you can over-invest in one of the sides of the marketplace to make building the second side easier. We probably would have gone harder in the sales and then harder on the marketing later, as opposed to both at the same time.
Pan Koutlakis: At the same time, we still also needed to validate the business model in Melbourne, which meant just doing it on a smaller scale.
Gen George: Did you find it was harder in a cultured city like Melbourne, where restaurants and pubs are very cultured compared to Brisbane or Adelaide.
Pan Koutlakis: It's funny. Brisbane we find much more similar to Sydney, and Adelaide we find much more similar to Melbourne.
Gen George: Really?
Pan Koutlakis: Yeah, yeah. It's interesting. I think in Sydney and Brisbane a high percentage of the restaurants are owned by restaurant groups and corporate players, whereas Melbourne and Adelaide it's much more sole trader restaurants. People open one restaurant, pour their heart and soul into it, and it's like their little baby. There's a mix of all of it in all the cities, but we did find that a little bit to be the case.
Pan Koutlakis: Launching in Melbourne, I think it was the right city to start in. We got the most honest feedback from a big range of different restaurant owners. That lead us to really tailor what we do to Australia's most foodie market.
Gen George: From what you have achieved today, to take it to that next level. What do you think it is going to take, and where are you guys headed?
Pan Koutlakis: For us, this business one that works at pretty enormous scale. The challenge in Australia, anyway, is keeping our economics as strong as they are then starting to seriously increase the spend. That is the biggest focus in Australia. At the same time, we are looking internationally, and are hoping to launch our first international market early in the new year.
Gen George: Great. You have just raised recently, as well. Can you tell me a bit about that process?
Pan Koutlakis: Yeah, sure. We raised our Series A, it was the second funding round we went through. It was a really comfortable process for us, we had some really great help doing it. We had brought on a few advisors and had incentivized them to help us raise that money. They did a really good job putting us in front of a lot of people. I think, probably, personally I was pretty comfortable with the whole process except when you started meeting people and getting in front of people to be able to pitch to it. I think that is something that I found it doesn't know until you know, and it was good to get help on that.
Gen George: Same as building teams, right? You need to understand where you weaknesses are and then backfill accordingly.
Pan Koutlakis: Yeah, exactly, exactly. There is always a lot to backfill in, but you find the people that can help you along the way.
Gen George: As long as you realize it early on, right?
Pan Koutlakis: Exactly, exactly.
Gen George: Being a leader, obviously, your focus and where you need to evolve and change to suit the business is a moving target. As the business is day one, year one, year three, whatever.
Gen George: How do you keep evolving and adapting yourself, and making sure you are continually learning and being the best you can be for the business?
Pan Koutlakis: So far, the evolution has been generally learning to be more hands off and let go of more things that you did control at the start. I've gone through that a couple of times now with a few businesses, so it is getting more comfortable. I think that is always a challenging thing. You know what I am saying.
Gen George: Yeah, we all go through it. Are there any podcasts, books, or mentors that you look to to get advice to keep getting a different perspective?
Pan Koutlakis: Yeah, lots of advisors. We've got a lot of great people on our board, and a few advisors as well. I talk to them very, very regularly. Have weekly conversations with all of them. That's useful for me, it is my main sounding board. I do, occasionally read from books and listen to some podcasts, but more recreationally, and not hardcore academically. I get most of my learnings from talking to people.
Gen George: Cool. How have you guys created that structure? Having a board is obviously, that step of adulting. At what point did you bring that in? Was it the first funding round?
Pan Koutlakis: Yeah, we had a board set up from the start. Our seed fund and the board was made up predominantly of people that gave us money in that seed round. I think that was a super useful thing. We set up a structure from the start so when we went for our Series A it was very helpful to have all of the board minutes from our four or five board meetings before we raised that Series A. It was very transparent. There was some people on the board that, without a doubt, helped us raise that Series A as well.
Gen George: Cool. You guys have a very famous figure as a co-founder, or ambassador. Can you talk me through that process and decision to do that?
Pan Koutlakis: We have Marco Pierre White on as a co-founder. He acts as a brand ambassador. He's the face that we have out in the media and answers a lot of questions when we do a media release.
Pan Koutlakis: The process for getting him on was cold emailing until we got a response and slowly got the idea in front of him. He really like the idea. We are incredibly fortunate having him on board and he has been a massive help in getting the app launched and adding some legitimacy from the start, which was awesome.
Gen George: What was the vision for that? A lot of people go, "It would be great to have this celebrity as part of it". Why him? What was the decision process?
Pan Koutlakis: For me, anyway, being into food, he is the celebrity chef. He is the original, he is the coolest. He's very recognizable. He's the one to go with.
Gen George: But not for anyone else to go with, just you guys.
Pan Koutlakis: He's all ours.
Gen George: What does the future hold for you guys? Where are you heading? Obviously, you've got the international expansion. There are a lot of startups, especially in the Australian scene, who get to a certain point within Australia and then they either have to get off the island or they stay here. What was the decision process around that? How do you think you guys are going to tackle it?
Pan Koutlakis: First of all, the Australian market is actually a really good market for this business and the economics work really well. We say this has been a really substantial, profitable part of our business. Like anything, you need to keep expanding and you pretty quickly run out of cities to expand in Australia. There is a couple more we have to go that we will be rolling out within the next six months to one year. Beyond that, it is looking internationally and probably focusing most of our attention on the US to start with.
Gen George: How did you pick that market? A lot of people go to the UK because it is a similar customer base, high population, et cetera. Why the US?
Pan Koutlakis: Mainly to do with the metrics we mentioned earlier. On paper, there are a lot of US cities that are the best markets in the world for this type of business. I think a lot of people go to the UK because there are some other similarities as well. Similar belief system, friendlier in terms of Visas for Australians, et cetera, et cetera. But, for us, America is the jewel of the startup scene. If you are going to start it anywhere, the US is definitely a great place to be. We are just excited for the challenge, and want to go as big as we can with it. America, for us, was the one.
Gen George: Great. Do you think you guys are going to build a team over there? Can you do it all from here? How do you think that is going to look. If I can ask that.
Pan Koutlakis: Yeah, for sure. There is a mix. It's both local and utilizing our head office and what we have learned here in Australia, as well. Its going to be a mix of the two.
Gen George: Grabbing that culture from here and replicating that is always difficult, especially as the team grows. What are the challenges you are going to come up against and how do you think you are going to overcome them?
Pan Koutlakis: What we want is a high performing team in the US like we have in Australia. We aren't necessarily looking to mimic the Australian culture in America, we just want to build another high performing culture. I'll be there, learning the best way to do that, once I get over there. We are not going to be too strict on making sure it feels like exactly the same company, we just want another working company in the US.
Gen George: So you are not going to say "How are you going" with everyone looking at you funny? With everyone going "I don't understand what you are saying".
Pan Koutlakis: Exactly. No, we are just going to have a little Australia in America.
Gen George: Cool. What are the other startups that you guys are seeing that have tackled the international expansion well?
Pan Koutlakis: Australian companies, or generally?
Gen George: Just in general.
Pan Koutlakis: I think there is lots that we look to. Before us, the food delivery companies are a pretty easy one to watch. They all bloomed in one particular market and very quickly raised a huge chunk of money and expanded globally.
Pan Koutlakis: That gives us a bit of a blueprint for us to follow. We just hope that this is the same. Invest the heat in the market and we should be fine.
Gen George: Perfect. That would be lovely.
Pan Koutlakis: Exactly.
Gen George: Obviously there is a lot of consolidation going on across the world in marketplaces. If you look in the pet sitting, walking space, Rover did Dog Vacay first in the US and then took out Dog Buddy in the UK for their European expansion. There's been talks that Uber's going to acquire Deliveroo, but haven't been able to get to the right valuations. Do you think that there is going to be much more consolidation, especially in your space? What do you think is going to happen? What are you seeing?
Pan Koutlakis: I think the global consolidations are generally the most common exit opportunities in these types of businesses and I think that is what everyone should be looking for, depending on whether you want to be the player that stays in the market and acquires others, merge, or you want to be taken out. I think that is one of the reasons why these types of businesses are so attractive to both entrepreneurs and investors. Its a really good opportunity, a very globalized place. They'll popup somewhere, they'll popup everywhere. The economics are often based on pretty enormous scale. Dominate a market, any market, and it would probably lead to an opportunity for consolidation, which I think is positive.
Gen George: Do you think there are VCs who have [inaudible 00:17:02] view on this. Entrepreneurs starting a business with the mindset of an exit up front is a no-no, or an absolute must. What is your view on that?
Pan Koutlakis: I don't know. My view is that you are starting a business and that you are taking peoples money and they want a return. You just need to know, have some ideas of where that return is going to come from. We definitely will only creating a sustainable business, and I don't think there is any room to do these businesses now where you just pump them up and then flog them off. They never really had any. The economics didn't work out and the business is never going to be sustainable. You do need to have a return in mind for your investors, if you are taking the money from them.
Gen George: You'd hope so. [crosstalk 00:17:50].
Gen George: For your team, how are you going to keep evolving them as leaders? That you are hiring the right people underneath them as you grow?
Pan Koutlakis: Can you repeat that one more time, it cut out.
Gen George: Team development [inaudible 00:18:07]. Can you walk me through how you are doing that in keeping everyone developing your team?
Pan Koutlakis: It's empowering lots of people to step up. There will be more of a hierarchy than there is now. I don't really like the word hierarchy but they'll be more people [crosstalk 00:18:24] with. Yeah, they'll be structure. People will have the responsibility of developing the people around them. It's just a bit more decentralized so it is super important that we develop the people we have now to be those people and they can continue to impart their wisdom on those around them and continue to build what we've built here. Building it out.
Gen George: Are these things that you have learned from the previous businesses that you have been involved with?
Pan Koutlakis: Yeah, absolutely. Probably lots of things I have learned that didn't go the right way. Like expansion is a super risky thing for businesses. Its often much easier to do it on a small scale. When you try to replicate it, you forget how different everybody is and different everybody works. I think I've got a lot of lessons from those past experiences that we are trying to make sure work out a lot better for us.
Gen George: Great. It turns out you guys have a really exciting business and big things to come. How can people support you guys?
Pan Koutlakis: Say it one more time again? I've got a bit of noise happening in the office now. Lunch time is just about to start.
Gen George: Exciting team! How can people support you guys?
Gen George: Download the app?
Pan Koutlakis: Download the app, give it a go. If anyone knows any restaurants, or owns any restaurants, hit us up. We can have a chat about how our app might be able to work for them.
Gen George: Great. It's EatClub.com.au?
Pan Koutlakis: Yes, or just straight to the app store and search for EatClub.
Gen George: Great. Thank you so much for your time.
Pan Koutlakis: You are very welcome. Thanks, Gen.