GoPuff CEO Rafael Ilishayev: The Plan to Make GoPuff Profitable by 2024 | 20VC #944

Raf Illishayev is the Co-Founder and CEO @ GoPuff, one of the market leaders delivering daily essentials in minutes. GoPuff’s latest funding round priced the company at a reported $8.9Bn in March 2021 and to date, Rafael has raised over $2.4Bn for the company from the likes of Accel, Softbank, Fidelity, Baillie Gifford, D1 Capital and more. Rafael has scaled the company to over 1/3 of the US with over 12,000 employees nationwide. ------------------------------------ Timestamps: 0:00 Founding moment for GoPuff 1:54 Why has capital dried up for instant delivery? 6:42 How do margins compare between old and new markets? 8:54 The race to profitability 13:07 How do you prioritize which products to persue? 15:40 Challenges to the instant delivery market 19:28 How does batching change the economics? 22:14 What is the north-star metric of instant delivery? 24:37 How do you know when you have a retained user? 30:15 Pricing of GoPuff membership 32:15 Consumer behavior in a downturn 34:22 Why did you pull out of Spain? 38:35 Could this recession be good for you? 40:58 Is this an acquisition opportunity for you? 43:18 What does Instant Delivery look like in 2-3 years? 45:13 Amazon is the competition we admire 46:40 What new GoPuff verticle will perform best in next 2-3 years? 51:35 What gets harder and what gets easier with scale? 52:25 What do you know now that you wish you knew at the start? 53:30 Who is your closest mentor? 54:38 Where will GoPuff be in 5 years? ------------------------------------ In Today’s Episode with GoPuff’s Rafael Ilishayev You Will Learn: 1.) From Student to Global CEO: How Raf came up with the idea for GoPuff and started the company as a student with no funding? What were the early signs of product-market fit that Raf observed in the early days? In hindsight, does Raf wish they had raised external funding sooner than they did? What would raising external funding sooner have changed about the way they run the business? 2.) The Rise and Fall of Quick Commerce: What are the core drivers that have led to capital drying up for players in the quick commerce space? With the changing environment, is it a race to profitability for all providers in the space? Is this the perfect time for GoPuff to acquire? What are the characteristics of businesses in the space that GoPuff would vs would not like to acquire? How does Raf see the quick commerce space looking in 5 years time? 3.) Getting to Profitability: The Levers That Matter: Customer Service: Why does Raf believe that all players pulling back on investing in customer service are making a massive mistake? What can be done instead? Delivery Time: Why does Raf believe the 10-minute delivery model is fundamentally unprofitable? How do GoPuff approach it as a result? Inventory: With a changing macro-environment, why does Raf believe it is prudent to focus more attention on alcohol and convenience goods? What do prior recessions show us about consumer spending patterns changing? Metrics: What are the single most important metrics which dictate the speed of getting to profitability? Why is the amount of orders a driver can deliver per hour the most important metric? 4.) Business Expansion Opportunities: How does Raf analyze the opportunity for GoPuff in Europe? Why does Raf believe they should have pulled out of Spain much sooner? Why are they so focused on the UK now? Why does Raf believe it is the right decision to stop investing in GoPuff pharmacy? Why is Raf so bullish on GoPuff kitchens? How does the unit economics of the kitchens compare to the core business for GoPuff? What are the positive effects of kitchens on GoPuff core product? What was the most recent disagreement the board has had when it comes to determining what to prioritize vs what not to? ------------------------------------ Subscribe to the Podcast: https://www.thetwentyminutevc.com/gopuff/ Follow Harry Stebbings on Twitter: https://twitter.com/HarryStebbings/ Follow Kyle Harrison on Twitter: https://twitter.com/afaelilishayev/ Follow 20VC on Instagram: https://www.instagram.com/20vc_reels Follow 20VC on TikTok: https://www.tiktok.com/@20vc_tok ------------------------------------ #GoPuff #RafaelIlishayev #InstantDelivery #QuickCommerce #HarryStebbings #20VC #DeliveryWars