This $1.5 Trillion Industry Still Runs on Paper and Fax Machines

1. 0:00 – 0:05

   Intro

   1. AEAaron Epstein0:00

      [upbeat music]

2. 0:05 – 1:07

   Vori’s Series B and the scale of grocery retail

   1. AEAaron Epstein0:05

      I'm excited to welcome Brandon from Vori, here to announce a $22 million Series B led from Cherry Rock Capital. Brandon, thank you so much for joining.

   2. BHBrandon Hill0:15

      Super excited to be here.

   3. AEAaron Epstein0:16

      Yeah. Maybe to start things off, uh, tell us a little bit about what Vori does, and give us the state of the business right now.

   4. BHBrandon Hill0:21

      Vori is an all-in-one point of sale and agentic store management system for supermarkets. So just to lay the framework, there is over 220,000 food and beverage retailers across the United States of America generating $1.5 trillion overall processing volume, and Vori is helping them move off of paper and pencil to run their stores more profitably and to feed their communities more sustainably. Vori's business today, we're processing over $500 million in payments since launch two years ago, and we've served over one million shoppers in communities across the United States, from Staten Island to Seattle.

   5. AEAaron Epstein0:59

      Yeah, I didn't expect that the industry is even that big. And, uh, we were talking earlier, it's bigger than restaurants, bigger than hotels-

   6. BHBrandon Hill1:06

      Uh-huh

   7. AEAaron Epstein1:06

      ... is grocery.

   8. BHBrandon Hill1:07

      Yeah.

3. 1:07 – 2:21

   A third-generation grocer discovers a “paper-and-fax” industry

   1. AEAaron Epstein1:07

      And I, uh, I think that's often overlooked. But, um, talk about how you got into this because you kind of have a family background, uh, in the space, right?

   2. BHBrandon Hill1:17

      I'm third-generation grocery, actually.

   3. AEAaron Epstein1:18

      [laughs]

   4. BHBrandon Hill1:19

      So my parents have been in the business for 40 years. They actually met and fell in love in a supermarket in Upstate New York. My mom worked for a number of food and beverage manufacturer companies. So like, Mondelez, which makes Oreos, and Oscar Mayer, which makes, like, the, the famous wiener. My dad also was the North American Director of Sales for Reynolds Consumer Products, which makes, like, the grill foil that you might use, uh, on Fourth of July barbecues.

   5. AEAaron Epstein1:43

      Mm-hmm.

   6. BHBrandon Hill1:43

      Right? They were star-crossed lovers. They met in, uh, the headquarters of Price Chopper in Upstate New York-

   7. AEAaron Epstein1:50

      Hmm

   8. BHBrandon Hill1:50

      ... in Schenectady, where, uh, they both had sales meetings pitching to grocery buyers. And since then, you know, they started the family and, uh, and here I am. But even before then, on my mom's side, my grandparents were in the grocery business. They had small stores in Oklahoma, where my mom is from. And so really this is like a generational thing in my family. But for me, I, you know, I went to Stanford. That's where I met two of my best friends, Rob and Trey. Trey I worked at Google with. Rob, who was a, uh, aerospace

4. 2:21 – 4:10

   The YC origin story: proving the problem with a stack of invoices

   1. BHBrandon Hill2:21

      engineer, um, worked at SpaceX, Lockheed Martin, and then did self-driving cars, uh, at Lyft. And I remember, back to our YC interview, I brought this stack of papers to the YC interview-

   2. AEAaron Epstein2:31

      [laughs]

   3. BHBrandon Hill2:32

      ... that actually my parents had showed me back when I was visiting them in Minneapolis.

   4. AEAaron Epstein2:35

      Yeah.

   5. BHBrandon Hill2:35

      They showed me this stack of invoices and paper catalogs from grocery stores. And I remember first seeing it, and I look at it, I'm like, "Okay, this is some relics from when you were my age, right? Decades ago." They said, "Uh, no, this is from 2019."

   6. AEAaron Epstein2:51

      Yeah.

   7. BHBrandon Hill2:51

      And it was 2020 at the time. And I was shocked that this was the state of the art of the largest undigitized retail format in the, in the world, and also that grocery is the most frequent consumer shopping behavior on the planet, and it's paper, pencil, fax machines, and paper clips. And so I show this to Trey and Rob, and we're all collectively dumbfounded. And what's crazy is, you know, Rob had worked at SpaceX. If you imagine the SpaceX headquarters, across the street is a grocery store. At SpaceX, they're re-landing rockets. At the grocery store, they're taking inventory on a clipboard. And somehow on the same planet, in the same zip code, you have, um, a company that's, like, terraforming other planets and putting, creating kind of multi-planetary species. But then in the grocery store is just as important, we're feeding civilization here on Earth, but it's so antiquated.

   8. AEAaron Epstein3:49

      Yeah.

   9. BHBrandon Hill3:50

      And so we got really inspired to say, "What could we do to solve this?" So it actually launched an odyssey on our part. We went through Y Combinator. We applied. Um, we got to work-

   10. AEAaron Epstein3:57

       You brought that stack of papers so we could see the problem

   11. BHBrandon Hill4:00

       ... we brought the paper. Yeah, exactly. Like slam- I remember slamming it on the table like, "Guys, can you believe this?"

   12. AEAaron Epstein4:03

       [laughs] I remember that.

   13. BHBrandon Hill4:05

       That was a crazy time. And we went through YC with this vision to create the operating system for grocery.

5. 4:10 – 4:58

   Starting with a wedge: digitizing reorders from wholesalers

   1. AEAaron Epstein4:10

      Yeah. And talk about, uh, it, it was a little bit different back then than, than what you're doing today, what the product is today, right?

   2. BHBrandon Hill4:16

      We started with a wedge 'cause it's, you can't build everything at one time. And we started with a wedge, which was, how do we help grocery stores reorder inventory from their wholesale suppliers-

   3. AEAaron Epstein4:26

      Hmm

   4. BHBrandon Hill4:26

      ... and move them off of paper, pencil, and fax machine? And we had this little mobile app that we spun up in a couple weeks. And through the course of Y Combinator, that's how we grew from our first store, which we had knocked on the door to get and begged them to use it, um, all the way through, you know, hundreds of stores over our first year being live. And then from the success of that one app is how we expanded into adding other features on top to build this broader store management platform that powers an entire supermarket end to end.

6. 4:58 – 5:34

   Demo Day traction and early adopter grocery brands

   1. AEAaron Epstein4:58

      Mm-hmm. And, um, do you remember how many stores you had by demo day?

   2. BHBrandon Hill5:03

      You know, I think we had 24 stores.

   3. AEAaron Epstein5:06

      Uh-huh.

   4. BHBrandon Hill5:06

      And those 24 were folks like Mollie Stone's, and these were important names in the Bay Area.

   5. AEAaron Epstein5:11

      Okay.

   6. BHBrandon Hill5:11

      Mollie Stone's, Berkeley Bowl, and a few others, and these were early adopters that, that saw this product and they said, "Honestly, we have a huge pain point 'cause we're spending hours flipping through papers, phone calling our suppliers to order bananas and ketchup and rice, and you just make it click of a button easy for me to get inventory to my shelves so I'm not out of stock."

   7. AEAaron Epstein5:34

      Yeah.

   8. BHBrandon Hill5:34

      Yeah.

7. 5:34 – 6:39

   How the first customers were won: relationships, persistence, and in-store discovery

   1. AEAaron Epstein5:34

      Yeah. Talk about that a little bit. The product was obviously very early, um, especially the beginning. Like, you had no reference customers or social proof that this was something that anybody should trust you with. How did you get your first customers, and what was that like trying to get some of those sales?

   2. BHBrandon Hill5:49

      Grocery as an industry, just like many of these old school industries, it's about relationships, it's about trust, and honestly, it's about persistence. And for us, honestly, the first, the first cohort of customers were really about walking into the store, looking a store o- asking for the store owner.Actually, before even doing that, studying the grocery store. Walk the aisles, see what items are on the shelves, what makes the store unique, and then finding the owner in the store, asking for their time, and saying, "Hey, my name is Trey. My name is Rob. My name is Brandon. We are very interested in your store. You have a beautiful store, and we wanna know what problems we could help solve for you." Showing up every day after they kick you out.

   3. AEAaron Epstein6:31

      [laughs]

   4. BHBrandon Hill6:31

      Show up the next day, be persistent. And then they say, "Okay." I think, you know, the stores basically realized that we weren't gonna leave, and so they gave us audience.

   5. AEAaron Epstein6:38

      Yeah.

8. 6:39 – 9:30

   The MVP breakthrough: barcode scanning orders and the ‘goosebumps’ moment

   1. BHBrandon Hill6:39

      And they sat down and said, "All right. If you guys are serious..." I remember The Market at Edgewood was, uh, one of the first stores. It's a store in Palo Alto-

   2. AEAaron Epstein6:45

      Mm-hmm

   3. BHBrandon Hill6:45

      ... um, not far from Stanford's campus. And, uh, the owners, they finally give us a sit-down, and they say, "We don't think you can solve any of these problems for us, but since you come in here every other day asking for our time, we can explain what's keeping us up at night." And they explain this, a, a set of problems, but really the most important one for them was, it, it was around inventory management and reordering their inventory. And if you imagine a grocery store, one of the key things that defines a grocery store is that there are not 100 SKUs or 1,000 different items. There's 50 or 100,000 items in a grocery store-

   4. AEAaron Epstein7:22

      Mm-hmm

   5. BHBrandon Hill7:22

      ... that they're ordering from hundreds and sometimes up to 1,000 different unique wholesale suppliers and vendors, and they're managing it using this clipboard.

   6. AEAaron Epstein7:31

      Yeah.

   7. BHBrandon Hill7:32

      Now, that takes a lot of time. There's errors. There... The problems that the, uh, The Market at Edgewood told us is they forget to place an order, and so then a shelf is empty, or they order too much, and so then they have to throw very good broccoli and produce into the trash can. And they said, "If you can help solve this, this would be, this would be huge for us. Um, but we don't think you can do it."

   8. AEAaron Epstein7:55

      [laughs]

   9. BHBrandon Hill7:55

      And so then we document everything. We ask them, "Can you give us what are you using now? Can we take pictures of it? Can you send us your spreadsheets with your inventory on it?" And we went into our garage in East Palo Alto-

   10. AEAaron Epstein8:05

       Mm-hmm

   11. BHBrandon Hill8:05

       ... right across the street, Trey, Rob, and I, and we literally, we bought, like, a case of Red Bull and a bunch of, like, beef jerky, and we sat in our garage, and we built, uh, an app to solve this in, like, 11 days. And then we came back to them, and we said, "Hey, we think we have something for you." And I'll never forget Jaime, the dairy order clerk. We said, "We wanna try this with your dairy supplier, um, because that's the most important department in a way in the store, because everybody's buying milk and eggs every single day."

   12. AEAaron Epstein8:34

       Mm-hmm.

   13. BHBrandon Hill8:35

       Jaime says, "All right. I'm gonna take it for a spin." We go to the dairy aisle. He grabs the phone out of our hands, and he goes to start to scan these barcodes and place a digital purchase order. Mind you, before, he's doing it all on sheets of paper-

   14. AEAaron Epstein8:50

       Mm-hmm

   15. BHBrandon Hill8:50

       ... with a bunch of, with, with spreadsheets on them.

   16. AEAaron Epstein8:53

       Yeah.

   17. BHBrandon Hill8:55

       Midway through, he pauses, and he, and he looks at us three founders sitting there in the dairy aisle. He says, "Guys, I have goosebumps. I've never seen something like this before." And then Trey, Rob, and I look at each other like, "What?" And, and Jaime literally grabs, I think he grabs Rob in a bear hug. And by the way, Jaime's, like, 6'2". He's a large guy, right?

   18. AEAaron Epstein9:18

       Yeah.

   19. BHBrandon Hill9:18

       And he lifts Rob [laughs] off the ground. His feet are dangling. He's like, gives him a bear hug like, "Nobody's ever built something for me before." And I think it was at that moment we knew even though it was small, it was big.

9. 9:30 – 11:09

   From love to proof: scaling to paying customers with design partners

   1. AEAaron Epstein9:30

      Yeah. Yeah, was that convin- what convinced you that this was gonna work and that you were on the right track? Or was, did you still have doubts after that? Did you need to see more evidence from other customers to know it was a common problem?

   2. BHBrandon Hill9:42

      We definitely needed to de-risk it further, of course. And so what that moment told us is there's a gap in the market, right? There's clearly a pain point. If, if Jaime feels this way, where he's getting goosebumps and is giving us bear hugs, that feels like the type of visceral reaction that, that you and that Michael Seibel and that Paul Graham talk about when we talk, talk about that, like, unquantifiable feeling of product market fit.

   3. AEAaron Epstein10:05

      Yeah. We talk about find the 10 customers that love you rather than the thousand that sort of like you.

   4. BHBrandon Hill10:10

      Exactly.

   5. AEAaron Epstein10:10

      And that is an embodiment of love you-

   6. BHBrandon Hill10:14

      Yes

   7. AEAaron Epstein10:14

      ... picking you up, giving you the bear hug and, and the goosebumps.

   8. BHBrandon Hill10:16

      Can we get 10 people to give us bear hugs, right?

   9. AEAaron Epstein10:18

      Yeah, right. [laughs]

   10. BHBrandon Hill10:19

       As opposed to 100 people who give us handshakes-

   11. AEAaron Epstein10:20

       Yeah

   12. BHBrandon Hill10:20

       ... is kind of the thing. So then from there we're like, all right, there's a gap in the market. Is there a market in the gap? And so for us, that's like, we need to get more customers, and then we need to get them to pay us. And so that, we went from that one to then to Delucce Market where we, um, met our first employee, what would become our first employee, Abby. Uh, she was the store director there. She actually helped us redesign that MVP into something that would be more scalable.

   13. AEAaron Epstein10:46

       Mm-hmm.

   14. BHBrandon Hill10:46

       She took out a napkin and said, "Hey, you should redesign the interface like this." She's a grocer, young, in her 20s. And we took that. We rebuilt it in her back office, writing code in the back office of the grocery store. We rebuilt the app. We eventually relaunched it to her. She loved it. And then, you know, eventually to the third, the fifth, the 50th store, uh, and then we started doing our, our first revenue.

10. 11:09 – 11:16

    Go-to-market evolution: from founder-driven to a national field sales team

    1. AEAaron Epstein11:09

       What's your, uh, sales process like now? Are you still showing up at the stores? Or how have you figured out a way to scale that?

11. 11:16 – 15:17

    Building the full-stack grocery OS: POS, payments, inventory, marketing, pricing

    1. BHBrandon Hill11:16

       Yeah. And it's been a very interesting integration. Uh, our evolution of our go-to-market has been very interesting. Of course, in the YC days, it's founders' feet on the street. Knock on five stores a day. And then you go from founder exclusive or founder driven to founder led. Then we, you know, eventually we hired our first three reps. And again, this is after we expanded our product surface area. I think what's important, before I even get there, I think what's important to understand is it, from 2020 to 2024, was actually a long period of what I would consider research and development. We expanded from this wedge product in a very tough market, which is grocery. It's very durable, but it's extremely high barriers to entry. Because of regulation, you have to have government payment types like food stamps-

    2. AEAaron Epstein12:05

       Mm

    3. BHBrandon Hill12:05

       ... and EWIC.

    4. AEAaron Epstein12:06

       Mm-hmm.

    5. BHBrandon Hill12:08

       Three orders of magnitude more inventory than, uh, a restaurant or a coffee shop. So if you think about a coffee shop, they have 50 menu items or a restaurant, there's 100 menu items. In a grocery store, there's 50,000 or 100,000. You have to think about and reason about all that complexity. And so we went on this odyssey over that four-year period where it took us to, you know, design partners in Western Colorado, visiting stores in Amsterdam. We wanted to get this global view of how grocery worked so that we could build the canonical operating system for all of food retail globally.

    6. AEAaron Epstein12:37

       Mm-hmm.

    7. BHBrandon Hill12:38

       That was our ambition, but we had to do it one store at a time. Over the four years, we expanded from just this ordering app that Jaime loved and gave us a bear hug for, um, all the way to a full stack system that is point of sale, payment processing, inventory management, shopper marketing, and dynamic pricing. These are the five pieces that allow us to go in and double the net profitability of the grocery store.

    8. AEAaron Epstein13:03

       Mm-hmm.

    9. BHBrandon Hill13:04

       Um, and that is the end product that we needed. I actually distinctly remember Michael Seibel. W- we're contemplating, man, this is a very scary leap to go from just an app, which even pre-cloud, like anybody can build an app, to hardware and to payments and to becoming this, like, this grownup compound startup.

    10. AEAaron Epstein13:24

        Mm-hmm.

    11. BHBrandon Hill13:25

        And I remember Michael Seibel said specifically, "You, this is what you have to do. What is-- Where in the grocery store is your customer spending the most money?" Our customer being the store. "What technology are they spending the most money on? It's on the point of sale, it's on payment processing, it's on the store operating system."

    12. AEAaron Epstein13:39

        Yep.

    13. BHBrandon Hill13:40

        And we're-- So we built that out over four years of se- of, of intense research and development. Now, once we launched that, uh, it was still founder-led, knocking on doors, earning trust with many of the-- honestly, going back to many of the stores that had trusted us with just our, our initial application.

    14. AEAaron Epstein13:58

        Mm-hmm.

    15. BHBrandon Hill13:58

        Our ordering app.

    16. AEAaron Epstein13:59

        Yeah.

    17. BHBrandon Hill13:59

        We said, "Hey, now that was our appetizer. Now we have a main course for you."

    18. AEAaron Epstein14:03

        Mm-hmm.

    19. BHBrandon Hill14:03

        And that's how we kind of got our early, you know, first, uh, like 50, the first 20 stores on the, on our end-to-end store management platform. Then we hire three sales reps, coming back to your question of our, our go-to-market.

    20. AEAaron Epstein14:15

        Mm-hmm.

    21. BHBrandon Hill14:15

        Now we go to founder-led sales, where we have, uh, you know, three sales reps focused on Northern California, gave them quotas, and we ramped them, and we got them to success. Uh, I think, you know, quotas are roughly a million dollars a year, and they were successful. That then led us to, uh, founder-managed sales or even really a scalable go-to-market motion that we have now, where we have a US head of sales.

    22. AEAaron Epstein14:40

        Mm-hmm.

    23. BHBrandon Hill14:41

        We have a sales team of 15 spread nationally, focused on different geographies, and there's an inside motion. Um, but all of it comes down to that core sentiment of you have to build the rapport with the grocers. Our sales, our sales reps are field sales reps. They knock on doors. They have a playbook for how to, um, identify grocery stores. You can use various heuristics online to figure out what are the best ones.

    24. AEAaron Epstein15:04

        Mm-hmm.

    25. BHBrandon Hill15:04

        Google reviews, um-

    26. AEAaron Epstein15:06

        Yeah

    27. BHBrandon Hill15:07

        ... different things. And then once you get in the store, it's about how do you build that relationship and how do you diagnose pain points and, uh, again, have that human touch that YC taught us.

12. 15:17 – 17:56

    Selling the ‘heart transplant’: winning POS replacements by tying to P&L

    1. AEAaron Epstein15:17

       I think a lot of founders, um, start with a wedge product like you guys did, and they think, "Okay, I'm gonna sell this wedge. I'm gonna find the people that want the wedge, and then we're gonna expand our product line," a- as you did, "and then just go back and expand within those businesses, and they're gonna pay us more, and everything will be great." Was that your experience, or was it actually a lot harder than you thought to get people-- Like, you're asking people to rip out their point-of-sale system-

    2. BHBrandon Hill15:41

       Right

    3. AEAaron Epstein15:42

       ... even though they trusted you and they used you for this one piece. Was it as easy as you thought it might be, or did it turn out to be harder? And what ended up being the pitch that, that, that worked to convince them to, to rip out the thing that was already working for them?

    4. BHBrandon Hill15:56

       It actually became a really big deal. You're asking them to kind of do a heart transplant.

    5. AEAaron Epstein16:00

       Mm-hmm. [chuckles]

    6. BHBrandon Hill16:01

       And [chuckles] not everybody wants to do a heart transplant. But what we found out is that if you actually just tightly couple our solution to their P&L and you talk about everything in terms of P&L. So our formula is actually three things: sales, gross margin, and labor. Everything about Vori right now, from the way we build product to the way that we sell it to the way that we onboard it, is focused on those end microeconomic levers of the grocery store. And our impact overall has been, you know, over ac- our, our whole body of customers, 20% to 25% lift in net sales. That's massive for a grocery store that's doing a million to a million and a half dollars per month-

    7. AEAaron Epstein16:41

       Mm-hmm

    8. BHBrandon Hill16:41

       ... in volume. Two, growing their gross, adding 7 to 10 points in net prof- in, in gross margin, which is basically a 25% lift from where they are. That's huge. That means every sale they make is more profitable. And then three, labor. To be able to come in and say, "We can come in and repurpose one or two of your headcount from doing valueless work like hanging up shelf tags or printing out paper and, and retyping in data into your back office ERP. Forget all that. Go spend time with your customers." When you add that stack of value up, all of a sudden, Vori is the number one investment that they can make pretty much in their-- We have grocers that say, "Vori is the best investment I've made over 20 years."

    9. AEAaron Epstein17:21

       Hmm.

    10. BHBrandon Hill17:22

        So now when you actually approach the store and say, "Hey, we wanna rip out your, your POS and replace you with something that can double your net profitability," it becomes a no-brainer. And so our median sales cycle is something like 18 to 21 days.

    11. AEAaron Epstein17:33

        Hmm.

    12. BHBrandon Hill17:33

        And our median deployment cycle is, I think, 37 days now.

    13. AEAaron Epstein17:37

        Yep.

    14. BHBrandon Hill17:38

        Um, so it's not like a lot of people might misunderstand and think, "Oh, it takes Vori six months to sell a grocery store and another six months to get them live." No, you're actually seeing almost like SMB, almost consumer-like buying patterns, but with ERP-level complexity and stickiness.

13. 17:56 – 20:36

    AI inside Vori: autonomous agents, faster shipping, and a defensible moat

    1. AEAaron Epstein17:56

       AI's obviously been a huge, uh, huge change in the world right now. How has that impacted you either in your product or given you tailwinds or made it possible for you to do things that weren't possible before? Um, and is it a risk to your business in any way? Like, I know there's a lot of businesses worried about how the world is changing, but everyone's always gonna need groceries, right?

    2. BHBrandon Hill18:15

       I think AI does three things for us. Number one, it helps us devel- deliver a better value prop to our customer.... in our product. Number two, it allows us to operate more efficiently as, as a business. And then number three, there is a defensibility that it gives us overall. So in terms of our product, our product is driven by three agents that take autonomous action on behalf of the grocery store, right? You have our inventory agent that will automatically queue up orders when it's time to replenish from the grocery store, or, uh, automatically generate personalized offers to help grocery store customers, um, increase their basket sizes. Oh, of course, our pricing agent is-

    3. AEAaron Epstein18:54

       Mm

    4. BHBrandon Hill18:54

       ... uh, most powerful because if you imagine tariffs and inflation, the cost of goods of a grocery store is always going up. Bananas are going up. Milk is going up. And the cost the store has to pay to procure those, and so how do, how do they stay on top of their margins? Vori automatically recognizes a price change, uh, from an invoice, pushes an update to the shelf with our electronic shelf labels, and makes sure that the customer pays the right price at checkout, which is ours as well. And that entire, like, chemical reaction is done automatically in one step, whereas it was a 12-step process before. Internally, like, we are now shipping stuff that would take a year and a quarter, and a quarter and a month, and a month and a week, and a week-long dev cycle will take a day, and that's really exciting. And on the go-to-market side, we have sales reps who are coding to win deals. So we're completely-

    5. AEAaron Epstein19:44

       [chuckles]

    6. BHBrandon Hill19:44

       ... AI-filled internally. And then lastly, when you think about, like, the moat, I'm seeing this bifurcation in what's going on with AI. I think you have AI for kind of digital work. People talk about the thin AI wrappers, um, pieces of software that, like, basically the cost of software going to zero. And then you have AI for, like, real industries. I think Vori sits in this interesting place where we're-- It's like the HALO business, heavy asset, low obsolescence, where we have hardware. We have, of course, we're AI native. We have payments and government regulation. We have multiple layers of-- We have operations to get the product in the store.

    7. AEAaron Epstein20:18

       Yeah.

    8. BHBrandon Hill20:19

       That only-- What it takes for us to win only becomes cheaper, but what it takes for somebody else to catch up-

    9. AEAaron Epstein20:26

       Yeah

    10. BHBrandon Hill20:26

        ... only gets more expensive. I'm very bullish on any startup that's building for these big pillars of the American economy, healthcare, food. I think Travis Kalanick has a whole thing on physical AI.

    11. AEAaron Epstein20:36

        Mm-hmm.

14. 20:36 – 22:11

    The hidden retail arms race: Walmart and Amazon vs. everyone else

    1. BHBrandon Hill20:36

       Sequoia actually has a piece on how retail, like the, the genealogy of retail, and how every technological innovation has driven a new unlock. Like manufacturing unlocked department stores. Railways unlocked Sears. Uh, microprocessor unlocked all of Walmart's innovations. Now AI is gonna produce what? Well, Vori is sitting in this interesting place where we see-- There's actually, Aaron, there's this interesting thing going on right now where there is a $1.5 trillion race to transform and define the future of American retail that nobody's talking about. Two of the largest and most operationally rigorous companies on the planet are literally betting their next trillion dollars of market cap on this right now, and that's Walmart and Amazon. Walmart, in the past three months, have filed 50 retail AI patents to transform Walmart su-supercenters into stores of the future. Amazon, they invented the e-commerce format. That's how they became a trillion-dollar company. Their next 10 years is focused on physical grocery. They bought Whole Foods. They spun up Amazon Fresh and Just Walk Out, but they also are now opening up Costco competitors in Chicago and planning to scale, scale like a club format across the country. Combine those two companies are, what, 25% of overall trillion and a half grocery market. The other 75%, there's nobody else building Walmart and Amazon scale technology for the rest of, you know, the 200-plus thousand food and bev retail locations in the country, and definitely, you know, there's $10 trillion of volume to go out and modernize across the planet.

    2. AEAaron Epstein22:07

       You help them compete.

    3. BHBrandon Hill22:09

       We're helping them compete.

    4. AEAaron Epstein22:09

       Yeah.

    5. BHBrandon Hill22:10

       And that's where we're at.

15. 22:11 – 25:32

    Lowest point and the reliability lesson: the ‘don’t mess with the dairy order’ story

    1. AEAaron Epstein22:11

       Yeah. You've been building a lot of momentum over the last few years. Um, but I'm curious, what's been the low point for you? It's been a lot of ups and downs. What sticks out as the time when you thought maybe you might not get to this point?

    2. BHBrandon Hill22:23

       I'll tell you a story about a, uh, a dairy order. So one of our principles internally is actually don't mess with the dairy order, and it's a ode to reliability because we're, Vori is so important as critical infrastructure for the store, and the store is critical infrastructure for a community. But one day we literally did not-- We failed so bad. What happened was, um, it was actually Mollie Stone's Palo Alto. I remember we got a call on support at, like, 5:00 a.m. Because you remember grocery stores open up-

    3. AEAaron Epstein22:52

       Mm-hmm

    4. BHBrandon Hill22:53

       ... very, they open it early, but they do their work even earlier.

    5. AEAaron Epstein22:55

       Yeah.

    6. BHBrandon Hill22:56

       And they called saying, "Hey, we placed a large Clover Dairy order on Vori, and Clover just let us know that it's not gonna come because Vori dropped the order somehow. And we're panicking because if Mollie Stone's doesn't get milk, that means that community's mothers are coming in, don't have milk for their, for their kids. Kids don't have milk for their cereal. That means there's no eggs for breakfast, and that also, you know, dairy is actually the loss leader. People come in to get dairy products, and they also get other items throughout the store.

    7. AEAaron Epstein23:28

       Mm-hmm.

    8. BHBrandon Hill23:28

       Um, and it was gonna fall on us. It was gonna impact our reputation as, like, a, at that point, like, a one, like, a six-month-old business. So we took a page out of YC's book, which is superhero acts of customer service, and what we had to do was we literally rented a refrigerated truck that morning. We drove to, I think we drove to Whole Foods. We drove to, like, a couple, like, big box locations and literally recreated their order by buying these items off the shelf.

    9. AEAaron Epstein23:56

       Right.

    10. BHBrandon Hill23:56

        And I remember we had, like, five carts filled to the brim, uh, of, of milk and eggs and cheese. We put it in this dairy truck, in this refrigerated truck, and we had to deliver it to Mollie Stone's. And we got there just in time, uh, for, for them to kinda open their doors. And I'll never forget that moment because if we would have actually dropped it, we probably would have lost that account and all the other stores that ultimately signed up for Vori because of Mollie Stone's.They would've not signed up. But because we, we kind of stepped up to the plate and delivered, we were able to keep our reputation intact. And to this day, Molly Stone's, uh, they tell that story, um, of, of how Vori kind of came in and, um, made things right.

    11. AEAaron Epstein24:40

        It's such a great example of anytime something goes wrong, it's an opportunity to make an even bigger champion out of your customer just by fixing it and, and taking action like most people wouldn't, right?

    12. BHBrandon Hill24:50

        Well, it's like you were saying, like I think that's the competitive advantage with most startups is giving a shit.

    13. AEAaron Epstein24:56

        Yep.

    14. BHBrandon Hill24:56

        And you may not have the best product, you may not have the best, the biggest team, but just by showing up, taking that phone call at 11:00 PM or at 5:00 AM-

    15. AEAaron Epstein25:06

        Yep

    16. BHBrandon Hill25:06

        ... founders giving their cell phone number to the customer saying, "Hey, look," like you said, "my business, literally my survival is tied to your success."

    17. AEAaron Epstein25:15

        Mm-hmm.

    18. BHBrandon Hill25:15

        "I want you to succeed. Call me with anything." Um, that has stuck with us even to this day. Like we're not, you know, now we're national, like I said, doing half a billion dollars in payments volume. Um, still at this point, caring matters.

    19. AEAaron Epstein25:28

        Yep. It's a competitive advantage.

    20. BHBrandon Hill25:31

        Yeah. Totally agree.

16. 25:32 – 28:16

    What’s next: the self-driving grocery store and financial services layer

    1. AEAaron Epstein25:32

       What's next for you guys in the next few years? What's the future of Vori?

    2. BHBrandon Hill25:36

       Vori's goal is to build the clearing house for trade in the global food supply chain. And so we're, the path for us is how do we get to 100 million in ARR? That's simply walking and getting our first 3,000 stores on the platform. Um, and we can do that with our current product. And so it's just inves- investing in the product, investing in sales, and, and marketing and deployments, and just kind of walking in a straight line. Where we wanna go in the long term though is we want it such that if you walk into a Safeway or you walk into a Trader Joe's or you walk into an Aldi or a Costco, you see Vori running what is effectively a self-driving grocery store. We believe in this vision of the self-driving grocery store, which means the store owner... And it's not about replacing humans. It's about augmenting humans and taking the nonsense manual work out of the business. The grocery store of the future will be, for the consumer, it's gonna be a very homey environment. The grocery store's actually becoming kind of a third space. If you look at, if you look at some of the, the reports coming out, Gen Z is actually shopping more at grocery stores than millennials in person. They're holding speed dating events inside grocery stores. They're having, they're setting-

    3. AEAaron Epstein26:45

       Just like your, your parents.

    4. BHBrandon Hill26:46

       Just like [laughs] yeah. It's crazy. Um, and I think what it is is, you know, there's, there's gonna be three layers to the self-driving grocery store. There's gonna be the system of record layer, like you said, the ERP, holding the suppliers, inventory pricing, all in, in, on, on, in one ledger, one login.

    5. AEAaron Epstein27:04

       You got that.

    6. BHBrandon Hill27:05

       We got that. We have the system of action, which is the agents that now can act on behalf of the store, leveraging that data on pricing, inventory, and marketing to make them more, more money and save them time and their sleep. And then there's the system of transaction layer, which is effectively processing every dollar that flows in the store and out of the store. Right now, we process every dollar that comes into the store through payment processing.

    7. AEAaron Epstein27:26

       Mm-hmm.

    8. BHBrandon Hill27:26

       That's actually 60% of our revenue.

    9. AEAaron Epstein27:28

       Mm-hmm.

    10. BHBrandon Hill27:29

        Now it's like how do you layer on the ability for the store to pay its bills to its suppliers, to earn, to secure capital from Vori if they wanna open up a new location or add a new, add a coffee shop or a new department to their store, um, and eventually other financial services on top of that. Um, and we'll get there. We'll get there over the next five, 10 years.

    11. AEAaron Epstein27:50

        Yeah. Well, it's a massive secret industry that I think a lot of people don't know about, and it's been really amazing to watch all of your growth and progress over the years since the batch, was it six and a half years ago almost now?

    12. BHBrandon Hill28:02

        Yeah.

    13. AEAaron Epstein28:02

        Um, and to see how well you guys have been doing. So really appreciate you coming on and, and sharing your story here.

    14. BHBrandon Hill28:07

        Thank you so much. Great to be here. [upbeat music]

Episode duration: 28:16