- Adora from Y Combinator interviews Ush Magarg, CEO and founder of Gobble, a company that delivers 15-minute pan dinners.
- Gobble started in 2011 and is currently making around $100 million in revenue per week.
- Ushma discusses the evolution of her business and the challenges she faced.
- She also talks about the importance of determination and not giving up.
- Ushma started her first company in college but eventually sold it because it didn't align with her values.
- Her health declined during this time, leading to the inspiration for Gobble.
- Gobble initially started as a marketplace for home-cooked meals, then shifted to catering, personalized dinner service, and finally to 10-15 minute dinner kits.

- The speaker discusses the evolution of their catering business, starting with personalized dinner service and later transitioning to a meal prep service.
- They talk about meeting one of their first users and the importance of feedback in improving their company.
- The speaker shares their strategies for acquiring users, including distributing promo cards and partnering with meetup groups.
- They discuss the different iterations and failures of their business models, including a marketplace model and a catering model.
- The speaker emphasizes the importance of personalization in the food industry and the potential for long-term success in cracking it.
- They highlight the challenges and risks involved in changing business models.

- The speaker faced fear and criticism from investors when deciding to stop enterprise catering.
- They learned to trust their gut instincts and not be swayed by others' opinions.
- The book "Blue Ocean Strategy" helped them develop a framework for their company.
- Product-market fit is a combination of growth and retention.
- The speaker initially made sales without a website to prove their concept.
- Funding was difficult, but they managed to keep their burn rate low and raised bridge rounds.
- Y Combinator (YC) helped them secure funding and they eventually found success with a 15-minute one-pan dinner kit.
- Keeping employees motivated was challenging, but referrals and transparency helped.
- They turned down an acquisition offer from a clothing startup, choosing to stay independent.

- The speaker sees a lot of potential in their company, Gobble, and believes they would be leaving billions on the table if they were acquired now.
- They believe that necessity breeds invention and not having much money forced them to innovate and focus on making every dollar count.
- The speaker attributes their determination and grit to experiences they had as a child, such as being rejected from a school multiple times but eventually getting in and seizing the opportunity.
- They believe that success is not an overnight phenomenon, but rather the result of hard work and perseverance.
- The speaker mentions that the only reasons they have quit in the past is when they felt their work lacked impact and fulfillment.
- They emphasize the importance of constantly evolving and not getting comfortable in order to stay competitive.
- Two critical decisions that contributed to their success were hiring an executive chef to innovate in the food industry and receiving support and motivation from someone who believed in their idea.
- The speaker encourages speed to execute and finding people who are in your corner as critical factors for success.
- The speaker envisions Gobble being even bigger in the future.

- The speaker envisions Gobble becoming the "Disney of the home" by creating magical experiences that are easy and fit into busy lives.
- They aim to facilitate moments with loved ones through learning, dinner, and food.
- Gobble is also working on other things like education and learning.
- The speaker suggests establishing a shell company and having an investor as a board member to navigate legal and immigration hurdles.
- Pricing for Gobble was determined through experimentation using email and offering different plans to customers.
- The speaker initially started Gobble as a solo founder but eventually formed a 5-person executive team that operates as a co-founding team.
- The role of the CEO has changed from constant innovation in the early days to now being filled with meetings.
- The highs include the gratification of being known and meeting customers, while the lows include struggling with few customers and feeling alone.
- The speaker emphasizes the importance of caring about the customer and their experience for long-term success.
- In the early stages, the speaker suggests working with mentors, advisors, and friends by not pestering them but making them believe in the company's vision.

- The speaker shares two strategies for getting mentors and advisors: targeting the right advisors and asking them questions in their area of expertise.
- The speaker emphasizes the importance of being organized and prepared when meeting with mentors and advisors.
- The speaker also discusses the challenges of getting investors and advises practicing and perfecting your pitch.
- The speaker suggests ending investor pitches on a strong, confident note, emphasizing the potential for success rather than focusing on protecting their money.

- Ush Magarg, CEO and founder of Gobble, discusses the evolution and challenges of her company in an interview with Adora from Y Combinator.
- Gobble started in 2011 and currently makes around $100 million in revenue per week.
- Ushma talks about the importance of determination, not giving up, and the inspiration for Gobble.
- Gobble initially started as a marketplace for home-cooked meals and later transitioned to catering, personalized dinner service, and finally to 10-15 minute dinner kits.
- The speaker emphasizes the importance of feedback, personalization, and the potential for long-term success in the food industry.
- They discuss the challenges and risks involved in changing business models and the importance of trusting their instincts.
- Y Combinator helped Gobble secure funding and they found success with a 15-minute one-pan dinner kit.
- The speaker believes in the potential of Gobble, sees it becoming even bigger in the future, and emphasizes the importance of constantly evolving and not getting comfortable.
- They mention the importance of caring about the customer experience and the challenges of getting mentors and investors.

YC Partner Adora Cheung - https://twitter.com/nolimits - talks to Gobble (YC W14) founder and CEO Ooshma Garg - https://twitter.com/ooshma

You can find additional content here: https://www.startupschool.org/videos/54

Learn more at https://www.startupschool.org/

I'm 1 of the partners here at Y Combinator.

And today we're going to talk with, have a conversation with Ush Magarg, who's the CEO and founder of Gobble, which creates and delivers 15-minute pan dinners to you.

It's great for people who don't have time to do grocery shopping, prep ingredients, actually cook and then clean up afterwards.

So Gobble started in 2011 and while it's doing pretty well today, It's growing around 100 million revenue per week, I believe.

It's gone through its many ups and downs.

And so with Ushma today, I wanted to talk to her about a couple things.

She's mostly been in the food business, but it's iterated her business model many times.

And so I think it'd be interesting to talk about that.

And then 2 is something she's an expert in, which is grit and determination.

I think she's 1 of the few people that I've seen that just never gives up.

And so I think determination are 1 of the qualities many people think they have, but when shit hits the fan, things start to fall apart.

And so I think it's also interesting to talk about.

So with that, I would love to welcome Ushma to the stage.

So maybe we can just briefly start from the very beginning.

You were a student at Stanford, and I believe you started your first company then, which was, correct me if I got this wrong, is you helped students get jobs at banks and other companies.

say, obviously that didn't work out and you did Gobble instead, but can you explain why that didn't work out and what made you think that you should just move on from that idea?

So back when I was at Stanford, I started this company out of my dorm room.

And fun visual is that I had this 150, 200 square foot room like with no space And I lofted my bed like 5 inches from the ceiling and stuffed some like Ikea desks under my bed.

I was a junior, so I hired all these freshmen, really smart freshmen as interns, and got a boyfriend so I could sleep somewhere else for the business.

And and then our dorm room became our office, and I hid the key in the girls bathroom, and people would come between class and get the key from my pink shower caddy, and then go into my dorm room and work on our startup.

And the idea was to help students get jobs.

I was head of this group, Stanford Women in Business.

We were matching people to banks and law firms and consulting firms.

I bootstrapped it and no 1 would fund me.

They told me the idea was too niche or what have you.

But really, no 1 was using LinkedIn at the time and all of these students are looking for work so I thought that we could really be the LinkedIn for students and it was all centered around their interests and student groups.

Long story short, the idea was working and we were making money.

Like these companies would write us $20,000, $25,000 checks for annual subscriptions to my recruiting website.

And it was a two-sided marketplace, so what really happened is, first of all, I poured everything I had into the business, and my health went down the drain, which later leads to gobble.

But what ended up happening is, I learned the hard lesson that whoever pays you kind of owns you and determines how your product evolves.

So these banks and consulting firms and all of them were paying me, and they wanted to recruit students based on quotas, based on their GPA or their race or other parts of their background that didn't really have to do with if they were a good cultural match.

So anyways, I was making money, but the mission and the initial vision and all of that of the business of helping people find good jobs wasn't true anymore.

So I actually got to a very dark place and ended up selling the business.

So it could have worked, and it could have worked longer term, but it wasn't the business I initially intended, and I'm not the kind of person who is just gonna do something to make money, I wanna do something that I believe in.

So in our third year, we were taking off with law firms.

There are thousands of law firms and only tens of banks on Wall Street.

And so I sold it to a company called Law Works and basically they're recruiting company and software and they wanted to add community to their offering.

At that time it was like 2010 and social and communities and all of that were not as common as they are now.

So you mentioned briefly, this is a good transition into maybe talking about Gobble in the beginning, your health was going down the drain.

How did that actually turn into Gobble itself?

Yeah, I'm sure as you all are too familiar with, starting a company, at least, especially in the first thousand days, is very, very lonely.

Very few people believe in the idea outside of yourself.

And so you're the only thing that keeps yourself going.

And maybe your co-founder or your partner, but your partner is sick of hearing about it, and your co-founder may or may not work out.

And basically, I became just very insular.

I stopped visiting my family and my friends.

I was working on the business, but I was staying up too late, and then waking up too late, and then just eating all this takeout and soda.

And I think it not only affects your physical health and I gained a lot of weight, but it also affects your mental health.

So all of that came to a head when my dad insisted on visiting.

And I was here in California, my parents are in Texas, and my dad is the head of nutrition at UT Southwestern in Texas.

So he's spent 30 years of his life studying diabetes, obesity, and nutrition.

So, and then at home he would make sure we all ate home cooked food and like real good food.

And your parents always know when something's wrong.

So anyways, He got on a plane, actually first he cooked for 3 days and made all of this home cooked Indian food, stuffed it in these international suitcases that were nicely packed and checked in, everything's in foil and Ziplocs and whatever, flew here to California to my little dingy studio apartment, and without even saying hello, comes in the apartment, goes to the fridge, and starts stuffing the food in the fridge.

And it just showed his anger and sadness and emotion about me not taking care of myself and how bad things had gotten.

And he warmed a little plate of some sub-Z, which is like a vegetable Indian dish with some bread and rice and just put it in front of me.

I had this like Ikea two-person dining table in a corner and I ate this first bite and I just like started crying uncontrollably because the food was so good.

And it showed me that I like that's how much I had lost and it wasn't just nutrition it was like a sense of self and being.

And so anyways, that first bite of my dad's home cooking inspired Gobble.

And that moment was when I decided that home cooking and the sense of family dinner is very important to me.

So the first version on Gobble, if I got it correctly, it was a marketplace for people to create home cooked meals and sell it on a marketplace.

And then I believe then 1 year later you turned it into, if I have this written down, catering.

And then a year later it was personalized dinner service, and then to what it is, pretty much what it is today, 10, 15 minute dinner kits.

So maybe you could start off with, if you remember, your 1 liner for each 4 of those business models to help us distinguish the difference between those 4.

I definitely remember the first 1, because it's what I raised our seed round off of.

So we started, after I ate that food, I wanted to replicate my dad in the Bay Area and I posted on Craigslist and looked for moms or dads that would cook for me.

Anyway, the way that we described the idea, it ultimately became a marketplace for personal chefs and families.

And we described it as peer-to-peer lasagna.

And everyone remembered that and just said it.

And the peer-to-peer economy was really hot at the time.

Airbnb was just coming up, Etsy was coming up, and there were all these rental or sharing startups in 2010 to 2012.

So that's how we described the marketplace.

Catering was just like home-cooked food for office.

The personalized dinner service was exactly that.

It was meals personalized exactly to your tastes.

And our current dinner kits we describe as just as a meal prep service, 15 minute 1 pan cooking.

So everyone who built a product always remembers their very first user who wasn't their mom or dad or family.

Do you remember that person and what was he or she like?

So, recently I met 1 of our very first 10 users.

And it's really funny, I actually met him, And he was a user of ours in 2011, so now it's 7, 8 years later.

I met him a few weeks ago at a wedding in New York.

And he was like, I used to eat your food.

And he, you know, your product goes through so many iterations that when someone remembers like the first website of yours and all that, those bugs and things, it's really special.

He was a Stanford student and he would email us like pages of feedback, you know, every time he tried the food.

And so it was kind of the canonical early adopter that someone who really wants to work with you and who wants to help improve your company and like make it good for them and for everybody else.

So in the beginning, you also did a lot of unscalable things to get users.

I read you did promo cards everywhere, you went to Starbucks and I guess bothered people to order from Gobble.

So a lot of those things probably didn't work, but anything that you remember that actually worked.

1 of them is, I guess the things that work is, when you're just starting out, you can't throw a million dollars into Facebook ads in 1 week.

But it doesn't also work to just like talk to 10 individuals.

So it's all about reaching like micro groups.

1 thing I did is I would go to my favorite, I went to all my favorite shops, like coffee shops, restaurants, laundromats, whatever, and I actually bought card holders on like a whatever, equipment website, and made promo cards that were business card size, and it said like, 2 free dinners gobble.com and it had the restaurant's name on the back.

1 of the first valuable innovations or features that we released into our product was the ability to accept promo codes because attribution of your growth is extremely important from day 1 or else I can't tell you what's working or not working.

So there's zombie runners on California Avenue.

It's this coffee shop and it's inside a running store that used to be a movie theater.

And so they put a little thing at their register and it turned out to be more effective than the nail salons, the laundromats, anything else.

Another YC company, Order Ahead, actually for a while was very successful with coffee shops and promos and ordering at coffee shops.

1 other thing was I spoke to as many meetup groups or moms groups and neighborhood groups as possible.

And I would get them, I would always try to have an offer that was, I tested offers and I knew what would work, so every single 1 of them would send my offer on their email list.

And it had to be an email with your offer to a group and that converted.

The attribution point is very, I think, key there, which is, even if you're doing a spray and pray method of just like, everyone use me, at least you know when they come in the door where they actually saw

So, again, going back to the evolution of the business, at what point in each of the business models did you realize, Oh, this isn't it.

The funny thing is that, and so first of all, we talked about these business models.

All of that was going on from 2011 to 2014.

So between 3 and a half years, which is still roughly that thousand days of finding product market fit, We had 4 different iterations to the product.

And this is a minor little point, but I know that, I think Michael Seibel spoke recently, and he said that, he talked about the difference between pivoting and iterating, and I thought that was really important, because people say gobble pivoted, but we didn't pivot, we didn't turn into some like you know online video game, we just iterated and then found success.

So I think that nuance is important because pivoting I think you don't carry a lot of your learnings with you, iterating is always building on your previous learnings.

So with these business models and different iterations and launches, they all failed for different reasons.

We had a marketplace first And everyone loved the food because it was this authentic, small batch, home-cooked food from like real people.

Italian grandmas and Mexican moms and Ethiopian chefs and things.

That's not like ruined by capitalism, I guess.

So we started getting success with that marketplace idea.

But when I asked this like Italian mom in San Carlos to make me 200 of her lasagna when she used to make 20 a day, it wasn't fun anymore.

And she didn't want to make 200 and she wasn't a caterer.

So that model, you know, Airbnb is a peer-to-peer model that can scale and it's sharing an asset, it's sharing a space.

This is a peer-to-peer model that has a lot of break points at scale of quality, time, capacity and so on.

So that's why the marketplace model didn't work.

We were supply constrained, not by the number of chefs, but by the juice we could squeeze from each of our SKUs on the marketplace.

Then we pivoted to catering, because we had built that marketplace with seed funding and we were, we maybe had like a half a year of money left or something but 1 of our investors was very insistent that we pad our growth with money and we do something that'll definitely make us money.

You just get, we got like Box.net and Pinterest and these companies signed on and they rarely quit and so you're just making this money in the background.

We did that, we made good money and we showed growth but the problem is that when we went to raise series A, the investors asked how much of your money is from families and the model you're pitching and how much of your money is from families and the model you're pitching, and how much of your money is from catering and from enterprise?

And at that point, some 75% was from enterprise, because when you do something like that, like the previous startup lesson we learned, all your attention goes to what's giving you the most money.

And so that really sucked because unless I wanted to build a catering business, then I wasn't gonna get funding.

So we were in a pinch then and I had to raise a bridge round and wind down the catering business, which was hugely unpopular because we were making lots of money, but it wasn't my long-term vision.

The vision was that people don't have access to this home-cooked food, and I wanted to crack it and figure it out and give it to everyone.

So we wound that down because it wasn't part of the long-term vision.

So then we focused on this personalized dinner service.

I still today think that the power of personalization, what Amazon brings to e-commerce and what Netflix and Spotify bring to movies and music, that level of personalization has not taken off in food.

And just like Google with search, the company that cracks it in food, I think, will be the long-term winner and have all these learnings built on top of each other to where you build a long-term sustainable advantage.

So that's what we did with that personalized dinner service.

We took these chefs and then we started using restaurants and caterers and we focused on the technology because that's what that's the talent that we had in our headquarters.

So we focused on the tech to match, to take, we allowed people to give us whatever taste they wanted.

So we ended up getting like thousands of picky eaters and people who like didn't eat nightshades and they were vegan, but they still didn't like olives and lettuce and like crazy stuff.

And no matter what your tastes were, I said I would feed you.

And so anyway, that model really stretched our technology and by doing the hard thing we learned.

If you're a vegan and don't like lettuce, what are you eating?

I know, I don't know, Like lots of beans.

So you move the business model a little bit each time or quite a bit actually each time.

And so 1 of the difficult things in doing that is taking the risk and bringing down your current business for hopefully future success.

And that, I think a lot of people actually don't do that because it's very, very scary.

They just try to keep pushing the current model and trying to make it work.

And what was your thought process and actually just saying, no, not gonna do with enterprise catering anymore, even though it's making me tons of money?

And actually, some of our investors would call me into their office and just use it as like, me as a punching bag, you know?

And I'd sit down at their reclaimed wood table in their kitchenette or something, and I'd be sitting and I'd stand up and they'd be like, And every time there's new startups coming up, the grass is always greener because the investors know all your problems and they don't know any of the other problems.

So anyway, so they would be like, this company Muntry is starting and this company Order Ahead is starting and all these companies are starting and like, what are you doing?

And it was much louder and much worse than that.

And so, but you know, I have found, I think that's what you mentioned earlier about the grit and determination.

I don't know if it's learned or what it is.

Over so many years, I have found that I cannot listen to anything, there's nothing more loud than my gut.

And it just, when you know something and you've been in it for 3 years or thousands of days, you can't avoid it.

Other people think about you like 1% of the year and just in the 1 hour meeting.

And so I think early on we put a lot of weight into investor meetings, even into YC partner meetings, into all these meetings.

And it can really throw you off your game for a few days.

You're like, oh, this 1 person didn't like my idea.

And it's just something you have to get through.

And I would always try to justify each direction with logic and with market drawings.

And 1 book that really helped me was Blue Ocean Strategy.

And it talks about how companies broke through the noise in existing industries.

Talks about Southwest Airlines, Yellowtail Wine, and some really interesting companies that no 1 thought would work.

So you, and it gives you a framework with which to think about your company.

And I would draw that framework and keep using it as my North Star.

In a previous talk, and let me read this so I get it right, you said something pretty insightful, which is product market fit is not just an aha moment, it's a summation of lots of broad experiments and micro-learnings over many years.

Like a common mistake is for people when they look at product-market fit is to just look at 1 metric and then if it moves in 1 direction then that's good.

So what did you look at the beginning, and how did you visualize this summation of stuff?

Yeah, ultimately I think that product market fit is the center of the Venn diagram of ability to grow on 1 side and retention on the other side.

And so if you look at our history, in the marketplace model, we weren't able to grow because of the chefs.

In the personalized dinner model, we actually weren't able to grow really fast because of the customers.

Even though it was personalized, the food wasn't better than the best takeout that you could order.

So if you want to change the world or change your industry, you have to do something that is materially better, like iPhone level better than the market.

So people weren't racing to our door, so we didn't have that ability to grow.

Our dinner kit model has the ability to grow and scale internally and externally from customer demand, and it also has high retention.

So moving on to maybe more about grit and determination.

So in the beginning, at Stanford, you were a bioengineering major.

How did you manage actually doing all of this without being technical?

Well, initially, and everyone is gonna use their skill sets and I think the 1 common theme is that in the first few months you need to prove your concept.

You can do that with code, you can do that with sales, whatever.

I learned PHP but in both my businesses, in the recruiting business and the chef business, or the food business I have now, I made initial sales without a website.

And I proved our concept in the first 3 months before any other kind of funding.

So with the recruiting business, I did know like Photoshop and design and I taught myself all of that and loved it.

And I designed these like sales packages that would like, and I made up stuff.

I was like gold, platinum, whatever, $20,000 and I would like see if people would give it to me, which is very bold as a college student.

And I like had a mock-up of a website that wasn't built yet.

And I took a semester off and tried, and only did sales, because that was my proof of concept.

And my parents said that only if I got a sale could I not go work on Wall Street, which was horrible.

So side note, I didn't get a sale that semester.

And I met like maybe 80 or so people through introductions.

And I went to go work at Morgan Stanley in 2008 in that horrible summer.

And I hated my life, it was like equities trading.

And 3 weeks in, I got a check in the mail for $10,000, because it was a founding customer price, from this law firm.

And it took me 7 to 10 days to figure out how to quit the internship.

People were all like, you'll get blacklisted, you'll never get a job.

And I told the head of the program and he said, you will always have a job here, but you will never come back.

And I thought that was weird at the time and now I fully understand it.

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A Conversation with Ooshma Garg - Moderated by Adora Cheung