20 VC FF 20 Shaking Up The Food Industry With Willie Biggart @ Spoonfed



In this episode of the 20 Minutes VC, host Harry Stebbings interviews Willie Bigot, the Scottish chairman of Spoon Fed, a SaaS startup revolutionizing the corporate catering market. Bigot shares his entrepreneurial journey from founding BD Network, a leading European marketing agency, to investing in and transforming a chaotic catering business with co-founder Murray McNichol, which led to the creation of Spoon Fed's system-driven platform. He emphasizes the importance of systems over people in business efficiency and the vast market potential, with Spoon Fed tapping into a global £33 billion drop-off catering market. Bigot also discusses the challenges and strategies of fundraising, including their current £500,000 round on SyndicateRoom, and the value of operational experience in the industry one is innovating in. He concludes with insights into customer understanding, targeted marketing, and the significance of adding value for both customers and shareholders.

Summary Notes

Introduction to Spoon Fed and Willie Bigot

  • Willie Bigot is the chairman at Spoon Fed, a startup that merges SaaS with the food industry.
  • Spoon Fed aims to optimize the corporate meeting room food drop-off market for catering companies and restaurants globally.
  • The company is currently raising a $500,000 round on www.syndicateroom.com.
  • Willie Bigot founded BD Network in 1990 and exited in 2002, which is now one of Europe's largest marketing agencies.
  • Willie has started, developed, and sold three businesses since 1990.
  • The discussion revolves around the advantages of building a business around systems rather than people, the rise of SaaS, and opportunities in the B2B catering space.

"Spoon Fed offers a new way for catering companies and restaurants globally to take advantage of the growing corporate meeting room food drop off market."

This quote explains the core service offered by Spoon Fed, targeting a niche in the B2B catering market.

Personal Recommendation: Mattermark Daily

  • Harry personally recommends Mattermark Daily, a daily newsletter curated by Nick Frost.
  • The newsletter features articles from both the investing community and industry operators, like Willie.
  • Mattermark Daily is divided into two sections and is not a paid product placement but a genuine endorsement.

"And one of my favorite aspects of the newsletter is it's split into two sections, pieces and articles from the investing community, and then articles and pieces from operators in the industry like Willie."

Harry shares his appreciation for the structure of Mattermark Daily, highlighting the value it provides to readers interested in both investment and operational perspectives.

Willie Bigot's Background and Journey to Spoon Fed

  • Willie Bigot shares his background in marketing and his entrepreneurial journey.
  • He started his career in marketing roles at various companies and then founded a sales promotion agency.
  • Willie transitioned from BD Network following a management buyout and moved into a non-executive role, investing in startups and joining a business angel group.
  • He invested in a catering business, identified the need for systems and processes, and developed software to address this.
  • The software's success led to the sale of the catering business and the beginning of Spoon Fed.

"So we upsticks and started a sales promotion agency. My children weren't so happy when I came home and they were moved out the kids playroom. But we started from a very simple, basic platform and built the business over a number of years with some ups and downs, as I say, to 12 million turnover and a million PBT."

Willie recounts the early days of his entrepreneurial venture, emphasizing the humble beginnings and growth of his business.

System-Based vs. People-Based Business

  • Willie Bigot discusses the transition from a people-dependent business to a system-dependent business with Spoon Fed.
  • Systems and processes are emphasized as a means to enhance efficiency and value for customers.
  • A system-based business is portrayed as more scalable and impactful compared to a people-based business.

"Well, what was really interesting about spoonfed compared to my previous life in business, here we were running a business that was a system dependent business now, as opposed to a people dependent business. And that's our opportunity here we have something that we could create that would add serious value to customers and help them run their businesses better."

Willie highlights the fundamental shift in business approach with Spoon Fed, focusing on systems to drive efficiency and customer value.

Business Model and Market Opportunity for Spoonfed

  • Spoonfed is a SaaS platform designed for caterers delivering food to offices.
  • Ensures accurate and timely delivery, preventing embarrassment for the orderer.
  • Cuts out mistakes with integrated processes and back office functionality.
  • Competes against traditional methods like paper and spreadsheets.
  • Few competitors in the B2B space doing what Spoonfed does.

"So one of the great benefits of Spoonfed in this regard is it allows caterers customers to know with confidence that what they order is what they will get and it'll be on time."

This quote highlights the reliability and accuracy of Spoonfed's service, which is a key selling point for caterers and their customers.

"I've often said our biggest competitor is actually paper and spreadsheets, but there are more technology companies on the market than there ever have been."

This quote emphasizes the shift from traditional to technological solutions in the catering industry and the increasing presence of tech companies in the market.

The Scale of the Market Opportunity

  • The global drop-off catering food market is valued at 33 billion pounds.
  • Spoonfed's revenue potential is estimated at 200 million pounds annually.
  • The American market is significantly larger than the UK market.
  • Initially targeted smaller UK caterers but now also attracting larger chains.
  • Advanced diligence stage with two major retailers in the UK and the US.

"The drop off catering food market globally is 33 billion pounds. In terms of revenue potential for spoon fed, that's 200 million annual revenue potential."

This quote provides an estimation of the market size and the revenue potential for Spoonfed, indicating a substantial opportunity for growth.

"America is a huge market and it's eight times the size of the UK."

This quote signifies the scale of the American market relative to the UK, highlighting the potential for Spoonfed's expansion.

Technological Adoption in the Food Market

  • There's a broader acceptance of technology in society.
  • B2C food technology offerings are exploding, but B2B solutions like Spoonfed are rare.
  • Spoonfed offers a complete system for business efficiency, not just an ordering platform.

"But there's very few companies working in the niche space we are in, which is providing not only that online ordering platform that you get with the b to C side, but from a business to business point of view, we've got a complete system which you can plug into your business and it will run it for you and make it more efficient."

This quote explains Spoonfed's unique position in the market, offering a comprehensive system for B2B clients, unlike the numerous B2C solutions.

Early Customer Acquisition for Spoonfed

  • Spoonfed's initial customers included a former catering company and beta testers.
  • Utilized a targeted "rifle strategy" rather than a broad "shotgun approach."
  • Le Pan Quotidien found Spoonfed through inbound marketing, indicating a shift in customer acquisition strategy.

"Well, I mean, in the very early stages, really delicious was our old catering company that we sold. So it was natural that they wanted to take our system to continue to run the business."

This quote discusses the initial customer base for Spoonfed, leveraging existing relationships from a previously owned catering company.

"Le Pan quetidian actually found us through the Internet and inbound marketing. And I guess looking to the future, that's where we want to be. We want to get found rather than."

This quote suggests a future focus on inbound marketing for customer acquisition, a shift from the direct, targeted approach initially used.

Understanding Customer Needs

  • Willie Bigot discussed how their company's deep industry knowledge helped understand customer needs.
  • They developed software solutions based on firsthand experience from running a catering business.
  • This approach differed from competitors who were developer-led and focused on the product rather than industry-specific problems.
  • Willie Bigot emphasized the importance of offering solutions to problems that are affecting the industry through their SaaS offering.

"We've developed software based on customer needs from needs that we identified when we ran our own catering business."

This quote explains the origin of their software solutions, which were derived from personal experience and understanding of the industry-specific challenges faced in their previous catering business.

Importance of Operational Experience for Founders

  • Willie Bigot believes that founders having operational experience in their industry is a significant advantage.
  • He shared personal experiences of relating to customers due to his background.
  • Willie Bigot also mentioned hiring a sales executive from a customer company, Socialbyte, which saw significant growth using their software.

"I think it's a real bonus. There's no doubt about it, it helps."

This quote highlights Willie Bigot's view that operational experience is beneficial for founders, as it provides credibility and relatability when engaging with customers and understanding their problems.

Impact of Software on Customer Growth

  • Willie Bigot shared a success story of Socialbyte, a social enterprise customer.
  • Socialbyte's revenue increased from £7,000 to £70,000 a month using their software.
  • Socialbyte's ambitions to grow further were supported by the effectiveness of the software system.

"And they've grown the business with our software platform from 7000 to 70,000 pounds a month in terms of turnover."

This quote illustrates the tangible impact that the company's software had on a customer's business growth, showcasing the value of their solution.

Seed Funding Experience

  • Willie Bigot discussed his experience with seed funding for Spoon Fed.
  • He highlighted the company's bootstrapping phase and the decision to seek external funding once the product was market-ready.
  • Willie Bigot detailed the process of presenting their business plan and securing the first round of funding.

"When we had a product that was fit for purpose and ready to rock and roll, we went to the market and said, here's something, we've got some sales traction, we've got some customers, we know it works, and here's our business plan."

This quote describes the strategic timing for seeking seed funding—when the product was proven and had market validation through sales and customer adoption.

Tips for Founders Entering Seed Round

  • Willie Bigot offered advice for founders seeking seed funding.
  • He stressed the importance of being genuine, knowledgeable about the business, and presenting a concise pitch.
  • Being engaging and well-prepared with numbers and business details is crucial.

"Know your stuff and know your numbers inside out, and make sure that your presentation is very short, sharp and to the point."

This quote provides practical advice for founders to be thoroughly prepared and concise in their pitches when seeking investment.

Choosing Crowdfunding for Raising Funds

  • Willie Bigot explained the decision to use crowdfunding for the next funding round.
  • He was impressed by Syndicate Room's pitch and their business-to-business crowdfunding platform.
  • The decision was influenced by the platform's ability to work in conjunction with angel investors.

"Tom from syndicate room contacted me and Jock Milliken from equity gap at the time of our first round, and we were almost fully subscribed and said, look, give it a go."

This quote reveals the reason behind choosing crowdfunding—being approached by Syndicate Room and the appeal of their business model that complements angel investing.

Deciding the Amount to Raise

  • Willie Bigot discussed the financial considerations for determining the fundraising amount.
  • The company's current burn rate was mentioned as a factor in this decision.

"Our burn rate is presently about twenty five k a month."

This quote indicates that the company's operational expenses, or burn rate, played a role in deciding how much funding to raise.

Business Forecasting and Growth

  • Murray McNichol, with a KPMG background, is skilled in creating robust forecast models.
  • Forecasts are built from the bottom up, focusing on customer acquisition rates and achievable targets.
  • The company takes a conservative approach to forecasting, avoiding the common "hockey stick curve" projections.

We literally built the forecast from the bottom up. Interestingly, when I was on the other side of the fence, seeing presentations, we saw the traditional hockey stick curve. And we were quite conservative, and have been quite conservative in our forecast, because we've put forward forecasts we believe we can achieve.

The quote emphasizes the methodical approach to forecasting, aiming for realistic and conservative growth predictions rather than overly optimistic ones.

Influential Books and Business Systems

  • "The Lean Startup" and "The E Myth Revisited" are influential books for Willie Bigot.
  • Ray Kroc's focus on systems in McDonald's inspired the use of multiple apps to run Spoonfed.
  • The importance of creating systems that can be operated by minimally skilled workers is highlighted.

It's all about. What really inspired me was Ray Crock from McDonald's and his story about creating great systems to run the McDonald's business and setting that system up at a level that it could be operated by the lowest skilled operator in the business.

This quote reveals the inspiration drawn from Ray Kroc's philosophy of building efficient systems within a business, which has influenced Willie Bigot's own approach to running Spoonfed.

Best Advice Received

  • Sir John Harvey Jones provided crucial advice during a difficult time in the business.
  • The advice was to return to basic principles, find good people, give them significant responsibility, and reward them unexpectedly.
  • This advice led to the growth of talent within the company and the rewarding of employees who are now shareholders.

Will he go back to first principles, find really good people, and when you found them, provide them with a frightening level of responsibility, and secondly, reward them with unscheduled remuneration when they least expect it.

The quote outlines the advice given by Sir John Harvey Jones, which focuses on the foundational aspects of business management and the importance of empowering and rewarding employees.

Favorite Blog or Newsletter

  • Kenny Fraser's blog for SaaS startups is a favorite resource.
  • A group in Scotland meets to discuss SaaS-related issues, and Fraser's blog captures these discussions.

Kenny Fraser, who runs Sunstone Communications, writes a lot of blogs for SaaS startups and SaaS businesses.

This quote identifies Kenny Fraser's blog as a valuable resource for insights into the SaaS industry, reflecting its importance for Willie Bigot's continuous learning and networking.

Key Daily Metric

  • The number of users in cities worldwide is the daily metric checked to assess growth.
  • Growth in user numbers across different cities indicates positive business performance.

The one I check a lot is number of cities, number of users in cities across the world.

The quote highlights the specific metric Willie Bigot uses to gauge the expansion and success of Spoonfed on a daily basis.

Admired Founder

  • Ray Kroc of McDonald's is admired for his focus on business systems rather than the product itself.
  • Richard Branson is also mentioned but not as the primary source of inspiration.

Ray Crock, the way he sort of shaped McDonald's, bought the business from the McDonald brothers. I just think it's a great story.

The quote underscores Willie Bigot's admiration for Ray Kroc's business acumen and his ability to create a successful global system, which serves as an inspiration for his own business practices.

Future Plans for Spoonfed

  • The goal is to significantly increase sales and achieve an EBITDA just under a million.
  • The focus is on providing value to customers and shareholders, with plans to enhance marketing efforts.

Obviously, we're keen to drive sales significantly upwards and to achieve an EBITDA around just slightly south of a million would be acceptable, but much further north would be great.

This quote outlines the financial objectives for Spoonfed over the next five years, highlighting the ambition to surpass an EBITDA of just under a million.

Acknowledgments and Resources

  • Willie Bigot expresses gratitude for the opportunity to share his insights on the show.
  • Spoonfed's fundraising page is available on syndicateroom.com.
  • Mattermark Daily is recommended as a valuable curated newsletter for investors and operators.

Well, thank you very much. And I've really enjoyed chatting to you, Harry, and I'm much obliged for the opportunity.

The quote conveys Willie Bigot's appreciation for the chance to discuss his experiences and insights on the podcast.

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