This is really clever. Just couldn't exist without the changes/standardization in browser technology that have happened in the past 1-2 years. Congrats, and really excited about the potential.
First rule of Startup Club... you DO NOT get accepted to Startup club.
Second rule of Startup Club... you ARE NOW ACCEPTED to Startup Club.
Third rule... if either of these notices from the other two rules affected the trajectory of your startup you are not a true founder. So get to work and stop worrying if someone else approves your startup or not.
Totally fair. We're really proud about this part :) But given the confidentiality requirements we're under, I can't say.
I can say that Paribus has been FAR more generous and collegiate with equity than early stage companies we know. To give a sense, many early employees could be in a position to fund their own seed/pre-seed rounds in their future businesses on the exit/compensation, if they so choose. The full team is staying on.
Founder here. Definitely a common first reaction, but we've found that on average shoppers become far more loyal (and spend more, growing store top-line & often net bottom line) when this happens.
You might think we're crazy, but we fully believe (and have data to back up) that we're helping these stores far more than the costs.
You should take it a step further and help the retailers add this as a feature to their own apps -- having a store app should include a promise that if the store lowers prices, it will refund the difference for purchases in the last week (or whatever time frame) to loyal customers, perhaps through a store credit. It's a dandy reason to drive adoption of the app.
One thing you should listen to is the number of people who want a reserve price (transaction threshold). This price setting is pure economic gold as information goes -- it tells you their risk aversion (probably) and the shape of their utility curve for extra income. I'm sure it correlates with income, and gives independent verification of income, statistically.
If you have 5 big retailers using your app feature internally, offer to build them a network they can join, to make their rebate offer even more attractive to participants.
With the stores' aid, you can circumvent the problems with email permissions, which frankly are going to limit your adoption. You are far better off working with the stores in a partnership I think, and helping them to understand their own customers' reserve price (and hence propensity for returns and chargebacks, which they surely care about), than being a 'gotcha' adversary.
Selling this as a service to the merchants seems like a great idea. It would feel less creepy than allowing Yet Another App access to my inbox and credit card details.
Supplying merchants is also likely to provide a more _predictable_ income.
However...
Are giants like Amazon really likely to listen to a pitch from a startup, even one incubated at YC? (No snark, genuine question.)
There is another option: open source the product and give it away, charging for the hosted service. Obviously this may not be an option for Paribus, which would be a shame.
But I'd challenge you on your assumption that this is a bad thing for stores and consumers.
It's a powerfully negative experience to buy something, and then find out within a few days (or hours) that it's selling for far less. It happens millions of times per day (www.forbes.com/sites/walterloeb/2014/11/20/amazons-pricing-strategy-makes-life-miserable-for-the-competition/), and most people don't find out. But the reality is that it's happening.
A customer could return it for free (and re-buy it -- many states require this by-law). Or a store could do good by the customer and give a price adjustment.
It turns out that when stores do good by customers when this happens, shoppers become far more loyal (and spend FAR more on average too, growing store top-line & often net bottom line). This is part of the secret of Amazon Prime.
While I can't claim that it is the right or only view, I fully believe that stores will benefit far more than the costs.
I love a good story, but I think you're embellishing this one a bit much. It sounds a little like "We're rescuing victimized consumers from abusive companies employing teams of uptight actuaries intent on nickel-and-diming you wherever they can".
They might very well be conniving, but your app to me feels more like those people that save up a bunch of coupons and walk out with a cart full of groceries and the grocery store actually owing them money. There's nothing wrong with that: I have no doubt that the CEO of Fred Meyer still rues that day in college that I walked into one of his aisles and walked out with a bunch of cartons of eggs.
People aren't victims when a company offers a product at a price that the customer is willing to accept. I'm sure you have a fine app that will save some people some money, but we're not rebels striking an uprising against our grocery store overlords who dare to sell overpriced eggs to underprivileged American consumers.
(edit): The parent post has been edited to sound less like a movie trailer, so my post may now sound out-of-place.
This is totally irrelevant to the parent's point, that point being that Paribus seems to be defecting in the refunds-when-reasonable game in a way that will probably harm consumers in the long run. It irritates me that you just wrote a bunch of talking points. Your response downthread was a lot better.
(Disclaimer: I use Paribus but it never got me any money yet.)
Yet. Do you offer an iron-clad guarantee you won't in the future? Otherwise it seems like the first thing you'll do if investors start to put pressure on you...
Google app invites is a smooth flow, but not designed for high performance. Selecting a bunch of friends from a list is just better. I haven't seen much data here, but some growth community forum posts agree with this intuition.
Their contact rankings are good though. Not FB level insight, but good
You're straight up wrong. Read the piece. Quote below:
"For instance, total shopping time for households with an income between $100,000 and $150,000 (category 5) is 5 to 7 minutes greater (per day) than average shopping time by an individual in a household with income in the $0 to $24,999 bracket (category 1). After controlling for various individual characteristics (column I), this is robust to including both time and state (columns II and III), as well as labor force status dummy variables (column IV)."
He's wrong to say that the study only looks at employment status. It looks at income and a number of other factors as well (mainly, income and time spent working).
However, he is right that the article's conclusion is mis-represented:
"Overall, we don’t find much evidence in favor of a negative correlation between income and shopping time, particularly comparison shopping possibly motivated by locating better prices. As a matter of fact, whereas total time spent purchasing goods and services is about 20 minutes per day, the component of shopping time devoted to comparing prices and products seems to be extremely low in the data. It is about 4 seconds a day on average, given the large number of respondents declaring zero. Moreover, nonparticipants and the employed spent more time than the unemployed in this activity. This may indicate that most of the effort made by consumers in the goods market is unrelated to uncovering better prices."
"The results indicate that a 1 minute decline in market hours is associated with a 0.04 minute decline in shopping time."
The correlation between income and shopping time is simply not caused by leisure time. This should hardly be surprising - leisure and income are inversely correlated (i.e., the poor have lots of leisure, the rich very little).
> leisure and income are inversely correlated (i.e., the poor have lots of leisure, the rich very little).
Do you have any data for that? I rather doubt that it is very solid if it exists at all. There are a large number of poor people working more than two jobs and more hours than the rest of the "middle-class". Additionally, many of the jobs from the upper end of the middle-class tend to often require longer working hours.
Thanks for the kind words on the service. On your feedback, here's my take:
1. Stepping back, isn't it more absurd that people are, by default, charged more unless they spend significant time dealhunting? The claim is not that the disparity itself is unjust, just that it's time for this to come to an end.
2. For all of the biggest e-Commerce players (Amazon, Walmart, etc.), their biggest business lines (and ones where they're investing the most) are in the sales of basic necessities (food, household goods, etc.). So considering how dynamic pricing will impact people (esp. re: basic necessities) is important. I'm not sure why you're dismissing the key point so quickly -- if we care at all about helping bridge the income divide, we should care about helping the poorest get the most affordable prices.
In any case, I wrote the article because it really did shock us. Joe is a real person and a friend and we hope it does some good to show a small slice of what we're seeing.
1. To paraphrase what the fine folks in the US like to say, the world doesn't owe you a deal.
The merchants do deals not for the customers, but for themselves: to maximize profit, increase market share, and maybe achieve some other goals. If you guys are communists, and think corps are evil, and the poor are exploited, that's fine, but how can you hope to successfully operate in any industry without comprehending the basic motivation of the principal actors?
Getting away from the usual capitalist moralizing, Paribus has a time-tested business model I've seen before. Very well-compensated people discover companies overpaying for (say) a utility, and offer to negotiate for them.
> To paraphrase what the fine folks in the US like to say, the world doesn't owe you a deal.
(And it even contradicts the whole point of the "US". We’re born into all sorts of bizarre deals, like the so-called social contract I never consented to.)
In a highly-competitive marketplace, the stores that treat people right will win volume. Those who win volume take the market. So don't rip customers off (or be extremely quick to correct it when you're called out) and you'll gain customer loyalty and all the subsequent transactions.
The world doesn't owe you a deal, but then again, the customer doesn't owe you their next purchase. Life is long. As a store, your job is to keep earning customer trust so they come back.
There are all kinds of players along the spectrum. It's just that the ones that grow to become the largest (Amazon, Walmart, Costco, Jet, etc.) tend to operate this way (and offer Everyday Low Prices).
>> "1. Stepping back, isn't it more absurd that people are, by default, charged more unless they spend significant time dealhunting? The claim is not that the disparity itself is unjust, just that it's time for this to come to an end."
I strongly dislike such tactics since it causes people to waste a ton of time dealhunting, but isn't this usually to the benefit of the poor? These tactics allow companies to price discriminate and charge the rich more -- since they won't spend the time clipping coupons, waiting inline on black friday, or waiting for sales -- and thus theoretically subsidizes the 'discounted' prices for the poor.
On a separate note, what information from my email gets sent to your servers? Do you run a search for "Amazon", "receipts", etc. in GMail's cloud, then only send matching email to your server?
> I strongly dislike such tactics since it causes people to waste a ton of time dealhunting, but isn't this usually to the benefit of the poor? These tactics allow companies to price discriminate and charge the rich more -- since they won't spend the time clipping coupons, waiting inline on black friday, or waiting for sales -- and thus theoretically subsidizes the 'discounted' prices for the poor.
Even without ericglyman's link to corroborating data, I would assume it goes the other way. Coupon-clipping and online deal-hunting requires time and, especially, emotional energy that the poor often don't have; and since the poor generally have to use essential items until they physically fail, and then scrabble frantically for the first available half-decent replacement, they don't have the luxury of waiting for special sales.
Me too man! On time spent dealhunting -- data from the Federal Reserve shows that it goes the other way: http://www.frbsf.org/economic-research/publications/working-.... It's counter-intuitive, but the wealthy actually spend more time shopping than the poor, not less.
On the second -- exactly. Paribus is designed to only pull in emails that appear to be from known merchants (Amazon, Bonobos, Best Buy, etc.).
I think you make a good point here. I'm not sure it always works out one way or the other though. We can talk in generalizations, but there are also very savvy poor shoppers and very careless rich shoppers. My inclination in matters like this is that it's better to arm people with information and encourage them to be savvier. I think what you guys are doing is a great example of this, using technology to empower people over their own finances.
More of a musing: I do wonder if it is ultimately self-defeating. If everyone were to use Paribus, companies would stop offering special deals in the first place. Maybe it's a good thing overall. But the savvy poor shoppers would be hurt by this.
