We recently hosted a webcast conversation between Cody and Elliot focused on how Bounce quickly turned their short-term storage idea into a successful business.

Don’t have time for the full webcast now? Below you can catch the highlights and tips from their talk in our companion blog.

Iterating a Big, Crazy Idea into a Six-Figure Business

Last year, Cody Candee had a crazy idea. He wanted to launch a company that offered “cloud computing infrastructure for the physical world.” Fast forward to August 2018, and he’s the CEO and co-founder of Bounce, a service that allows people short-term storage of their things (luggage, gym bags, backpacks, and even small massage tables) at participating small businesses. Bounce works with over 60 locations in New York and, more recently, San Francisco. How did this vision bloom so quickly? As Cody told Lean Startup Co. faculty member Elliot Susel in a recent webcast, he based everything from the initial product to its scalability on a bias for action—getting out of the building and talking to customers. “You learn the most by just getting out there and doing something, even if you think that something won’t work,” he says.

Cody and his co-founder initially used the concierge method to test their hypotheses. Their hands-on learnings offer inspiration for other entrepreneurs who, like Cody, dream of leaving day jobs to realize their startup ideas. We’ve collected examples from the webcast of how Cody and his co-founder constantly tested the simple ideas before adding complexity.

A Different Kind of Luggage Concierge

Cody wanted to offer his customers the ability to move their possessions around seamlessly so they could avoid running back to a hotel or an apartment to grab their bags. He imagined a Bounce employee picking up customer belongings in a car, “and then when you want it back, you press a button and they bring it back to you,” he says.

He knew that rolling out a minimum prototype is the best way to discover if customers will make a real commitment to using your product. “You’re not gonna learn what to build in a conference room or on a whiteboard,” Cody says.

His leap of faith assumption was that people would be willing to hand over their valuables to strangers. So he and his co-founder spent four hours creating a landing page last year directed at people in New York. No code, Cody explains, just something saying, “Hey, call this number. Someone will come pick up your things and bring them back to you.” They used Google AdWords to boost visibility, and five minutes later, they received their first call from a customer.

“[The customer] is asking me all these questions—’How much does it cost?’ ‘How does it work?’—and I’m making it all up on the fly as if we were a real business,” Cody says. He only promised what he knew he and his co-founder could deliver. In response, the customer asked them to pick up her stuff the next day at a specific time. “I give her a price, hung up the phone, and we were like, we have to take this person’s luggage now,” Cody says.

They wanted the business to look legit, but lacked the time to get branded clothing or vehicles before the pickup date. So Cody and his co-founder bought Saran wrap, wrapped one of their own suitcases, and labeled it with a sticker. They rode over to the customer on Citi Bikes with the wrapped case in hand. “That way, when we showed up we [could] say, ‘Oh yeah, we’re doing a run around the city picking up multiple customer items.’” Their first customer trusted them, but wanted to know why they didn’t have a van. “My co-founder said, ‘Oh, we’re doing a route right now… and then we’ll get picked up [in a van] and bring this to the facility.’” The “van” was little more than an Uber Pool, and the “storage facility” was their apartment.

They tested their hypothesis on five paying customers before feeling confident that there was “at least a subset of people out there who are willing to hand their things over to strangers,” Cody says. They decided to move forward on their business plan.

The Minimum Viable Storage Facility

After spending two weeks proving out their initial hypothesis, Cody and his co-founder wanted to simplify their concierge model. They decided partnering with small businesses could be the solution. They would ask customers to drop off at one location and pick up their stuff somewhere else.

“Rather than door-to-door delivery, it’s from around-the corner-from-you to around-the-corner-from-you,” Cody explains. They changed their landing page to include the new description, and used Google AdWords (and chatted with people in their co-working spaces) to see if this idea gained traction.

The first customer for their new service asked if they had a drop-off location near him. “I said, ‘We’re actually opening a bunch of locations later this month. Let me see if any of them will open earlier in the location near you. I’ll call you back in 15 minutes.’” Cody hung up, called a bunch of small businesses, and asked if any were willing to store a suitcase for five hours for $5. Once he found an owner who agreed to the deal, he called his customer back. “I said, ‘We have a location for you. In fact, you’re gonna be the first customer at this location so I’ll actually be [there]. I’m the founder of Bounce and I’ll get to meet you and I’ll make sure it goes seamlessly’.”

Cody was able to watch how the small business processed the bag. He was also able to ask his customer questions like how he knew about Bounce, what made him want to use the service, and what made him almost not want to use it. “I got so much valuable information from doing that,” Cody says. “I did that five to ten times to validate that this model could work.”

In order to attract small business partners, Cody says he presented owners with two key value propositions—additional foot traffic into their stores, and a revenue share on every bag stored. He admits that the idea of storing someone’s random belongings in a shop would’ve sounded nuts five years ago, but the popularity of sharing economy apps changed everything. “There’s been so many companies that have changed social norms,” Cody says, and the small shop owners he met needed all the foot traffic and revenue streams they could get.

Though talking to his customers, Cody learned they didn’t necessarily need separate drop-off and pick up points for their belongings. There were enough people willing to work with a single location to validate simplifying that part of the process too.

From there, Cody and his co-founder started building the actual product—writing the first lines of code and launching relatively quickly. Within a month, Cody says, they had “a full booking flow where folks could book and we were completely hands off.” Their business has grown substantially since then, says Cody, to thousands of users in multiple cities.

Keeping the Conversation Going with Customers

Bounce offers multiple support channels, from chat to phone and email dialogs. “We talk to customers every day, everyone on the team,” Cody says. Their customer support platform allows them to ask people how they discovered the service, or what additional problems Bounce could solve for them.

For example, Cody says, people were constantly asking for more specifics about their drop-off options, even though they’d been presented with all the relevant information. He realized Bounce was offering too many locations to choose from. “The conclusion from that is, we just tell a customer which location they should book. They want to be told what to do a little bit more, rather than be presented with a ton of options.”

Every Feature Still Starts as an Experiment

One year in, Cody says every feature still starts as an experiment. He knows you can save time by getting in front of people with your product early. “Even if you’re the best product manager in the world, the best consumer insights manager in the world, it is impossible to predict what customers want,” Cody says. Instead of predicting, he adds, you should be asking how to “put some version of something that mimics the key behavior that you want to test out there as fast as possible” and then measure customer responses. You also need pass/fail criteria on the assumptions you’re testing, he adds. “Having the idea of what success and what failure looks like is really useful.”

Cody’s front-end team has the technical ability to iterate on customer conversations quickly, which is instrumental in testing their way to the bigger Bounce experience.

“We want to build this into a giant company,” Cody says, “with the whole vision of cloud computing infrastructure for the physical world. What we are today is just a small fraction of what we’re going to be.”

Thanks to Jennifer Maerz for contributing this piece. If you seek to bring the entrepreneurial spirit to your organization, Lean Startup Co. can help.