He lost his only 2 customers & was ready to quit—then he grew to $1.5M ARR in a year. | Josh Domingues, Founder of Flashfood
Jan 20, 2025
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Josh Domingues, founder of Flashfood, turned a near-failure into a booming enterprise, showcasing his resilience. He shares his journey from $35K in debt and losing key customers to achieving $1.5M ARR within a year after partnering with Loblaws. Domingues discusses the importance of continual testing in startup development, the surprising ease of securing large clients compared to smaller ones, and how to turn setbacks into success. He emphasizes the impact of corporate culture on sales and the vital connection between passion and environmental sustainability.
The journey of a startup often requires brutal honesty about an idea's viability, encouraging founders to persist despite rejections.
The Flashfood app addresses food waste by offering discounted perishable items, appealing to consumers' desire for affordability over environmentalism.
Securing partnerships with major retailers can significantly propel growth, but requires demonstrating a compelling business case to decision-makers.
Deep dives
The Journey to Product Market Fit
Finding product market fit is a critical phase for any startup, often requiring founders to critically assess their ideas. The necessity for brutal honesty about an idea's viability is emphasized, as founders must identify reasons why their concept might not work. If they fail to find compelling arguments against their idea, it suggests that there is potential to keep pushing forward. This mindset fosters determination, as demonstrated by the speaker who initially faced numerous rejections before eventually succeeding.
Addressing Food Waste with Technology
A mobile application was developed to address the pressing issue of food waste in grocery stores, where excess food with limited shelf life is often discarded. The app allows stores to discount perishable items and notify users of available deals, with discounts of up to 50%. This innovative approach transforms the traditional food clearance process into a more appealing experience for consumers, tapping into the growing demand for affordable grocery options. The idea was sparked by a personal incident involving a chef and the realization that food waste produces significant environmental harm, including greenhouse gas emissions.
Challenges of Partnering with Grocery Retailers
Partnership with grocery stores presents unique challenges, including securing commitment from decision-makers who typically avoid risk. Initial attempts to engage with retailers often met with indifference or outright rejection, highlighting the difficulty in gaining traction for new concepts. The turning point came when a personal connection opened the door to a pilot program in a major chain. This partnership led to rapid expansion, demonstrating the potential of aligning with retailers that understand their need for waste management solutions.
Consumer Demand and Affordability
Consumer preferences play a decisive role in the success of the mobile app, especially as affordability remains a primary concern for shoppers. While the app originally focused on environmentalism, the marketing strategy pivoted to emphasize cost savings to resonate with a broader audience. The experience revealed that consumers are more motivated by financial benefits than environmental impacts, necessitating a shift in messaging. The realization that consumers prioritize discounts over sustainability offers critical insights for any business targeting the grocery sector.
Scaling Operations and Revenue Growth
Following the successful launch and subsequent adoption of the app, the business witnessed remarkable growth, transitioning from a handful of locations to hundreds in record time. This rapid expansion was driven by continued engagement with partners who recognized the financial incentive of reducing wasted food. By leveraging strategic partnerships, the company captured significant market share and achieved annual revenues in the tens of millions. This success story illustrates the importance of adaptability and perseverance in turning a startup vision into a thriving enterprise.
A few years into building Flashfood, Josh was $35K in debt with no money in his account. Just a few months earlier, he'd lost both the pilot customers he'd worked so hard to lock in. He'd worked for months to land them and had delivered what he promised.
But both retailers told him the problem he was solving was not important enough.
And then, he met Loblaws-- one of Canada's largest retailers. They loved the case studies he had. They tested it out and quickly launched it across 100% of their locations.
"I was going to shut down the company." That's how close it came to failing completely. Instead, a year after meeting Loblaws he was doing $1.5M ARR and had raised a $3M seed round. Now, he does 10s of millions in revenue and will soon be profitable.
Here's the story.
Why you should listen:
Why startups often drive founder to near bankruptcy.
Why you need to keep testing your startup until you hear 'no'.
Why sometimes large customers might be easier to close than small ones.
How to get champions to close enterprise deals.
Why you might be a top priority for some customer sets and not others.