Before building tools for ecommerce brands, Adii Peenar helped co-found the now popular WooCommerce platform for Wordpress. Since his WooCommmerce days, he's built, launched and successfully sold a Shopify app called Conversio; authored a book called Life Profitability; and now, has created a new product he refers to as “your extra head of operations.”
Cogsy turns data into accurate forecasts for businesses so they can make better decisions about inventory and free up extra capital. It actually does more though, giving customers accurate re-stock dates right on product pages when out of inventory. Cogsy couldn't have come at a better time as the holidays approach amidst a looming inventory crisis.
Adii Pienaar is the founder of Conversio. Prior to Conversio, Adii was co-founder of WooThemes/WooCommerce, where he explored what it meant to be an entrepreneur while learning about building software for ecommerce stores. He is the author of Life Profitability, and recently founded Cogsy, an inventory tracking management tool for ecommerce stores.
Jay Myers: Adii Thank you so much for coming on the show. It’s been a bit of a challenge scheduling this, but we made this happen. Thank you so much for being here man.
Jay Myers: Adii Thank you so much for coming on the show. It’s been a bit of a challenge scheduling this, but we made this happen. Thank you so much for being here man.
Adii Pienaar: No dude. Thanks for having me Jay I’ve been looking forward to this for a couple of weeks now.
Jay Myers: It’s going to be fun. I got lots of stuff I want to dive into. You are a person that has a truly rich history in e-commerce in startups, business, life. You’re one of the co-founders of WooComerce. You’ve had multiple projects since then. Can you kind of walk us through, and I know this could be a big question, but walk us through who you are and kind of your story, how you got to where you are today.
Adii Pienaar: I think they’re kind of the first place my mind goes to Jay cause I think this has been the theme that has ultimately driven the things that I’ve done in my life, both professionally and just personally. Which is I really consider myself a learner and a seeker. What I mean with that is if I get curious about something, I am more than happy to go down a rabbit hole. Even if that rabbit hole is risky. And I think like, that’s just, if I- and obviously these things are in hindsight, but if I look back at my journey, there are so many things, decisions that I made where that was true. And those things ultimately, whether they worked out or not is, I think that’s a moot point, but those things ultimately shaped what came next?
I think the interesting bits here then on my kind of your path and who I am today is the fact that I studied accounting. And I think that’s an important note in terms of what I am doing today. Studied accounting in my final year of varsity built the first product that became WooComerce. I’ve always been a tinkerer, but never a great programmer. I’m a much better entrepreneur than I am a programmer. Then WooComerce was this really wild journey, as a first-time founder, like same thing for Magnus and mark, my co-founders, we were literally just learning things as we were doing them. it’s not like today where today we have all these playbooks available to us where we can literally stand on the shoulders of giants and there’s so much content available to help guide you. WooComerce was this immense kind of a roller coaster.
Then that really got to a point for me, where I felt like I needed a new challenge. I needed to learn something new. So I bounced from there founded a company called Receiptful initially rebranded Conversio where we built email marketing automation tools for e-commerce brands and sold that to campaign monitor two years ago now. About two years ago, August, 2019. Spent most of 2020 with them post-acquisition. Now I probably see that as the kind of my almost sabbatical year. Not that I wasn’t working and wasn’t giving them my full commitment, but that was the first time in my professional career that I had some more space in my life. I wasn’t the one that was ultimately responsible for so many things. It was not my business anymore.
Just having this space, it was interesting. I think that’s where other realizations and learnings then comes from. Not just last year whilst I was with them, but I picked up my mindfulness practice, for example, again, and di loads of stuff there and went down a different rabbit hole. I think saying all that much of my path has been just curiously going out, taking some risks, doing some things, putting myself out there. And I’ve been fortunate enough that in terms of companies, at least I’ve had two successes, and then I have a much, much longer list of failed projects along the way where there’s no direct quantity of reward necessarily. But those things probably added some qualitative benefits that I would not have gotten otherwise.
Jay Myers: Yeah that’s such an important trait of successful people is they’re curious. They ask questions, they wonder why things are done a certain way. Could they be done better? What if we approach this differently? Just to put a little bit of context around some of this. So when did you co-found Woo- when did you leave? When did Conversio, like what, were some of the dates there?
Adii Pienaar: Yeah. So November, 2007, which is 14 years ago. It’s crazy.
Jay Myers: When you think about that though, like 2007, like what else existed for an e-commerce solution in 2007?
Adii Pienaar: Not much, so I think when we started out, so 2007 was when I built the first products and like that led to me meeting Magnus and mark. Woothemes became before woo commerce. Woothemes, was officially founded, I think July, 2008. And I think they know WooComerce itself just celebrated its 10 year, birthday, but 2008, middle 2008, Woo came into existence. And back then, like to your point, not much existed for e-commerce, which is why we ultimately built WooComerce. We built themes on top of WordPress and our customers started demanding, hey, we want to sell online, help us do that. That’s 2008 WooComerce was 2011. And then I left end 2013 when I needed a new challenge founded Receiptful end of 2014, sold that august 2019, as I mentioned, and then start of this year, started working on Cogsy. So those are the more relevant dates across that’s kind of your 14-year span of working within software for e-commerce.
Jay Myers: Gotcha. Yeah, it always just helps me put things into a framework when I have dates. So yeah. You mentioned Cogsy which you recently launched, which I know a bit about, and I know that it’s going to help a lot of e-commerce brands make better decisions, sell more, sell more efficiently. And I’m going to get into that in a little bit, but I want to get to a couple more questions on the personal and professional side because you just have such an interesting, interesting story.
How do you choose a kind of like a little bit of insight into your mind, like how your mind works. How do you choose the problems that you’re trying to solve? Like you went from Woo commerce to Receiptful which is kind of like optimizing the thank you page and the receipts page and turning that into a sales channel pipeline and now Cogsy, which is completely different. How do you choose these problems? Is it people you know that have them, or do you just observe and I’m sure there’s probably like lots of opportunities? It might not have been Cogsy you might’ve had five other things you were thinking about doing, how do you pick the ones you ended up doing?
Adii Pienaar: Yeah. I think part of this, Jay is probably impulsive. In the sense that I think when the kind of the inspiration hits an idea pops up that the more momentum that I sometimes build as I go down that rabbit hole initially. That seems to be a pretty good indicator of whether I actually pursue that idea. All right. So I think that’s part of it. And again if I think through Receiptful was a bit of a, it was a gamble. We gambled on, can we build a solution that injects marketing messaging into receipts, something like market didn’t ask for it. And we ultimately use that as a way to then build something where it was more of a me-too product. We became yet another email marketing automation tool.
The initial kind of your part, there was like, this is experimental. Like this is not a sure bet. I think like part of me really likes that part, likes that risk trade off. I say this, this is not the coaching that I would give if a first-time founder comes to me and says, Adii what am I supposed to do? How do I go about taking this form idea? I would definitely suggest do like validate your ideas, do the customer development don’t do- do as Adii says not as Adii does kind of situation, but like I think that’s part of it. Is to how much I get obsessed about idea and then how impulsively I act on that thing. That’s generally a theme.
Beyond that, at least when I was sitting down with Cogsy, I think that there are a couple of things that was important to me as, and evaluating Idea and before committing to it. One was I felt it was a, a space that I know, well it’s at the intersection of software and e-commerce, that’s just something that I have loads of experience with loads of network and loads of social capital, et cetera. So I think it made sense from that.
What I did this time around, it was probably two other things. One is I really wanted to solve something that was intellectually interesting and challenging to me. So I’m not a big kind of e-commerce operator myself. I’ve never done that myself, but I can totally geek out around the challenges that operators have, for example. So part of what I’m hoping to do with Cogsy is I don’t want to build just the better spreadsheets. I want to build a spreadsheet like outcome for a brand, for operator in a whole different way. So I’m super kind of intellectually invested in solving this thing and changing the way this is done at the moment. That was the one part.
The other part was totally thinking through just business model. Like, is this big enough for me to pursue now, like down to the granular level? Like how do I think about kind of building the product building the revenue model to a point, for example, that it has expansion revenue? So I, had a few of those kind of more specific criteria things that was important to me as well as I was evaluating the. That’s more I would say more evolved approach. I was going to say mature, but it’s not very mature, but evolved approach where I didn’t necessarily do that with Receiptful and Conversio. And again, like Woothemes and WooComerce was very impulsive. Like if we just build the product took off and then we figured things off from there. So it didn’t have that idea that you’re kind of validation or even kind of investigation.
Jay Myers: Yeah. Interesting. So that’s on the product side. I want to discredit your intuition and your, what you phrased as like energy, when you get excited about something. Because there’s kind of a Venn diagram of genuinely what creates a successful company, being passionate about something is one of the circles. It’s not everything like there has to be market opportunity. You have to have domain knowledge, you have to have the skill and competency to build it and being passionate about it. And when you kind of overlap in the middle is your opportunity. So that is a big one, for sure. Someone who’s maybe got all the skill in the world, but building a product that they’re not passionate about, that they’ve only done market validation, but maybe they know zero about the product. They have no experience probably won’t succeed either. While you say, listen to what you say, not what you do. I think there is some credit to what you do as well too. I’ll just throw that out there.
On the other side, so that’s on the product side. You’re a, I don’t know what you call it. Multi founder, serial entrepreneur, whatever word people want to slap on it. It’s translated. You’re not afraid to take chances. You’ve probably made big mistakes. You’ve had some big wins, you’ve had dark moments. You’ve probably had to learn a ton. And I know this is something that you’re passionate about. Because I’ve heard you speak about it and I’ve seen you post things. But can you talk me through some of the values that are important to you that you’ve learned over the years through these companies? Because that is a big part of building a great product is the values principles in the company and the people behind it, because, at the end of the day, a product is just as good as its people. So three-year journey. What are some of those values that are important to you now?
Adii Pienaar: Yeah, that’s a great question, Jay, because I think part of the answer by the way here is just that as I have kind of gone on to finding my third company here is the thing, one of the bigger things that I try and do is I try and take the learnings from the previous company and the previous journey. And I try and take the best things and I try and reapply them and I try new things on top of that. And like one of the more persistent things has always been around culture and values of the- both of, internally for the team that you built, but also how that ultimately gets into the product and into the brand, into the marketing.
Just thinking through that has been very important and I’ll never forget. I think its Jason, Jason Cohen. Who’s now the founder of WP engine. I think he is crafted with saying culture happens to you regardless of whether you do something about it or not. And the idea there is like you either set the culture or the culture gets set for you, but the culture is always going to be there. So I think being deliberate and intentional around kind of your thinking through values and what that means, I think that’s a game-changer.
So where I’m at today. Interesting enough. So my personal journey, there’s a bit of an arc in the sense that trying to do, because I know you like dates. 2015 Conversio is growing really well Receiptful conversion growing really well. My wife and I had a young baby in the house. Our second was one and a half at the time. And then I get to this point in my life where I completely like, I feel stuck in a corner, just very angry, frustrated, and anxious. And I almost got a divorce. And that was literally this culmination of, I think this accelerated path that I’d been on, but also a very narrow path of you build a business you work hard and like, if you want to move forward, you just push forward. You just go, go, go.
In like going through an experience and we didn’t get a divorce my wife and I are still together today. We recently celebrated our 11th wedding anniversary, but that was a pivotal moment for me, at least as a person. What that sparked and I’m willing to get back to your kind of question around the values that I kind of live by today. What that sparked was my- I had a therapist that got me on this path of mindfulness broadly speaking, and just learning so much more about kind of both the kind of my masculine and feminine energies and how this kind of default mode that I’ve always been on wasn’t necessarily going to work for the rest of my life. The way I now think about this as this is not to punt my own book, I published the book called Life Profitability earlier this year.
Jay Myers: I was going to bring that up, that I had that on my list of things I wanted to talk to you about. So go right ahead.
Adii Pienaar: Also the idea there, Life Profitability was the successor of kind of my team I Conversio stumbling onto this language, which is how do we build a team and a company that’s life and family first. In our minds, what it meant was as individuals like we shouldn’t do work and work for companies and work on teams where we always have to kind of sacrifice life to build a business, to make progress. Like I just felt like this is zero-sum game that nobody’s ever happy with. The way I kind of positioned this to anyone that asks me like Adii aren’t you speaking about work-life balance. I think that the key thing that I thought through was when you suggest that there is something like work-life balance, you also suggesting that these two things are separate and they can keep each other in balance. And I just don’t philosophically believe that’s the case. I think work is just part of life. Life is as bigger container or a bigger opportunity we have and work is just one component there.
There are probably loads of other things that compete for our energy and attention and investment in that realm of life and as opposites to work. So if you want to [Inaudible 14:57 ] kind of your balance, you have to balance those things. And so when I think this is a very high level, kind of your elevator pitch to what Life Profitability means, but the way I want to then think through kind of that is how do I build a business that’s not just financially profitable in the narrow sense of the word, but actually life profitable? This business, this work that I do, shouldn’t power, all those other meaningful things that I want to do extra. And that’s probably the kind of my north star metric now is to be very, very aware of what my life Profitability looks like and trying to make sure that I’m always optimizing for that.
There’s loads of different things in there. Like the big things for me in that are my family, learning I mentioned learning as an example and then doing interesting things like making things. Those are like three core things that I would put in that bucket or in my life portfolio that I just need to make sure that I am constantly kind of nurturing those things, putting investments into those things, paying attention to those things, being present with those things. And as [Inaudible 16:01 ] I think about it, like when I build a team and a business, I want the same thing for all of my teammates. We should always be doing those things to also empower it. Like it should not just be the founders and the C-levels or whatever that gets that opportunity to get some margin in their life. Like there is a way I think to work together, build a business, build a team that allows everyone to pursue their own unique version of life profitability.
Jay Myers: Yeah. I love that so much, you’ll always get the pushback saying, well, that’s a cop-out that life is work and work is life, because then that just means your boss can ask you to work in the evening or something, or while you are with your family, you’re expected to reply to an email. Like some people will say they need that hard-line, but I think they’re missing the point. I think you can still have your hard-line of when you’re like at work, not at work, but it’s more like separating what brings you joy and your happiness? Like you might be miserable at what you do, and then try to have a happy life with your family. Like it’s like you, can’t like you are one person in every area you are and you can’t have silos.
To me, like, I agree with you a hundred percent and that’s how I look at it. I’m also very pretty strict. I mean, if there’s like emergencies that come up, I don’t mind taking them, but I have two young kids and I try to protect my family time is as much as I can. So I think you can have your viewpoint and still protect your family. It’s not like balancing time. It’s balancing your happiness. I guess you probably put it more eloquently in the book, but I agree with you.
Adii Pienaar: And I think I would change the word happiness for intention and or presence or a combination of those two things. Because happiness gets us into a bit of a kind of measurement and I’m not sure- we measure so many things in our lives and, I’m not sure that it’s always great for us or creative in any way. So I think about it as intention and my presence and boundaries should always be there. I think it’s important to be vigilant around if I’m, for example, if I need to be present with my kids and need to play Legos with them right now, I should not be on my phone. For example, I think that’s a boundary. Like there’s a simple but simple boundary to impose.
I also avoid kind of very rigid the hard lines and how I kind of demarcate, the things I do in my life. So one of the things that I often like doing don’t do it every weekend, but on a Saturday morning, like offer some exercise or some family activity I would kind of in mid-morning, I would sit at my desk and I would just do email for half an hour, 45 minutes. Because everything is calm, nothing is pressing in that moment. And it just allows me to actually do something that I really want to do and that I feel good about. And that’s maybe a, kind of a glub example, but in the kind of while I should only work Mondays to Fridays these and these times like that wouldn’t fit into those rigid lines, but in a more or less, they call some sense. That is actually really good for me to be able to do that.
I said, I didn’t do it every weekend, but every now and again, like that is what I need to do and want to do. And I think that’s just what I’m very liquid and kind of what I propose with life probability be very liquid around following your energy. And how again, then being present without being intentional about pursuing that energy when it pops up.
Jay Myers: Yea and no one’s forcing you to do that, you’re doing that because you want to, it, maybe it releases some mental things that you want to do. Like, I feel exactly the same way sometimes before I go to bed, I know I’ve got a couple of emails, a couple of things. And if I just go and just do that, I just sleep better. And it doesn’t take long, but rather than let things build up for three days, I can remove it from my mind. It’s not weighing on me. Yeah. And we know ourselves.
Adii Pienaar: That’s the final point. I think that’s the practice. it is like for anyone that wants to do a deeper dive here, like my recipe is not going to work for you Jay or for anyone else listening for example, and vice versa. Doing that discovery, being aware of like, what are those intrinsic needs to ourselves those unique things. And then being able to find ways to better optimize them over time. Like that’s the generic playbook errors. If you’re aware of those things, then you can actually prioritize them.
Jay Myers: Yep. I know people that wake up half an hour, 45 minutes before their kids, they get a few things and different people have different rituals in the morning. Some people take it for their own space, their own mind space. Some people want to like get their creative work, done. Some people want to check off a bunch of emails or whatever it is so that by the time the kids wake up, their head is in the right space and it can be different for different people. For one person, they need to meditate. One person they need to answer a few emails. Some people don’t want to turn on their emails until 10:00 AM. They want to do all their creative work first. And it’s different. There is not, you nailed it. Like there isn’t a formula, different things, energize us and allow us to be our best version of ourselves.
I can tell you for me, like if I wake up and there’s a few things I need to do, like some messages start coming in. If I can just address a couple and then I go downstairs and I’m with my kids, I leave my phone away. Like I’m with them for an hour. We have breakfast. We play Lego every day too, coincidentally. But, if I have my phone with me and I see a message, I’m there, but mentally I’m not there. And so I have to kind of like do that first, get a few things out of the way. And so, we’re all different. This book, Life Profitably, where can someone get it? If they’re interested? Is it on your site or on Amazon or?
Adii Pienaar: It is on Amazon. That’s probably the easiest for most people. Otherwise all the different links would be on my personal website as well Adii.me.
Jay Myers: Okay, cool. So with all that said we’ve talked about, your history, your background, your philosophy, your values, how you make decisions? Well, let’s talk about Cogsy. This is where you are today. All of this, everything you’ve done in life has brought you to this moment right here, talking to me. You ever think about that? Like everything you do, like if you turn left down the road, instead of right, you might’ve married a different person or started a different business or our life is just a series of circumstances. But here you are, you’re building Cogsy. And that’s what I want to talk about- we talked about a little bit earlier, but we didn’t get into the nuts and bolts. What is Cogsy? What does it do for, for e-commerce brands?
Adii Pienaar: Yeah. So we’re positioning Cogsy as being the, kind of the extra head of operations for your direct to consumer or your modern retail brand. What that effectively means at the core today and what the current version does, Jay is that we help brands have the right stock at the right time, in some way that kind of optimizes for working capital. So the philosophy there is like, we want to ultimately help brands grow, not just grow, but grow better. So paying due care to the kind of underlying unit economics and metrics related to that. So we do that. That’s the one kind of your primary action that we drive. And then we’ve got a second reaction that we acknowledge that sometimes kind of there are gaps in the demand and supply of your products.
We built this really great function called customer-centric backorders and what it is, is it’s because we see all of your imagery, data or related kind of data, and we see the purchasing plan. We can actually give a brand’s customers a date next available shipping date for products when they’re out of stock. And what ultimately happens then is customers can buy those products with confidence and with trust. It’s not like backing a Kickstarter campaign and you don’t know A, like, am I ever going to get this product that I just bought? Or like B what is the timeline there’s an accurate date here, which says hey Adii purchase the product today we are shipping this on the 27th of October. Because the brand knows that that’s when they have it available.
What we’re seeing with our kind of early customers is that converts so much higher than obviously not selling when you’re out of stock. But generally kind what brands do today is some kind of back-in-stock notifications as a fail-safe almost. The challenge with that is like, depending on the timeline from where I input my email onto a website saying, yes, I want this product, I want the notification when it’s back in stock. My purchasing intent in that moment is not as high as when I get the email. So with the customer’s backorders that we’ve built, we can essentially strike when the iron is hot and that purchasing intent is the highest. And I said, our bands are seeing significantly higher conversion rates as a result.
Jay Myers: I’ve done that a hundred times, I’ve entered my email on something out of stock. I either A don’t notice the email when it comes in or B I’ve bought something else or C by the time it comes I’ve lost interest, it was an impulsive decision. I saw an Instagram ad and I’ve moved on.
Adii Pienaar: Exactly.
Jay Myers: Yeah. That’s so interesting. So, okay. So what does this look like in a practical sense for a store? Like, does it give them reports on what they need to order? And when what is the actual interface and what does this store interact with?
Adii Pienaar: Again, it’s probably 2 philosophical things and I’ll get more specific. One thing kind of from the start that my co-founder Stephan and I decided was we didn’t want to just build a spreadsheet on steroids. I think there are many really good tools out there that helps brands kind of with everything, from the kind of inventory, planning, purchasing operational bits in their business. Most of the things still look like spreadsheets, and I totally get it. Like there’s the old cliché, which is your new software solution is always competing against an intern with a spreadsheet which is the case with so many things. So as a kind of truism, like I totally get that. But when we thought about Cogsy, we didn’t want to build just a spreadsheet on steroids. We were kind of totally rethinking what that kind of user experience needs to look like. So that’s one part.
The second part is we also don’t want to build a reporting tool or analytics tool. I think brands often have too much data. And the challenge when you have a data or even an insight the software solution gives you an insight is you as the kind of operator, the person that needs to action, this thing, you still need to contextualize this, you need to figure out like, what else do you need to take action here. So the way we’re positioning Cogsy at least is to be an action taking platform. So when we spin up an insight for you, we always want to help you take an action. And right now today with the current product, that’s live, those two actions are on the purchasing side and then the backorder side. and on the purchasing side kind of very concretely, what that looks like is literally kind of you pick a button at any time and for all the kind of your vendors or products that need replenishment at that stage, we will spin up optimal and optimized purchase order for you that you can just review and that it becomes a starting point for you to then kind of continue the purchasing workflow.
Depending on what your tech stack looks like, you can totally run with the purchasing workflow within Cogsy to receive the units there over time. Or we can sync it back to kind of, if you’re using a different IMS or anvil, for example, on the purchasing side, as a purchasing platform, totally do that there. The idea there is that we’re not just showing you, Hey, Jay, here’s 10 products that are likely to run out of stock before you can replenish them. So you need to replenish them now. We’re actually giving you that ability to say, just click a button and just do the hard work for me.
Ultimately what Cogsy does underneath the surface is we are consolidating data for you from different sources. So many of our bigger customers for them we’re consolidating data across their IMS. There’s 3PL provider and then for good measure, we interject things like their Google analytics data in there to inform our forecasting accuracy. So got all these data sources. essentially, if you’re buying Cogsy today you’re essentially trusting us to do all of the, kind of your harder math work for you to essentially kind of take those first couple of steps for you in deciding, Hey, which products do I need to purchase next? How many do I need to purchase, et cetera.
Jay Myers: Does it take into account seasonality or trends and like holidays and stuff like that, or is it just off of historical Data?
Adii Pienaar: Yes. So yes, we do consider seasonality we’ve got a couple of different machinery based algorithms that we use. Some are better at detecting seasonality and accounting for that. So yes, we already have that today. What is interesting again, for any one listening to a software founder ever getting your 2 philosophical, it means that they are way kind of you’re down this rabbit hole. Another one of those kind of philosophical things is on the forecasting side, I actually don’t believe that kind of improving your forecasting methodology or accuracy by 1% is probably very hard to do. And it probably doesn’t have the kind of the benefits that you expect for it to have. So the way we are thinking about it is we would much rather have a brand be 5 to 10%, more agile, more proactive, more flexible, in how they run their operations, how they kind of do their energy planning and purchasing. So that’s what we’re optimizing for on our side.
There’s so many solutions out there that suggests, AI machine learning, all these high kind of IP buzzwordy things, and they are just not as valuable. So to your point about seasonality, what we’re currently working on is, and this is very applicable. Many of our initial customers are super-fast growing brands and ultimately no forecasting algorithm can accurately kind of predict the future. When you’re growing at such a clip, kind of your next year is going to be totally different to kind of last year.
What we’re building at this stage is essentially what we are calling for the moments working progress, growth assumptions. So taking the kind of the forecasting that we do, programmatically, and then layering what the business understands about itself. what that means is everything from when you are planning your campaigns to kind of growth rates in different times of year, certain kind of you’re applying a multiplier for example, for black Friday, because you know that you got a black Friday in your business drive 10 X, the growth that it does in any other month, for example. So, really kind of going back to how would you build, holistically build the best kind of model and visualization of what the future of the business looks like? Instead of just relying on a single data point, IE, a machine learning-based algorithm to spit out numbers and try and predict the future.
Jay Myers: This feels All very relevant right now, going into this episode we’ll probably air fairly soon, probably, either just before or during the holidays. But, all the talk right now is around supply chain and brands are saying, you don’t even need to have a sale, just have inventory. There are all these images you’re seeing around the internet with stuck boats at sea and inventory shortage. And, Nike said that they have run out of fabric for all their clothing, jerseys, I don’t think they said shoes, but like athletic wear, like they’re out, that’s it, like, they’ve made what they can make for the holiday season.
So, Adii, like the first thing that comes to mind is, I guess if you can’t get the inventory, Cogsy can help with that. But the ability to capture… I saw an interesting phrase, I think it was on your caraway case study, what was the wording? It said, capitalizing on the intent of purchase, that was like the phrase. And I think that’s something that brands… My observation is, they’re not good at. Like when something is out of stock, it’s out of stock. Like an email meet later, I wonder what’s the data on that, do you have any data on what percentage of email meet went back in stock, of those actually turned into a sale?
Adii Pienaar: Yes, and I can’t quote my source, but…
Jay Myers: Okay.
Adii Pienaar: Essentially, kind of the average is… The range seems to be 5 to 15%.
Jay Myers: Interesting. Yeah, I’m not surprised, I was going to guess 10%, but yeah. And versus being able to order with an estimated date and they can actually place the order. Do you have data on these numbers yet? Or it’s too early?
**Adii Pienaar: **So, our data is too early, but, anecdotally, would be canceling for… Again, like, I think part of this, by the way as well, Jay, is like the other variable here is not just the data that we’re showing, kind of being more customer-centric. It’s also brands that have more loyal customers or kind of have that brand affinity and that product-market fit, they will always do better here. Assuming that’s the case, like what we’ve seen, like many of our… I think the brands of recurring work will fall into that exact same category, they will tell you that even prior to using Cogsy.
So Caraway being an example, Caraway was our first customer, and they pioneered doing this and they just did it manually. And if you ask them about their data, then anecdotally, in the last year or so, conversion rate hasn’t changed significantly for products that are on backorder, versus products that are in stock. So, but again, like, that’s still too early for Cogsy to at least authoritatively say, here’s the data, here’s why that is significantly better. We’re a young product, young company in that regard.
Anecdotally, it looks like we are far outperforming that five to 15% range on back-in-stock notifications, as one alternative, to solve the problem of those times when you don’t have stock yet of a product because it got delayed, et cetera.
Jay Myers: Yeah, that’s really interesting. I can 100% sympathize with that. If someone is buying for the price, if the price is the value driver of the purchasing decision, they’re more likely to go back to Google and find the next site that sells the same products. But if it’s Caraway, who is a D to C brand, they manufacture their cookware, no one else does. They have loyal customers who are bought into the brand, a product like Cogsy probably works exceptionally well. So it’s going to be on a spectrum.
It’s also an interesting indicator, I bet you’ll maybe get to a point where you can write a blog post on this one day, if cogsy converts, when out stock at 15 to 20%, maybe your brand is weak. If it’s 40 to 60%, you’ve got an average brand, if it’s 80 and up, you’ve got a strong brand, because they’re willing to take out their credit card and pay, even though they’re not getting it, it’s on a ship date. I guarantee there are some data points around that.
Adii Pienaar: I mean, Jay, would you describe there sounds like the kind of challenge that I will happily take on? And what I heard you saying is, Adii, can you please redefine how net promoter score works with these interesting dates that you have or so. Challenges, except that, I actually think it’s a great idea, by the way, I think correlating how brands… Cause it is… I think the higher the conversion rate on products that are out of stock, I think there is this close correlation to brand affinity. So, you’ve got me curious, you’ve got me very curious to see how this plays out in the next two or three years.
Jay Myers: CPS, the Cogsy Promoter Score or the Cogsy CLS, Loyalty Score. Yeah, that actually… That Caraway case study was really interesting, there was a couple of things I thought that stood out to me there is, you have to be in the right mindset or have a couple of operational things about your company that have to be in place for a project like Cogsy to be very effective. I think there were… I was just pulling it up. There was five listed in there, you need to be a data driven inventory management. The only way to rely on back order model is to implement smart inventory management.
This way you can have real time inventory, accuracy, over-communicate, company culture, making sure that everyone is on board with the importance of data, and then, the nature of the product. Actually, this is one we just talked about, FOMO doesn’t work for everyone, it depends on the brand. So, I can definitely see that being some companies have to set themselves up for success with Cogsy.
Adii Pienaar: Yes, and I think there are kind of two things that I can just pull out on those. I think from a kind of data standpoint, ultimately, like, this is still a kind of crap in crap out situation. If you aren’t good with… And that’s what we find with many growing brands. They often have the creative, and the product, and the growth side of the business figured out, but the operational side is not as sophisticated. They’ve not prioritized it, and ultimately in that realm, that’s where I think there’s ways to get better. Like, figuring that out, like your measurements and how you run your processes, et cetera.
Is probably where you eke out, you do one thing consistently for a quarter and you eke out 2 or 3% extra margin, or a 5% increase on your turn around working capital. Whatever metric you want to use there. And I think the key thing there is, the reason why that matters today is, yes, e-commerce globally has had such significant tailwinds, and we all know all the cliches, the pandemic has accelerated that. What is also true though, is that, we can’t continue growing at the same [inaudible 36:51]. And, the more that grows, the more it divides competitors into the ecosystem.
And, what brands have already started seeing is that their customer [inaudible 36:59] cost is kind of going through the roof, alongside this kind of inflated or accelerated demand. So, I actually believe that the best brands of tomorrow won’t grow at all costs, they’ll figure out a way to grow better. And that’s where kind of you… Where Cogsy comes in, and I think operational excellence comes in. There is another lever to pull here, where it’s not just about reducing the top line, kind of revenue growth. But also making sure that what’s happening below the line is effective in your cost-efficient, effective, et cetera.
So, like, that’s our spiel here, like that’s how we’re thinking about that. And, to come back to a point where I made about the data is, the very first thing that most brands should start doing is, just better start kind of tracking any inventory rate data, costs involved, just calculating cost of good sold for example, like there are so many tools out there that helps you with that. Like all those things are improvements that brands can implement and should probably implement, that’s a key step to starting to grow better.
Jay Myers: I have a theory that E-commerce brands that are going to be winning in the next 3 to 5 years are the ones that are operationally excellent. You talked earlier about we’re building on the shoulders of giants and we’re… Every year… You go back 10 years, if you just had a decent-looking website, you could do well. And then if it was like if you had a mobile-friendly website, it did really well. But then now, everyone has a mobile-friendly website. If you have… Each year, what companies like Shopify have done, have made it so easy to start a store.
Like, you can have a store up and running, you can have take payments tomorrow, it can look beautiful, it can load fast, it can have… Everything about it is like you would’ve paid $100,000 for 10 years before. So, it’s actually becoming, in a lot of ways, harder for brands to stand out. And, I think the thing that a lot of them maybe aren’t focusing on, and the ones that are winning are, is, operational excellence. And, I think personally that this is going to be a big differentiator, I don’t know if it’s a couple of years or if it’s 3 to 5 years, but, in the near future for E-commerce. I don’t know, what are your thoughts on that?
Adii Pienaar: 100% right. I think we’re already seeing that as well, Jay. Is that, brands are starting to think, earlier in their journey about what kind of operational excellence or just efficacy and efficiency, actually looks like. So, I see kind of more people with operations in their title. You’re popping up at these direct consumer brands much sooner, so I think that’s already happening as well. And, to your point about standing out, like the one thing, because I agree on this tech side of things. Like, if you think through this as kind of your…
In a lifecycle manner, the first phase of E-commerce was all around the platforms that needed to get built. Everything from E-commerce, to Shopify, et cetera. Loads of infrastructure-related stuff, payment processing needed to happen to enable E-commerce. Then, I think in the last couple of years, we’ve been in the second phase, thereof, which has all been around the kind of creative and the growth side of things. So everything from, how do I send marketing emails more easily? Like, mail gym completely kind of revolutionized that, as an example.
So, anything that we do these days, which is SMS stuff, Facebook messenger stuff, like all these channels popped up. We built out the design side of things, like, that’s really sophisticated and kind of well-stocked today. The next part now is that your point is around operations, how do we, like… Because we’ve neglected this, like, there aren’t that many tools out there, whether they are direct competitors of Cogsy or not, like that’s a good point. There are just not as many… There aren’t as many inventory planning tools, for example, as there are email marketing solutions.
So, my point there is, I think there’s a lot of work to be done there. And again, like stuff that’s not even tech-related, one that I’ll throw up in the air. I saw this service the other day called importyeti.com, and effectively, I think what it does is, it searches the US customs database, but if you know, for any other brands you love, and I think this is the US only, for any other brands that you love and you knew what their legal entity name was. And you input that there, assuming that they import their goods from abroad, you can actually see all of that, because it’s publicly available information.
You can see the kind of import slips or whatever the fancy people will call them. And you can trace that back to all the suppliers in China that are manufacturing these kinds of goods, which in my kind of tangent here is, if that’s the case, that’s the shortcut to just sourcing products from the same factory, and competing against some kind of incumbent. So, product sourcing as well, like not just on the tech side of things, but product sourcing, manufacturing, all those things has also changed and that also become easier.
So, I truly believe that one of the next core competencies that brands will need to build, I’ve got a couple, but I think it is around operational excellence. I think they need to get really great storytelling and branding to support the products they are pushing out the market. Because, as I said, product sourcing is super easy. And then I actually think the other thing that pops to mind is, access to capital. I think, interesting enough, in the last couple of years, we’re seeing directions consumer brands now raising venture capital and raising them on similar terms to what software companies were doing five years ago.
And, I put up a mentor and a friend who kind of said to me that, he said Adii, you know what, if you got access to capital, you could solve any problem in the business. It’s like, building business is not a challenge. And, again, like it sounds a bit of a globe tourism, but, the idea there is, if you can attract capital with what you’re doing, you’re essentially buying yourself time to figure things out. So, I actually think like those are the core competencies going forward versus what we had to do in the past.
Which was, how do I put a tech stack together to start selling online? How do I figure out growth channels? Like, those are things are still important as well, but I don’t think that they are the kind of competitive advantages of the future, for brands.
Jay Myers: That’s interesting. I agree with the access to capital, I also… Just our story at bold is, we’re in the middle of Canada where our headquarters are now spread out all over North America, but, typically, not a great place to raise capital, there’s not a huge investment community here. And, there’s a lot of government grants, and tax credits, and things like that, but not a huge investment community. And we went seven years without raising anything, and we, like, it kind of put us in a mindset like we have to succeed.
There are pros and cons to that, I definitely agree, because you might just do what makes money rather than build a valuable company. And it’s easy, we had to… It’s hard when you’re starting off, if someone came to you right now, and if you had no capital in the bank and said, Adii, can you build… I need Cogsy to do this, and I’m going to pay you $100,000 to do it, to tailor it exactly to the way I want to use it. That might not be what’s best for the market, but it’s what’s best for me as a customer.
But if you need capital, then you end up doing that because you need to take the money, and it actually then money… That customer’s money dictates your product roadmap. Sometimes you’re lucky, and it is a customer that has an aligned need as the market, but sometimes it’s not. And that definitely happened to us in both cases, we’ve had each scenario over our time, but, it’s something to watch out for. So it’s a good observation.
**Adii Pienaar: **Totally. And I think that… Just not to make it too promotional about Cogsy. I think, when I look at the available kind of tools that would compete against us, if we were a mature product today, whom we would compete if we were mature because we are the younger kind of upstart here. But if I look at those tools, I think, again, like I mentioned earlier, we’re not trying to build a spreadsheet on steroids. I think so many tools have been built in their… An incremental improvement on what came before them.
And I think that’s going to be a part of that, is exactly what you described there, Jay. Is like, you get a customer in the door and they’re willing… They ask you for this… You do that thing. And that also leads to this incremental product that gets built and many great businesses have been built incrementally. What we’re doing with Cogsy, at least, and the way we are funding this is to kind of make a bigger bet here. Which is making an exponential jump on how things are done today versus how we imagine things are done. How brands are doing things in 3, 4, 5 years time.
So, I totally hear you there. And like capital in that scenario, allows you to take a different path, and play a different game, and make a different kind of bet than the one you would need to do if it was more bootstrap and more incremental.
Jay Myers: Yeah, I totally agree. So then, I want to ask you one last question and then a couple of quick questions just for brands listening, like other business owners, speaking of that, what are your long-term goals for Cogsy? You’ve got some capital in your growing, and I know you can’t say everything, but maybe, in the next… Maybe 3 to 6 months, what are some things you’re excited about?
Adii Pienaar: Yeah. So, I should also, a bit of chicken egg here, Jay. I think your sights have more context than I, I will leave that mysteriously secretive. What am I excited for, for the next 3 to 6 months? I think the important parts are that Cogsy is up in the market now, we are onboarding new customers every single week. And what we’re doing is, we’re really using those customers to help us prioritize kind of what the roadmap looks like. So, and I can really see on the product kind of side of how quickly the product is evolving today.
So, that is really exciting, there… I totally expect some bigger news to come out here in the next couple of months or by the time… Like, they might have dropped by the time this goes live. I think ultimately, [inaudible 46:37] is kind of the bigger vision here. Which is ultimately still, Jay, that we are trying to replace a spreadsheet and a spreadsheet-based workflow, without this looking like a spreadsheet. And, I’m still conceptualizing this, I don’t even know whether this can work, but for anyone that’s ever built a kind of medium terms, think 12 month kind of purchasing plan, in a spreadsheet.
I visualized an alternative that looks more like a GitHub commit history. So same outcome, totally different UI, UX visual, and just workflow. So, that the kind of thinking here, I don’t know whether that’s going to work by the way and whether it’s going to be useful. But that’s the kind of thing that we are already working on and will be working on. You will not find rows, and columns, and cells with formulas in Cogsy, anytime soon. If that ever becomes the case, then I have downgraded the vision I’ve signed up to kind of manifest here.
Jay Myers: Yeah. Well, I think the sky is the limit and it’s going to become more and more relevant. So, I wish you all the best with your future roadmap, whichever way it goes. It sounds like you are a lot like us at bold, we say, we lead with a compass, not a map, we know where we want to go, but we don’t know exactly the route to get there. We kind of figure as we go, but we have a compass and we have a long-term goal in mind.
Adii Pienaar: I’m totally stepping in before your question, I’m totally stealing that, and I’m totally taking that to my team as well.
Jay Myers: I hope you Do. I hope everyone listening steals it as well too. It’s been a really important thing for us to understand that we’re going to make mistakes, we’re going to run into roadblocks, we’re going to hit areas that we can’t get around, and… But that doesn’t change our goal. It’s, we have a compass, not a map. So, and I think too many companies try to have a five-year roadmap. Even the word, like we need to maybe take that word out of it, we can call it our compass session. But yeah, I’d like to end on a couple quick questions.
I didn’t send these to you ahead of time, so for everyone listening, I’m putting Adii on the spot here. A little bit of a lightning round, and so if you get a total brain farty kind of answer, I’ll ask the next one, that’s fine. But I feel like you’re going to have good answers to these, because also, your wife owns a fairly successful E-commerce company as well too, right?
Adii Pienaar: Yes, and she just sold that.
Jay Myers: Oh, okay.
**Adii Pienaar: **It really kind of… Yeah, so she just exited that, but yes, I think part of the whole Cogsy genesis was also me being her tech and financial co-pilot, in that business. Because I can do the 99% of things that actually needed to be done in the business, but I could add somebody on the tech, and the financial side.
Jay Myers: Yeah. So one way or another, you’ve got some background in this. So, the first question, what is the biggest mistake you see merchants make selling online?
Adii Pienaar: Not having good data practices in place.
Jay Myers: Do you have a pet peeve when you shop online?
Adii Pienaar: Oh, When I shop online?
Jay Myers: When you’re shopping, what really annoys you, that a brand does while you’re shopping, or during the experience, or in the follow-up emails? Maybe not using good email hygiene, receipts.
Adii Pienaar: Yeah. Well, the thing that irritates me to the [inaudible 49:40] degree is, if I’m forced to create an account, like just… Sometimes I just shop and I’m always… Like, this is just a one-time buy, just make this quick, don’t take all of my details.
Jay Myers: Will you abandon a checkout if you don’t… If you have to create an account, is it that significant for you?
Adii Pienaar: I have, yes. Like if you force me into doing something, no, this is just like too much hassle. I’m not here to become a life-long customer, I’m here to purchase this one product, this one time.
Jay Myers: Yeah. And for anyone listening, you can backload account creation, they can… Customers can create them after they purchase. You can give them benefits for creating accounts, you can put offers and special benefits inside their account page. So, create an account, get our exclusive offer, there’s a hundred different ways you can do that way better, that actually, doesn’t interrupt the shopping flow. And, it does one better, it brings that customer back to your store to get an offer and possibly shop again. So, I think it’s bad on so many levels, so you hit one of mine as well, too. What is your favorite thing about your job?
Adii Pienaar: The ability to build a team or the opportunity to build a team.
Jay Myers: I like that. What’s your favorite online store or the last place you bought something?
Adii Pienaar: Oh, the last place I bought something? I bought a Yeti Rambler for a customer because a mentor of mine got me one, a big… I think it’s a liter, that’s in metric or Imperial, I don’t know which one is which. The one that I…
Jay Myers: 32 ounces?
**Adii Pienaar: **Yeah, I think it’s 36 ounces, and I just use it every single day and it has been an amazing gift, so, I got one of our customers one as well.
Jay Myers: I’m drinking coffee from Yeti right now, that I poured before we started this podcast and it’s still piping hot. They really work.
Adii Pienaar: Exactly! It is an amazing product. I don’t use it for warm liquids as much, but for water, it’s my go-to vessel, during the day.
Jay Myers: Yeah, me too. Most of our listeners are business owners, obviously, they’re entrepreneurs, you are a business owner and entrepreneur. Do you have any quotes, or advice, or just, yeah, like sayings, or things that you’ve lived by that are really important to you that you find yourself always going back to? Or maybe you have it on a wall, or you’ve shared at talks, different things that you would like to share.
Adii Pienaar: It feels like the kind of question that I should totally be able to answer
Jay Myers: Me too. But if I was put on the spot, I’d be the same way too. Oh my God! There are so many.
Adii Pienaar: Yeah. I think the way I actually think about these quotes, almost mantras, Jay, is that, for me, at least they’ve been very seasonal in my life. So, like for a season, this one thing sticks to my mind and [inaudible 52:09] and then looking… Three years later, it’s a totally different thing that drives me. The one thing I will say, the book I most often recommend to anyone, and I’ve read it twice already, is Siddhartha, by Hermann Hesse. Has nothing to do with business, and it’s just a fascinating book that I go back to it every now and again.
Understanding that I won’t give it away, as much… The book is about a journey, and I think that there are just so many interesting [inaudible 52:38] and almost like a kind of lens to look at business or look onto business from. So, yeah, that’s the one I would throw out. It’s a kind of.. Almost an overarching thing that I go back to every now and again.
Jay Myers: Is that the one by Herman Hesse? Am I saying it right?
Adii Pienaar: I don’t know Herman personally, but yes, that’s the author.
Jay Myers: Oh, okay. I just… Oh yeah, those are all the same. Okay, never mind. I just Googled it and I saw three different Siddhartha books, all with different covers, but it’s the exact same book. They’re just… One is audible, one is the Amazon, okay. I’m adding it to my reading list, I have not read that one. Last question, if you had to give some advice to someone who, this may or may not be possible, but they want to double their e-commerce sales in the next year or grow significantly.
They could be getting started, could be annual. But, what is one of the biggest levers, or if you could remove all marketing tactics, except for one that you’ve seen work over the years, what is one thing you think a branch should focus on, to drive as much growth as possible?
Adii Pienaar: On the marketing side, Jay, like, double down on whatever is working today. Like that’s a… I think that’s a go-to strategy in your business. Instead of trying to diversify, spin up something new that you don’t have a core competency on, I think the surest bet for most brands is to figure out like, how do I really double down on this thing that’s already working? And getting those… Whether it’s units, economics [inaudible 53:59], whether it’s just volume that you need to be kind of more, for you to double up. I don’t know like there’s some nuance there. But that’s where I would start, like I’m… As a person and as a founder, I’m more double down on my strengths versus trying to fix my weaknesses.
Jay Myers: Yeah. Pay attention to where things are working, your best customers, your customers that are spending the most. Find out what channels they’re coming in, why they’re buying, and I agree 100%, double down on that. Yeah, that’s so good. That’s all I got, you did pretty well in the lightning round, considering I never sent it to you before. So, where can people go to learn about you, and Cogsy, and is it… Actually, I should have asked this earlier, but, can people just download it and try it? Or is it like a signup process? Or… Give us the details on all that?
Adii Pienaar: Yeah. So, [email protected], both have a S, and a Z are smart to get both domains there for mispronunciation.
Jay Myers: Good call.
Addi Pienaar: So cogsy.com is also the Shopify app store. If you search for it there, it is self signup, so you can get into it, depending on your data integrations. So, new customers might need to ping us and interact with me. I am a sales team of one at this stage, but obviously, more than happy to work with any brand. So, those are the ways to find Cogsy at least. And if anyone wants to learn more about my philosophical inclinations, the place would probably be Twitter where I’m just Adii, Adii, double “i”, or my website, adii.me.
Jay Myers: Awsome! Thank you so much Adii, This has been a real pleasure. A lot of fun, I learned so stuff, caught up with an old friend. I really enjoy this, thanks for coming on the show.
Adii Pienaar: No Jay, thanks for having me, the pleasure is all mine.