Mike Salter and Nicholas Russell are the two co-founders of We Are Pop Up, a community marketplace that connect brands and businesses to short-term space across the UK. I invited them over on YHP to share their story so far.
Hey guys, Thanks for doing this. How are you doing today?
Hi, we’re doing well! For the last three months, we’ve been building and launching new features for the platform on a near-weekly basis. We are close to completing the current feature set, so we’re focusing on connecting with our community of users. They’re a great bunch and we enjoy working with them.
Could you give us some background information about yourselves?
We’re both Americans from Los Angeles who have each been in the UK for five or six years.
Nicholas has an undergraduate degree in psychology and an MBA from the University of Oxford. He’s worked in a variety of industries, from television to branding to sustainability to manufacturing across the US, the UK, China, and India – needless to say, he’s quite fond of travel.
Mike has fine art degrees from both Dartmouth College, and The Slade School at University College, London. He lived in Austin for a year, working on a graphic novel about growing up in Los Angeles in the 80s. In London, he had a studio in an old Chinese printing press in Hackney.
So tell us how you both got into business?
Both of us come from families of entrepreneurs in California. I guess you could say it is in our blood. We’ve been in and around business our entire lives.
How did the idea for We Are Pop Up come about?
Nicholas was a management consultant focused on creating financial value from environmentally and socially sustainable business practices. He worked on quite a few efficiency programmes in that time, and some of them involved creating value from “waste”. Most “waste” has value, the key is creating business models that can extract that value. Sustainability is a mind-set and a way of seeing the world. We have limited resources, and we must use those resources as efficiently as possible.
In early 2011, Nicholas saw tons of empty shops around the UK and US. An increasing number of empty storefronts in previously-vibrant communities. At the same time, he was studying the emerging business models in the sharing economy – AirBNB, Kickstarter, and Uber. The idea behind the sharing economy is to maximise the value of existing assets by using technology to drastically reduce transaction costs.
If Nicholas had the original idea, it was then shaped as a technology platform and service by Dr. Alastair Moore. Alastair holds a PhD in Computer Science from University College, London and creates software systems to solve real-world problems. His previous start-up was an algorithm platform called Satalia that had applications in a variety of sectors, one of those being resource-allocation.
Nicholas and Alastair both saw the problem, and the opportunity to create a software solution. Yet we were missing the use-case – how would people actually use a software platform to fill empty retail shops? The AirBNB model offered a conceptual direction, but how people actually use commercial property is very different.
Mike had been working on a different problem. The London art scene is notoriously inaccessible to new artists. It’s a world of personalities driven as much by guangxi as talent and practice. Mike found himself spending more time playing the art game than actually creating art. He came to visit Nicholas’ flat in Central London one day. “You know, there’s an empty shop downstairs. This is a great neighbourhood. I’d like to just rent that shop for two weeks and host my own gallery. I’ll do it twice a year, and people can see what I’ve been working on. I don’t need to be anointed.”
We had our use case. The democritisation of retail property.
Tell me about the early days, what was the hardest part of starting the business?
Nicholas: Building the team. Great people have their choice of roles and commensurate salaries. It’s a big step to ask them to move away from what they’re doing and believe in an idea. It’s also a challenge because at the heart of any new business is a limited pool of resources and a variety of needs. The strongest teams are start with a small group of high-calibre people. It’s a challenge to get that combination right initially, and then to keep everyone together as the story unfolds. That being said, this idea has brought together an amazing group of people and I feel fortunate to have the opportunity to work with them every day.
Mike: Creating something with heart. We’re asking people to use a website that we are building, to spend their time learning how to use the software and interact with other people through the platform. We have to respect what they are doing – their goals – and facilitate that. When we started building the site, I wanted to create something that I wanted to use myself. There was nothing off the shelf that really spoke to that. So I learned HTML and CSS, so that I could create something truly innovative that not only speaks to the community that we’re creating, but honors what they are doing.
What is We Are Pop Up? And what are you trying to solve with it?
We Are Pop Up is a community marketplace that enables people to transact commercial property on short-term contracts. It’s an online marketplace filled with real-world stores. We call it ‘shopping for shops’.
We provide potential short-term tenants with showcases for their ideas – we call them Projects. These are rich profiles that essentially do for retail tenants what LinkedIn did for job seekers. Projects showcase images, social network connections, previous projects and tenancies, and a variety of other information.
Properties – Spaces – also have profiles that include pictures, maps, street views, pricing, and availability. The platform then matches potential tenants with potential commercial spaces, and facilitates the communications process. Eventually, we will support the full transaction process.
At a basic level, the problem we’re looking to solve is that there is a tremendous un-served demand for short-term commercial space by a range of businesses, from small Internet entrepreneurs to large multinational corporations.
The commercial property market is optimised for a time that has now passed. One of the luminaries we spoke with said that two messages comprise the majority of commercial property emails: “You call me” or “I’ll call you”. It’s a high-touch industry of personal connections – back to the guangxi thing again – that doesn’t scale. All those shops are empty not because demand is lacking – we have plenty. Those shops are empty because the current business model cannot fill them. So we’re building a new business model to enable both property holders and tenants to fill shops in a different way.
In terms of a larger purpose, We Are Pop Up is inherently designed to have numerous positive second-order effects. Youth unemployment is at a peak, and so is retail vacancy. We’re helping to break down the barriers to entry so that young people can begin writing their own economic destinies.
Whilst faraway owners are amenable to properties sitting empty, those empty properties cause blight in local communities. Crime rates rise, and remaining businesses are negatively affected. We enable communities to fill their own shops and reverse the trend of High Street blight.
Despite these high vacancy rates, construction on new retail space continues. On average, retail stock grows at 2% per year. Many of these are green-field sites. The world is quickly exhausting its environmental carrying capacity. We Are Pop Up is designed to maximise the use of existing retail space by reducing the transaction costs and time. We like to say 9 months of retail vacancy is 270 days of short-term tenancy.
And Mike would say that we are the solution to boring. So much of retail is homogenous and just not interesting. Our platform literally makes the world more interesting.
How have you been able to fund it?
We started out with a founder’s round of investment and built the first version of the platform. We did a second small round of capital, with funds raised from friends, family, and the Springboard Mobile accelerator programme. Today, we’re in the great position of running of revenues. We’re currently in discussions for another round of funding to build out the team, but thanks to our revenues, we’re in the position to look at the right investors, rather than just any investors.
What sorts of advice do you having for entrepreneurs looking to raise money for their startups?
Thanks to the UK’s SEIS scheme, it is very easy to raise capital up to £150k. We actually priced our second round too low, because nearly everyone that received an offer to invest accepted it.
The second point would be that it always takes twice as long as you think it will. There’s no shortage of companies looking for investment, and after the level of SEIS funding, they want to do their homework on the entrepreneurs, the business idea, and the market.
The third point is to be very clear on what you want out of your business. There’s a great book called the Founder’s Dilemmas by Noam Wasserman. Wasserman looks at the resulting characteristics of businesses that bootstrap versus raising capital. The gist is if you want a business that you can control and grow with, bootstrap. Investment is basically an accelerant and if your business is successful an well-capitalised, it may well quickly outgrow you. It’s important to know whether you want a big piece of something small, or a small piece of something big.
The last point is quite simple. The first part is that once equity is given, it cannot be taken back. It is very tempting in the early days to incentivise people with equity offers instead of paying them cash. The second part of that is equity is like a sheep. You can sheer a little bit of wool today, and sheer a little bit of wool tomorrow, but at some point, the sheep will run out of wool.
About the first few months, how excited were you, tell us about how those months felt, what happened?
The first few months were really exciting! We did a lot of research before building the software and consequently went to every pop-up shop, supper club, food truck, and design show that we could find. We talked to the people who had created these experience, and are glad to now call many of them friends. We were privileged to see a universe of universes. They shared their stories, motivations, and aspirations. We started promoting them on our Twitter account, and going on their journeys with them.
The launch of the brand coincided with the London Olympics in 2012, and East London was alive with amazing events and new ideas. We literally could not keep up with everything going on. The team would get together on Saturdays for strategy sessions and distill everything we were learning to shape the product.
At the end of summer 2012, we applied to Springboard Mobile and were accepted. At that point, we put our heads down and started building software. It was still amazing and exciting, but in a very different way. We had a direction and a goal for the platform, and strove daily to achieve it. We did not have as much time to go to events and meet people, and we missed that.
That’s when we decided to start our PUMU (Pop Up Meet Up) series of events and stay connected with the community by providing a monthly gathering place. Those events keep the excitement and energy going. It’s back to the idea that we enrich ourselves when we enrich others. We know we’ve done well when we see the energy of a PUMU reflected on subsequent website activity. PUMU has been so successful that we’re expanding it to Brighton this month. We’re excited about that, because PUMU is the embodiment of the excitement of the early days and we love sharing that excitement with people.
How did you initially get traction?
Paul Graham from Y Combinator has said, “it’s better to have 100 users that love you, rather than 10,000 that think you’re just okay.” We took that on-board and treated our early adopters well. Our big break came when Roger Wade from BOXPARK Shoreditch called and asked if we could run a holiday competition for him. That connection came from Mike asking for permission to use one of their images on our homepage. He made our own luck in that case, and that was the spark that ignited our user base.
What are the most crucial things that you have done to grow your business?
Deeply care about our users and act in service of them. When we first started the PUMU series, people would approach the team and introduce themselves. Often, we recited their projects back to them, and they loved that. We love talking to the users. We go to launch parties, promote new projects on our social media accounts, and we keep in touch with our users as they go on their journeys.
While We Are Pop Up is our software platform and our business, it’s often our users’ livelihoods and their lives. People’s time is precious, which is why we’ve always seen this as a partnership and that’s worked well for us. Our ethos is that we’re building a community of amazing people. The software platform connects them, but the heart of our business is in helping people achieve their goals, whether they’re Finchittida Finch – two sisters selling beautiful jewellery – or multinational brand managers looking to do something fresh.
What would you say has been the highlight of your entrepreneurial journey so far?
We hosted a PUMU in New York City, with Greg Spielberg’s OpenhouseNYC. They were running a project called “3DEA” which showcased a variety of 3D printers at the Eventi Hotel in midtown. We had a great turnout, and it showed us that this isn’t a London trend or something that relevant just in the UK. This is a worldwide shift in behaviour and thinking.
We were staying in a converted synagogue on the Lower East Side (appropriately found on AirBNB) and returned from PUMU to find out that we had been named Wired UK’s “Start-up of the Week”. The next morning, we took a walk through Highline Park, and we were all very content. What six months previous had been an idea scribbled on whiteboards had become a reality and was being noticed, not just in London but also in NYC. It was validation that what we are doing matters, and is important.
What should we be expecting from yourself and the We Are Pop Up team for 2013?
We’ve placed over 30 projects in the last five months, primarily in Camden and Shoreditch. Up until now, we’ve been running a closed beta programme on the property side, taking feedback and building out different bits of the software. We’ve now opened up the functionality on the property side to everyone. In the last two weeks, we’ve had over 30 properties registered, and we’re seeing a lot of activity on the site.
Also, a lot of our users wanted the opportunity to share space and collaborate on projects, so we launched that functionality at the end of March. Now, projects can find other projects and collaborate together on finding a space. We had that functionality on the roadmap for later this year, but as we talked to users, it was a popular topic and we moved it up. We have no idea what results that functionality is going to produce, for it’s the first thing we’ve offered that literally doesn’t exist anywhere else. We’re very excited to see how people will use it.
In April, we’ve launched a few collaborations of our own. We’re working with Philip Dundas from PipsDish on an opportunity for independent chefs to run their own restaurant for a night. We’re working with Camden Collective on a series of free pop-up spaces designed to revitalise Camden High Street.
We’ve started a project called Re:Create with The Brighton & Hove City Council to create a culture of pop-up retail in Brighton. We’re working with Rosie Cann from popupspace on delivering that, which is a great honour as Ms. Cann is one of the UK’s leaders in this area.
In May, we have some very exciting spaces coming online at a beautiful Victorian arcade in Birmingham. We’re currently in discussions for something very exciting in London that will show how people can think differently about everyday urban spaces.
Finally, we’ve been working for a while now with Emma Jones’ PopUp Britain on ideas at the policy level. Ms. Jones has put together the National PopUp Forum, which takes new thinking in retail space use to Whitehall.
Lastly, what three pieces of advice would you offer entrepreneurs starting out today?
1) Ensure all founders are signed up for reverse-vesting from the beginning.
2) Write short emails.
3) Regularly engage with a coach or mentor who is completely separate from the business.
