Localvore logoCompany: Localvore.co

Website: www.localvore.co

Headquarters: San Francisco

Year Founded: 2012

Founder: Cameron Kramlich 

Twitter: @sflocalvore; @islaisnow

Brief Company Description: Localvore.co celebrates retail ready artisan manufacturers by enabling people to discover and buy local products—starting in San Francisco.

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Cameron Kramlich, Localvore.coBy Cameron Kramlich, founder

Localvore.co catalyzes local commerce by connecting retail ready artisan manufacturers with people who want genuine and authentic products made near them. We love (and share) maker stories to provide the context of physical products. As both a platform for curated social discovery and a distribution platform, Localvore closes the loop between makers and customers.

I started Localvore to meet a need I see in my neighborhood which I think exists in other neighborhoods, too. I live in a community of entrepreneurs in San Francisco’s Dogpatch neighborhood, which just bustles with amazing local makers and designers. We have legends like Mark Dwight (founder of Rickshaw Bagworks and SFMade.org), hip startups like DODOcase, emerging makers like Summer Connor’s Lovebison.com; not to mention countless Kickstarter projects like Sara Argue’s Storytime Toys. PCH International’s Liam Casey recently pivoted from China to my neighborhood to open an industrial maker space. I’m fortunate to live in this inspirational environment and started Localvore to meet the opportunity to help other people discover the magic by supporting these artisans without biking across town.

Although we have lots of indirect competitors, no one else really offers a multi-brand local shopping experience with fulfillment. Our closest competitor is either the boutique run by The Bold Italic blog or the Zaarly local service discovery platform. ScoutMob sells artisan manufactured products not filtered by geography, and we really admire the aesthetic choices made by Gravel & Gold. At the lower end of the spectrum we compete with the hawker stalls in tourist neighborhoods selling “I escaped from Alcatraz” t-shirts and shot glasses. Given the nature of our product mix and our compelling high value (but not necessarily low) price point, we believe that Localvore exists to expand the market by stimulating demand for products through raising customer awareness.

We feel that a big part of enabling this social discovery is connecting with everyone in San Francisco including locals, commuters and visitors. Our marketing strategy reflects this by simultaneously going old school by reaching out to the press and posting street signs on light posts while leveraging the social graph by encouraging people to share the products they love over Pinterest and Twitter. Unlike many other digital retailers, we do not require people to share their personal information just to discover our quality curated products. We know that this reduces our ability to manage the sales funnel through email, but feel that the trade-off in lower bounce and just treating people the way we want to be treated is worth the cost.

Our business model is pretty simple: we have inventory that we sell at a markup; our pricing strategy is to use manufacturer’s suggested retail price and charge both shipping and sales tax. Many of our products are not available elsewhere and for some products we contractually cannot discount. We aim for more of a Whole Foods customer who appreciates a green business than a Groupon customer looking for a daily deal.

It is quite fashionable for web businesses to manage capital needs by focusing on lead generation and having vendors drop ship merchandise to customers. We feel that this undermines a big part of our value proposition because we feel that: a.) the core competency of makers tends to be in making things and not shipping them, and b.) retailer and enablers like Amazon and Google Shopping Express have set the customer expectation that products will arrive within hours as opposed to weeks. We’re big fans (and customers) of Fab.com, which means we’re able to learn from their early growing pains of multi-month shipping periods. To minimize capital needs (and accelerate our ability to grow), we are more inclined to work with artisans who trust us enough to sell on consignment.

We’re taking a similarly thoughtful approach toward managing our burn rate. Our business is built on the fundamental proposition that much of the core technology stack for an online retailer has been commoditized. PHP and SQL are user-friendly technologies which enable applications like WordPress and WooCommerce to connect with services like Stripe for payments, CloudFront for speed and CloudFlare for reliability. Early on we approached an offshore software development firm to build our minimum viable product; when they quoted six months and $150,000 we decided we could do it ourselves. Let’s just say that we took far less time and have invested money in things customers care more about like marketing and inventory.

Our frugality is reflected in a very small core team leveraging the amazing infrastructure out there. We are based in San Francisco’s South of Market neighborhood, blocks away from South Park in a space surrounded by dozens of other startups. We believe that at a fundamental level we’re meeting a marketing and logistics problem (instead of a technical problem), which means our team shares this focus. This said, we currently seek a Magento expert and can always use more UX talent. We’re also contemplating building a mobile app which would entail finding a mobile developer. We also are looking to add to our operations team. Our most pressing human resources need is actually finding a few quality people to handle logistics and a potential retail storefront.

We have lots of friends in the Venture Capital industry, and love advice from Angels; this said we’re not currently seeking investors. We have a great advisory board with experts ranging from a co-founder of Whole Foods, a Silicon Valley marketing legend, a Big Data guru and a gamified retail/reputation expert. At the moment we’re focused on building our business to a point where we’ve proved the model in San Francisco. Once we’ve met these internal targets, we’ll raise a Series A so that we can share Localvore with other communities.

Localvore – www.localvore.co