Being Open to Change, Morgan Berman, Podcast #119

Morgan Berman is the Co-founder and CEO of MilkCrate, a Philadelphia-based tech company that runs a digital hub that connects an organization to its audiences. Many iterations of MilkCrate and the reality that her original product worked for a different market gave Morgan the ability to pivot her company and reinvent MilkCrate. 

You can listen to this on Itunes here.

Comments (Archived):

  1. Bryce T.

    Being Open to Change, Morgan Berman, Podcast #119“Entrepreneurs are risk managers, not crazy people.”0:39 If you look back on your career, you’ve always had this connection to community. And you’re over educated as well, I’ve noticed. Did you grow up in the Philly area? Born in Philadelphia, raised an only child. Mom’s from Philadelphia area, Dad raised between Patterson and Upper West Side. “Philly was always home.” Went to college at William & Mary. 2:14 “I didn’t let myself to apply to Penn. Because all the smart kids in my class were going there. I’ve got to not do the thing everyone’s doing.” 3:18 But then you went on to other educations. “I’ve got my masters. I found one program that met my interests that if I was competitive enough in my application they would fully fund the whole program. And so I only applied to that program.” Smaller private school called Philadelphia University that was absorbed by Jefferson. Masters in sustainable design.4:54 When you graduated what was the path you took? Were your parents interested in social responsibility? “My mom was one of the first female chefs in Philly.” From dishwasher, “eventually wound up being the head chef at all these restaurants, when women were not doing that.”6:40 “Entrepreneurs are risk managers, not crazy people.” “I kept my job at an architecture firm for as long as I could while printing business cards on their printer for MilkCrate.”7:35 When parents had no money, when father was getting PhD, mother started thrift shopping a lot. “And she got really really good at it. She wound up writing books about thrift shopping that were like Zagat guides (three editions), because she knew the food world and she now knew thrift shopping, so she kind of merged them.”8:36 “Father, similar, foundation for researching brain trauma and dementia, non-pharmaceutical intervention. So both having an aim for helping people in creative weird ways.”8:51 You graduated from that program, but you went into architecture instead? “The program was about architecture, and I wanted to be a designer.” “I had been interning at a publication focused on sustainability. And I was like you know, sustainability is something that resonates so strongly with people. People care so much about the environment, and they want to align their lifestyle but they don’t know how, and it’s a lot of work.” 9:44 “Let’s make like a green Yelp. Something that’s like an easy resource to help people make these choices.” “My whole master’s thesis was researching previous tools that had been created, apps, websites, whatever, to help people make sustainable life choices.”11:02 “The very first version of MilkCrate was my masters thesis of trying to shift consumer behavior around a cause that I cared about. “And I said to myself, alright, in one year I’m going to launch this thing. I’m going to make an app that makes this easy for people. And a year later I did.”11:46 “In August of ’14, we launched the very first version of MilkCrate. A few weeks later I got a call from Forbes.” “My very first investor pitch was to Steve Case on the stage of Forbes Under 30.” 12:07 “I was like alright I guess I’m doing this startup founder thing, let’s make it work. And I could not make it work. It was failing miserably.”12:35 You originally created essentially a marketplace. Between consumers and companies they could connect with that were doing sustainable type work. And it was just not growing at the pace you wanted it…? “It wasn’t sticky. We were competing with Yelp. We were competing with Google.”13:24 Here you are two years in… “I’m an entrepreneur who’s a top ten best female entrepreneur in the world according to the U.N. Foundation with no revenue and a business that is utterly failing.”13:47 “I don’t want to go back to those jobs…how do I make this work?” In talking to mentor… “instead of trying to get lots of little checks from lots of little businesses, how do we get a big check from a big business. What would a big business value about what you’ve created. And so I started to think about corporate social responsibility and sustainability and the impact that corporations want to have on the world and the impact branding they’re trying to create for themselves.”14:19 “Maybe we can make a platform where we build versions of MilkCrate for these employers to engage employees.” 14:50 JW: “That’s a great way to keep employees these days.”15:24 However… “We got one big corporate contract, despite the fact we did everything right…the corporation wanted us to be able to integrate with all of their other employee engagement tools.”16:02 “So again I had to ask myself, who will pay for what we currently have.” “In the midst of asking that question, I was talking with a man, who’s a potential investor, who sat on the board of a non-profit that was really struggling with programmatic impact data.” “The program was funded by a foundation to create a program where teens could go to all the museums in Philadelphia for free.” “The data never got aggregated.” 17:00 “We’ll build a white label app, using our platform.” “We launched this app, just the exact code we already had, with exactly what they wanted, and they paid us twice as much as the corporation and it was amazing.” “And we were like, wait a minute, foundation’s are funding non-profits to run programs to get people to do good things out in the world and they don’t know if it’s actually happening. $66 billion worth of foundation funding every year, and only 16% of those foundations know if they’re actually successfully tracking the impact.”18:03 “So, here I am, I’ve already pivoted once. And now I’m realizing this sustainability focus thing, it’s too narrow. There’s an opportunity where all sorts of causes need apps. And it’s not corporations, it’s non-profits and foundations.”18:25 Re-launch in June/July 2018. Have a workshop with non-profit leaders. Two weeks later one of them signs up, and then another one. “Oh my God, we have three times as the amount of clients we ever did under the old model, this might be working.”18:56 “We had really proven this is a thing. There is a problem. There is a problem in the market for non-profits. They need an affordable solution to track their program participants.” “They need a mobile solution to engage and track progress and participation so they can report it back to their funders, and we were kind of accidentally perfectly situated to do that for them.”19:32 What else are you capturing and what are you learning? Poll questions (gauge satisfaction), events calendar, log hours, teams and segments, social interactions, chat feature… “all these different features that are perfectly designed for a non-profit program to get people to do the thing.”20:31 You’ve literally gone full circle. You built something, it was all about your desire to get people to do things that were sustainable…21:47 Are you now doing outbound? What did you say to your investors as you pivoted? How were those conversations? “It’s definitely been a process.” “But, transparency is important. And being open to change is important. As scary as those things are.” 22:47 JW: “I think the good entrepreneurs realize when something’s not working and then they change it.”23:02 You’re making money now…? Grew 44% in August. “It’s been good.”23:15 “One of the biggest things that I knew a year and a half ago when we made this decision was, foundations were going to be huge part of our success.”25:12 “the idea the more you pay, the higher quality it must be, which I learned from my mother thrift shopping is not true.”26:11 How many people are working with you now? Ten26:18 Are you making your way around the country and talking to the top largest (non-profits)? Speaking at biggest non-profit tech conference, session is called “To App or Not to App” “One of the most important insights I’ve gained over the last couple of years is, which non-profits and which programs shouldn’t build an app.”27:15 JW: “I think what I love about what you’ve done, is you’ve started with this idea, the people that invested in you, really don’t care. At the end of the day they invested in you.” “So it’s those founders of companies that you believe particularly early are going to figure out how to make it work.”28:40 Dealing with “crushing anxiety” of being an entrepreneur. Discovered Jiu Jitsu. “I have been training in Brazilian Jiu Jitsu as my counter weight to being a startup founder.”29:30 Why women in tech, female founders need to do something that give them an outlet.31:00 JW: “Business is business and personal is personal…you have to take care of you.”