About this episode

No start-up story follows a direct path. There are often many twists and turns along the way. These varied experiences train and equip entrepreneurs to eventually achieve success. This is especially true for Chelsie Lee.

Chelsie is the CEO and co-founder of Shipsi, a delivery technology platform that allows retailers to offer same-day and scheduled delivery without managing any of the logistics. They help retailers adapt their businesses to meet the Amazon-level expectations of consumers. After just two and a half years, Shipsi has over one million drivers who serve over 850 cities. But, like with any good start-up story, this didn’t happen overnight. It was a lifetime in the making and Chelsie shares that story with us today.

In this episode, you'll hear.

  • How Chelsie’s childhood (and especially her grandma) shaped her entrepreneurial journey.
  • Why and how she pivoted to technology.
  • How to balance having accurate data and not getting too deep into the weeds.
  • The catalyst for thought for the idea of Shipsi.
  • How she strategically worked on both the driver and retail side.
  • The decision points before they went public.
  • How she avoided having a mindset of desperation.

Resources from this episode

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The Startup Story on LinkedIn: https://www.linkedin.com/company/thestartupstory
The Startup Story is now on YouTube: https://www.youtube.com/jamesmckinney
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EPISODE CREDITS

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Episode transcript

The Startup Story - Chelsie Lee

Chelsie Lee: Hi. I'm Chelsie Lee, cofounder and CEO of Shipsi, and this is MY startup story.

Every wildfire began with a spark. Every superhero has an origin story. And every single startup has a moment that they point to as their beginning. And every founder has a purpose that drove them in the midst of all obstacles. THAT is The Startup Story.

[00:29]
James McKinney: Welcome to another episode of The Startup Story. You know, it's been a while since I've mentioned it but if you're new to The Startup Story podcast there is a way you can advertise your business for absolutely free. Just leave a five star rating and a written review in Apple Podcast. If you do that, I will read your review in an upcoming episode so make sure to plug your brand, URL, or social media account in the review. These episodes live on forever and so will your ad. I'm basically giving you a free advertisement for simply writing a review on Apple Podcast. It's just my way of saying thank you for taking the time to write a review.

We have an incredibly exciting opportunity for you so make sure you listen closely and get ready to act. How would you like to join a private recording session with Julie Bornstein, the founder of Yes! And former COO and board member of Stitch Fix? Julie helped to scale Stitch Fix to $1 billion in under six years. Prior to Stitch Fix, she was a CMO and chief digital officer for Sephora as well. Julie is an absolute force of nature and you have the opportunity to join a private livestream event where you can have your questions answered directly by her. Yes, you heard me correctly. You have the opportunity to have your startup questions answered directly by a founder that has executed numerous times and can provide you with tactics and strategies to accelerate your personal entrepreneurial journey.

Look, if you are not already an inner circle member, then you missed out on our private livestream event with Ben Chestnut, the founder of Mail Chimp. So if this is an opportunity that you would want, then all you need to do is join The Startup Story inner circle ASAP, because our recording session with Julie will be taking place on Thursday, August 13th. Don't let this rare opportunity pass you by. Just visit thestartupstory.com/VIP to sign up today so you can be part of this super private event. When you have ever been afforded the chance to sit with someone who has accomplished so much within the realm of business and entrepreneurship, and a chance to receive direct mentorship from them? This opportunity can truly change the trajectory of your business, but it is only for The Startup Story inner circle. So visit thestartupstory.co/VIP today. All right, now let's jump into this week's episode.

Our guest this week is Chelsie Lee, cofounder and CEO of Shipsi. Shipsi is a delivery technology platform that enables retailers to offer same day and scheduled delivery without managing any of the logistics. Amazon's ability to deliver to us within two days has changed our buying expectations and now Shipsi is helping retailers everywhere adapt their business to meet those expectations as we all seek to get our purchases even sooner. Chelsie's journey is remarkable because after just two and a half years since launching Shipsi, they now have over $1 million drivers and can serve over 850 cities. Seriously, in just two years the Shipsi team has accomplished so much. Yet, much like every startup story episode, none of this success was overnight. Oh no, it was decades in the making. Well, really it's a lifetime in the making and Chelsie's startup story is no different.

[03:49]
Chelsie Lee: My favorite activity as a kid was going to all my friend's houses, and organizing and cleaning out all the toys, and I would organize a community garage sale for everyone.

[04:03]
James McKinney: Oh, I love it.

[04:05]
Chelsie Lee: The best part about that is I helped everyone clean out their items so I got to pick the things first. And I also served as the conduit between different kids in the neighborhood and would negotiate, and everyone felt like they were getting the best deal.

[04:24]
James McKinney: The neighborhood arbitrage, I love it.

[04:26]
Chelsie Lee: Yes. So it was by accident. My grandfather was a great influence. He owned a gun shop. I loved the idea of supply and demand and I attribute a lot of that to my interest in retail. I love the fact that he could argue or negotiate anything he wanted during hunting season to anyone, and then make deals like okay, your wife owns a beauty salon, I'll give you a deal on that gun but my wife needs her haircut, let's cut a deal.

[04:54]
James McKinney: I love that. Now did you grow up in your grandfather's gun shop? Is that really a strong part of your childhood story?

[05:03]
Chelsie Lee: Yeah, absolutely. So my parents split when I was young and I'm also an only child, so I think it was just a matter of having to figure things out and adopting to any scenario. Yeah, it's a huge part of my childhood.

[05:19]
James McKinney: Yeah, it's funny you mention being an only child. I truly believe our birth order plays such a role in how we navigate the entrepreneurial journey. We've had obviously the first born, the only's the middle's, the babies, and each one has just navigated a bit differently, kind of found their stride a bit differently, so it definitely plays a role. And to your point, you said you became a problem solver because of it.

[05:42]
Chelsie Lee: Mm-hmm.

[05:43]
James McKinney: So when you think through to your, as we continue on the childhood journey, we think through to your high school years. What were the things that you thought your future held? What did you want to be? As we look at that natural chapter being graduation of high school, what did you think your next step was?

[06:00]
Chelsie Lee: I thought that I wanted to be a sports news reporter for a while. And then I thought I wanted to get into finance and accounting for a while. And then I wanted to be a TV host at some point, and a writer at one point. While all those things are great, I never really felt like I fit in a box. I would take the class, I wouldn't like it. Or I would interview someone who did that job and it wouldn't be what I thought it would be. And so I kind of had this fake vision and never really felt like, "Oh, I am good at all of these things that fix this box," because I see things from a different lens a lot of times, and that's good, bad, or indifferent.

[06:48]
James McKinney: What do you think contributes to that seeing through a different lens?

[06:53]
Chelsie Lee: I think it's the creativity, and I think a lot of those lose that, especially as we get older and I didn't have older siblings to ask how to do things, or if this was the right way or the wrong way. I definitely wasn't the kid that was afraid to ask a question when everyone was thinking what is that question in the class. I think it was because I had to hang out with adults a lot. I had conversations and would ask questions, and I felt like it was my right maybe.

[07:22]
James McKinney: One of the things about figuring things out on our own, it does allow us to also fail on our own. It allows us to learn through some of our missteps. And so I want to table that as we venture on more throughout your career leading up to Shipsi. And so when you had all those ambitions for all those things, writer and sportscaster, and everything else, accountant and finance, all the things that you wanted to do which is quite a bit… you wanted to be Upwork in its entirety is what I'm hearing from that. So when you actually came to the end of high school was college on the horizon? You started your own company, you started just interning a lot of places to get some of that firsthand knowledge of what you did or didn't want to do? What was that first step for you?

[08:07]
Chelsie Lee: I took some advice from my grandmother in this one. I was born and bred in Minnesota, thought that I was going to University of Minnesota or Notre Dame, because that is what you do in the Midwest, and you get a white picket fence and you make a lot of small humans right away, and marry your high school sweetheart. I'm I would say a Type A vagabond, and had everything planned out. My roommate, the fridge, and I bought the TV. I had gone to the University of Kansas for the weekend with a friend of mine because she was looking at it, and I ended up going out that night, having my first cocktail, applying to the University of Kansas that night. I automatically was accepted because of my ACT or SAT, I can't remember which one. But my mom got the notification.

I remember my mother telling me the next morning, "Chelsie Lee, you realize no one in our family has ever been to the state of Kansas, right? Did you just apply?" And so it wasn't intentional that I wanted to leave, but sometimes you have to follow your gut, and that was definitely one of those scenarios and I remember specifically speaking with my grandmother and saying, "Is this the right choice? What do you think?" And her and an uncle of mine that I'm quite close with, I remember she said, "Well, it's kind of like dating. You have to experience the good ones and the bad ones to know what you like and what you don't like." I think of that still today at least once a month. You have to learn the good and the bad to know what you like.

[09:53]
James McKinney: Oh that is so funny, I love that. Absolutely love it. So you end up in Kansas through a cocktail decision, and you end up at the University of Kansas.

[10:02]
Chelsie Lee: Thank you. Making my mother proud.

[10:07]
James McKinney: You know what, that might be my secondary podcast, The Cocktail Decisions. I think there's a lot of stories to be had around that. So you're at the University of Kansas, but what did you think you wanted to do? Again, you have this catalog, this idea of all the things but we start with a first step. The reason I'm asking this question is because a lot of times through a lot of different founders that I've had a chance to meet, either they come to the university level and just I'm over this, they jump ship on their startup, or they come in to obviously the computer sciences, and then they're hacking away on some things and come up with something great, much like my founder Nick Alexander of Yoshi did, or sometimes they get to the very end, they're like, "I don't want to do any of this that I've spent so many hours preparing for." So what was your university journey and how did it wrap up?

[11:01]
Chelsie Lee: I would say that just about everything has happened by serendipity, or on accident, or being at the right place at the right time and the universe steering me in the right direction. I knew I was always interested in business. My mom ran her own company growing up which was a huge inspiration for me, and I went to KU intending I believe my freshman year my primary focus was PR or something. Now, I'm not even good at social media, I don't even know my Instagram password. But I studied business and anthropology because I again didn't really fit in this box, and as you can imagine my classes were very interesting because I would go from finance to the civilization of whatever country.

And from there, it was really adapting and learning the things that I enjoyed and didn't enjoy. I had a next door neighbor who we would call when the fridge broke or something was wrong with the toilet, and he had an aunt that worked in retail. I knew that I wanted to get into corporate retail, and I had this big, fancy glamorous vision of moving to New York and getting into retail. Then I took a sideways step or journey to South America for a while and went down there to teach. I met a great French professor who recommend I apply for a retail program in London. So I moved from Cusco to London to get into a corporate retail office. I made absolutely nothing but they paid for my housing. Completely broke. My poor mother flies from Minnesota to the UK to move me back. I stayed there for about a month and then I think I went to Canada. Then moved to New York, got a job at Saks corporate, and then from there pivoted into technology.

[13:00]
James McKinney: I love it. And I mean you've travelled to some unique places. Obviously, the first within the family, the family not having gone to University of Kansas. How did you, now we find ourselves in if I'm not mistaken from a timeline perspective, we find ourselves in New York. How did you and you've now pivoted to technology, what were the steps? Now we can start to see ourselves getting close to Shipsi. We're now at least in the same industry or school of thought as far as technology. What were you doing at that moment in New York with technology?

[13:32]
Chelsie Lee: Well, when I was in New York I was in the buying office working in buying and planning, and working with different brands, and working on private label initiatives. I felt this headache around this retail thing called EDI, which is how retailers and brands get purchase orders and invoices. It was always a massive pain and I always got frustrated that the brands that I was working with had a hard time… I just wanted them to tell me recommendations of here's what sells in your stores, this is going to make you money on your open to buy. Do this and do that, and here's the numbers behind it instead of this fluffy, smoky mirror, "OH, this is a pretty fluffy, fancy, sparkly thing." So then I called in an old friend from Kansas and ended up moving back to Minneapolis and getting in technology at a company called SBS Commerce. I started in an EDRI role, figuring out what this EDI code was. So I was in that and then transitioned to operations, and then had a great opportunity to run enterprise B to B sales team, focused on sell through analytics or my frustrations that I was working with brands. And we had acquired a few companies and so I got to run and manage and teach brands how to arm themselves to go into that buying decision, and make those recommendations to their buyers, which was a reason why I was so passionate about it because I knew what it was like in their shoes.

[15:07]
James McKinney: That's incredible. Now I want to ask that question about missteps. You've been to a lot of places. You've worked on various initiatives with numerous brands. You've gone from not being in technology to being in technology, and really in some of the least glamorous sides of technology. EDI is critical. Most people don't think about it though, but never the less-

[15:30]
Chelsie Lee: Not the sexiest thing.

[15:32]
James McKinney: Not necessarily. So when we think to, and again I just want to state for the record, I'm not talking to someone who has 30 years of career experience. There's a lot you've covered. Part of that, what you mentioned in the beginning of the show, the learning to figure things out, what were some of the missteps that occurred throughout your career, up to this point in your startup story, and then what were some of the learnings that came out of that?

[15:59]
Chelsie Lee: It's really hard to see things when you're so far in the weeds is I think the biggest mistake that most make, whether you're writing an email or you're diving into a project that doesn't support your major initiatives, or not focusing on the important things. I'm trying to think of a specific example maybe in the buying office, or even before that. I think that you don't really know until someone tells you to pull your head out of the weeds, and those are really the best mentors and leaders that I've had to learn from that can clearly point out and be direct to you, and I think always asking for constructive criticism. If it's a partner, customer and having clear expectations. I think that's one thing that I continue to practice and work on is having clear expectations with a timeline in every single scenario. Because expectations are hard.

[16:55]
James McKinney: One of the things you mentioned about the idea of being so deep in the weeds. Especially when we just talk about data. We talk about data driven decisions or data informed decisions. Either way, it is so easy for us to just go so deep within the weeds around data. How did you, whether it be lessons now or up until that point, it doesn't matter, just the general question how do you balance having adequate data and not being too deep into the weeds?

[17:26]
Chelsie Lee: My strong belief is that it always ties back to a business reason or a compelling event, or a consequence. So one of the reasons why I had a lot of success at SBS Commerce is because I had this EDI data or the purchase order data from a bunch of different brands. So I could go to just about any name brand, look at their purchase order information, their invoice information, and what was selling at a store level. And with that data, it supported their business initiative and I had a lot of that data. But it's translating it from the business side and the technical side and the operations, and being able to articulate that business problem and that gap and that bridge is really, really challenging for a lot of people.

Once I had my head wrapped around it, it was such a perfect cycle. I had this big bag of data, like magic bag in my pocket, and I could go to a lot of name brands and say, "Excuse me, do you realize you just bought back more inventory than you sold to Dick's Sporting Goods or Kohl's or Advanced Auto," whoever it was that year. But I think arming yourself enough so that you can have a clear and honest business conversation about that and the impact that you can have.

[18:53]
James McKinney: Oh, I love that. I want to also table that same question for when we actually get to the story of Shipsi, because I think a lot of times startups can get hung interesting hat paralysis by analysis before they even actually move on their startups. I want to talk about how you navigate that season. But let's continue on within your startup story. So you're at this technology company. When did you start percolating the idea of Shipsi, or the solution that needed to be solved? What was the a-ha moment or the catalyst for thought at least?

[19:23]
Chelsie Lee: I got frustrated. I got really frustrated after I worked with over 500 different brands and retailers. I would sit in a meeting or be working with a private equity firm or investment firm who was often writing the check for these initiatives. Five, eight, ten years ago a private equity firm or an investment firm didn't know what drop shipping was, which is now ecomm. So I got so frustrated because we would make these brilliant, amazing strategic plans and then the brand would be off on their numbers because they weren't dropship capable, and no one at the brand had the balls to raise their hand and say, "We're missing our numbers because we're drop ship incapable, and by the way here's what it means."

So I got really, really frustrated that people were overlooking these seemingly simplistic problems on the surface. So I called Ben, my now cofounder, and I asked him if he thought that I would like to go work for a private equity firm, maybe in the retail space. Maybe I can just be this translator. He had asked me to do him a favor which was to take a look at a project that he was working on called Shipsi. I said, "It sounds like a logistics thing, I don't think you want me to look at it." Just kind of when I got into sales, I didn't know anything about sales but I knew a bunch of ERPs. I looked at it and I flipped it inside out, upside down, started poking holes in it. No less than a dozen times people have said well, when everyone zigs you zag. Well, this is another scenario of that.

Our solution or our platform today was originally meant for traditional logistics, conceptualized for boats and trains and planes, a tool for freight forwarders to use and aggregate. I asked Ben well, what if we did delivery networks or a school bus or a limo, or whoever is going to do random deliveries now. What about ecomm, because there was clearly a need for on demand and ecomm as Amazon continued to eat everyone's lunch. Can you just replace the half empty boat with delivery network or a courier, or a DoorDash, or an Uber, or maybe a FedEx? And so really it was us putting our heads together.

He comes from a background of a serial entrepreneur and angel investor, and I come from a corporate box. I thought a startup was something people worked on in their garages. I didn't imagine being a CEO of a company. I just knew that I liked working with people and finding the right partners, and connecting those dots in a way that's lucrative for everyone involved.

[22:01]
James McKinney: That's incredible. So let's put a date stamp on this. So when are you and Ben having this conversation about Shipsi?

[22:06]
Chelsie Lee: Late 2017.

[22:09]
James McKinney: So three years ago, not even three years ago, two and a half years ago because we're in the middle of 2020. So two and a half years ago you're having this conversation about Shipsi, and as it stands today for all the listening audience, explain what Shipsi is today. Because you talked about what it initially was to be, but what is it now as it stands today?

[22:32]
Chelsie Lee: So Shipsi is a technology solution for retailers so that they can offer on demand delivery, same day or scheduled delivery. That comes in a couple different flavors. One is directly at checkout online in their was, or their store point of sale for in store shoppers to get things delivered. And then we recently developed a way to access our platform and our network through a web link or the instant delivery portal that requires no integration. So it is on demand delivery, schedule delivery through their website, point of sale system, or a web link. And then we utilize existing infrastructure of stores, warehouses, distribution centers, everyone's current systems, the current delivery networks that are available like Postmates or DoorDash or couriers. So today we have over a million drivers in 850 cities within our network.

[23:32]
James McKinney: That's incredible. Again, we're two and a half years old. So when did Shipsi launch? Just because again, those numbers are impressive but let's even shorten the real window. When did Shipsi come to market and start collecting those retailers and those drivers?

[23:48]
Chelsie Lee: So first we had to build a delivery network or find delivery network partners. Now, it's really exciting because on average we fuel those drivers with five to six times more revenue, and at a corporate level we improve the success rate by 15%. So now it's really fun to have those conversations, but right before we got on I was on with an investor who invested when we were pre product and pre revenue. We didn't have a delivery network. After three months of his investment, I think we had 100 cities, and this is all early '18, even late into '18 and we went through a couple hundred alpha and betas at that point, and then really launched in 2019.

[24:28]
James McKinney: That's incredible. Just such amazing success. Now, let's get into some of the nitty gritty on the how you did it. The reason, especially for where you sit in that space where you need retailers and you need drivers. There's a lot of technology solutions out there that they find themselves in the middle needing to fill both sides, but yet they would prefer to just have to focus on one. I think of the DoorDash, I think of Postmates, well obviously most things that we think of because of just coming out of quarantine are all food delivery services because they were so critical for us. How did you go about strategically working on both sides, because for a lot of the challenges that startups have is trying to figure out which side to focus on first. So how did you built out? Would you focus on a city? What was your strategy?

[25:17]
Chelsie Lee: Well, it started as a big box of chaos. The delivery space is incredibly crowded. It is full of smoke and mirrors. We ended up creating an internal evaluation system that we use now. So we have over 100 delivery type companies internally and we stack rank them on a 40 point checklist system. It really depends on the brand or retailer needs that we have, and then also marrying that with the network. For us, it was a matter of finding a couple really solid partners that were going to be with us from the beginning. From a strategy perspective, it helps to think about what it looks like from the other side of the table.

The team literally, the couple people in the beginning, rode around with a Postmates guy, a DoorDash guy, an Uber guy and was like, "What do you like about this? Would you like it if you didn't have to talk to people or worrying about a drink spilling over? What do you do during a break? Do you get paid?" and so it was really this live market research. Now, it's one of our biggest value props. Oh, during your off-peak hours we can give you more deliveries, and by the way you don't have to change anything. It's just being vulnerable with any… the mailman or somebody delivering your food.

[26:37]
James McKinney: I love the fact that you were with these drivers getting feedback. It reminds me of when I had a mobile startup and I wanted real user testing. I signed up to be an Uber driver so that everyone I picked up, I was like, "Hey, can you test this? I want to see what your feedback is."

[26:53]
Chelsie Lee: Yes! I love it.

[26:54]
James McKinney: That was the sole purpose of why I did it, it was great.

[26:57]
Chelsie Lee: I love it.


[26:58]
James McKinney: Before we continue with our episode, I wanted to let you know that all the great content from our most recent two day livestream event, Startup Story Live, is available to you in an on demand format, basically a Netflix for entrepreneurship. After two full days of groundbreaking content at Startup Story Live my head was spinning. Every time I thought, "That's going to be the biggest takeaway," I was floored by another mic drop moment. And that's why I created a new membership program for entrepreneurs who want to leverage The Startup Story Live experience as much as possible.

So I'm inviting you to join The Startup Story Inner Circle. When you become a member in this exclusive group, you secure an unlimited VIP pass to The Startup Story Live content and bonuses, designed to help your business succeed no matter what the stage or environment you find yourself in. Your Startup Story Inner Circle membership includes on demand access to every founder session from the event. We're talking real practical, tactical advice from real entrepreneurs and business owners, no thought leaders, real business owners. We're having full transcripts for each session with crucial talking points highlighted to it allows you to focus only on information you need right now. We're going to have exclusive livestream events each month with top founders from companies like Mail Chimp.

In fact, we just concluded our first private livestream event with Ben Chestnut of Mailchimp, and you'll have that video content accessible as an Inner Circle member. We have Julie Bornstein, the current founder of Yes! And former COO of Stitch Fix. She will be joining us in August. We have access to a private Facebook group where entrepreneurs support other entrepreneurs, make valuable connections, and even find new clients and customers. Plus, members will receive special offers and giveaways from Startup Story brand partners like Express VPN and Trainual, Design Pickle, Foundermade, and even Entrepreneurial Magazine, and so much more. Right now, you can claim a three month, all access membership for just $99. That's probably less than you'll spend on streaming services for the next three months, except this content can radically change your business.

There is so much uncertainty within entrepreneurship and the next three months might be some of the most challenging you will ever face. The hard truth is, many businesses will fold because of their inability to navigate these challenging times. They simply aren't able to adapt so they collapse under the pressure of rapid change. But other businesses emerge stronger than ever before. If you want to be in the group that emerges strong, then you need practical strategies to survive and the support of entrepreneurs who want to see you thrive. You'll find both and more when you become a member of The Startup Story Inner Circle. Let's fight for your business together. Secure your three month membership for the flat rate of $99 by just visiting thestartupstory.co/VIP today. Again, just visit thestartupstory.co/VIP to start your Inner Circle membership today and secure your spot for our private livestream with Julie Bornstein, the cofounder of Yes and former COO of Stitch Fix. And now let's get back to our episode.


[30:06]
James McKinney: Now we go back to the question I tabled before, and that's the paralysis by analysis, getting so deep into the weeds. You had a big problem to try and solve for, entering into the industry. There's a lot of data that you can just kind of bury yourself in. there's a lot of details you can bury yourself in. how did you manage that? Maybe it was a culmination of all your life lessons, but how did you balance the idea now we're going to launch, we have enough retailers, we have enough drivers. What were some of the decision points you looked to before you actually became public and for user use?

[30:45]
Chelsie Lee: It was understand what our customers cared about, and what did success look like in their mind. In Q4 last year, our volume completely spiked. We hit projects that we anticipated to hit in July of this year in December of last year, which is really early for a young company. Part of that was doing everything that we could to satisfy our retails and consumer. So there are thousands of orders that I made the decision on a Saturday morning or a Sunday night that technically or contractually, we didn't necessarily have to fulfill because we didn't receive A information or B information, but at the end of the day we're incentivized based on our retailer success, and they're not successful unless their end consumer is successful. It's the same thing with a store associate in our business, or someone at the warehouse. If we're not supporting them and giving them the tools that they need to be successful, we can have the greatest technology in the world and the greatest brand in the world, but if the guy at the warehouse doesn't really give a damn, we've got nothing. So really listening as closely as we can.

[31:55]
James McKinney: Starting a startup from nothing is very different than working for corporate America.

[32:03]
Chelsie Lee: No…

[32:05]
James McKinney: As you transitioned from an established entity with some structure, with some processes, probably some policies, what did you find to be the most challenging layer to that transition for your personally

[32:21]
Chelsie Lee: Resources. I took for granted having a legal team and a marketing team, and somebody who could work on your contracts, who paid your check. Dealing with unemployment and regulations, not to mention investors and a board. Really it was trial by fire and I am so grateful that I didn't know what it was like, because I think that a first time founder, yes of course there is the argument that you build and sold, or taken a company public and you have that experience which is unbelievable experience and so incredibly valuable. But I also think that there is this opposite side of the spectrum that works to your advantage sometimes because we're so damn naive to all of these problems that we just jump into feet first, and absolutely have to figure it out.

[33:17]
James McKinney: Yes.

[33:18]
Chelsie Lee: And you have no other choice. One of the things I did was build a five year wages model before we had a product as a fun weekend activity when, thank goodness Ben my cofounder comes from startup land and reiterated that wasn't important at this point. I heard a line recently or read something last week, I cannot recall who it was, but they said, "It's okay to get 80% of the way there as a CEO." I tend to be a perfectionist and that's something I'm still actively working on is understanding… First of all, giving the team the reins, just go and take it, it's there ownership. I'm so impressed.

[34:00]
James McKinney: Yeah, I've heard various things around that 80% rule. Complete is better than perfect, launched is better than perfect. There's a lot. Really anything is better than perfect, and in fact we've had a few episodes where founders talked about being a perfectionist, and some of the paralysis that can create as we move forward. I think as your team grows a bit, the impact of that perfectionist nature becomes polluted a bit because now there's just more people.

[34:30]
Chelsie Lee: It's worse.

[34:31]
James McKinney: For you it's worse.

[34:33]
Chelsie Lee: Mm-hmm.

[34:34]
James McKinney: Really? Explain.

[34:35]
Chelsie Lee: When we started growing really, really fast and bringing customer service in house, my attention to detail would take me from 8 o'clock until 2 or 3 in the morning at the office, looking at a delivery or a report, and then diving into the data really deep and it went, my time would have been well better spent in other areas working on something with our partners or business development. And so that was a real challenge for me because I was getting so, so exhausted but I was so excited. I couldn't not go in or I would get a delivery report and weekends are our busiest time. We just had gotten a new office. It was just so fun to count and see our success, and I would get something and say, "Whoa, no way, that can't be right. That's what we were supposed to hit for the month, not this weekend." It's amazing. It was incredible.

[35:32]
James McKinney: I love it, absolutely love it. So the same question I asked earlier. What were some missteps? Again, going back to the only child and the trying to figure things out on our own, and there's actually some traits to that to also the first born, not necessarily just the only. But what are some missteps as you tried to figure things out on your own? And I'm going to ask this question with a little bit of an assumption to it so you can correct me if I'm wrong. But part of the perfectionist element as well is not necessarily wanting to come seek assistance for a solution but really trying to figure it out. So I feel like there's a multiple layer here. What are some learnings you've had and some missteps along the way?

[36:14]
Chelsie Lee: A loaded question but I like it. I could have sold my way out of it easier than raising venture capital the first time around. Really, a lot of the challenges or missteps, I think one is understanding really clearly what your strengths are and being vulnerable. Even now in the current environment, we're going through a lot of really challenging things and whether it's in an outreach for something with the community or to a prospect or to our partners or to investors. We say, "I'm really sorry but this is where I'm at right now, can you work with me on this? What can I do to help you?" Or, "If you can do this for me, here's something that I can do for you later down the road." And I think that vulnerability is something that people are really afraid of. This environment has really opened up the box to it.

Having a clear plan and direction and being able to adapt is something I think every entrepreneur, you know you have this great idea and intention, and I'm sure that you hear it all the time about a founder being able to adapt. But are you seeing it? And it's a really tough challenge between is this a problem that I just need to keep pounding through that brick wall and just figure it out, or is it time to realize this isn't working. And it is such an art and a science, and I think we're all learning more and more of both of those sides every day.

[37:44]
James McKinney: There are so many stories throughout The Startup Story catalog of those who made a pivot too soon, made a pivot incorrectly and had to go back to where they were. It is an unknown and that is part of the entrepreneurial journey is every step you take, it's completely new and there are new challenges and new problems to solve. Even now, with some of the successes you're having, what are some of the newer challenges? Like you mentioned, COVID had thrown a lot of things in turmoil, and a lot of people had to solve for things. So you service retail. You service retail in helping them to get product outside the store, to customers via same day delivery. With all this touchless service out there, which isn't really touchless, I mean going through a drive thru thinking it's touchless, you just touched that bag that I'm about to grab, what do you mean touchless? How are you solving some of the challenges that COVID has thrown into the mix?

[38:43]
Chelsie Lee: So it's been a challenge for everyone, but the thing that I love about the environment that we're in that I don't believe people appreciate enough is with all the chaos and the looting, the thing is we have such an opportunity because we're all screwed in this together. Why not come together? When else is the world been in turmoil all at the same time and together? We should be using this to our advantage. A common challenge I think for a lot of businesses in this time and any startup founder is maybe it's a customer telling you to make something custom, or some partner telling you to make something out of the box, or an investor saying go north and the opposite saying go south. It's listening to your gut and that's really, really hard. And adapting to that is something that I wish I would have picked up earlier on in being a CEO, really listening to your gut.

I just had a conversation today with one of my investors saying thank you for the feedback, this is the direction that we're going to go, I appreciate it. This is what I believe is the best thing for the business and I'm doing the best thing that I can possibly do every single day to maintain the responsibility that I have to our shareholders. And this environment has thrown a wrench in everything. So you had asked one of the examples that we're doing to adapt. We knew and heard from our customers that they wanted to offer delivery. Whoever it was, whatever vertical, whatever category it was, but they didn't have the resources or the know how to get it setup. So collectively as a team we brainstormed different product enhancements that we could make. Now, six of those are in our product roadmap and we just build and test it, and rolled out one that is called the Instant Delivery Portal that I mentioned earlier. No integration needed, that's how we're adapting to serve as many retail partners as we can.

[40:45]
James McKinney: That's incredible. One of the things you mentioned a few times about the investor challenge, and we just had Christina Stembel from Farm Girl Flowers on the show probably about a month ago. Her story is so dynamic. I mean oh my goodness, bootstrapping to this year scheduled to be a $60 million company from $49,000. Continues to get no from investors because her team doesn't have the makeup. She is a spitball to listen to. She's unreal, I love her story. And you as a female founder, and one of the things that I love about the female founder story is some of the unique challenges as a female founder that other founders don't have. I always caveat this with I believe things are getting better, but I also believe we still have a tremendous way to go when it comes to equity among male founders and female founders, whether it be percentage of portfolios, whatever the case may be. As a female founder, were there any moments when as opposed to just feeling like a founder you actually felt like a female founder? Does that make sense?

[41:48]
Chelsie Lee: I have countless examples of that. I'm actually writing a book on it. It basically started as the lessons that I have learned in fundraising that I wanted to make sure I was aware of and know how to do the next time. A couple things that work with me now with investors is clearly understanding an agenda and their investment strategy, any specific revenue targets, and stage that they look for even before taking a meeting. Some firms, it rubs them the wrong way when I say can you fill out my 10 checklist items to make sure that we're making the most use of both of our time. Because I understand that they want to build a relationship early on, and so do I, but I'm not going to have a company if you suck up all my time so that I can't focus on the business. So tell me your 10 questions, maybe we're a fit now, maybe we're a fit down the road, I'll tell you when I'm ready to have a conversation. It's authentic to what I think is right. If I'm working with a customer and their major initiative, their biggest initiative or goal this year has absolutely nothing to do with my business, okay maybe we have a 10 or 15 minute conversation, can I help you with that initiative. Don't try to shove a square box in a round hole. I think a lot of entrepreneurs try and do that with investors and it's, again, hard when you're in the weeds of it not to just want to vomit your idea to an investor, but really seeing it from their side. And you're giving them the opportunity to join you and your organization.

[43:17]
James McKinney: But how did you get there? Because there's a unique mindset to get to that place. Obviously, there cannot be a mindset of desperation which so many startups operate from. So many startups. I'll chalk it up to me as well. In the mobile app that is now defunct, I would take any investor meeting that I could because it was just, it was a hope. It was like I need the capital. And you're right, it just sucks up your time but you got to a place, really a position of power in not having that desperate hope. What was the catalyst for that? How did you get there?

[43:56]
Chelsie Lee: I failed a lot. It's again an art and a science. I got there and I still have my days, but my moment was from one of my dearest investors who has now become a very close friend of mine. And he had given just teed me up, and he does a great job of singing my praises to potential investors or existing investors, and he's just one of those guys that wrangles everyone. And he had just perfectly teed me up to a dozen or so investors that I had meetings with in a week. I was in such a bad place with investors because I had just gotten burned multiple different… Within a month I had three different VC funds share my deck with competitors-

[44:41]
James McKinney: Oh wow.

[44:42]
Chelsie Lee: … seemingly on the surface competitors. Those companies are no longer around. I had one of those founders of one of those competitors come and attack me, and someone asked me out that week. It was just like a week or two of hell dealing with investors. And so I still have my moments, but one of my now current investors and friend introduced me. He called me after I had those meetings and said, "Chels, take two weeks off from investors. Stop being such an asshole to everyone I introduce you to." Because I got on the phone and I just had this hard, nasty distaste. I still have my days like that. It's a challenge. It's still a challenge.

[45:28]
James McKinney: I love it though. I love that shift in power. I love not operating from desperation, but it does, it takes a tremendous amount of resilience to get to that point, a tremendous amount of fortitude because there are times in the startup race that the mind will mess with you at so many levels.

[45:47]
Chelsie Lee: That's why it's good to be naive I would argue. It's the most challenging thing I've done personally, professionally, emotionally ever in my entire life.

[45:58]
James McKinney: That leads us, because I want to honor our time together… before we transition to The Startup Story final three I like to call them, where do you see, if we're having this where are they now episode with you and Shipsi, let's say five years from now where would you like to see Shipsi positioned? Whether you want to answer that numerically or in some other metric, but where do you see Shipsi in five years?

[46:21]
Chelsie Lee: The leader in the supply chain relating to all things delivery or convenience for our consumers. Really, we're not a vendor. We are a partner and in it for the long run, and really encompassing a part of their entire supply chain for our customers, and bringing enormous value.

[46:42]
James McKinney: Awesome, I love it. Absolutely love it. So our final three, Chelsie. When we get to thinking about and talking about the challenges of being an entrepreneur, I want to ask this question to you. Do you believe anybody can be an entrepreneur or is it a genetic makeup? What is that key determining factor for you?

[47:04]
Chelsie Lee: I do not believe everyone can be an entrepreneur. I really don't. I think that it takes a grit and drive and resilience that a lot of people don't have the balls to have. Maybe people can with great advisors, mentors, and some good therapy to get you through it. But I really think it's this grit that is a combination of your experiences and something you're born with.

[47:29]
James McKinney: I love that, I love it. It kind of segue ways to the second question, that being about gratitude, that community of people. The reason I ask this question is I truly believe that if we start thinking we did all of this on our own, we become isolated because we think we did it all on our own, and that isolation will ultimately lead to our failure. And so when you think back from your childhood to now, all the people that have poured into you and contributed to where you are today, who do you look back to with such immense gratitude?

[47:59]
Chelsie Lee: I look back to my grandmother a lot, and thank her for pushing me to figure out how a button got sewed on a shirt, or how to load my own gun for my dad. Really every mentor along the way and I think in the beginning, when you're early on in your career, you don't necessarily want to give credit where credit is necessary because you want to sound smart because you're early in your career, and you want to prove yourself. But I think there's a lot of people that I should have shown more gratitude towards and given more praise and now in fact I try and make up for some of that, hopefully, with my team. Hopefully they feel that.

[48:43]
James McKinney: Oh, I absolutely love that, and thank you for that very authentic answer because I think there's a lot of people, myself included, that we missed opportunities to extend that gratitude in the moment because of that exactly. Again, for myself, I'm going to say my arrogance. There were times where I just didn't say, didn't show the necessary appreciation or really understand why I should be appreciating because I thought I was due it or it was. So I thank you for that great answer.

As our time comes to an end, we've been talking to the tens of thousands at a very high level, just them listening in on our conversation about your startup story. I like to offer this mentoring minute if you will where we take the conversation from the tens of thousands down to the one. This is just if you could picture yourself at a coffee with a piece of Plexiglas in between for social distancing, it's a one on one with just you and this listener.

Maybe that listener is the frustrated entrepreneur, the one who has been at this for 7 or 10 years, constantly frustrated by cash challenges. The coronavirus has just completely screwed things up for them. Maybe it's the want-repreneur, someone who has a 9 to 5 and a buck full of dreams and ideas, but some narrative as to why they can't move forward because of financial reasons or spouse and kids, a mortgage. Or maybe because they're 55 and they think they're too old to start something old. Or maybe it's the defeated entrepreneur who just recently, again because of coronavirus might have just lost everything, and isn't quite sure they want to go through that again of starting a new business. Whatever persona you want to speak to, I want to bring the conversation from the masses to the one. What do you say to that one person?

[50:24]
Chelsie Lee: I would say to the one who is afraid to take a risk jump in two feet first, the hell with the consequences. And my follow up to that would be are you going to look back 5, 10, 15 years down the road and wonder what if? That is normally the right direction of your gut, the right direction that the universe is pointing you in that direction. Don't be sorry for it.

[50:52]
James McKinney: Once you've had a few moments to process all the value Chelsie brought us in this week's episode, please hit me up on LinkedIn, Facebook, or Instagram and share with me your thoughts on this episode. And lastly, if you've been around The Startup Story for any length of time then you know how much emphasis I put on the idea that entrepreneurs support other entrepreneurs. So if you are a brand or retailer looking to satisfy the consumer need for instant gratification in the buying experience, then please visit shipsi.com. And better yet, if you have a favorite brand or retailer that doesn't already provide same day delivery then let them know about Shipsi. Let's make sure, we The Startup Story community, show up for Chelsie in a huge way as a thank you to her for all the value she delivered to us today. Remember, entrepreneurs support other entrepreneurs. And now for my personal ask.

The Startup Story community has been so incredible about sharing our podcast with others, but we have more stories to tell and more people to reach. We too are a startup and word of mouth is everything, so please follow us on Facebook and Instagram @TheStartupStory or on Twitter @StartupStory_. If you're on LinkedIn, please search for The Startup Story and follow our company page. LinkedIn is a really powerful way to raise awareness of the show. But the most impactful way you can help us grow our audience is to leave a review on Apple Podcast. Or if you listen to the show via Spotify, then please simply share the podcast directly from your Spotify app or wherever you listen to the show.

These simple actions can make a huge impact in getting these amazing founder stories out to the masses. And please make sure to tag or mention The Startup Story when you do share so that we can connect with you and say thank you directly. I'm so incredibly appreciative of the fact that you listen to the show each and every week, and I look forward to sharing these amazing stories with you every Tuesday with hopes of encouraging and inspiring you to start your story.

If you like this podcast and are thinking of creating your own, consider talking to my producer Danny Ozment. He helps thought leaders, influencers, executives, and authors create, launch, and produce podcasts that grow their business and make a real impact in this world. You can contact him today at emeraldcitypro.com/startupstory.

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July 21 2020
Chelsie Lee, founder of Shipsi

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