What Happened With Ruckify?
Some may say the good news is that Ruckify generated wealth for some people. The bad news is that it wasn’t any of the shareholders or the people that worked so hard building it.... and the ugly news is how that actually happened.
I spend a lot of time on zoom calls… and it truly amazes me that so many people around the world ask about Ruckify on a daily basis, so I thought that it would be worth sharing my views and also providing some insights on a technology startup.
It definitely was not a good ending for Rückify… and everything that it should have become.
When I decided to leave Ruckify, there was a fresh $7M in the bank. This had been our largest raise to date. Close to half of what we had raised and spent in the previous 3.5 years, building the company from scratch.
With shareholder support, along with many others, I was fortunate to be in a position that allowed me to leverage my 25 years of rental experience to help “crack the nut” on a dream of mine... building a successful “rent anything” marketplace. As with any startup, there were plenty of mistakes along the way and none of us were perfect. I am proud of how we all responded to those challenges.
A few memorable breakthroughs over my 3+ years at Rückify are:
Secured the first peer to peer rental marketplace insurance
2020 proved that Ruckify works by generating over 6000 bookings across multiple categories, in many North American cities.
One of the first in our space with instant criminal/background checks upon signup, which resulted in zero insurance claims.
One of the first in our space with an instant booking feature
One of the first in our space to offer a fully managed inventory availability booking system
One of the first in our space with “owner stores
One of the first in our space with trading posts
One of the first in our space with an integrated app delivery-Rückify Expres
One of the first in our space to offer user reward currency-RuckBucks
One of the first in our space to commission an ESG report from PWC, to help highlight Rückify and its communities, positive impact on the environment
Built a best in class 4 step posting process.
316 online reviews with an average score of 4.5…. And that was just for version 1
Google - 4.6 out of 109 reviews
Google Play - 4.3 out of 56 reviews
Facebook - 4.9 out of 78 reviews
Apple App Store - 4.1 out of 73 reviews
I am most proud of how we navigated 2020 and how capital efficient we were.
Being one of the first real players to build a “rent anything” marketplace business was not a simple task. Marketplaces by nature are complex to figure out and also very expensive to build. Being capital efficient and having a team that is motivated and prepared to outwork the competition, is the only path to success when you have competitors who have raised significantly more, while pursuing only a single category.
As of November 2020, we had been innovating, iterating, testing and building a unique marketplace-Rückify for 3+ years. We had raised $13M and made 2 acquisitions. We also ran most of the key features from our MVP technology stack, through an exhaustive design thinking/innovation process, which allowed us to start developing/launching an absolute game changer... Ruckify 2.0.
These accomplishments were only possible because of a fully committed team that were willing to work harder than most and initially be paid considerably less than market. From day one, we did not waste money on fancy headquarters, opting to sign temporary rents, for far below market in exchange for moving more often. Every penny was fully respected and only utilized to meet our goal of becoming the worlds largest rent anything marketplace.
Mid March, 2020, was the beginning of COVID in Ottawa . Due to uncertainty of the pandemic, we made the very difficult decision to furlough half of our team and we also canceled our lease. We were one of the first to reach out to the CEO’s of BDC, EDC, looking for financial aid.
Early March 2020, we were uncertain how viable Rückify would be in a global pandemic.... Would people want to handle and rent, other peoples items during a pandemic? Knowing that we had to cancel our fundraising with limited cash remaining, I immediately requested our CFO prepare best and worst case financial models. It would not have been possible to stretch our cash without making many more tough decisions. This included having the remaining team take a significant pay cut, finding a way to increase our year over year bookings (6000+), all while eliminating our traditional marketing budget. We also instructed our CFO, at the time, to work on leveraging federal and provincial funds to rebuild our team. Our ultimate goal was to be in a position to continue building supply within our marketplace, continue innovating, rolling out Rückify2.0 and building marketplace momentum.
A few of the proactive measures that helped propel us through Covid, while eliminating our traditional marketing budget were:
our focus and conversation around helping people earn cash during Covid
our impact on the environment, which was amplified through earned media and influencers.
we decided to focus on three key areas, which are critical for any marketplace. bookings through the platform, building momentum and building supply.
our ability to “prime” our markets with RuckBucks, which is an internal currency we used to entice people to add inventory, signup and share the platform with others. The unfortunate part with most of the RuckBucks earned, is that they are not allocated as a cost of sale/marketing. The redeemed RuckBucks were allocated as a direct offset to revenue, which obviously reduces the companies reported revenue amount.
If a global pandemic was not enough to deal with, in mid summer of 2020, I uncovered a significant misappropriation of funds by a senior executive on a Friday, had a full confession on the Saturday, sent an offer out to a CFO by the Sunday, and then managed to have 90% of the missing funds back in our account by that Thursday.
Building Ruckify was some of the most rewarding and meaningful work of my career. It was an honor to work for all the Ruckify shareholders, supporters and team members. I still get chills knowing that I was able to help build something that the world has never seen before, and in my opinion, is certainly ready for.
Our team had worked incredibly hard to crack the “rent anything” nut. We were not perfect, but I am especially proud of how capital efficient we were with the $13 million we had raised over the 3 years that I was CEO . We invested in two successful acquisitions, including an RV Rental Marketplace, an industry that has been shattering rental records through COVID, we not only survived but thrived through the first year of COVID.
We invested heavily in the foundational aspects of building the “Amazon” of rent anything. This included acquiring hundreds of thousands of supply rental items along with successful brand building throughout many targeted North American cities and we were making headway on building and deploying Rückify 2.0, game changing technology.
Unfortunately, when you bring on a partner, it opens up the possibility of opposing visions, this is exactly what happened in our case.
I knew that Ruckify could not continue to thrive through an intolerable partnership and divisive strategic visions. It was a difficult decision, but in the company’s best interest, I initiated a search for a replacement CEO late November of 2020, right after our last raise of $7 million.
Early December our opposing views became combustible and I opted to no longer draw a salary. I made the painful choice to resign as CEO late January 2021, and then also resigned from the Ruckify Board of Directors in February.
Fast forward a year after my resignation, in a letter to shareholders, my former partner stated that they were unable to complete the Fat Llama acquisition promoting the decision to cancel the public listing and wind down the company. Shock and utter disappointment was my reaction. They had 7 million to complete Ruckify 2.0 and with the favourable fundraising environment, exponential rise of the sharing economy and the overall market potential, they should have been able to see it to fruition.
We had a group prepared to buy Ruckify so that we could continue to scale it, and also leave current investors with equity, but unfortunately we were shocked to learn that a considerable portion of Ruckify’s value had been given away during the due diligence with Fat Llama.
The online rental inventory and users from over 40 North American cities were actually and literally transferred over, and went live on the Fat Llama platform prior to the deal being closed or terminated.
The ugly part for our investors and the team was that after being "given" Ruckify's North American customers and supply list, Fat Llama then turned around and sold their company for $41.5m USD, to a great team from Stockholm, just months after the failed acquisition.
I remain proud of all we accomplished. A sincere thank you to every single person that used and loved Rückify, our valued partners, our very supportive investors… and most of all, the incredible team members that helped make the impossible…. possible.
My personal motto is to always find a way… and we will find a way!
Ruckify Technology Progress And Overview When I Resigned
Ruckify had been in development for nearly 4 years and has accomplished many tremendous triumphs along the way. We wanted to build differently than our predecessors who build to scale from day one. We wanted to have as much manual horsepower behind every feature in order to learn as much as possible about the user & the business. With the majority of the Founding Team coming from a Rental Industry background, we knew what had to be built to create a customizable & personalized UX for our MVP which was in the production market for 3 years.
We began with a hybrid mobile app because we wanted to remain in a near-stealth mode for our beta testing in Ottawa. The team intentionally made the decision to push off anything to do with SEO and organic discovery for that reason. The reason we chose a hybrid over Native was simply to save time & money developing a single code base instead of two. In our second year, we launched a functional website using an Angular framework leveraging the same API backend as the mobile app and backend Admin. It took over a year to build out the website to mirror the functionality of the mobile app and there are still gaps in the user experience.
From day 0, our Founding Team knew we had to separate ourselves from the Kijiji-like marketplaces that have Trust & Safety as an afterthought, along with offering a personalized experience. After reading the nightmare stories of Airbnb and similar platforms of unverified users being bad actors on the platform, we knew we had to be different. These became two of our main pillars building out the entire platform, especially in our backend Admin where we managed the platform from behind the scenes. We built the platform to be completely customizable based on the parent category, subcategory, geography, and value of the asset.
As we grew our team in size, we needed to become more efficient in our roles. The Product & Development team took note of this and developed solutions to implement to solve the actual problem.
To summarize the document estimate:
Total - Current Annualized Wage Savings: $799,906 & Total - Q4 2021 Annualized Wage Savings: $4,817,356.
In mid 2020, the Product Team was officially separated from the Development Team, and we assigned Fabiana, a Lead UX Designer to lead the Product & Innovation team. Fabiana was responsible for leading Ruckify through the Design Thinking Methodology of building products that Users actually love and want to use. This is when we officially started to design & spec Ruckify 2.0. This allowed us to have core-functionality, re-built using Design Thinking and forcing ourselves to not compromise on the quality of design because of development blockers or limitations. We prioritized the re-design with the following features:
New Showcase (Item Page)
New Signup Process
New Posting Process
New Notification Centre
New Checkout Process
To give a sense of the improvements these redesigns made, our MVP Posting Process was 8 steps on desktop and averaged a 30% conversion rate from start to finish. Once the redesigned workflow of 4-steps was finally released, we reviewed the new process’s conversion rate which was a 60-day 75% conversion rate. We had very positive results with the New Signup Process, and also the Bounce Rate and CTR of the Showcase.
We had many features already developed that would contribute to a unified goal to achieve these results in the given timeframe because from day 0 we built the API to be customizable by geography, category, subcategories, asset value, and even by individual users.
Two primary examples of features that were ready to deploy in the admin:
1. Variable Rake
This would allow us to change our default 10% to 20% rake by geography, category, subcategories, asset value, and even by individual users. Leveraging this tool could open new revenues for the company.
2. Variable Insurance Premium
Similar to the above feature, the Variable Premium was designed to be customized by geography, category, subcategories, asset value, and even by individual users. This would again, open new revenue streams for the company.
Below is a list of features that we have added to Ruckify that our Members are facing or for Internal processes improvements. Each feature/improvement was created to improve manual processes or reduce negative feedback, and we originally solved it with manpower. The following features were added to show diversity where we find efficiencies and what we plan on adding to improve what we have now.
Total - Current Annualized Wage Savings: $799,906
Total - Q4 2021 Annualized Wage Savings: $4,817,356
Time Saved Calculation:
Hours saved per month x integrated time period = Time Saved
1 year has 24 pay periods (88 hours per pay period)
Average starting salary is $50,000.00 / 24 = $2,083.33
Time Saved formatted into Pay Periods Saved
Pay Periods Saved x $2,083.33 = Amount Saved Per Person
Amount Saved Per Person x Team Size = Current Annualized Wage Savings
Current Annualized Wage Savings x Forecasted Growth = Q4 2021 Annualized Wage Savings
Status of Feature Descriptions and Improvements as I was leaving
1. Trulioo - Integrated in October 2018
- Current Annualized Wage Savings: $7,639
- Q4 2021 Annualized Wage Savings: $99,307
- Purpose to instantly authenticate and perform background checks
- Saves manual review of driver’s license
Trulioo is used for our instant background checks during the signup, it was a tool we knew that we had to integrate right away in order to efficiently and safely allow members to create accounts on Ruckify. The alternative is asking members to send us pictures of their Driver’s License and for us to manually review to ensure the information is accurate.
2. Stripe - Integrated in October 2017
- Current Annualized Wage Savings: $1,389
- Q4 2021 Annualized Wage Savings: $55,560
- Purpose to help flag transactions as fraud and block pre-paid cards
- Saves time and money for dealing with charge-backs and payment disputes
Stripe is used for our payment processing, but it also supports early detection of high-risk charges in terms of fraud. It will automatically block transactions if they believe it to be fraudulent or with our custom rules by blocking pre-paid cards before payment. It allows us to focus our attention on other areas of the business instead of worrying about members committing credit card fraud.
3. Intercom/HubSpot Live Chat - Integrated in October 2018
- Current Annualized Wage Savings: $45,447
- Q4 2021 Annualized Wage Savings: $90,894
- Purpose to make member support near-instant and more organized
- Saves Support from alternatively digging through emails to respond
Intercom/HubSpot Live Chat is managed by our Support Team to quickly communicate with our members in times of need. This was added at the beginning of Ruckify because we found ourselves unorganized and spending too much time answering emails from our members.
4. Admin Tools - Integrated in August 2018 to Present
- Current Annualized Wage Savings: $341,925
- Q4 2021 Annualized Wage Savings: $2,099,046
- Purpose to improve productivity for manual processes and provide a better UX
- Saves time once we find a manual problem to solve by automating with technology
- Cloning Machine
Current Annualized Wage Savings: $50,000
Q4 2021 Annualized Wage Savings: $150,000
- Keyword Automation
Current Annualized Wage Savings: $50,000
Q4 2021 Annualized Wage Savings: $370,000
Current Annualized Wage Savings: $50,000
Q4 2021 Annualized Wage Savings: $150,000
- RuckifyExpress Manager
Current Annualized Wage Savings: $11,361
Q4 2021 Annualized Wage Savings: $147,369
- Notification Manager - Version 1
Current Annualized Wage Savings: $6,818
Q4 2021 Annualized Wage Savings: $20,454
- God Mode / Login As
Current Annualized Wage Savings: $23,746
Q4 2021 Annualized Wage Savings: $166,223
- Merchandising Tool
Current Annualized Wage Savings: $150,000
Q4 2021 Annualized Wage Savings: $1,095,000
Our backend Admin Tool is something we custom built to help us manage the business. It started with creating simple tools to perform what was necessary. But, it turned into a tool to help increase productivity internally for certain tasks that took many “man-hours” and turned it into a few-second process by leveraging technology.
5. Elastic Search - Integrated in December 2019
- Current Annualized Wage Savings: $200,000
- Q4 2021 Annualized Wage Savings: $1,480,000
- Purpose was to improve search accuracy and lower Curation costs
- Saves time by not having to scrub search results for poor results and add
positive/negative keywords to improve the quality.
We used to employ a large team on curation and had multiple people scrubbing search results to find poor quality or inaccurate results and then add positive or negative keywords to improve them.
6. HubSpot Integration - Integrated in January 2020
- Current Annualized Wage Savings: $5,500
- Q4 2021 Annualized Wage Savings: $33,000
- Purpose to pull custom reports and as a CRM
- Saves development time in the Admin Tool from having to build new reports or an Interaction feature to keep track of everything a CRM does. We created a 2-way HubSpot integration for a variety of reasons but mainly to limit the support needed on our internal Admin Tool such as building reports or turning it into a CRM.
7. Ekata - Integrated in October 2020
- Current Annualized Wage Savings: $2,272
- Q4 2021 Annualized Wage Savings: $24,996
- Purpose to scan a member’s digital footprint to prove their identity
- Saves Support time from conducting social scans and interviews to prove their identity
when Trulioo fails
Ekata is used during the signup process to create a risk score of a member’s online profile/footprint associated with the details they used to create their account. This saves our Support Team from having to manually scan the social media of a prospect when they get blocked from Trulioo to confirm their identity.
8. MapBox - Integrated in December 2020 (partially implemented)
- Estimated Annualized Wage Savings: $5,680
- Q4 2021 Annualized Wage Savings: $17,040
- Purpose to create Marketplaces defined by combining multiple postal/zip codes
- Saves time for Support answering negative feedback from members. But, it also
decreased our Google API monthly spend by 90%
MapBox is a tool to replace Google’s geo-services. The current implementation of how a marketplace is created/support receives a lot of negative feedback because of Google’s limited APIs. MapBox also allows us to map a marketplace around postal/zip codes to accurately track and define what a marketplace is and ensuring that members and items are assigned properly.
9. Tipalti - Integrated in December 2020 (partially implemented)
- Estimated Annualized Wage Savings: $50,000
- Q4 2021 Annualized Wage Savings: $350,000
- The purpose is to automatically payout our Owners once their booking has been
- Saves us from manually calculating and sending payouts
Tipalti is a Payouts Service Provider for many types of businesses. We are currently manually calculating and sending payouts by having the member onboard themselves through a secure link. Tipalti can automate this process completely, therefore saving us two full-time employees.
10. Record360 - Integrated in December 2020 (partially implemented)
- Estimated Annualized Wage Savings: $11,458
- Q4 2021 Annualized Wage Savings: $80,206
- The purpose is to help eliminate the majority of disputes by video capturing and geo/time
stamping the item’s condition pre and post-booking
- Saves our Trust & Safety Team time and effort from mediating each dispute
Record360 is a tool we will be integrating with to help limit the number of disputes we receive from damages or additional fees. It creates a video that is geo/time stamped and it completely
removes the conversion when a Renter tries to blame the Owner for existing damage. Our Trust & Safety Team currently spends their time reviewing and moderating these disputes.
11. Notifications (Version 2) - Integrated in December 2020
- Estimated Annualized Wage Savings: $5,680
- Q4 2021 Annualized Wage Savings: $17,040
- The purpose is to eliminate the cause of most negative feedback from members
regarding too many notifications
- Saves time for our Support Team by not having to answer as many questions, emails,
chats, and phone calls
We have received the most negative feedback from our members regarding our current notification volume. They simply receive too many notifications, and they continuously chat or send emails to our Support Team to let them know. We are making them completely customizable to create a more personalized experience for our members.
12. Sift - Integrated in December 2020 (Planned)
- Estimated Annualized Wage Savings: $22,916
- Q4 2021 Annualized Wage Savings: $170,267
- The purpose of this is to make the Posting Approval process near-instantaneous
- This will drastically save the Curation Team time and effort manually reviewing each post
Sift is used by many of the top marketplaces for their bundle of APIs. We will be starting with their Content Integrity API which will help speed up our Posting Approval process dramatically. It allows us to create custom workflows through an API to make the posting experience near-instant.
13. Segment - Integrated January 2021(partially implemented)
- Estimated Annualized Wage Savings: $100,000
- Q4 2021 Annualized Wage Savings: $300,000
- The purpose of this is to have all of our data in one place to make it faster and easier to
pull and analyze the data
- This saves time having to go to different areas to find the data, combine the spreadsheets, and also make reporting more accurate
Segment is used by many top companies and integrates into our whole techstack to aggregate all of our data.
Alternative Options for Possible Ruckify Competitors
There are many alternative options to custom building a marketplace. G2’s list is here. The problem that most OOTB solutions have is restrictions to their UI editor or adding APIs. The main issue with having a custom-built solution is that there is no company that’s built one (peer-to-peer rental marketplace) that is as successful as the big household names (Airbnb, Turo, etc.). Most Custom shops are also lacking the real-world experience of bringing a marketplace from 0 to 1 successfully with an IPO or an Exit. When looking at potential acquisitions, the marketplace industry is so dependent on a heavy wallet, there is usually a lot of debt or lack of revenue for the startups we could afford to purchase.
Ultimately, Custom Marketplace platforms versus Out-of-The-Box Solutions each have their own pros and cons, however, the main key difference is you are either compromising on your requirements to fit the needs of the OOTB solution, or you’re investing the time and money to customize the solution to fit your business requirements.
Also, with an OOTB solution, you have to question if it is built for scalability because in the majority of cases the target market for these solutions is founders only building an MVP to achieve PMF (Product Market Fit). Once they’ve achieved a level of scale, they go back to the drawing board to create version 2.0.
Going with either an OOTB or Customizable Solution, the big question is if the tech stack matches our current stack Angular, PHP, and SQL. If there are differences, we may need to re-think our development team, and therefore will require to train and ramp new members to the team.
Top Out-Of-The-Box (OOTB) Solutions
Sharetribe has 2 products that are meant for first-time Founders building their MVP on a budget. Their Go product is highly configurable and offers basic rental functionality. The Flex product offers their OOTB API with a frontend template and requires a dev to do any further customization. They are the best because of the education on the marketplace industry that they offer to first-time Founders, that is why they rank so highly and have an excellent content SEO strategy. However, if we look at comparing apples to apples, Ruckify continues to be the gold standard.
Some of their customers.
Comparing Sharetribe to a Custom Builder - CS-Cart.com
Comparing Sharetribe to an OOTB Solution - Idyaflow.com
Comparing Sharetribe to a Custom Builder - Open Cart
Here is a tool to compare many other solutions
Yo-Rent is the runner up to Sharetribe but also going after a different target market. Yo-Rent is focused on a more technical Founder that understands some of the complexities of a marketplace, however, doesn’t understand what is actually possible. With all OOTB Solutions, there are limitations to the configuration settings, especially in terms of the UI & UX. Yo-Rent’s focal Case Study Client - GearFlow almost has next to no SEO strategy. None of its pages are being indexed by Google or other search engines and the demo Admin Yo-Rent offers only allows for simple SEO customization.
The frontend is done well for an OOTB, one of the better ones, however, it will take a lot of manipulating to get it to par with Fabiana’s designs for Ruckify 2.0 which can cause extra pain and effort from a development standpoint. The item’s page (Showcase) doesn’t appear to have an integrated availability calendar to the level of detail that Ruckify has recently released. Attempting to make Yo-Rent’s calendar work with our requirements could easily result in a nightmare after experiencing the pain our original frontend developer, Sahaj, had dealing with Mobiscroll’s plugin. They offer a pleasant search UX with the ability to add or remove specific filters (Not category-specific). This was one of the objectives to implementing Custom Properties at Ruckify which we invested over 4 months of 2+ employees dedicated full time creating.
At first glance, the backend Admin seems to be highly configurable and very eye-catching with the dashboards of relevant KPIs which isn’t much different from Ruckify’s. PPC (pay per click) catches your eye immediately because it is a highly interesting feature that helps eat away at the trust built up on the platform. The main draw in their Admin is definitely the CSM (Content Service Manager) which allows you to configure labels and other content on the platform in a unified manner. We have a similar tool built in our Admin to manage our Dynamic Home page & Category Landing pages.
With a clunky UI, the main Dashboard for a Poster holds only some relevant information such as the amount owed, total credits, and unread messages. When you go to view the unread messages, you find it is an elementary version of a user chat because you cannot even share files (like Ruckify). When editing the Profile, you find there isn’t even a description box to write a Bio about yourself which helps build trust as Airbnb says. The main highlight is viewing the orders that haven’t been paid out and requesting payment. This is something that Ruckify can quickly add through Tipalti’s integration. Sadly, when requesting the funds, you find that they don’t have the required tax slip information that is required in some provinces & states. Again, Tipalti takes care of this for Ruckify.
Overall, Yo-Rent doesn’t offer much that Ruckify doesn’t already have, and certainly not in a better fashion than Ruckify.
This seems to be a great option on the outside, however, they have a major flaw, its Client’s entire platform is built on an “app” subdomain meaning none of the pages are indexed by Google or other search engines (compare to Ruckify). This is likely a similar use case to Ruckify, where the app domain is built in a language or framework that is not compatible with SEO.
Other OOTB Solutions
Top Custom Option
Marketplacer is the top competitor when it comes to custom building marketplace platforms. Unlike many other solutions, its Founders actually built and ran a successful marketplace for retail bicycle exchanges during 2007 in Australia. The main issue is that they focus primarily on retail marketplaces and do not have the industry experience in Rentals that is a necessity when building a peer-to-peer rent anything marketplace. Raising nearly $60 million in VC funding, they have proven they know what they’re doing for eCommerce marketplaces.
Fat Llma actually had to re-brand by adding an “L” to their name because of negative press and bad reviews. It has very basic functionality, a very time consuming process (manual) for limited Trust & Safety, a basic Posting Process which is not specific for categories, and it does not offer any on platform delivery options, which leads users to off platform transactions. On Trust Pilot, 16% of their reviews are 1 star or this article about a user’s $5,000 camera being outright stolen in 2019.
In closing, I am obviously a passionate believer in Ruckify’s potential and it will be rebuilt