In February of 2015, Rory Stolzenberg was a year and a half removed from graduating U.Va. with no steady income and seemingly nothing going right professionally. He was in, as he puts it, “the deepest point in [his] trough of sorrow.” At face value, Stolzenberg was impressive – he had graduated from an elite university and ran his own tech business as a twenty-something. And yet, Foodio, the online and mobile food ordering application he had nurtured for half a decade, was failing.
New restaurants were rarely joining on – as little as one per month, never more than three. Foodio’s first and best client went out of business. One of Stolzenberg’s co-founders left “to go get a real salary.” The company was barely profitable and he was considering pulling the plug. Stolzenberg now recalls his small team’s desperation to attract customers: “We started cold calling until we couldn’t feel the sadness.”
Last fall, Jason Brewster was onboarded as the new director of the business incubation program at U.Va.’s i.Lab, an enclave for entrepreneurial innovation at the Darden School. Blue-eyed, long-haired, and possessing an unmistakable West Coast accent, Brewster seems like a character from a Jack Kerouac novel at first glance. Of course, this image turns into something rather different when he nonchalantly uses terms like “product-market fit,” “scalable business,” and “minimum viable product.” In reality, Brewster is a forward-thinking businessman who knows his stuff. So, he knows what Stolzenberg has gone through. He knows this shit is difficult.
When I sat down with Brewster in February, he jokingly asked, “if [getting a business off the ground] was easy, everyone would do it, right?” Difficulty, challenge – whatever you may call it – is inevitable in any venture, but it’s hardly ever noticed until a startup becomes a mega-corporation and its founders are played by Jesse Eisenberg or Michael Fassbender in blockbuster biopics. As Brewster makes clear, “there’s always a perception a particular business is an overnight success, but it’s never an overnight success.” So, while it would be easy to discuss the outward glamour of owning a company, it’s more honest to explore the challenging and often chaotic process going on behind the scenes.
The idea for Foodio started in Stolzenberg’s first-year as a personal project to keep his friends from free-riding on mass pizza orders, an annoyance with which many can sympathize. Connor Clark, a fraternity brother of Stolzenberg’s who joined Foodio as a co-founder in 2013, said, almost nostalgically, “it all started when Rory was upset at people – maybe me – for not paying him back when we would order food.” In fact, Stolzenberg’s initial vision for Foodio was a mobile ordering system which could split the bill and, in the fall of his third-year, he learned to code solely to make the initial iteration of an app. By Clark’s account, it was a stretch to even call Foodio a business in these early days; ironically, it was he who was brought on in a “business development role” in 2013.
In the intervening years, Stolzenberg found HackCville. Situated in a little green house perched atop a dive bar and furnished with whatever Spencer Ingram – the organization’s founder – could scrap together, HackCville’s gritty beginnings mirror those of Foodio. While Stolzenberg was coding away with a “steady beat of all-nighters fueled by caffeine and Android docs,” Ingram was literally renovating a rundown house on The Corner. As he puts it, “when HackCville opened, it was bring-your-own-chair.” That said, the environment was less important than the community of like-minded, “relentlessly resourceful” students interested in entrepreneurship which Ingram fostered. When speaking to HackCville members today, this community is still what they mention most.
HackCville was eye-opening for Stolzenberg, who thought Foodio was the only “remotely entrepreneurial” project being pursued on Grounds at the time. He spent the summer of 2012 working in the house at 9 Elliewood Avenue and, for the first time, became really serious about Foodio. In fact, it was hard not to be serious about the app; the presence of seven different teams creating startups in the same location “made it way easier to stop letting the excuses of everyday undergrad life get in the way of getting shit done,” says Stolzenberg.
After graduating in 2013, Stolzenberg was accepted into the incubator program at the i.Lab. The ten week summer program offers financial support, office space, and mentorship to emerging businesses with the ultimate goal of “leveling up” a project, as Brewster puts it. Damon DeVito, a board member of Foodio as of 2015, hailed the more intangible benefits of the incubator program. “You create these centers for collision and these centers for people to get together and challenge one another,” he says. “You get a lot more success than failure that way.”
“The deal,” Stolzenberg says, was “pretty unbeatable,” with help ranging as big as $8,000 in funding and legal advice, and as small as a functional printer. (His inkjet was on its last legs from all the flyers he had distributed around Grounds.) The result: “We came out of the i.Lab with a product we thought restaurants would really want.”
By the latter half of 2014, Stolzenberg and Clark had attracted some customers and were considering extending Foodio’s reach beyond Charlottesville, but it would be an exaggeration to say everything had gone according to plan. Even DeVito’s addition to the business was by chance. A seasoned business veteran and Darden graduate who owns whatever room he may be sitting in, DeVito initially seems like an investor from a Shark Tank-esque entrepreneurship gauntlet. In reality, he found Foodio at a Darden reunion when he snuck out of a cocktail party into a cafeteria where i.Lab’s businesses were on display. DeVito’s son, now a first-year at U.Va., immediately hit it off with Stolzenberg and Clark, scoring a summer internship with them. Meanwhile, the elder DeVito, who also serves as the managing director of Affinity Management, a consulting firm for country clubs and golf courses that now use Foodio, decided to join on.
Another completely unplanned development allowed the entire premise of the business to change. The restaurants Stolzenberg approached in Foodio’s formative years had more pressing concerns than allowing cheap 19-year-olds to split $10.99 orders. Local mom-and-pop restaurants, DeVito and Clark say, are being overtaken by national chains like Chipotle and Dominos largely because they lack online ordering systems. To make matters worse, delivery services like GrubHub and OrderUp can be expensive for these establishments and confusing for their customers. So instead of continuing with the “GrubHub model,” Stolzenberg and Clark transformed Foodio into a white label product, which means a restaurant can get Foodio software embedded directly onto its website or mobile app in a way that matches the restaurant’s design and logo. In exchange, Foodio takes a 5% cut of each order.
This shift meant that Foodio’s defining feature, the tab-splitting software for which Stolzenberg had learned to code, was made a secondary feature. The dangerous and sudden change of emphasis occurred in a highly saturated market. Clark admits, “We’re obviously not the only people who have ever thought about selling restaurants’ food online.” As a result, the young founders have had to find new ways to distinguish their company from the competition. The best methods: hard work, attention to detail, and personal care.
Clark’s role is mostly centered around business development, meaning he’s the one who personally interacts with prospective and current restaurants. He told me the team has worked to streamline the sales process, improve the technology, and ultimately make Foodio a fit for small local establishments. In this respect, Stolzenberg and Clark have shown immense dedication to bettering their product. Progress, for them, was – and still is – an endless, yet rewarding process. “I don’t think we’d ever have been satisfied with getting 50 clients and relaxing,” Stolzenberg told me. Even when left cold calling restaurants in the winter of 2014-15, they grinded their way through. Stolzenberg remembers, “we needed to either give up or get our shit together on sales.” Needless to say, they took the latter road.
Largely because of the two founders’ customer-centric approach and unwavering commitment to improving their product, Foodio is getting big. Just over a year ago – five years after Stolzenberg’s initial idea – about 20 restaurants had adopted the software. Now, Foodio is growing 21% each month. They’ve expanded to New York and Northern Virginia, and may move into the Research Triangle in North Carolina soon. “We’ll get twelve new companies in an average week,” DeVito says. “We’re googling things like ‘What is this restaurant that just signed up?’”
Nevertheless, the company is still scrappy as hell. They aren’t paying college-educated techies a yearly salary to code; they’re paying a bunch of high school students by the hour to manually sync 80 restaurant menus in a couple of weeks. DeVito estimated with a chuckle that Foodio is probably the number one employer of Western Albemarle High School students. At one point, they even solicited resumes on Craigslist for freelance fieldworkers who could attract more restaurants in New York. And it’s not like Clark and Stolzenberg are exempt from the hustle. Even though the two are incredibly busy, Stolzenberg still codes the application and Clark still handles personal relations with partner restaurants. “It definitely does not run automatically,” Clark notes.
The hard work and grit behind the scenes should come as no surprise considering these are still early days for the startup. MJ Toms of the Batten Institute, who helps run the i.Lab, told me that Foodio can’t even count as a “successful” company in i.Lab’s statistics until 2019, which would be five years after graduation from the incubator program. That said, you’d be wrong to think Foodio’s team isn’t enjoying the ride. Clark told me, “I really, really like being my own boss and feeling a stake of ownership in the project I’m working on. That’s a big deal to me.” According to Brewster, this kind of entrepreneurial fervor is the key ingredient in getting an emerging business off the ground. “It’s about the passion,” he says. “Not everyone wants the kind of challenges and demands and risk of doing something entrepreneurial.”
While Foodio is unquestionably one of the most well-developed projects to have come out of the HackCville/i.Lab/U.Va. ecosystem, the hope is many yet-to-be-conceived startups catch up soon. In 2013, i.Lab opened up its doors to non-Darden students. Foodio was one of the obvious beneficiaries of that policy change, but so too were the high school students and over fifty Charlottesville residents who participated in the 2015 incubator program. Meanwhile, HackCville has expanded like hell. Just a few years ago, the organization was alumni-led and comprised of a select group of founders. Now, HackCville’s staff projects about 1,000 different people will come to 9 Elliewood Avenue by the end of the current semester. The organization also runs four annual startup trips, connects members with an expansive alumni network, and includes a media wing (that’s us, by the way) and an education innovation program.
Clark, for one, has noticed such progress, saying that there is now “a real focus and excitement about entrepreneurship that wasn’t there during [his] time at U.Va.” And while an entrepreneurial atmosphere isn’t always necessary for success, it’s certainly beneficial. As Toms told me, “the bigger, more vibrant the ecosystem is, the more startups are involved, the more entrepreneurs and investment you’re going to attract, the more creative collisions are going to happen.” And perhaps fitting for a locally-created, locally-based business that helps local restaurants, Foodio’s team loves seeing this ecosystem evolve. They’ve participated in career fairs at the University, maintain a strong relationship with HackCville, and aren’t hiding the fact that they’re rooted in a small city in Central Virginia. “Connor and Rory are unbelievably generous with their time,” DeVito told me. “When somebody comes through HackCville and wants a mentor or somebody comes through the i.Lab… I’ve never seen either one of them say no.”
As for their own business, well, Stolzenberg and Clark have one goal: “Grow!” Simply put, the founders want the journey to continue. They’ll willfully admit that their work can often get tedious and that new roadblocks will continue to appear, but neither one can envision giving up and heading off to Deloitte. “We’re not still around because we’re more competent or capable people than [people] in companies that aren’t [around] anymore,” Stolzenberg says. “We just never packed our bags and went home.” That attitude, it seems, is what distinguishes real entrepreneurs from everyone else. Technical skills, business knowledge, wealthy investors, groundbreaking ideas – these elements are all secondary. It’s about overcoming, it’s about loving your project, and more than anything, as Brewster said, “it’s about the passion.”