April 4, 2025 • 32 mins
Welcome to the Beyond Fulfillment Podcast, the ultimate resource for entrepreneurs, small business owners, and start-up founders eager to transform their ventures with proven strategies from successful leaders.
In this episode, host Dave Gulas interviews Keivan Shahida, the visionary CEO and co-founder of Response, a pioneering platform revolutionizing procurement for mid-sized 3PLs and retailers.
Discover how Response aggregates top industrial vendors in the US, offering businesses unparalleled control over operational spend. Explore Keivan's entrepreneurial journey, from studying computer science at Cornell to navigating the challenges of building Response during the COVID-19 pandemic. Learn how Y Combinator played a crucial role in their journey, propelling Response to new heights.
Gain insights into how Response's innovative command center simplifies spend management, benefiting finance teams and improving operational efficiency. If you're seeking actionable strategies and key insights from a successful entrepreneur, this episode is a must-watch.
Stay tuned to learn how Keivan and his team pivoted, adapted, and innovatively approached problem-solving, driving growth and impact in the logistics and procurement industry. Subscribe now for more insights and inspiration to fuel your entrepreneurial journey. Don't forget to check the links in the show notes for more information!
Connect with Keivan on LinkedIn: https://www.linkedin.com/in/keivanshahida/
#Response #CEO #CoFounder #Procurement #SpendControl #3PL #Retailer #CreditCards #Purchasing #CentralizedSpend #Cornell #ComputerScience #B2BPurchasing #Inefficiency #YCombinator #StartupAccelerator #Airbnb #COVID19Pandemic #HealthcareWorkers #PPE #WarehouseTeams #OperationsTeams #PlatformIntegration #Marketplace #PriceShoppers #Logistics #SupplyChain #CommandCenter #IndirectSpend #FinanceTeam #InvoiceReconciliation
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Transcript
Episode Transcript
Available transcripts are automatically generated. Complete accuracy is not guaranteed.
(00:00):
Today we sit down with KayvonShahida, a dynamic entrepreneur who
is tackling a critical, yetoften overlooked aspect of business
operations.
Kevan is the co founder andCEO of Response.
His entrepreneurial journeybegan during his computer science
studies at Cornell, leadinghim and his co founder into the procurement
(00:24):
industry.
We'll explore the story behindResponse, a platform that's revolutionizing
space control for retailersand 3 PLs.
Kayvon shares a fascinatingjourney of how Response came to be
from its initial conception tonavigating the complexities of the
COVID 19 pandemic andultimately finding its niche in simplifying
(00:48):
and centralizing purchasing activities.
We'll explore how Responseempowers businesses to streamline
their operations, gain realtime visibility over their spending,
and ultimately transform daysof tedious work into mere minutes.
Kavan also shares his insightsfrom Y Combinator and the key lessons
(01:08):
learned while growing Response.
Get ready for an inspiringstory of resilience and innovation
as we learn how Kayvon and histeam are improving procurement.
As always, if you found valuefrom this content, please like and
subscribe.
Hello everyone and welcome toanother episode of the Beyond Fulfillment
(01:29):
Podcast.
I'm.
I'm your host Dave Gulas, andthis week my guest is the CEO and
co founder of Response, Kayvon Chahida.
Welcome Kevon.
Thank you for having me.
Absolutely.
We appreciate you taking thetime to be here.
So Kevon, Response, tell uswhat that company is.
(01:51):
Yeah, definitely.
So Response is a company I cofounded with a longtime friend and
business partner of mine,Kaiser Bayerjean.
We met when we were studyingengineering at Cornell.
And the basic idea behindResponse is we've aggregated all
of the top industrial businessand packaging vendors in the US into
(02:14):
a single platform.
And on top of thoseintegrations, we built a platform
for controlling spend.
So if you're a mid sized 3 PLor retailer were a way for you to
ultimately control exactlywhat your team can buy.
Typically our customers,before Response, they're giving out
credit cards to people.
(02:34):
They're letting people issuepos left, right and center.
It's just the wild west of procurement.
And the idea behind Responseis we help them centralize all that
spend so they have visibilityinto exactly what their team is buying
in real time.
And then we give them controlso they can control the exact SKUs
and the exact amounts and theexact vendors that their team can
(02:55):
buy.
Okay, yeah, so a lot to unpackthere with Response and what it's
doing and certainly some bignews that you've made recently.
But let's just go back to thebeginning so you're studying.
I think it's computer scienceat Cornell.
Yep.
And so what.
What was like, how did thisidea to start this company come about?
(03:18):
It was.
It was almost a complete accident.
I know it's crazy to say, butwe were working on something entirely
different.
And in the process of doingresearch for that idea, we had to
start talking to people inprocurement, people in operations,
and they started to explain tous some of the challenges that they
were having in purchasing andB2B purchasing.
(03:40):
And our minds were just blown.
We were like, oh, my God, how.
How is it that people areusing these tools from decades ago?
It's so manual, it's so slow,it's so inefficient.
There has to be a better way to.
To do this.
And the opportunity was justso massive that we effectively just
(04:01):
dropped what we were workingon before, because we realized, wait,
this is a way bigger, waygnarlier challenge for us to go after.
And so after that point, weactually spent the first couple of
years really just researching,not even building anything.
We wanted to make sure that wereally deeply understood the challenges
(04:23):
that people in procurement or,you know, operations, people who
maybe have procurement as oneof their many responsibilities, we
wanted to understand the rootof those challenges.
And so we interviewed hundredsand hundreds and hundreds of teams
before building anything.
And eventually what ended uphappening is we got into yc and YC
(04:46):
was an incredible, incredibleopportunity for us.
Y Combinator, they're one ofthe top startup accelerators in the
world.
They were the first investorsin companies like Airbnb, Stripe,
Dropbox, Doordash, Flexport,you name it.
They're the big dogs in town.
And so we get into YC andCovid Hits, and when we entered yc,
(05:10):
we're building this enterprisesoftware for procurement teams, helping
them automate these supercomplex, complex workflows.
RFPs, RFQs, tender offers, youname it.
But Covid hit, and all thecontracts that we had effectively
just, poof, vanished.
And we had to figure out, whatare we going to do?
(05:32):
Like, we just got into yc.
This is our opportunity.
This was going to be themoment where we shine and we go into
YC and it just takes off.
And instead we have to.
We have to really rebuild andrethink our approach.
And at the time, this is oneof the craziest parts of our journey
at the time, you know, we werehearing constantly about healthcare
(05:55):
workers needing to source PPE,so gloves, masks, sanitation products,
etc.
It was such a challenge forthem to source what was at the time,
life saving equipment and supplies.
And we said, wait, we havethis platform for letting people
source things globally in anefficient way.
(06:15):
What if we just worked withhealthcare teams and helped them
source ppe?
And so during the course of ycwe were just in this wild west of
healthcare, but we really madea big mistake there because unlike
when we'd spent yearsinterviewing procurement teams and
ops people, we knew nothingabout healthcare workers and their
(06:38):
day to day challenges.
And so the mistake we madethere was we effectively slapped
our solution onto a group ofpeople in a problem that we didn't
know much as much about.
And yes, they were having aproblem sourcing ppe, but it was
very much a one and doneproblem once they got it.
(06:58):
And of course once Covid dieddown, it was no longer a problem.
But that's when we got lucky.
And that's actually where thejourney of response as it exists
today started.
So towards the end of thepandemic, we weren't just helping
healthcare workers source PPEat the time, other businesses were
(07:20):
coming back online in personand they still needed to source these
kind of supplies.
And so we started helping afew warehouse teams.
And one day this VP ofoperations comes to us and she said,
you know, you guys are helpingus with all this ppe, but we have
to buy all of this other stuffto run the operation and I don't
(07:42):
want to deal with it, but Iknow we're overspending, I know we're
not doing things efficiently.
Can you guys just take thisoff our plate?
And so we're like, oh, that'svery interesting.
But we, we reflected on allthe mistakes and all the learnings
of the previous years and wesaid, all right, we're going to do
this.
We need to make sure we reallyunderstand the space and spend a
(08:04):
lot of time with people inperson, understanding the day to
day lives of these operatorsto figure out if the problem is really
a big one and if it is a bigone, how to start addressing it in
the most effective way.
And so we dug in again andjust started meeting with operations
teams, started working withwarehouse teams, and that ended up
(08:28):
being the basis of all theresearch and foundation of response
as it exists today, where nowwe're helping 3pls, we're helping
retailers who have their ownphysical stores and fulfillment centers,
we're helping distributors,you name it.
But yeah, that is kind of thehigh level, high level story of response.
(08:53):
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Okay, so a lot to unpack thereas well.
So you, you originally had.
This is originally anenterprise solution.
You get into Y and just for,for people, in case everyone doesn't
(09:58):
understand what's the processlike to even get into Y Combinator?
Oh, it's absolutely insane.
So we, we actually applied twice.
The first time we applied wedidn't get in.
And at the time I think itwas, and it's probably similar numbers
now, it's something like20,000 companies apply for each batch.
(10:19):
And at the time I believe theywere taking something like just under
200 companies.
So incredibly competitive process.
After the application step, ifyou make it to the next step, there's
an interview.
That interview is also thiskind of legendary thing in the story
of many, many startups out there.
(10:42):
And the interview is uniquebecause at the time what they would
do is they would fly you toMountain View here in California
in the South Bay and you havesomething like 13 minutes with them.
It's like a, it's a bizarrenumber, it's super short, but for
them it's really efficient.
And you go into that processand it's like, you know, you're expecting
(11:06):
them and you're preparing forthem to just grill you something
like 50 questions, right?
They're just gonna ask yourapid fire to figure out whether
it's a company they want toinvest in or not.
And then within the same daythey will give you a decision.
And you know, we werepreparing like crazy because again,
it was the second time that weapplied, we ended up finding out
(11:29):
that they want to fly us out.
We're just over the moon, likethis is our dream.
And we were just grinding,preparing for that interview for
weeks.
Meeting with X, you know, YCfounders, people had gone through
the program just getting thatprep and you know, we go into that
meeting super nervous,thinking like all right, we're about
(11:52):
to get torn to shreds becausethat's kind of the reputation that
it has, you know, going, goinginto those interview and we sit down
and the first thing they sayis, so you guys are solving a really
big problem here.
And we're like, wait, what?
Like, usually you have toconvince them or explain, get them
to a point where they realizethis is a big problem, but they saw
(12:14):
it and they, they understood it.
And really the main questionthey had was, all right, this is
a big problem, but it's super gnarly.
How are you going to get started?
There's so many potentialstarting points in procurement, by
industry, by different problemsubset within procurement, etc.
So we go through thatinterview and if, if they accept
(12:37):
you, you'll get a phone call.
If they deny you, you'll getan email after that.
And so we were just nervouslywaiting around, you know, our phone
for the next hour and we gotthe call and we were just over the
moon.
We ended up getting in andthen from there it's a three month
(12:57):
program.
You're partnered up with thespecific investment partner there.
These are people who haveworked with hundreds if not thousands
of startups.
They're really just likethese, these experts, largely experts
in failure because a lot ofmost startups will fail.
And so what their superpowersare, are pointing out potential red
(13:19):
flags, potential traps thatyou might fall into and helping you
get around or jump over thosetraps and avoid them entirely.
During the program.
They bring in tons of notable founders.
The batch started off with thefounders of Airbnb giving a talk
to everyone and then a ton ofother notable founders come in throughout
(13:41):
the course of the batch.
And it all then culminates insomething called Demo Day.
And Demo Day is thisopportunity where 200 startups are
all pitching to an audience ofsomething like thousands of investors.
And there's just this insaneflurry of excitement and intensity
(14:01):
where most companies exitingyc, they're trying to, to fundraise
so they can get the money theyneed to get to that next step in
their journey.
And yc, one of YC superpowers,in addition to their knowledge, is
Demo Day itself.
And just this environment thatit creates where investors are flocking
(14:23):
to you.
Unlike, you know, in ascenario without yc, if you don't
have an extensive networkalready of investors, which most
people don't, often you'retrying to get them to spend time
with you, whereas here they'retrying to get time with you.
So they flip, flipped, theyflipped the table.
So overall, amazing experience.
(14:44):
We're still super close withour partner there, Dalton Caldwell,
who has been invaluable to ourjourney at response, but that was
our experience with yc.
Okay, all right.
And you know, you have thisidea right when you have the aha
moment, you see this bigproblem exists.
And okay, let, let you dropthe other project and let's dive
(15:06):
head first into this.
But what was the process likeof actually tangible, tangibly building
this, this software solution?
We were insanely methodicaland how we approached it, this was
like a very classic engineerapproach for us to take.
So what we did actually beforeeven starting the building process
(15:30):
is we pulled up just a simplebusiness model canvas and we wrote
out all of the assumptions wehad about the business.
And then what we did is we putall of those assumptions in a spreadsheet
and we had two columns.
One column was, you know, howconfident are we about this assumption?
Meaning, like, how much datado we already have to support it?
(15:53):
And the other column is, howrisky is this assumption if we get
it wrong?
So, meaning if we're wrongabout this, is it going to tank the
entire idea and approachentirely, or is it something that
we can just tweak slightly andall as well?
So we kind of, we, we listedthese out, we ranked them, said,
all right, we're going to nowrun interviews.
(16:14):
It was just simpleconversations to start to test our
riskiest hypotheses, the onesthat we knew the least about.
But if we get wrong, had somesort of foundational or fundamental
error that it would cause inour approach to building the company.
And so it started off fromthere, just interviewing people.
(16:35):
And we had no, we had nonetwork in supply chain and logistics
at that point.
This was kind of, you know,after, after yc, when we kind of
ran through this process andwe just had to cold call people,
it was a lot of LinkedIn cold outreach.
And it was a lot of peoplejust out of the kindness of their
(16:58):
hearts, taking the time with us.
And usually they would takethe time because actually they had
this problem and so theywanted to help someone investigate
it and ultimately solve theproblem so that they wouldn't have
to deal with it during thecourse of their.
Their work.
And so once we tested thosehypotheses, it became much clearer
(17:19):
what we needed to build.
And again, we're just tryingto be lean, move really fast.
And so the next stage fromthere was we just built prototypes.
We still didn't build the full thing.
We just wanted to havesomething to show someone because
it would take months to buildit if we needed to build it.
So we didn't want to have towait months to find out that our
(17:42):
first approach was wrong.
And often the first approachis always going to be wrong.
So our philosophy was, let's just.
Now that we've learned allthese fundamental, you know, facts
and about the assumptions thatwe made, let's put this forward in
front of people as a prototype.
And we just ran the process again.
And by the time we did thatfive times, it was like, all right,
(18:05):
it's very clear what we needto build.
And we built it.
And as a result of buildingthis rapport with this initial community,
that in the beginning it wasjust cold outreach.
But consistently we're comingback to them and saying, we've made
this progress or hey, thisthing you suggested, we've actually
implemented it.
We've actually researched itdeeply, because we did that and we
(18:28):
followed through and wefollowed up.
Those people were then showingup for each additional step in the
process.
And by the end of it, thosewere our earliest customers and users
of the product.
These were operators again, inthree PLs, different e commerce companies,
etc.
Who they saw, they spoke withus before we even had anything.
(18:50):
And then they ended up beingthe first people to ever place orders
on.
On response.
Wow.
Okay.
So you go through thatprocess, you take your time, a lot
of interviews, lot oftweaking, right?
And you find, like you said,you finally get it right and you,
you launch.
And like you said, the peoplethat gave you the feedback are, are
(19:11):
your early customers.
So you're, you're at thatpoint and now you're, you go to market
and then what happens next?
Yeah, so it definitely wasn't,it still wasn't.
Sunshine and roses.
Right, and off to the races.
So we had this group of peopleusing the product and there was kind
of two different camps thatwere emerging of what people wanted
(19:32):
out of us.
And again, we're slowly,gradually learning the nuances of
supply chain and logistics.
We were new to the industry,we knew a lot about procurement at
this point, but that was justkind of.
It was across so manydifferent industries.
And so these different campskind of emerge.
And the first one was what wecalled effectively the price shoppers.
(19:54):
And the idea that people hadinitially our first jab at response,
even after all this testing,this seemed like it was the right
move.
And so we built a.
We built a product thatallowed people to search across the
market.
The idea was pretty basic.
It's like Google flights orkayak all right, I'm looking for
this supply.
Show me this supply and allthe similar products across 100 vendors
(20:18):
so I can quickly get the best price.
And so we end up building that.
It takes some time to build aproduct of that scale with something
like 20 to 30 million products.
And there's just an insanelift to build something like that
to deliver that experience.
And people were using it, butit just wasn't, it wasn't taking
(20:39):
off in the way that we, weneeded it to be taking off.
And when we looked at the dataand we looked at who's sticking around
and who isn't, there was areally clear split.
We were like, oh my God, howdid we miss this?
And the people who weren'tstaying around were often these kind
(20:59):
of single location, smb3pls,retailers, etc.
They were the price shoppers, right?
But, but by nature of beingprice shoppers, they were not necessarily,
they were not necessarilyloyal, right, because they're always
looking for the best price.
So unless we could guaranteethat the best price was on response,
(21:20):
which was a tall order for astartup to be doing, then they were
hopping on to some other tool.
And for most people, theydon't want to have to think about
it, they just want an easybutton for this stuff.
So those people weren'tsticking around.
But when we looked at who wassticking around, it was all of these
mid market organizations,larger organizations, where maybe
(21:42):
they have six facilities or adozen facilities, et cetera, and
they were using us in this waythat we just, it was right under
our nose.
We didn't realize what valuethey were getting out of us.
And we had built this littlefeature called lists just to help
people stay organized.
In response, the basic ideawas, all right, if I'm buying corrugate,
(22:04):
here's my list for all myboxes and here's my list for my janitorial
supplies, et cetera.
But instead of building listsin the way that we'd envision, what
these customers were doing wasthey were doing things like Atlanta
operations team, Columbusoperations team, New York, you know,
(22:25):
office team.
And we asked them, we're like,okay, why, what are you using this
for?
They're like, oh, you know,before response, our team was just
going out and buying whateverthey wanted, right?
Either overspending or buyingproducts that they shouldn't be.
Maybe we negotiated with onevendor like staples for paper, but
then they're going out toOffice Depot and paying twice as
(22:49):
much.
And so we want to just put theproducts that they're allowed to
buy in one place.
So all they have to do is login and click, click, click.
Here's their personal store ofwhat they're allowed to buy.
They check out, it's done, andall that spend is controlled.
But the individual operatorfeels like they have the freedom
to quickly go in, select whatthey want and get on with their lives.
(23:11):
We're like, whoa, like, howdid we totally miss this?
And so what we did from therewas we said, all right, it's, it's,
we're going to double down onthis, we're going to double down
on being this command centerfor operational spend.
Indirect spend takes a bunchof different shapes and forms, but
really it's just everythingfrom packaging to janitorial supplies
(23:33):
to office supplies, equipment,everything you need to buy the physical,
physical goods you need to buyto run your operation.
They just wanted a controlcenter for that.
They wanted a command centerso that they had visibility.
Because before that theydidn't know how much.
They didn't know what theirteam was buying.
Maybe they would know, allright, we spent 5 million on consumables,
(23:57):
but what are all of thosesubcategories of consumables?
And not only that, purchaseswere happening and after the fact,
they were saying to people,why did you make this order?
And they were slapping peopleon the wrist so they didn't have
any way to proactively preventthat rogue spend from happening.
And so we doubled down and wemade it incredibly easy where people
(24:19):
can just link their accountsdirectly to response.
They can get up and running inless than a day if they really want
to.
Once their products are inresponse, they can put controls in
place so they can say, allright, you know, operations team
in this location has access tothese products.
And then on top of that, wegive them the tools to analyze and
(24:40):
optimize that spend.
So looking at their spendoverall, seeing, okay, where is their
opportunity for consolidation?
Are there any interestingtrends in what we're buying?
Why, why is Columbus spending50% more this month than last month?
These are kind of things thatthey seem so simple.
But before response, mostbusinesses do not have the ability
(25:05):
to quickly get access to thosekind of, those kind of answers to
those questions.
Yeah, I mean, it seems like ano brainer in terms of you'd want
to have that in place.
But of course, like there'snot been a solution.
What, what was the processlike when you had that other, that
insight to, okay, now we wantto have, you know, the teams, you
(25:26):
know, be separate by facilityand be able to make all these other
updates, how much work was.
Was it in terms of putting allthat in place?
The funny thing was, versusbuilding the marketplace, it was
actually way simpler.
Like, building the marketplacewas this crazy technical challenge,
because 30 million productsand you have to come up with a way
(25:48):
to determine which productsare similar.
Like one vendor might callsomething cardboard boxes and other
might call it cartons.
And we have to build the datascience infrastructure to figure
out, you know, which productsare apples to apples.
And that's.
That's not an easy challengeat all.
And then it had to be a reallysimple user experience.
(26:10):
Whereas this world that we'rein now because we built all those
integrations, it actually setus up for success.
And that it was.
It was much simpler becausethis was just effectively building
lists of products and thenjust having guardrails in the product
to make sure that based onsomeone's level of seniority, they
(26:31):
can't do certain things thatthey're not allowed to do.
So from a developmentstandpoint, was actually way more
straightforward to build theproduct that we have today.
But we were able to movequickly because we'd built that solid
foundation of all of thoseintegrations, all of the messy data
cleanup that we had to do.
(26:53):
So that ultimately allowed usto build something pretty unique
compared to some of the othersolutions that are out there.
Okay, all right, so then yousettle on, that's where the product
is now, and then thereafter,you had a.
Another capital raise, is that right?
Exactly.
(27:14):
Yeah.
So we reached a point where,all right, people are now using Response
as this control center for alltheir spend.
We're now repeatedly closing customers.
You know, we've gone fromcustomers that have one location
to customers that have dozensof locations, public companies, you
(27:35):
know, using Response.
So we felt like, all right,we've raised this money.
Now is the opportunity toannounce it to the world.
And so at the start ofFebruary of 2025, we did a launch
on February 6th.
And it was this incrediblemoment for us where all the vanity
(27:56):
metrics were there.
The launch itself got a ton oftraction, a ton of engagement.
We launched these incrediblevests and sent them out to influencers
across the space who wereposting about Response.
So it was hundreds andhundreds of thousands of views and
engagements with the launch itself.
But really, I would say themost fascinating thing that came
(28:20):
out of the launch was reallywho was signing up.
And traditionally at Response,we'd targeted operations people.
Those were the people we builtthe early connections with that we
ended up building out thisnetwork with.
But what we found was afterthe launch, all of the people who
(28:41):
were signing up inbound wereall in finance.
And one of the mostinteresting things that happened
before our launch was we werebuilding out case studies so we can
put them up on our site toprove the ROI of response.
And I was meeting with thedirector of operations at Nimble
Fulfillment, there are threepl and in Salt Lake City, Utah.
And he said something reallyinteresting to me, which is he said,
(29:04):
yeah, the time savings foroperations team has been incredible.
You know, you're saving themhours and hours of time every week.
But really the people who weremost excited by response, who have
had the most value out ofresponse, are our finance team.
And at the end of the month,because before response, people were
(29:26):
buying whatever they wanted.
Invoices were flying left and right.
At the end of the month.
It was this like this hunt forthem there.
It was a wild goose chasewhere they're just trying to figure
out, where is this invoice?
Why did you buy this?
Multiplied across a dozenvendors, multiply, multiplied across
a dozen buyers, multipliedacross dozens and dozens of orders
(29:48):
that had to be placed to buywhat they needed.
So when OPS wasn't followingthe best practices, it was just creating
this mountain of work for themat the end of the month to reconcile
that spend so they can closeout the books for the month.
And he said, you took aprocess that took them two days of
work and turn it into just 30 minutes.
(30:09):
I was like, oh my God, that's crazy.
How did we completely missthat here?
And lo and behold, when we didthe launch, guess who was signing
up for response?
It was all finance people.
And so it's been super exciting.
You know, the pitch is, isreally landing like one after another.
(30:29):
Now when we're pitchingfinance people, they just get it
because they're living in this problem.
It is this hair on fireproblem for them.
For ops, there's definitelyinefficiency there, right?
They don't want to deal with it.
They don't want procurement tobe one of their responsibilities.
And so there's an opportunityfor us to step in and provide them
(30:49):
this really easy experience tojust go in and out, buy what they
need.
But really the ultimatebenefit of response are the downstream
effects.
It's spend being coded correctly.
It's invoices, bills of ladingor delivery receipts, purchase orders
all being in one place.
It's all that spend beingunder one hood.
(31:10):
So that at the end of themonth when finance goes to see, are
we on budget?
You know, do we have all theinvoices we need, were things delivered?
Is it coded correctly?
That's just being done as theygo throughout the month.
So all of that work is justgetting automated away for them.
Okay.
All right.
And Kayvon, if people want tofind out more about response and
(31:33):
how they can potentially signup, what's the best way that people
can reach out to you?
Yeah, there's a few ways.
One of the best ways is tovisit our website.
That's www.try respons.com t ry response spelled normally.com.
they can also reach out to meon LinkedIn.
Kayvon Shahida.
(31:54):
That's K E I V A N S H A H I DA K V on Shahida on.
On LinkedIn.
They can feel free to.
To shoot me a DM and I'd behappy to.
To respond to them there.
Okay.
And we'll link all that in the show.
Notes for everyone.
That's great.
Well, Kayvon, thank you somuch for joining the show today,
(32:15):
sharing all this wisdom fromyour journey and certainly some great
lessons for entrepreneurs.
And best of luck with whatyou're building and where you're
headed next.
Awesome.
Thank you so much, Dave.
All right, and that's all thetime we have for now.
We will see you next time.
Today we sit down with KayvonShahida, a dynamic entrepreneur who
is tackling a critical, yetoften overlooked aspect of business
operations.
Kevan is the co founder andCEO of Response.
His entrepreneurial journeybegan during his computer science
studies at Cornell, leadinghim and his co founder into the procurement
(00:24):
industry.
We'll explore the story behindResponse, a platform that's revolutionizing
space control for retailersand 3 PLs.
Kayvon shares a fascinatingjourney of how Response came to be
from its initial conception tonavigating the complexities of the
COVID 19 pandemic andultimately finding its niche in simplifying
(00:48):
and centralizing purchasing activities.
We'll explore how Responseempowers businesses to streamline
their operations, gain realtime visibility over their spending,
and ultimately transform daysof tedious work into mere minutes.
Kavan also shares his insightsfrom Y Combinator and the key lessons
(01:08):
learned while growing Response.
Get ready for an inspiringstory of resilience and innovation
as we learn how Kayvon and histeam are improving procurement.
As always, if you found valuefrom this content, please like and
subscribe.
Hello everyone and welcome toanother episode of the Beyond Fulfillment
(01:29):
Podcast.
I'm.
I'm your host Dave Gulas, andthis week my guest is the CEO and
co founder of Response, Kayvon Chahida.
Welcome Kevon.
Thank you for having me.
Absolutely.
We appreciate you taking thetime to be here.
So Kevon, Response, tell uswhat that company is.
(01:51):
Yeah, definitely.
So Response is a company I cofounded with a longtime friend and
business partner of mine,Kaiser Bayerjean.
We met when we were studyingengineering at Cornell.
And the basic idea behindResponse is we've aggregated all
of the top industrial businessand packaging vendors in the US into
(02:14):
a single platform.
And on top of thoseintegrations, we built a platform
for controlling spend.
So if you're a mid sized 3 PLor retailer were a way for you to
ultimately control exactlywhat your team can buy.
Typically our customers,before Response, they're giving out
credit cards to people.
(02:34):
They're letting people issuepos left, right and center.
It's just the wild west of procurement.
And the idea behind Responseis we help them centralize all that
spend so they have visibilityinto exactly what their team is buying
in real time.
And then we give them controlso they can control the exact SKUs
and the exact amounts and theexact vendors that their team can
(02:55):
buy.
Okay, yeah, so a lot to unpackthere with Response and what it's
doing and certainly some bignews that you've made recently.
But let's just go back to thebeginning so you're studying.
I think it's computer scienceat Cornell.
Yep.
And so what.
What was like, how did thisidea to start this company come about?
(03:18):
It was.
It was almost a complete accident.
I know it's crazy to say, butwe were working on something entirely
different.
And in the process of doingresearch for that idea, we had to
start talking to people inprocurement, people in operations,
and they started to explain tous some of the challenges that they
were having in purchasing andB2B purchasing.
(03:40):
And our minds were just blown.
We were like, oh, my God, how.
How is it that people areusing these tools from decades ago?
It's so manual, it's so slow,it's so inefficient.
There has to be a better way to.
To do this.
And the opportunity was justso massive that we effectively just
(04:01):
dropped what we were workingon before, because we realized, wait,
this is a way bigger, waygnarlier challenge for us to go after.
And so after that point, weactually spent the first couple of
years really just researching,not even building anything.
We wanted to make sure that wereally deeply understood the challenges
(04:23):
that people in procurement or,you know, operations, people who
maybe have procurement as oneof their many responsibilities, we
wanted to understand the rootof those challenges.
And so we interviewed hundredsand hundreds and hundreds of teams
before building anything.
And eventually what ended uphappening is we got into yc and YC
(04:46):
was an incredible, incredibleopportunity for us.
Y Combinator, they're one ofthe top startup accelerators in the
world.
They were the first investorsin companies like Airbnb, Stripe,
Dropbox, Doordash, Flexport,you name it.
They're the big dogs in town.
And so we get into YC andCovid Hits, and when we entered yc,
(05:10):
we're building this enterprisesoftware for procurement teams, helping
them automate these supercomplex, complex workflows.
RFPs, RFQs, tender offers, youname it.
But Covid hit, and all thecontracts that we had effectively
just, poof, vanished.
And we had to figure out, whatare we going to do?
(05:32):
Like, we just got into yc.
This is our opportunity.
This was going to be themoment where we shine and we go into
YC and it just takes off.
And instead we have to.
We have to really rebuild andrethink our approach.
And at the time, this is oneof the craziest parts of our journey
at the time, you know, we werehearing constantly about healthcare
(05:55):
workers needing to source PPE,so gloves, masks, sanitation products,
etc.
It was such a challenge forthem to source what was at the time,
life saving equipment and supplies.
And we said, wait, we havethis platform for letting people
source things globally in anefficient way.
(06:15):
What if we just worked withhealthcare teams and helped them
source ppe?
And so during the course of ycwe were just in this wild west of
healthcare, but we really madea big mistake there because unlike
when we'd spent yearsinterviewing procurement teams and
ops people, we knew nothingabout healthcare workers and their
(06:38):
day to day challenges.
And so the mistake we madethere was we effectively slapped
our solution onto a group ofpeople in a problem that we didn't
know much as much about.
And yes, they were having aproblem sourcing ppe, but it was
very much a one and doneproblem once they got it.
(06:58):
And of course once Covid dieddown, it was no longer a problem.
But that's when we got lucky.
And that's actually where thejourney of response as it exists
today started.
So towards the end of thepandemic, we weren't just helping
healthcare workers source PPEat the time, other businesses were
(07:20):
coming back online in personand they still needed to source these
kind of supplies.
And so we started helping afew warehouse teams.
And one day this VP ofoperations comes to us and she said,
you know, you guys are helpingus with all this ppe, but we have
to buy all of this other stuffto run the operation and I don't
(07:42):
want to deal with it, but Iknow we're overspending, I know we're
not doing things efficiently.
Can you guys just take thisoff our plate?
And so we're like, oh, that'svery interesting.
But we, we reflected on allthe mistakes and all the learnings
of the previous years and wesaid, all right, we're going to do
this.
We need to make sure we reallyunderstand the space and spend a
(08:04):
lot of time with people inperson, understanding the day to
day lives of these operatorsto figure out if the problem is really
a big one and if it is a bigone, how to start addressing it in
the most effective way.
And so we dug in again andjust started meeting with operations
teams, started working withwarehouse teams, and that ended up
(08:28):
being the basis of all theresearch and foundation of response
as it exists today, where nowwe're helping 3pls, we're helping
retailers who have their ownphysical stores and fulfillment centers,
we're helping distributors,you name it.
But yeah, that is kind of thehigh level, high level story of response.
(08:53):
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Okay, so a lot to unpack thereas well.
So you, you originally had.
This is originally anenterprise solution.
You get into Y and just for,for people, in case everyone doesn't
(09:58):
understand what's the processlike to even get into Y Combinator?
Oh, it's absolutely insane.
So we, we actually applied twice.
The first time we applied wedidn't get in.
And at the time I think itwas, and it's probably similar numbers
now, it's something like20,000 companies apply for each batch.
(10:19):
And at the time I believe theywere taking something like just under
200 companies.
So incredibly competitive process.
After the application step, ifyou make it to the next step, there's
an interview.
That interview is also thiskind of legendary thing in the story
of many, many startups out there.
(10:42):
And the interview is uniquebecause at the time what they would
do is they would fly you toMountain View here in California
in the South Bay and you havesomething like 13 minutes with them.
It's like a, it's a bizarrenumber, it's super short, but for
them it's really efficient.
And you go into that processand it's like, you know, you're expecting
(11:06):
them and you're preparing forthem to just grill you something
like 50 questions, right?
They're just gonna ask yourapid fire to figure out whether
it's a company they want toinvest in or not.
And then within the same daythey will give you a decision.
And you know, we werepreparing like crazy because again,
it was the second time that weapplied, we ended up finding out
(11:29):
that they want to fly us out.
We're just over the moon, likethis is our dream.
And we were just grinding,preparing for that interview for
weeks.
Meeting with X, you know, YCfounders, people had gone through
the program just getting thatprep and you know, we go into that
meeting super nervous,thinking like all right, we're about
(11:52):
to get torn to shreds becausethat's kind of the reputation that
it has, you know, going, goinginto those interview and we sit down
and the first thing they sayis, so you guys are solving a really
big problem here.
And we're like, wait, what?
Like, usually you have toconvince them or explain, get them
to a point where they realizethis is a big problem, but they saw
(12:14):
it and they, they understood it.
And really the main questionthey had was, all right, this is
a big problem, but it's super gnarly.
How are you going to get started?
There's so many potentialstarting points in procurement, by
industry, by different problemsubset within procurement, etc.
So we go through thatinterview and if, if they accept
(12:37):
you, you'll get a phone call.
If they deny you, you'll getan email after that.
And so we were just nervouslywaiting around, you know, our phone
for the next hour and we gotthe call and we were just over the
moon.
We ended up getting in andthen from there it's a three month
(12:57):
program.
You're partnered up with thespecific investment partner there.
These are people who haveworked with hundreds if not thousands
of startups.
They're really just likethese, these experts, largely experts
in failure because a lot ofmost startups will fail.
And so what their superpowersare, are pointing out potential red
(13:19):
flags, potential traps thatyou might fall into and helping you
get around or jump over thosetraps and avoid them entirely.
During the program.
They bring in tons of notable founders.
The batch started off with thefounders of Airbnb giving a talk
to everyone and then a ton ofother notable founders come in throughout
(13:41):
the course of the batch.
And it all then culminates insomething called Demo Day.
And Demo Day is thisopportunity where 200 startups are
all pitching to an audience ofsomething like thousands of investors.
And there's just this insaneflurry of excitement and intensity
(14:01):
where most companies exitingyc, they're trying to, to fundraise
so they can get the money theyneed to get to that next step in
their journey.
And yc, one of YC superpowers,in addition to their knowledge, is
Demo Day itself.
And just this environment thatit creates where investors are flocking
(14:23):
to you.
Unlike, you know, in ascenario without yc, if you don't
have an extensive networkalready of investors, which most
people don't, often you'retrying to get them to spend time
with you, whereas here they'retrying to get time with you.
So they flip, flipped, theyflipped the table.
So overall, amazing experience.
(14:44):
We're still super close withour partner there, Dalton Caldwell,
who has been invaluable to ourjourney at response, but that was
our experience with yc.
Okay, all right.
And you know, you have thisidea right when you have the aha
moment, you see this bigproblem exists.
And okay, let, let you dropthe other project and let's dive
(15:06):
head first into this.
But what was the process likeof actually tangible, tangibly building
this, this software solution?
We were insanely methodicaland how we approached it, this was
like a very classic engineerapproach for us to take.
So what we did actually beforeeven starting the building process
(15:30):
is we pulled up just a simplebusiness model canvas and we wrote
out all of the assumptions wehad about the business.
And then what we did is we putall of those assumptions in a spreadsheet
and we had two columns.
One column was, you know, howconfident are we about this assumption?
Meaning, like, how much datado we already have to support it?
(15:53):
And the other column is, howrisky is this assumption if we get
it wrong?
So, meaning if we're wrongabout this, is it going to tank the
entire idea and approachentirely, or is it something that
we can just tweak slightly andall as well?
So we kind of, we, we listedthese out, we ranked them, said,
all right, we're going to nowrun interviews.
(16:14):
It was just simpleconversations to start to test our
riskiest hypotheses, the onesthat we knew the least about.
But if we get wrong, had somesort of foundational or fundamental
error that it would cause inour approach to building the company.
And so it started off fromthere, just interviewing people.
(16:35):
And we had no, we had nonetwork in supply chain and logistics
at that point.
This was kind of, you know,after, after yc, when we kind of
ran through this process andwe just had to cold call people,
it was a lot of LinkedIn cold outreach.
And it was a lot of peoplejust out of the kindness of their
(16:58):
hearts, taking the time with us.
And usually they would takethe time because actually they had
this problem and so theywanted to help someone investigate
it and ultimately solve theproblem so that they wouldn't have
to deal with it during thecourse of their.
Their work.
And so once we tested thosehypotheses, it became much clearer
(17:19):
what we needed to build.
And again, we're just tryingto be lean, move really fast.
And so the next stage fromthere was we just built prototypes.
We still didn't build the full thing.
We just wanted to havesomething to show someone because
it would take months to buildit if we needed to build it.
So we didn't want to have towait months to find out that our
(17:42):
first approach was wrong.
And often the first approachis always going to be wrong.
So our philosophy was, let's just.
Now that we've learned allthese fundamental, you know, facts
and about the assumptions thatwe made, let's put this forward in
front of people as a prototype.
And we just ran the process again.
And by the time we did thatfive times, it was like, all right,
(18:05):
it's very clear what we needto build.
And we built it.
And as a result of buildingthis rapport with this initial community,
that in the beginning it wasjust cold outreach.
But consistently we're comingback to them and saying, we've made
this progress or hey, thisthing you suggested, we've actually
implemented it.
We've actually researched itdeeply, because we did that and we
(18:28):
followed through and wefollowed up.
Those people were then showingup for each additional step in the
process.
And by the end of it, thosewere our earliest customers and users
of the product.
These were operators again, inthree PLs, different e commerce companies,
etc.
Who they saw, they spoke withus before we even had anything.
(18:50):
And then they ended up beingthe first people to ever place orders
on.
On response.
Wow.
Okay.
So you go through thatprocess, you take your time, a lot
of interviews, lot oftweaking, right?
And you find, like you said,you finally get it right and you,
you launch.
And like you said, the peoplethat gave you the feedback are, are
(19:11):
your early customers.
So you're, you're at thatpoint and now you're, you go to market
and then what happens next?
Yeah, so it definitely wasn't,it still wasn't.
Sunshine and roses.
Right, and off to the races.
So we had this group of peopleusing the product and there was kind
of two different camps thatwere emerging of what people wanted
(19:32):
out of us.
And again, we're slowly,gradually learning the nuances of
supply chain and logistics.
We were new to the industry,we knew a lot about procurement at
this point, but that was justkind of.
It was across so manydifferent industries.
And so these different campskind of emerge.
And the first one was what wecalled effectively the price shoppers.
(19:54):
And the idea that people hadinitially our first jab at response,
even after all this testing,this seemed like it was the right
move.
And so we built a.
We built a product thatallowed people to search across the
market.
The idea was pretty basic.
It's like Google flights orkayak all right, I'm looking for
this supply.
Show me this supply and allthe similar products across 100 vendors
(20:18):
so I can quickly get the best price.
And so we end up building that.
It takes some time to build aproduct of that scale with something
like 20 to 30 million products.
And there's just an insanelift to build something like that
to deliver that experience.
And people were using it, butit just wasn't, it wasn't taking
(20:39):
off in the way that we, weneeded it to be taking off.
And when we looked at the dataand we looked at who's sticking around
and who isn't, there was areally clear split.
We were like, oh my God, howdid we miss this?
And the people who weren'tstaying around were often these kind
(20:59):
of single location, smb3pls,retailers, etc.
They were the price shoppers, right?
But, but by nature of beingprice shoppers, they were not necessarily,
they were not necessarilyloyal, right, because they're always
looking for the best price.
So unless we could guaranteethat the best price was on response,
(21:20):
which was a tall order for astartup to be doing, then they were
hopping on to some other tool.
And for most people, theydon't want to have to think about
it, they just want an easybutton for this stuff.
So those people weren'tsticking around.
But when we looked at who wassticking around, it was all of these
mid market organizations,larger organizations, where maybe
(21:42):
they have six facilities or adozen facilities, et cetera, and
they were using us in this waythat we just, it was right under
our nose.
We didn't realize what valuethey were getting out of us.
And we had built this littlefeature called lists just to help
people stay organized.
In response, the basic ideawas, all right, if I'm buying corrugate,
(22:04):
here's my list for all myboxes and here's my list for my janitorial
supplies, et cetera.
But instead of building listsin the way that we'd envision, what
these customers were doing wasthey were doing things like Atlanta
operations team, Columbusoperations team, New York, you know,
(22:25):
office team.
And we asked them, we're like,okay, why, what are you using this
for?
They're like, oh, you know,before response, our team was just
going out and buying whateverthey wanted, right?
Either overspending or buyingproducts that they shouldn't be.
Maybe we negotiated with onevendor like staples for paper, but
then they're going out toOffice Depot and paying twice as
(22:49):
much.
And so we want to just put theproducts that they're allowed to
buy in one place.
So all they have to do is login and click, click, click.
Here's their personal store ofwhat they're allowed to buy.
They check out, it's done, andall that spend is controlled.
But the individual operatorfeels like they have the freedom
to quickly go in, select whatthey want and get on with their lives.
(23:11):
We're like, whoa, like, howdid we totally miss this?
And so what we did from therewas we said, all right, it's, it's,
we're going to double down onthis, we're going to double down
on being this command centerfor operational spend.
Indirect spend takes a bunchof different shapes and forms, but
really it's just everythingfrom packaging to janitorial supplies
(23:33):
to office supplies, equipment,everything you need to buy the physical,
physical goods you need to buyto run your operation.
They just wanted a controlcenter for that.
They wanted a command centerso that they had visibility.
Because before that theydidn't know how much.
They didn't know what theirteam was buying.
Maybe they would know, allright, we spent 5 million on consumables,
(23:57):
but what are all of thosesubcategories of consumables?
And not only that, purchaseswere happening and after the fact,
they were saying to people,why did you make this order?
And they were slapping peopleon the wrist so they didn't have
any way to proactively preventthat rogue spend from happening.
And so we doubled down and wemade it incredibly easy where people
(24:19):
can just link their accountsdirectly to response.
They can get up and running inless than a day if they really want
to.
Once their products are inresponse, they can put controls in
place so they can say, allright, you know, operations team
in this location has access tothese products.
And then on top of that, wegive them the tools to analyze and
(24:40):
optimize that spend.
So looking at their spendoverall, seeing, okay, where is their
opportunity for consolidation?
Are there any interestingtrends in what we're buying?
Why, why is Columbus spending50% more this month than last month?
These are kind of things thatthey seem so simple.
But before response, mostbusinesses do not have the ability
(25:05):
to quickly get access to thosekind of, those kind of answers to
those questions.
Yeah, I mean, it seems like ano brainer in terms of you'd want
to have that in place.
But of course, like there'snot been a solution.
What, what was the processlike when you had that other, that
insight to, okay, now we wantto have, you know, the teams, you
(25:26):
know, be separate by facilityand be able to make all these other
updates, how much work was.
Was it in terms of putting allthat in place?
The funny thing was, versusbuilding the marketplace, it was
actually way simpler.
Like, building the marketplacewas this crazy technical challenge,
because 30 million productsand you have to come up with a way
(25:48):
to determine which productsare similar.
Like one vendor might callsomething cardboard boxes and other
might call it cartons.
And we have to build the datascience infrastructure to figure
out, you know, which productsare apples to apples.
And that's.
That's not an easy challengeat all.
And then it had to be a reallysimple user experience.
(26:10):
Whereas this world that we'rein now because we built all those
integrations, it actually setus up for success.
And that it was.
It was much simpler becausethis was just effectively building
lists of products and thenjust having guardrails in the product
to make sure that based onsomeone's level of seniority, they
(26:31):
can't do certain things thatthey're not allowed to do.
So from a developmentstandpoint, was actually way more
straightforward to build theproduct that we have today.
But we were able to movequickly because we'd built that solid
foundation of all of thoseintegrations, all of the messy data
cleanup that we had to do.
(26:53):
So that ultimately allowed usto build something pretty unique
compared to some of the othersolutions that are out there.
Okay, all right, so then yousettle on, that's where the product
is now, and then thereafter,you had a.
Another capital raise, is that right?
Exactly.
(27:14):
Yeah.
So we reached a point where,all right, people are now using Response
as this control center for alltheir spend.
We're now repeatedly closing customers.
You know, we've gone fromcustomers that have one location
to customers that have dozensof locations, public companies, you
(27:35):
know, using Response.
So we felt like, all right,we've raised this money.
Now is the opportunity toannounce it to the world.
And so at the start ofFebruary of 2025, we did a launch
on February 6th.
And it was this incrediblemoment for us where all the vanity
(27:56):
metrics were there.
The launch itself got a ton oftraction, a ton of engagement.
We launched these incrediblevests and sent them out to influencers
across the space who wereposting about Response.
So it was hundreds andhundreds of thousands of views and
engagements with the launch itself.
But really, I would say themost fascinating thing that came
(28:20):
out of the launch was reallywho was signing up.
And traditionally at Response,we'd targeted operations people.
Those were the people we builtthe early connections with that we
ended up building out thisnetwork with.
But what we found was afterthe launch, all of the people who
(28:41):
were signing up inbound wereall in finance.
And one of the mostinteresting things that happened
before our launch was we werebuilding out case studies so we can
put them up on our site toprove the ROI of response.
And I was meeting with thedirector of operations at Nimble
Fulfillment, there are threepl and in Salt Lake City, Utah.
And he said something reallyinteresting to me, which is he said,
(29:04):
yeah, the time savings foroperations team has been incredible.
You know, you're saving themhours and hours of time every week.
But really the people who weremost excited by response, who have
had the most value out ofresponse, are our finance team.
And at the end of the month,because before response, people were
(29:26):
buying whatever they wanted.
Invoices were flying left and right.
At the end of the month.
It was this like this hunt forthem there.
It was a wild goose chasewhere they're just trying to figure
out, where is this invoice?
Why did you buy this?
Multiplied across a dozenvendors, multiply, multiplied across
a dozen buyers, multipliedacross dozens and dozens of orders
(29:48):
that had to be placed to buywhat they needed.
So when OPS wasn't followingthe best practices, it was just creating
this mountain of work for themat the end of the month to reconcile
that spend so they can closeout the books for the month.
And he said, you took aprocess that took them two days of
work and turn it into just 30 minutes.
(30:09):
I was like, oh my God, that's crazy.
How did we completely missthat here?
And lo and behold, when we didthe launch, guess who was signing
up for response?
It was all finance people.
And so it's been super exciting.
You know, the pitch is, isreally landing like one after another.
(30:29):
Now when we're pitchingfinance people, they just get it
because they're living in this problem.
It is this hair on fireproblem for them.
For ops, there's definitelyinefficiency there, right?
They don't want to deal with it.
They don't want procurement tobe one of their responsibilities.
And so there's an opportunityfor us to step in and provide them
(30:49):
this really easy experience tojust go in and out, buy what they
need.
But really the ultimatebenefit of response are the downstream
effects.
It's spend being coded correctly.
It's invoices, bills of ladingor delivery receipts, purchase orders
all being in one place.
It's all that spend beingunder one hood.
(31:10):
So that at the end of themonth when finance goes to see, are
we on budget?
You know, do we have all theinvoices we need, were things delivered?
Is it coded correctly?
That's just being done as theygo throughout the month.
So all of that work is justgetting automated away for them.
Okay.
All right.
And Kayvon, if people want tofind out more about response and
(31:33):
how they can potentially signup, what's the best way that people
can reach out to you?
Yeah, there's a few ways.
One of the best ways is tovisit our website.
That's www.try respons.com t ry response spelled normally.com.
they can also reach out to meon LinkedIn.
Kayvon Shahida.
(31:54):
That's K E I V A N S H A H I DA K V on Shahida on.
On LinkedIn.
They can feel free to.
To shoot me a DM and I'd behappy to.
To respond to them there.
Okay.
And we'll link all that in the show.
Notes for everyone.
That's great.
Well, Kayvon, thank you somuch for joining the show today,
(32:15):
sharing all this wisdom fromyour journey and certainly some great
lessons for entrepreneurs.
And best of luck with whatyou're building and where you're
headed next.
Awesome.
Thank you so much, Dave.
All right, and that's all thetime we have for now.
We will see you next time.
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