A group of BYU students working on identifying a business idea decided to survey families to try to isolate their main pain points.
What they discovered, which will come as no surprise to any parent, is that one of the main challenges was the time spent transporting children to school, lessons, sports practices and other miscellaneous activities.
Quickly recognizing the enormous legal hurdles and daunting liability issues that would accompany any effort to market a kiddie taxi service, budding entrepreneurs were led to a different, yet close idea.
What about a company that could take care of all the non-kids running around and free up families in a way that made parenting less stressful?
It turns out the answer was in the question, and in January 2022, Errand was born.
Claire Larsen, co-owner of Errand, poses in American Fork on Tuesday, Dec. 20, 2022. She and her husband launched the startup aiming to become the DoorDash/Grubhub of running.
Jeffrey D. Allred, Deseret News
The start of the race
Errand co-founder Claire Larsen said the company started with pretty rudimentary technology, just a website where you could request a ride, identify pickup and drop-off locations and when you had them. need. The rest of the process was mostly manual and performed in a small service area.
The approach was part of a very intentional plan to reverse the more typical fundraising tech startup process onto an idea that would then be tested for practicality. The way forward, Larsen said, allowed him and his fellow co-founders to approach potential investors with a proven concept instead of an unverified business plan.
“We knew we would need funding to create an app, but we recognized that we were a bunch of students with no experience and no business experience,” Larsen said. “We ended up doing over 3,000 errands for people, using guerrilla marketing tactics and only spending our own money.”
The go-get-em idea and attitude proved to be a hit with a group of investors who participated in a pre-seed round of venture capital funding for the company that closed its operations. doors in October and raised nearly $700,000.
Just two months later, in early December, Errand launched its smartphone app. Now the business is up and running, operating along the Wasatch front with plans to grow statewide and, soon, into neighboring states.
Larsen said Errand is finding success on both sides of its business model, attracting customers who need a simple, affordable way to cross-reference items on their to-do lists and drivers of the gig economy that s are signing up, in droves, to make these races happen.
“When the app went live, we just wanted to move current customers,” Larsen said. “But in the first week we tripled our goal and around 6,000 drivers signed up.”
This rapid response on the driving side of the equation has likely been helped by a gig economy that has seen a resurgence in recent years, with an increase in those working on flexible, short-term contracts.
In a recent report, Fortune noted that the number of gig workers in the United States has risen from 55 million in 2020 to a record 60 million today, according to recent research by independent recruitment site Upwork. According to the study, nearly 40% of the U.S. workforce performed contract work in the past year, adding about $1.35 trillion to the economy.
On the customer side of Errand’s business model, a growing number of consumers are finding new convenience with app-based services, thanks to the proliferation of companies like GrubHub, DoorDash, TaskRabbit, and even ride-sharing services Uber and Lyft.
Many ideas fail. Few find success
Corbin Church, an adjunct professor at BYU’s Rollins Center for Entrepreneurship and Technology, acted as a consultant and supporter of Errand’s founders and noted that the company’s business model and launch timeline hits all the marks.
Church said he interacted with many budding entrepreneurs, teaching some 350 students each semester, and saw a lot of business ideas. But, he noted, the people behind the concepts are the most critical factor.
“I work with a lot of kids who start a lot of big businesses,” Church said. “A lot of ideas fail and a few succeed. It turns out that what’s more important than the idea is the founder behind it.
“Once in a while, these great vision founders are paired with the right opportunity, and I think Errand has found that magic.”
Church said Errand was aiming for a unique niche in the gig economy, staying out of the niche spaces occupied by companies like DoorDash or GrubHub, and instead taking a holistic approach.
“Errand comes at it with a broad approach and an idea that really boils down to making people more productive,” Church said. “It’s just the right kind of generic that delivers the same service and value whether the customer is a busy parent or a busy manager in a work environment.”
Church likes all the potential verticals for Errand, noting that he can see the service being useful for a wide range of individual and professional needs.
“Let’s say you’re in the construction industry and you’re running out of important building materials on the job site,” Church said. “A company could send someone to Home Depot and pay them their hourly rate for a run that will probably take at least an hour. Or, they can order something from the Home Depot website, designate curbside pickup, then send an Errand driver who can do it for less than $10. It’s smart and economical.
Larsen said Errand’s internal economics also made sense and the company had been profitable from the start.
How it works?
Customers pay a flat $7.99 fee for pickup and drop-off within six miles, a distance according to Larsen determined during their early operations, where 90% of their trips were within that mileage.
Need to go a little further? Errand charges an additional 85 cents per mile outside of their base range. On the driver’s side, riders are paid for both mileage and time and, according to Larsen, can earn an average of $25 to $30 an hour. Additionally, she said Errand drivers earn twice as much in tips as is typical for Uber or DoorDash drivers.
While Errand can’t transport your kids or other people, he can handle almost any standard errand, including picking up your dry cleaning, making donations to DI, or even doing light shopping or picking up take-out orders. customers’ favorite restaurants.
Larsen said Errand beats the rates of popular food delivery services and does so with a model that doesn’t inconvenience local businesses for its services through the startup’s client-side payment system.
Running can even get you out of some tough traffic jams.
Larsen said a client ended up at the airport last month but realized before embarking on an overseas trip that he had left his passport at home. An Errand driver was able to drive to the customer’s home, retrieve the passport and deliver it to the traveler in time for them to catch their flight.
“Not all of our trips are like this, of course,” Larsen said. “But we save our customers time and make life easier on every trip we take.”
To learn more about Errand and how to get the app, visit goerrand.com.