#032 - Pavel Gertsberg // Fluffy

Summary of our conversation:

• I grew up in a very interesting family. My parents come from the Soviet Union and I was born when the whole idea of communist switching to capitalism was kind of appearing in Ukraine and Russia.
• I saw that the only way out of poverty is business because people who were having jobs at that time were extremely poor people. If you work as a doctor, as a teacher or whatever job you have, unless you do a business, you are very poor, like ridiculously poor.
• You will never get too far in your life if you don’t build something on your own.
• Starting a business is easy. Building a successful business, that’s where it becomes difficult and you pretty much give up a lot of pleasures in life. It’s always easy to say go and start a business but let’s say usually for 6-12 months you don’t have any cash. And in worst case scenario, you also invest your own cash into your own company. So you’re actually actively losing cash. So without having some sort of buffer, it’s a very risky move.
• Tell our audience about Fluffy. So it kind of combined two of my passions FinTech and SureTechs and anything data driven technological projects. So what were doing at Fluffy, and you should probably guess by the name, something to do with pets. We’re on a mission to make pet care less stressful and more affordable. We are creating a well-being first pet insurance product that rewards responsible pet owners for people who are based in the UK.
• But talk to us a little bit when you’re going through this business, how did you figure out the market size or even the persona of a pet owner. I would say one of the surprising markets. Globally the petco market is 220 billion market. Its incredibly big. There are more pets bought than babies being born in the UK.
• There is a saying that goes, pets are new kids, plants are new pets, and kids are for the rich. So because pets are new kids, the spending is different, the care is different.
• So you’ve never operated in the pet space. How did you transition from taking that idea and turning it into a business? Overall, to be honest, in my experience, you can get immersed into any industry in three months and you can get very well connected today in six months. You can move to any space fairly quickly if you really want to, but its like, you become a student, you go around, you listen to people, you ask questions, you go around, you speak to people and so you start hearing the same names. And once you mentioned those names, people start to respect you. They go like, you know, this guy, you know, this is John. And then you go to another guy and you go to another guy and then you build this network of people. And then you create this echo chamber around yourself where people go, this guy knows everything about insurance. It’s doable. It’s much faster than people think. But you need to become a student.
• When you’re starting this thing off, what is the first few immediate team member skill sets look like? For me it was finding the right co-founder. I believe you need a co-founder because its incredibly stressful, a difficult journey and you need someone around you.
• There is nothing wrong with paid advertisement as long as A, your unit economics work, but B, you understand that if the channel stops, what do you do next if it becomes too expensive? That’s when you have to be prepared for SEO and big partnerships, and that’s when it’s time for you not to relax.
• If you have great market fit and good economics, pump money. That’s what you raise money for. Go for market share. Google ads, Facebook, TikTok, Instagram, whatever you can find, pump money into that if you need economics work.
• So I was lucky having good mentors and I think we need to give back to the community. If someone reaches out to me and I believe in what they do, I will always make at least three introductions. It’s a small community, and helping each other, I believe is a key, absolutely fundamental part of that.
• So mentors are super helpful. Never ever take advisors on equity. Take advisors, take them as investors or take them as mentors but never give away your equity for an advice. And I think like on our journey, a good mentor will never ask for equity.