Happy New Year to Canada’s SaaS Community,
But first, our first interview of the year.
A lot of companies shut down in March 2020. But Robert Kirstiuck was determined to not let his company be one of them. Despite losing all his revenue overnight, he and his team experimented and pivoted with what little cash they had left. Eventually, they built Freshline from the ashes, turning it into a thriving B2B ecommerce suite for food distributors. Speaking with SAAS NORTH, Robert shared his journey—and how he turned his competition into customers.
- When times get tough, look at what you have—and the other possible uses of every asset and piece of IP you own.
- Turning competition into customers is about filling a gap for them while removing yourself as a threat to their business.
- Don’t be afraid to run multiple experiments simultaneously, but be sure to have KPIs so you know when something is working or not.
Co-Founder/Producer, SAAS NORTH Conference Editor, SAAS NORTH NOW
The pandemic tanked Robert Kirstiuck’s fish supply marketplace—Coastline—taking the company’s millions in revenue down to near-zero. Suffice it to say, March 2020 was not a good time to be in the business of connecting restaurants to food supplies.
But he and his team bounced back, ran multiple experiments, and from the ashes of Coastline came Freshline, a B2B ecommerce tool for food distributors. Speaking with SAAS NORTH, Robert shared more about the journey and how he turned his primary competitors into his customers.
A pandemic punch, but not a knockout
Robert founded Coastline in 2016 with a mission to connect restaurants with fish retailers. At its peak, the platform had around 1,000 restaurants buying fresh fish—about 400 in any given week. The company boasted 16 employees and millions in revenue, driven primarily by import/export work in Canada, Japan, Vietnam, Thailand, and more.
Then the pandemic closed restaurants and with it, Coastline’s revenue.
“When the government mandated restaurants closed, that got us on a demand side,” said Robert. “All of our restaurants were high-end restaurants, so they weren’t able to take advantage of the kind of UberEats delivery wave.”
Just as quickly as revenue dropped, Robert had to lay off his team, leaving only a couple of members. Those remaining thought about closing up shop. In fact, Robert’s investors told him he could—they acknowledged the pandemic was a black swan event no one could have predicted, so they wouldn’t fault him for shutting down.
Instead of closing though, the Coastline team decided to pivot. The company had built a significant amount of software to power its solution, so Robert and the team went about ‘stripping it for parts.’ They looked at every feature or piece and experimented to see if it could be turned into a standalone solution—for example, food wholesaler supply management. Unfortunately, though, most experiments conducted between 2020 and early 2022 failed.
“We had a lot of existing IP that we were trying to rip off the main repo and try to build up to stand alone,” said Robert. “We were stripping the whole thing down for parts. And a lot of those [experiments] didn’t really stick.”
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Of all the experiments, one stuck: ecommerce for food distributors. Even during the pandemic, food distributors were selling. These businesses pivoted from restaurants—Coastline’s original customer base—to anyone who would buy from them, but they were still selling.
During this pivot, the team faced found two opportunities that helped them succeed. The first is food distributors have unique selling needs. The most prominent, said Robert, is that many food distributors sell by weight, something existing ecommerce solutions had a hard time serving. This meant an opportunity for niche ecommerce software.
Second came a slightly more difficult task: convincing competitors to become customers. Food distributors were Coastline’s primary competition since its niche marketplace brought supply and demand together technologically rather than through third-party distribution. However, Robert realized that in the food industry, competitors are ‘frenemies’ rather than outright enemies.
“These companies would compete with each other for a demand,” said Robert. “But then on the back end, a lot of them are buying and selling products from each other in order to keep their existing clientele happy.”
A frenemy dynamic enabled Robert to pitch these companies, offering the one thing they didn’t typically have: technology. Coastline was able to grow so quickly, said Robert, because it helped restaurants order online. Before that—and as was still the case with many food distributors—handled orders over the phone or by email. By pitching an online solution, many distributors saw an opportunity to grow their business despite the pandemic.
“We made that pitch to these food distributors saying, ‘hey, we’re no longer in the business of supply, but we do have the platform that you inevitably saw in the market—because the chefs would show the competing reps—and we’re now selling this as a software offering,’” said Robert.
To get in the market quickly, Robert and the team launched a DTC offering to compensate for low restaurant demand during the pandemic. But the company—officially rebranded as Freshline—evolved to focus exclusively on B2B ecommerce for food distribution.
“It’s important to chew glass”
While Coastline died in 2020 due to the pandemic, Robert and his co-founders refused to close the whole company. After two years of experiments, Freshline evolved and is continuing to grow.
Describing why the team didn’t give up despite a pandemic and investor blessings, Robert said he felt it was important to “keep on chewing glass for a little bit,” a metaphor he said reflected the entrepreneurial journey to keep pushing forward and not give up despite hard times.
Not giving up looked like multiple experiments for the Coastline-turned-Freshline team, each of which came with its own set of KPIs, namely the number of customers the team could get signed up with each new possible offering.
Looking back, Robert said his biggest lesson learned was giving each experiment enough time to work (or not) and running multiple experiments at the same time. But when something starts to work, it’s critical to slow down, simplify, and slowly begin to focus all effort on the one thing that’s going somewhere.
“Once we found something that we felt was working, there’s inevitably a slowdown where you were trying all these different things,” said Robert. “You had a ton on the go and all of a sudden you’re simplifying, simplifying, simplifying. And now all of your effort and energy is in this one thing.”