As a chef at a seafood restaurant in Boston, Matt Tortora knew the difficulty that restaurateurs had sourcing the fresh ingredients customers demand. He launched WhatsGood, a Providence-based online market that connected chefs and wholesale buyers with farmers, fishermen, and artisans.
The business model that seemed "perfect" when Tortora considered it from the chef's point of view quickly ran into problems. "With a two-sided, b-to-b marketplace, we ran into an internal conflict about who our customer was," he says. "We had to look at who we really represented."
Ultimately, Tortora did a 180, focusing the system on the needs of the producers rather than the chefs or wholesale buyers. That eliminated the conflicts, but added plenty of challenges. Farmers told him the virtual farmer's market was helpful in connecting them with wholesale buyers, automating many irksome tasks they had long done manually. But they also wanted to reach consumers who bought their goods at actual farmer's markets - something Tortora hadn't factored into his original business model.
Going to market
The change in direction required Tortora to rethink his entire approach to online commerce. A farmer might have one price point for a wholesale buyer who purchased 50 pounds of grass-fed beef or 25 pounds of broccoli, but charge a different amount for smaller retail purchases. An even bigger problem was how to make the economics work. Consumers wanted to use credit cards online, but those charges all but erased the tight margins of the food producers.
Tortora came up with a unique twist. He developed a Starbucks-like app that allowed farmers to upload information about the goods they were offering at an upcoming farmer's market. Consumers could order the goods online and pick them up, often in one convenient package that had been collected from many stands.
The margin issue was addressed by explaining the tight margins and adding a tiny amount to the purchase price to cover the credit card fees. Because the costs were so transparent, consumers were happy to pay, as it seemed less like a fee than a contribution to a worthy cause.
With the newfound focus on the growers, farmer's markets themselves, seeing that consumers wanted a more convenient way to shop for food, began to reach out to Tortora about the technology. The Farmer's Market Federation of New York, a grassroots organization of farmers, had been trying to develop similar technology for a year, but still lacked the capabilities that Tortora developed. In November, they licensed the technology to brand their own app, called FreshFoodNY, and other grower organizations have followed suit.
"That was a game-changer for us," Tortora says. "We realized we had been approaching our business model all wrong. We had never considered white-labeling our technology, but it made sense to partner with someone who already had an identity in their community, so we could wrap the technology around a brand the local consumer already understood."
Adopting the new business model was a matter of not letting his ego get in the way of changing the concept that had seemed "perfect" and having investors who saw the potential of the change. "Most people who start a business have identified a problem to solve," Tortora says. "As a chef, I saw a problem that was big enough to roll the dice on. But I was looking through a peephole, and I didn't realize there was a bigger problem until the door opened and I walked in."
WhatsGood won first place at Get Started Providence 2016, a fast-paced business pitch competition developed by Cox Communications.
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