My Luck Club, a Connecticut-based e-commerce startup founded by Phyllis Pierce (pictured), recently went from private beta to live. The launch marks the company’s entry into a classified ad and exchange marketplace that is massive, growing, and ripe for innovation.
The website provides a monetary incentive for people to help each other find what they want, including jobs, homes, services, collectibles, even love. Currently free to use, My Luck Club has been steadily attracting “Luck Seekers” and “Luck Makers” since its launch, according to the company, with rewards ranging from $50 for an apartment to $100 for lost prescription sunglasses to $500 for a job in IT.
Luck Seekers post a reward for what they are looking for. Luck Makers earn the reward if and when they find it.
Phyllis, a serial entrepreneur based in Trumbull, CT, began garnering attention with her concept and private-beta site well before My Luck Club’s official launch, winning several awards.
Her company was one of only nine selected by Connecticut Innovations to receive $25,000 in initial funding in 2012. In 2013, it was selected as a Company to Watch at the Connecticut Technology Council’s Innovation & Entrepreneurship Summit. Recently, Phyllis was honored as a Woman of Innovation for her “outstanding leadership as an innovator, role model, and mentor.”
Phyllis told The Whiteboard that the latter award was particularly significant. According to a 2012 report by the Kauffman Foundation, women form only 3 percent of US-based tech startups, and according to a Stanford University study, just 4.2 percent of venture funding goes to women-led businesses. Phyllis notes the irony of these numbers, pointing to another study, from Carnegie Mellon, that concludes that “women-led high-tech start-ups generate higher revenue per dollar of invested capital and have lower failure rates than those led by men.”
From Luck Seeker to Company Maker
The idea for My Luck Club came to Phyllis while she was running her first startup, a television production company. She had been looking for a house to rent but couldn’t find exactly what she wanted for the right price. Realtors told her “it didn’t exist,” and she had no luck on Craigslist or Realtor.com. Undeterred, Phyllis went to her desired neighborhood and posted signs saying, “$500 cash reward for information leading to [exactly what she wanted].”
“Everyone said I wouldn’t find it,” she told The Whiteboard, “but the minute I offered a reward, I did.”
She realized there was an untapped marketplace of people who can’t find what they want on Craigslist, eBay, or anywhere else, as well as people who are eager to help and make money.
This realization led Phyllis to the underlying philosophy of My Luck Club.
“People are helpful out of kindness,” she says, “but I’m a firm believer that money is a great motivator. A monetary reward encourages people to go the extra mile. It’s also a way of saying thank you for the time and effort you’ve spent helping me. In the end, we can take matters into our own hands and make our own luck.”
Based on this idea, Phyllis founded My Luck Club, providing the initial capital with money she had saved for a down-payment on a house.
Her Own Drum
Since then, one of Phyllis’s biggest challenges, she says, has been standing her ground.
She told us that, early on, she disagreed with self-proclaimed experts who insisted that she launch a minimal viable product as quickly as possible. “It made no sense to me to launch with an MVP of My Luck Club that users would have difficulty using or understanding, or that couldn’t handle a lot of traffic,” she explains.
“Just look at HealthCare.gov. It was supposed to handle tens of thousands of simultaneous users, yet just a few hundred users flatlined the site. Even the president admitted his team would not have launched the site had it known how badly it would perform. I think I made the right decision.”
Instead of rushing an MVP to market, Phyllis decided to keep the website in its closed beta version, giving her developer more time to perfect it. The result, she says, is a product that is much easier for both Luck Makers and Luck Seekers to use, with clearer calls to action.
Building a Customer Base
Phyllis also decided to contradict a dominant school of thought regarding early-stage revenue, she says, opting not to charge users at first, but to focus instead on establishing a large, loyal user base.
“A few angels in the CT startup community scolded me, saying, ‘The day you launch, you have to collect revenue.’ I said, ‘No, the day I launch, I want to attract users.’ Many successful sites have launched for free initially, and I’m following that model.” She points specifically to Craigslist, which started in 1995 as a free service and didn’t incorporate as a private, for-profit company until four years later.
My Luck Club has several revenue models, she says. Once the user base has reached a critical mass, it will charge a commission on each reward, to be paid by the Luck Seekers. In the meantime, Phyllis is implementing a strategy modeled after the band Radiohead, which asked fans to pay what they wanted for a digital album. Similarly, My Luck Club users are asked to make a contribution via a “Support Us” button on the site.
Advice for Entrepreneurs
“When someone says I can’t do something,” Phyllis says, “it angers me and provides even more motivation to succeed – not that I need it.”
It’s essential to maintain an entrepreneurial attitude, she says, which means not only embracing risk but adjusting to the difficult reality of the moment. A favorite quote of hers, from Alexander Graham Bell, articulates this point: “When one door closes, another opens; but we often look so long and so regretfully upon the closed door that we do not see the one which has opened for us.”
“I’ve been guilty of that,” she says, “but being an entrepreneur often means making the most out of how things work out.”
Phyllis’s goals for 2014 include acquiring additional funding for My Luck Club, forming synergistic relationships with other companies, and adding to her team and advisory board. She may be contacted at ppierce [at] myluckclub [dot] com.