An interview by Downtown Brooklyn Partnership Content Strategist Jessica Ainlay
On a warm summer day in June, I sat down with Happy co-founder Jay Reno at our local coffee shop, AVA Brew. We settled in and started chatting about how many turns a startup takes, and what a wild ride entrepreneurship can be.
“In fact,” he said, “I actually can’t tell you what I want to tell you…but I’ll make sure to tell your whole team as soon as I can.”
Interest piqued, I tried from every angle to get him to disclose the details of this latest turn in our first ever winner of the inaugural Make It in Brooklyn pitch contest in June of 2015. I got nowhere, obviously, and instead opted to wait patiently for the news.
Happy acquired by PaidEasy
Yesterday, Jay sent us a link to this TechCrunch article breaking the news that Happy has been acquired by PaidEasy, a New York-based mobile payment app for restaurants.
This is huge news for Happy - an app company solving excess capacity at bars and restaurants.
Originally, Happy had three co-founders. Jay took the Business Development & Partnerships side, Jake Malone became CTO and Sarah Bartley was CMO.
Happy built the product with this core team and raised some angel capital in 2014. They launched in early 2015 and the company started really growing just as the seed capital ran out. Jake and Sarah took on other jobs and the sales team was also let go.
“It was hard to let them go, but ultimately I had to let them know that our runway was getting shorter and shorter and that they should start looking.”
What winning $50,000 can do for a startup
That’s when Happy pitched and won first place at the Make It in Brooklyn Pitch Contest, an evening where ten finalists pitched for a $50,000 investment by Downtown Brooklyn Partnership Board Co-Chairs, MaryAnne Gilmartin and Bre Pettis. I asked him a few questions about how that investment helped his business.
How did the $50,000 investment help your business most immediately?
“First, I was able to bring back some of my sales staff so we could continue to expand our market and build our product out. But it was more than that.”
“Having Bre Pettis and MaryAnne Gilmartin interested in our company and on board with us helped legitimize us within the community. Suddenly there were headlines in the papers that we were one of Brooklyn’s rising startups. People really started talking about us.”
What is an advantage of being a Brooklyn-based startup?
“For starters, it gives your brand this ultimate legitimacy. Second, but also related, is that there are so many amazing bars and restaurants right here in Brooklyn. That means that not only were we able to build relationships here, but the venues here are a totally different type of owner than in other cities.”
In what way?
“People here are super interested and curious in general - there is such an open, innovative culture - that bars and restaurants are open to experimenting with new technologies - and their customers are too.”
What are some disadvantages of being based in Brooklyn?
“Almost nothing. One thing is that there is a lot more room for the entrepreneur + startup communities to be more closely knit. That’s why I love what you guys are doing at Make It in Brooklyn, bringing specifically the Brooklyn entrepreneurs and also VCs and other investors to really help create a sense of legitimacy within our own community. If Etsy and Kickstarter believe in Brooklyn, then you know that the rest will follow. It’s about making the community how we want it.”
Happy comes to an important crossroads
With the momentum of that healthy amount of funding by Gilmartin and Pettis, Jay continued to hustle and build the network. Unfortunately, however, within a few months, they hit a snag very common to many startups. They were either going to have to raise another round of funding or the company would go under. They’d have to raise $1 million to build and grow the company.
Investors wanted to see proof of consumer side metrics, and this wasn’t available. From Jay’s perspective, there was no reason to raise smaller amounts of money if what they actually needed was at a much higher level than what they were going to receive.
“What we know with absolutely certainty is we have a network that we know is valuable. We have a strong relationship with bars and restaurants, a strong consumer base and good consumer metrics. We have good technology and a great funnel for another company. We have a massive number of users coming in at the top of the funnel. A lot.” He underscored that last bit with quite a lot of pride.
The entrepreneurial roller coaster
“Being an entrepreneur is an emotional roller coaster - one minute you are completely down in the dumps because your realize that your company only has three months left of runway and the next, you can be right back up if you get the next angel check or make that next big sale.”
“That’s why you, no matter what, you have to say right in the 60-40 zone. When you’re on a big high from a success, don’t let your emotions fly up and off the charts. The same goes, however, for when you have something bad happen you didn’t expect - don’t let yourself drop down to a 20 or a 10. Always stay as level as possible, and that will help you along the way.”
I have to wonder if Jay was able to stay in that 60-40 zone when PaidEasy made the acquisition official.
What will you do now?
I’m still unsure of the details, but what I do know is that I’ll continue to support the Make It in Brooklyn community however I can. I think it’s super important to give back and to help grow our community here in Brooklyn.
Look out for Jay Reno as a judge at our next Make It in Brooklyn pitch contest at the Innovation Summit on September 28th, 2016.
How to take part in Make It in Brooklyn
Want more? Pick up a ‘Startup’ pass to attend just the afternoon panels ‘Show me the money’ and ‘Launch. Scale. Thrive.’ in addition to the evening pitch contest. Or, go all in and get the full day Founder pass to network with Brooklyn’s top leaders across all industries. Find out more about all the Make It in Brooklyn Innovation Summit Ticket tracks here.