53: How FiveStars Is Using Customer Data To Deliver A Personal Touch
FiveStars offers a unique approach to loyalty by helping local businesses turn every transaction into a relationship.
Do you ever notice when you shop online every website you go to knows everything about you and all your preferences? However, if you go in a coffee shop or any of your favorite stores in a shopping mall nobody knows anything about you. There’s a tech startup called Five Stars that has a loyalty problem or marketing automation CRM and promotion platform. Essentially what Five Stars wants to do is make local businesses more personal to customers and keep them coming back. I invited Vik Ho, the CEO and co-founder of Five Stars, to talk about that whole journey.
Tell us a little about yourself and your role at Five Stars.
I grew up in Southern California. I originally started my career in finance then decided I wanted to do something different. I co-founded Five Stars with my buddy Matt five years ago and today I’m the CEO of the company.
What does Five Stars do and what is your aim as a business?
Our goal is to help small businesses build better relationships with their customers and bring them back more often. Everything you see in the market is focused around getting new customers (Open Table, Groupon, Yelp, etc). Our goal is to give them something better than a punch card for treating their existing customers better and we have a suite of tools around that.
Can you expand on your experience of turning everything around?
My goal for a long time was to get into private equity firms that would pay me a lot of money, look amazing on my resume and accomplish some arbitrary dream. As I was talking with my co-founder Matt we took a step back and were thinking about how when you are 65 and retire if you could put on a pie chart all the hours you spent in a day the biggest slice of pie is going to be work and then it’s going to be sleep and then after sleep it will be everything you do with your friends and family and whatever you care about.
There was this thought that this distinction of work-life balance is actually incredibly stupid because it’s this idea that you work and you’re miserable and you fund this life that you have which is a much smaller slice of the pie. As I was thinking about the legacy I wanted to leave it was not gathering my grandchildren around me to tell them about some amazing trades I made or some company that made us a bunch of money.
Matt went to Uganda to work with local farmers and I thought about being a missionary. We were thinking of the impact we could make with our lives. It didn’t take much for me to realize I had no talents in these areas but I had been given talents in business. Business was my mission field. We started a company with the idea that every successful Fortune 500 makes a massive impact on society. If you can harness that impact on culture as a primary motivation for your company and build a business model as a means of spreading that rather than just to make money then something meaningful can be done.
Did you set out from the beginning to bring Fortune 500 tech to small businesses?
There wasn’t a light bulb moment. It was more the thought that I know the life trajectory I’ve been set on is one of autopilot of upbringing and society telling me what success means and I know it’s not right.
We wanted to start something so we quit our jobs and turned down these amazing offers we had slaved away at for years but we had no idea what we were going to do honestly. We wanted to build a business to do something impactful but didn’t know what it was. It developed over time into this specific concept around relationships and small business.
What is the secret of getting a user to download an app and keep using it?
I think you have to create an app that drives value. When they pick it up it makes their life better in a way that’s consistent and makes them want to keep coming back to it.
What would you advice to anyone embarking on a similar startup journey?
Where my journey has brought me is that it all starts with you understanding yourself at the core. What your motivations are, what you really care about and then being able to translate that into a business. Those types of things will become the mission statement of your business.
What is the best way for listeners to find out more about Five Stars?
If you go to www.fivestars.com there is a very easy button you can click that will put you in touch with a live human being who works here. They will be happy to share more about us. We also have a blog where we post a lot of different articles related to the type of conversation we had today.
What’s next on the horizon for you guys?
Our goal is to build tighter relationships. We have a road map of a lot of exciting things that will hopefully take the product more from something that might feel like marketing to something that feels more like a relationship you have with the person on the other side of the counter smiling at you.
Check Out Neil’s Column at INC. called Tomorrow’s Tech
Please also see check out the related article from my column: How This Startup Is Using Customer Data To Deliver A Personal Touch