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Startups Over School: Runerra

It’s not often that a visit to CVS Pharmacy is all that monumental, but for Bharat Pulgam, it changed the trajectory of his life and professional career.

The idea for Runerra—a community-driven delivery app—came when Pulgam was living with his cofounders in Territorial Hall at the University of Minnesota Twin Cities. He decided to stop by CVS on his way home from class. When a friend asked him to grab something, Pulgam told them “he would for a dollar,” as a joke. Instead of just forgetting the encounter, Pulgam and a group of his friends saw an opportunity for a business. A business that Pulgam and his cofounders have since dropped out of school to pursue full time.

With more than 2,000 users since its official launch in December 2018, Runerra is best described as an app that allows friends to run errands for each other, and make a little cash while they’re at it. The platform lets users see when their friend is running out to grab something, and where, and they can add products they want. Instead of a standard delivery service, users can see each other’s locations and “runs,” making it a more casual, “hey I’m running to the store, do you need anything?” platform.

When I last spoke with Pulgam it was about MXERS, just one of the three companies he was then currently involved with as a freshman at the U of M. Now, just over a year after that first call, Pulgam has shed all other projects (including school) to focus entirely on Runerra.

Defining Moments

Pulgam and his fellow founders—Josh Chang, Niel Patel and Sam Lerdahl—started the idea as a Facebook group before evolving it into a beta app in early 2018. Thanks to classes together and all living in the same dorm that first year, everything “kind of began to fall into place,” says Josh Chang, now head of marketing for Runerra.

In spring 2018, all four founders decided that they would not return for their sophomore years at the Carlson School of Management at the U of M that fall.

“We all knew it was a big decision and thought about it a lot,” Pulgam said, adding that he discussed it with fellow Runerra cohorts and his family before following through. The deciding factor? Getting accepted into the Techstars Retail in Partnership with Target accelerator in May 2018.

Photo of the 4 cofounders of Runerra
The four founders of Runerra (from left to right: Sam Lerdahl, Bharat Pulgam, Niel Patel and Josh Chang) in the early days of the company.

“We thought we were all going to get denied,” says Chang, a friend of Pulgam’s since high school. He describes being on the conference call on which Runerra was accepted as “an amazing feeling.”

Runerra participated in the nationally-known startup accelerator program from July to October 2018. Pulgam believes being involved with Techstars was “fundamental” for Runerra, as he and his fellow founders were able to connect with others who had been through the same process of creating a startup.

“It was super cool that just starting out, we were able to get that much support,” Pulgam said of the accelerator, which usually only accepts companies in further stages. “It booster rocketed us forward.”

“[Techstars] was a big moment for us as founders,” Pulgam says. “We thought, ‘this is a once in a lifetime opportunity, do we really want to have school in the back of our minds while we do this?’”

Further explaining that Runerra is the “right thing for them right now,” Pulgam continually praises Techstars and its team for their support. “They’re really the ones who gave us a chance.”

Sarah Bain, now an investment manager for Techstars, was the program director for the Techstars Retail program in 2018 and mentions she was impressed by the Runerra team from the start.

“For me, what really stood out was the team as a whole, the four of them seemed as though they were a really solid team,” Bain says. “They had so much passion about what they were doing.”

Bain and two of her colleagues talked to more than 2,000 companies before picking Runerra as one of just 10 teams to go through the Retail program in 2018. Meeting weekly during the program, Bain still meets with Pulgam on a “pretty consistent basis.”

“The team is incredibly committed to the product and to the success of the company, I’m really excited to see where they go,” says Bain.

The Delivery Market

With 28 restaurant and store partners in the U of M area, as well as two paid sponsorships with Target and Caribou Coffee, Runerra is starting to see some real traction. When asked how the company’s iOS app would compete with other similar third-party delivery platforms like Postmates, Pulgam explains, “Our advantage over any other delivery service is that we’re not a delivery service. Runerra isn’t dependent on you needing something, and doesn’t pay drivers to sit in their cars and wait for orders; instead, it’s a free delivery platform that plays off of errands already being run.”

The Runerra team in spring 2019.

“Runerra is the thing that connects the community,” Pulgam continues, explaining that he doesn’t think of GrubHub or UberEats as competitors. Instead, he sees them as a completely different option for when you want a specific thing at a specific time, whereas Runerra is about requesting a few things when a friend is already on their way to a convenience store.

Pulgam told me that between 70 and 75 percent of Runerra users have never used another delivery service because, as he puts it, delivery fees are “so friggin’ expensive.” Conversely, Runerra can subsidize delivery costs via sponsored partnerships with stores and restaurants.

Since runners can deliver by bike or on foot, Runerra argues that their runners get paid more than drivers for third-party delivery platforms because they can bypass vehicle maintenance costs.

“It’s an easy way to make money doing what you’re already doing,” Pulgam says, explaining the app’s appeal to college students. Pulgam estimates that each of the more than 100 runners at the U of M makes $12 to $20 per run with the average run taking only about 30 minutes. For products not purchased at sponsor locations, runners decide their prices—but Pulgam points out that it’s abnormal to charge more than a few dollars due to buyers being fellow college students.

Runerra is planning to launch in two new markets by the end of 2019. They plan to try an out-of-region state by 2021 to see if the platform will work in other markets.

“We don’t want to be seen as silly teens going after their dream,” said Chang. “We want to be taken seriously.”

Looks like they already are.

© 2019 Starting Up North, LLC. All Rights Reserved.

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