Walmart Canada became his biggest competitor
Intro recap of Lore's track record: he sold Diapers.com to Amazon for around $600M, then built Jet.com and sold it to Walmart for $3.5 billion.
“He sold diapers.com to Amazon for like, I don't know, $600 million. He created Jet.com and sold it to Walmart for $3.5 billion.”
Walmart ran Jetblack, a text-based personal shopping concierge for NYC parents. Users dropped Amazon Prime and gave it multiples of their Amazon wallet share, but it needed humans in the loop until the AI could learn, making it too expensive for Walmart to keep.
“I mean, it was like, you know, people stopped using Amazon Prime. It was, they just dropped it. It's like all the shopping, the entire, the entire wallet share was given to Jetblack, and it was multiples of what they were spending on Amazon.”
Lore cites that return rates on apparel sold online are 40%, an expensive problem for retailers that a virtual fitting solution could dramatically reduce.
“Return rates on apparel are 40%.”
Shaan recounts a Jet.com referral contest where the top customer-acquirer won 100,000 shares. An outsider spent $18,000 on clever paid marketing, won, and his shares were worth $20M at the Walmart sale — likely out-earning everyone at the company except Lore.
“He spent— the guy invested $18,000 into the paid marketing, won the contest, and his 100,000 shares became worth $20 million when it sold. And so this guy turned $18 grand into $20 million as a fan of the company, outside the company, probably made more than anyone else in the company besides Mark, which is amazing to me.”
Shaan reads that Rap Snacks, the celebrity-branded chip company started in 1994, relaunched in 2016 and now sits in 4,000 Walmart stores, with a reported $5 million in sales, a figure Sam insists is far too low.
“So now they're in 4,000 Walmart stores nationwide, and they say it's grown into a $5 million business, which seems really, really low.”
Harley's 'holy shit' moment: as a 21-year-old law student he built a Shopify t-shirt store ('Smoover') during tax law class, and within weeks his biggest competitor was Walmart Canada. That a kid in class could out-compete a giant retailer revealed Shopify was far more than a software company.
“And my biggest competitor after a couple of weeks was Walmart Canada. It was great. I made some money. I was able to pay tuition and help the family. But the fact that I, as a 21-year-old law student, was able to build a company sitting in class that competed against the largest or one of the largest retailers on the planet at that time, that felt incredibly different.”