The Engage fund, an Atlanta-based venture fund and startup program backed by 11 corporations including Delta, Goldman Sachs, the Home Depot and UPS, as well as Georgia’s venture fund Invest Georgia, has expanded its team with the addition of Daley Ervin as Entrepreneur-in-Residence.
Ervin has been serving as a startup mentor with Engage since the fund’s inception in 2017. Engage recently finished up its second program and now counts 16 companies in its portfolio.
Ervin, who worked at and built startups in New York City, London, and throughout Europe, says he first got involved in the program on recommendations from friends in the startup scene. “I was pretty new to Atlanta, and I asked around, and people kept pointing me to Engage,” he says. “I basically called them up and asked if I could help.”
Ervin has the experience to lend to these young startups from multiple engagements at successful — and failed — tech startups. His first job was at Airbnb as one of the now-unicorn’s first 100 employees.
But, he didn’t get that job easily. In fact, upon an interview where Airbnb turned him down based on lack of experience, Ervin offered to work for free. The company took him up on it and sent him to London to launch their UK operations.
After a few months of proving himself, they did upgrade him to a salaried employee. But, Ervin says, it was still a scrappy startup operation.
“Nobody knew Airbnb, nobody knew what home sharing even was or understood the idea,” says Ervin. “We got the supply up first by getting just a few users in each neighborhood and then having them spread the word to their friends. We would literally book them ourselves when they first registered just to give them that rush of dopamine.”
It was during the Airbnb Europe launch that Ervin learned his first major startup lesson, which he says is to “do things that don’t scale.”
For example, the London team hosted company-sponsored dinner parties for their early hosts all over the city, to spread awareness and boost their word-of-mouth marketing. They also hired photographers — hundreds of them — to go to hosts’ apartments and take photos of their rental options.
“We realized we couldn’t keep doing this — help all our hosts get good photos because they didn’t know how to take them and we knew good photography helped get a home booked,” says Ervin. “But we did it anyway.”
Nine months later — after quashing all their early competitors — Ervin left London and went back to Airbnb headquarters in San Francisco. He stayed on for a few more months, but the company had grown quickly — with an additional $240 million, it had swelled to 500 employees.
Ervin decided it was time to do it on his own. Taking the lessons he learned from Airbnb on what travelers wanted when in a new city, he moved back to London to start YPLan, a last-minute ticketing app where users could jump on the app, find local events like concerts, sporting games, or theater shows, and purchase unsold tickets.
“What we had heard from travelers was that they wanted to know what the locals were doing that night,” explains Ervin. The app spread like wildfire in London, where there was nothing else like it. In the first year they saw a million downloads and were processing $1 million in transactions each month.
But Ervin’s team faced a problem common to startups: they started scaling too fast. They raised a $12 million Series A and then a $24 million Series B, becoming the most funded app in Europe at the time. Their investors pushed them to expand to new cities, and quickly.
Ervin and the team landed in New York City to launch YPLan there, but found the market very different from London. “The tech scene was about 2-3 years ahead in New York, and the market had already nichified. There was an app for concerts, an app for sports games, one for Broadway shows.”
They couldn’t compete, and the team rolled back to London. But after bleeding money from the New York launch and losing steam, YPLan couldn’t keep up. Ervin suffered his first big startup failure.
Following YPLan, Ervin was connected by investors to a China-based online student housing startup, Student.com. He helped launch the marketplace in London, then New York City, and during his time there, the team grew from 20 to 250. But again, Ervin says they scaled too fast. The technology couldn’t match the demand, and the product suffered.
These obstacles led him to his second big piece of advice for the founders he now mentors: “Don’t expand outside of where you can touch, until you’re absolutely sure you can do it,” he says.
And his best funding advice, after going through a half-dozen funding rounds and working with countless VCs? “Who you raise from is just as important as what and when you raise.”
That’s partly the reason Ervin will now join the Engage fund full-time. He says he has been consistently impressed with not only the quality of the startups Engage attracts, but also the ability of the team to connect those startups with the right people at each corporate backer to generate pilots and contracts.
For example, honeybee startup Bee Downtown landed clients in AT&T, Delta, Chick-Fil-A, Georgia Power and more from their time in the Engage program. Ervin describes it as “giving startups an unfair advantage.”
A good portion of his new role will also entail working closely on cultivating relationships with those corporations.
“Engage’s mission is to leverage our platform to give entrepreneurs the opportunity to gain access to customers, distribution channels, and Fortune 500 scale,” said Engage’s Managing Director, Thiago Olson. “Daley will bring immediate value to Engage, our portfolio founders, and our corporate partners — we’re excited to have him on board.”
He wants to make sure the corporate leaders are not only learning from the startups, but from each other. Engage recently hosted its first topic-specific executive forum, centered around the companies particular explorations, challenges, and innovations in artificial intelligence.
“They were there for hours,” says Ervin. “Engage can serve as this forum where these leading executives can just talk to each other about what they’re working on in the innovation space, and learn from each other about how they can integrate startups, getting them ingrained in their culture.”