Access to funders and a readily accessible network of customers, mentors and advisors made St. Louis an attractive startup location for WashU Olin grads and entrepreneurs Andrew Glantz, BSBA ’17, and Marc Bernstein, BSBA ’15.
Both founders shared their reasons for establishing—and keeping—their startups in the St. Louis area in a story in the St. Louis Business Journal‘s entrepreneurship publication INNO last week (registration may be required). Bernstein, 29, is co-founder and CEO of Balto, which provides real-time call guidance software used by contact centers. Glantz, 27, is co-founder and CEO of GiftAMeal. Through its mobile app, GiftAMeal provides meals to people in need each time a user takes a photo at a partner restaurant.
According to the story, Bernstein originally didn’t think about staying in St. Louis, but when establishing a startup, he and his partners were very intentional, considering Washington, DC, Detroit, San Francisco and St. Louis for the location. “We chose St. Louis because it had a super low cost in that we felt like we had the network to get some early traction,” Bernstein told the journal.
An early investor in the St. Louis area, along with restaurant partners in the region, compelled Glantz to keep his company in the region from the get-go. “It’s been really encouraging how the startup scene has grown over the course of the last five to eight years that I’ve been here and started to be involved in it with all the different resources and just the collaborative ecosystem that’s here,” Glantz told the journal.
Read more in “Why 2 startup founders, both transplants from the coasts, decided to build their companies in St. Louis,” from St. Louis INNO.
At top: Andrew Glantz, BSBA ’17, and Marc Bernstein, BSBA ’15. Photos by Dilip Vishwanat, published courtesy of the Business Journal.
Companies typically offer incentives directly to customers who refer friends. Google Apps, for instance, offers customers $15 for each new friend they recruit. And World of Warcraft, the video game, offered users a free month of gaming if they successfully influenced friends to buy a subscription.
Suppose, however, that the reward went to the friends—instead of the existing customers? New research shows marketers could win more customers because existing customers may value the boost in their reputation among friends more than a “selfish” financial incentive.
Olin’s Cynthia Cryder, associate professor of marketing, and coauthors examined how social dynamics change the outcomes of incentivized behavior.
The benefits that come from being generous to one’s friends substantially influence decisions in ways that are not obvious to everyone who designs incentive programs, Cryder said.
The researchers focused on customer referral programs in which companies offer incentives to customers who refer people in their social network to become new customers. To the best of their knowledge, the research is the first to investigate “anticipated reputational benefits as a driver of prosocial behavior in referral programs.”
Reputational rewards motivate people to behave generously because of their strong desire for social approval and the fundamental human need to maintain close personal relationships, Cryder said.
For one study in their research, Cryder and coauthors conducted a field experiment with the startup GiftAMeal. GiftAMeal partners with restaurants and encourages diners to take pictures of their meals and share them on social media. Then, GiftAMeal donates a meal to a food bank each time a customer shares on social media. (Andrew Glantz, BSBA ’17, founded the company while he was a student at Olin.)
The experiment tested different incentive structures on new customer conversions. GiftAMeal emailed 6,364 customers, asking them to refer their friends to download the app. The customers were randomly assigned to one of five experimental conditions:
control with no monetary incentive,
sender-benefiting (Customers received a $5 Amazon gift card for each friend who downloaded the app.),
recipient-benefiting (Referred friends received a $5 gift card if they downloaded the app.),
shared (Senders and their friends each received a $2.50 gift card if the friend downloaded the app.),
or donation (GiftAMeal donated $5 to the charity Feeding America for each download.).
Overall, the conversion rate was low in the study, which is typical for referral programs, the authors said. Nevertheless, they detected significant differences between experimental conditions. The conversion rate was marginally higher in the friend-benefiting condition relative to the sender-benefiting condition. Multiple follow-up studies confirmed this pattern.
Scarcity of friend-benefiting rewards
As part of the research, a research assistant searched for about 300 referral incentive programs online and categorized them based on who received the reward. Of the 351 referral incentive programs, 40.5% offered sender-benefiting rewards, while only 2.6% offered recipient-benefiting rewards. (Fifty-five percent offered rewards that the sender and recipient shared.)
Yet, Cryder’s research shows referrals that benefit one’s social connections are more effective than sender-benefiting referrals: Recipient-benefiting referrals offer reputational benefits to the sender while also directly incentivizing the friend to sign up.
“The preponderance of sender-benefiting referral incentives in the marketplace suggests these effects are not expected by marketers who design incentive schemes,” she said.
Update 3/31/2020 – GiftAMeal has raised $20,000 for COVID-19 hunger relief.
GiftAMeal is a St. Louis startup founded by Andrew Glantz, BSBA ’17. The following is a press release from the organization.
GiftAMeal, a St. Louis based mobile app, is stepping up in the face of the COVID-19 crisis that has hit our community so hard. Today [March 18], GiftAMeal announced an ambitious five-point plan to provide relief to struggling restaurants and the most at-risk segments of our society.
is a mobile app that helps provide a meal to someone in need each time a user
takes a photo in a partner restaurant. Just two weeks ago, they announced they had
reached 200 partner restaurants, with 400,000 meals provided to those in need.
& CEO of GiftAMeal, Andrew Glantz, explained, “A majority of the community
members supported through GiftAMeal are children and the elderly. Schools are
closing, and children relying on meals normally provided are facing a new
challenge as social services scramble to readjust. At the same time, older
community members, the most at-risk population for COVID-19, need our support
now more than ever.”
continued, “Just as the community is struggling, so are many restaurants in the
face of public health guidelines designed to contain the spread of this virus.
Employees depend on their jobs to pay bills and make rent, and our partners are
doing their best to mitigate the effects of this crisis on their staff. But
they cannot do it without the support of the public.”
to assist both local restaurants and those at-risk in the community, Glantz
announced the following plan:
Donation program available for delivery/pickup/offsite customers
the mandated closing this week of dining rooms across the bistate area,
Glantz’s team quickly devised a big change to their program that was previously
only available to in-restaurant customers at partnering locations.
“We just launched an update to the GiftAMeal app that will temporarily allow users to take pictures off-site to donate meals for takeout, delivery, and gift card purchases. We will do this by lifting the location requirement of needing to be at a partner restaurant when you take the photo and we will move to manual verification. PLEASE support our local partner restaurants that are struggling during this difficult time.” – Glantz
Immediate financial support of hunger relief agencies – $5,000 matching challenge
“Having spoken to Operation Food
Search about their needs, we will be making our donations for the next few
months early to provide immediate funding to get food to those facing hunger.
We may be a small startup with limited means but we’re launching a campaign to
match donations, up to $5,000, for our food bank partner. If you would like to
contribute, click here: http://weblink.donorperfect.com/GiftAMealMatch.”
Publicity for restaurants undergoing fast changes
hundreds of restaurants forced to quickly find new avenues to pay their staff,
Glantz is keeping the app’s 35,000+ loyal restaurant customers aware of all
avenues to support their favorite restaurants:
“We will keep you up-to-date on
the latest with our partner restaurants on our Facebook, Instagram, and
Twitter. Many are expanding take-out and delivery programs to keep serving the
community and are implementing extremely thorough health precautions to keep
us all safe.” – Glantz
Direct coordination of food donations from restaurants
are working to coordinate food donations with Operation Food Search. If you
know of any restaurant that has a surplus that is interested in donating food
to the community, please let me know or have them contact Jack Baran of OFS
directly at firstname.lastname@example.org. It’s tax-deductible too!” –
Program cost relief for struggling restaurants
a message to restaurants (who normally pay $49-$149/month to fund the program
costs and donations), Glantz extended an offer to self-fund the program for
restaurants unable to contribute in the months of March and April so that food
donations and restaurant customers could continue to flow at a time when they
are most needed. When asked how he came to that decision, he explained,
“We are a small startup with
limited means, but this is a time where we can shine the brightest. It’s
important to me that our donations continue to flow to hunger relief
organizations, and I know that the visibility of restaurants on our platform
can have a big impact on cash-flow for these local businesses. I’ve always been
struck by the generosity and love of community that our partner restaurant
operators have shown, and even if it’s a drop in the bucket, I am going to help
however I can.”
response by the community has been overwhelmingly positive and grateful.
Kristen Wild, Executive Director of Operation Food Search, commented on
GiftAMeal’s fast and community-centered response:
“We are so very grateful to GiftAMeal for its
innovative approach to providing more people with access to healthy food. Socially-conscious
businesses like this are changing the way people approach giving, and the
generous support of GiftAMeal is making an impact in our community every day.”
Part of a series of Q&As with Olin BSBA alumni. Today we hear from Andrew Glantz, BSBA ’17. Andrew founded GiftAMeal, a company that developed a mobile app that helps restaurants reach new audiences while empowering users to feed someone in need.
What are you doing for work now, and how did your Olin education impact your career?
I am working on growing a startup I founded while I was a student at WashU called GiftAMeal. GiftAMeal is a mobile app that helps provide a meal to someone in need each time a user takes a photo at a partner restaurant.
Restaurants pay a monthly subscription to be on the app for marketing, and then we cover all the costs of donations to local food banks to feed the hungry. My Olin education has massively assisted GiftAMeal’s growth. From entrepreneurship courses like The Hatchery to marketing to negotiations to organizational behavior, I constantly pull from knowledge learned in Olin.
Additionally, the professors have been amazing advisors of mine, and we have actually been able to run some marketing experiments on GiftAMeal led by WashU professors to get their expert analysis!
In addition to the valuable course content and professors, my fellow classmates were majorly impactful. Olin has so many smart, driven students that are also incredibly unique. From conversations in the dorms, over lunch, or in the BSBA lounge, I was constantly learning from my peers and seeking their feedback.
What Olin course, ‘defining moment’ or faculty influenced your life most, and why?
The course that influenced me the most was organizational behavior. I bounced around from finance to economics and strategy. After taking OB 360, I realized my passion laid at the intersection of business and psychology.
Learning how people and organizations operate fascinated me and directed how I formed my team, negotiated contracts, built sales pitches, secured investment and built sustainable practices for my business.
How do you stay engaged with Olin or your Olin classmates and friends?
I stay engaged with Olin in a variety of ways. I serve as an associate member of the Alumni Board of Governors, a member of the Olin LEAD Committee, and as a member of the Skandalaris Center Eliot Society Committee.
I also occasionally guest lecture at WashU, hire WashU interns, conduct research with WashU professors, work with students who do class projects on GiftAMeal and mentor WashU student entrepreneurs. I stay in touch with my friends who graduated alongside me through Facebook, LinkedIn, phone calls, texts and occasional visits to one another.
Why is business education important?
Business education is crucial to build a solid foundation for how to think through problem solving and the fundamental components of what is needed for an organization to succeed.
Regardless of the organization, knowledge of finance, accounting, marketing, organizational behavior and strategy is just so necessary in order to make yourself a value add and to be able to see the bigger picture.
Looking back, what advice would you give current Olin students?
Looking back, I would advise Olin students to write down a few key takeaways at the end of each semester that they had about each of their courses. Then, when you have graduated, you can occasionally look back to remind yourself of those learnings and have them act as sparks to help you remember important things you learned in your courses.
I would also say to enjoy college, balance having fun and academics and get involved doing something you are passionate about. Olin presents so many opportunities for students, and this is the time to experiment and learn what you like and don’t like and find out who you want to be as a person in your future career.
Three startups spawned on the WashU campus joined the latest class of 20 companies to receive Arch Grants worth $50,000 each. All three companies were launched through Olin’s Hatchery course, one of the longest-running entrepreneurship courses in the United States.
The three Arch Grants recipients established at WashU are:
Balto, founded by Marc Bernstein, BSBA ’15. The company markets software that uses artificial intelligence to improve the success rate of sales reps working in call centers.
CheckTheQ, founded by Adam Hoffman, BSBA ’17. The company has created a monitoring system that delivers real-time information on wait times at airport security to airport operations.
GiftAMeal, founded by Andrew Glantz, BSBA ’17. The company markets a mobile app that helps provide a meal to someone in need each time a user takes a photo on its app at a partner restaurant.
“The entrepreneurial drive of these young alums, and the progress they are making with their companies is really remarkable,” said Cliff Holekamp, professor of practice in entrepreneurship, who teaches the Hatchery course. “It wasn’t that long ago that these students were sharing their new business ideas with me in my office, now to see them win Arch Grants is very exciting and a meaningful validation of the traction they are making with their companies.”
The three companies, along with 17 others, learned they’d each receive the $50,000 grant on November 16 at the Arch Grants gala, according to a story in the St. Louis Post-Dispatch. The Arch Grants organization does not take an ownership stake in the companies it supports, but does require them to operate for at least a year from St. Louis in order to qualify for the money.
The Olin Hatchery course involves student teams that work on a commercial or social venture idea proposed by a student or community entrepreneur. The students work to produce two presentations to a panel of judges and a complete business plan for the startup enterprise. The course is open to any WashU student who has taken the prerequisites.
Watch the Arch Grants video about all the 2018 grant recipients.
Pictured above: Arch Grant recipients Marc Bernstein, BSBA ’15, Adam Hoffman, BSBA ’17, and Andrew Glantz, BSBA ’17.