Episode 11: Fabric CEO Faisal Masud and Co-founder Ryan Bartley discuss startups, the problem with low-touch platforms, and the unique capabilities of headless commerce

Fabric Co-founder Ryan Bartley discusses how Fabric went from an idea to a startup company, and CEO Faisal Masud reveals Shopify Plus’ Achilles heel. Then they talk about what companies can do with headless commerce.

Fabric CEO Faisal Masud and Co-founder Ryan Bartley
Fabric CEO Faisal Masud and Co-founder Ryan Bartley

Transcript

Jon Henshaw: Welcome to the 11th episode of the Coywolf Digital Marketing Podcast. I’m your host, Jon Henshaw. In this episode, I’m sharing excerpts from my interview with Fabric CEO Faisal Masud and Co-founder Ryan Bartley. Fabric is a headless commerce platform designed to modernize and replace complicated and expensive legacy commerce solutions. Fabric also provides virtually unlimited commerce capabilities for retail, direct-to-consumer, and B2B companies.

In the first excerpt, I asked Fabric Co-founder, Ryan Bartley, to describe how Fabric went from an idea to a startup with $9.5 million dollars in seed funding.

There’s a lot of people, maybe not a lot of people, but there’s plenty of people out there that have a lot of experience around something. They recognize a problem and it bugs them and it’s a constant itch that they want to go solve. But how do you go from that to literally the startup? In other words, how did you essentially find your co-founders and say, “We’re going to do this, and this is how we’re going to do it.” Did you have to pitch? What did that look like? How did you … That’s a huge step to take, I think.

Ryan Bartley: Yeah, agree. For me, it was actually very interesting journey. I worked in large companies and we’re building these advanced tools. And so the benefit of that is we did a lot of R&D at eBay and Staples and those other scale businesses, and have lots of scar tissue of what worked and what didn’t. So literally we were the customer of the product that I’m building. And I think that just gives us a very quick advantage.

As people look at what we built over the last couple of years, they’re shocked at the scope that we have. They’re shocked at how advanced we are. And most startups have a problem or identify a problem, but they go through this incubation phase that no one talks about, no one ever shares in the news. It looks like they’re overnight hits, but typically there’s a few to several years where a startup wanders in the desert, trying to figure out the right product market fit, the right customer set ,the right everything. Where I think because of our experience, we didn’t have to go through that phase.

We spent a little bit of time upfront when I started Fabric with the co-founder, working on a couple of things. One is technical architecture. We knew that we wanted to start this business at a time when technology and cloud platforms had advanced to a certain level. And so we spent about six months really doing R&D on technology, and making sure we made the right technology choices that will last into the future. And then of course we spent a tremendous amount of time with customers, our expected customers, just understanding and revalidating all the things that we needed. And I think that goes back to really Faisal’s leadership. Coming all the way from Amazon, of being super customer centric. And it’s very simple. If you focus on the customer and you identify insights around what they need or what they want, and then you build to that, and you keep listening and you keep doing that. So that’s what we’ve done at Fabric.

So yeah, starting with a beachhead, me and a co-founder basically at a card table, and then scaling up very quickly over the past couple of years has really been a fun journey for me as an entrepreneur.

Interlude

JH: In the second excerpt, I asked Fabric CEO, Faisal Masud, to further explain why software-only, low-touch commerce platforms, like Shopify Plus, would struggle to make the jump from SMB to mid-market enterprise.

They’re trying to do something from the tech world and something they’d been able to automate easily for say, small businesses, and go into an area that is much more complex in every aspect. And I think what I’m hearing is that that’s going to be really difficult for them to succeed in doing that, especially because they don’t have the 50 years of experience type of thing that was mentioned earlier. But with that being said, I think that’s pretty clear as far as how you feel about that.

But one of the things, Faisal, that I heard you talking about were we can do this, we can do that, we understand where you’re coming from, but that does sound very service heavy to me. You know what I mean? As in, it’s not software, it’s also going to take human beings who are going to solve these problems with you and that type of thing. Do you foresee or are you already there to some extent where the software will handle the type of things that you were describing?

Faisal Masud: Yeah. I guess first of all, when you enter the B2B landscape, you can’t avoid the service component and if you do, you’re going to lose. You can provide platform for these companies that are billions of dollars and run large external sales teams and internal sales teams, but have never really dabbled in running their own commerce online with the team internally. Think about walking into a multi-billion dollar B2B company that has one IT guy and everything outsourced to some international location and running on some old school stack with no real understanding of customer experience, how to sell online and standing up a store that’s actually going to generate in the future, probably 50% of their business. So we see this as a massive gap in the market for who actually gets to sell to them.

The advantage we have is we have a network of SIs that work with us, Systems Integrators, that provide a lot of this outside of what we do. So it’s really a hybrid approach right now where as we grow the company, completely divorcing ourselves from their day-to-day issues on how to manage the product is not valuable, right? If you look at AWS, how they got everybody on board, they had a whole ProServe arm to do that. You only hear about AWS the platform, you never hear about the professional services revenue. The solutions architecture part is actually very critical because you’re walking into highly customized software that has technical debt for decades. You can’t solve that by just providing a platform and say, here’s our platform, thank you. It just doesn’t work.

JH: Yeah, it makes sense. I actually learned that the hard way myself. Several years ago, I had a digital marketing app that agencies used and we kind of early on, we were serving SMBs, but we kind of wanted that enterprise money. And so we made a play for enterprise and boy, that was a wake up call as far as the amount of effort and time and touch that that was involved. And what I learned from it was it’s really hard to do both. There was no reason why we couldn’t have shifted into just doing an enterprise and been very successful at that. We tried to do both and it’s funny because even going back to the Shopify sort of analogy, I guess, our approach is more Shopify-ish, where we were doing SMB, self-serve, that type of thing.

And achieving the needs that our enterprise customers had was pretty much impossible without having human beings with experience who knew how to solve very specific problems that they had.

FM: Yeah. And you’re actually calling out Shopify’s Achilles heel. For Shopify to turn this Titanic around in a positive way, it’s a huge shift they’re coasting on with great revenues. And all of a sudden go from selling at the SMB level to enterprise, it’s not a self-serve quote, unquote. There’s no such thing. We will build it and they will come, that’s complete BS. It doesn’t work like that when it comes to B2B. Like your experience, it’s going to require a choice. Are you mid-market enterprise? Are you SMB? Because you can’t be both. We have made a choice, a deliberate choice that Shopify Plus is our on-ramp. We do not touch anybody below that. We don’t want to. We have no desire to because that is not our wheelhouse. And by the time you are thinking headless, you need to be doing 10, 15 million.

Otherwise, you’re really better off on Shopify and it’s a perfect platform for you. But if you’re going to deal with large scale enterprises where commerce cloud and ATG and SAP live, there’s no way you can avoid getting systems integrators third parties involved in the human part of the equation. We believe product management is still a very new concept. It’s nascent in these legacy organizations that they don’t really understand the difference between product and project. And it is important, it is our duty to make sure, and it would be highly responsible for us to think that here’s our platform, go figure it out. Those implementations will fail. So we believe that in the early years, it’s going to be a critical sort of core competency for us to provide that similar to what AWS did, and now GCP does too.

And we don’t believe that that’s not a creative to our overall vision and ethos of what Fabric does. But longer-term as these companies mature, there’s less need for that and we become a more robust hardened platform where they just come in and use the platform versus anything else.

Interlude

JH: In this third and final excerpt from the interview, I asked Ryan to explain the advantages of using headless commerce.

So with headless commerce, sort of the promise of it is obviously you’re doing on a big scale, enterprise scale. The promise of it is that you aren’t limited in your channels per se. You aren’t limited in the way that you can sell or sort of have a transaction. And I haven’t spent much time with this. My expertise and experience is mainly SEO and that kind of thing. I haven’t done a whole lot in big ecommerce. And so I think a lot of my listeners are probably in that realm too. And so I would love for you to just provide the people who are listening some examples of the really neat things you can do with headless commerce. I mean, from this idea around micro-services and the different… I think of ways where, oh, I can take your API and use Swift to build an iOS app for whatever store. What are some things that are pretty neat that you can do?

RB: Jon, I’d say there’s a couple of angles to that. The first is just taking modular pieces of software and being able to recombine them in different ways. So if you’re a company, I don’t know, like a game developer, if you think of a game developer, they want to have in app purchases and micro-purchases. Those are all concepts. Commerce concepts, you need a product, you need inventory, you need pricing, you need promotions, you need a cart, you need payments. And so if you take headless approach, then you’re just combining those APIs and you’re building that experience in a unique way. And so that’s one of thinking about headless is you can get the best of the capabilities and recombine them, just very similar to how I think of the big cloud platforms as well, where again, you’re taking compute and storage and networking and building something over the top of it.

The second thing is really around scaling to different channels as well. So today, how does commerce happen? Well, that happens in retail stores and there’s a digital component to that. It’s growing obviously this year with COVID as an accelerant in ecommerce, what’s known as ecommerce, where you go log on to a website and you make a purchase. But the question is, where’s that going? What’s the end points where people shop and how do they shop? Those are going to change over time, and Jon, I don’t know how they’re going to change. I just know that-

JH: That was going to be my next and last question, but go ahead.

RB: Yeah. I don’t know how it’s going to change and what it’s going to look like, the form factors of shopping or procuring or discovering products, but you know customer experience always changes, and so as you think about that, we did some early work at staples around voice reordering in an office because it’s friction to go to a website to place a replenishable order, and I think you’ll see the rise of social shopping happen as well, and so those end points, you have to be able to plug in your commerce capabilities to meet the customer, wherever experience that they want to be at. So that’s really what headless commerce is about is if you break it down into a set of services and APIs, then you can recombine it into whatever experience makes sense for that customer in that channel.

JH: You can listen to the full 49 minute interview with Faisal Masud and Ryan Bartley at coywolf.pro/fabric. Thanks for listening.

Jon is the founder of Coywolf and the EIC and the primary author reporting for Coywolf News. He is an industry veteran with over 25 years of digital marketing and internet technologies experience. Follow @henshaw