ClearCOGS
Startup Snapshot
Startup name: ClearCOGS
Industry: Restaurant Technology
Business Model: B2B SaaS
Founder: Matt Wampler & Osa Osarenkhoe
Operates: Worldwide
HQ Location: Chicago, Illinois
Team Size: 9
Founded: 2022
Stage: Pre-Seed / Seed
Investors: Math Ventures & Lofty Ventures
Website: www.clearcogs.com
What does ClearCOGS do?
ClearCOGS synthesizes preexisting restaurant data and presents it in an actionable way to provide actionable answers to the restaurants' daily operations questions.
What's your backstory?
After graduating from college, Matt started working in the restaurant industry. He met a restaurant owner struggling with his business and considering giving up. However, Matt saw an opportunity to help him turn things around. With his expertise and hard work, Matt opened four more locations, increased the business's revenue from USD 400,000 to USD 1,200,000, and secured an acquisition within 18 months.
Later in his career, Matt became interested in data science and programming. He realized how powerful these tools could be in the restaurant industry and regretted not having had access to them during his previous venture. During the pandemic, he met Osa, the founder of Gyst Audio, and they hit it off immediately.
Matt saw the potential of leveraging his skills and experience in the restaurant industry. He reached out to his friends in the business and gained access to their restaurant data. He knew there was an opportunity to use this data to improve restaurant operations, but he wasn't sure how.
Restaurants can save over 2% on food costs and increase profit margins through precise forecasting, inventory management, and ingredient sourcing.
That's when he decided to collaborate with Osa. Together, they explored the potential of the data and discovered a way to use it to optimize restaurant operations. Their collaboration resulted in the creation of ClearCOGS, with a mission to help restaurant owners make data-driven decisions to improve their business.
How did you come up with the idea?
Matt and Osa had conversations with several restaurants and discovered that many struggled to gain useful insights from their data. Although these restaurants knew that they needed answers from their data, Matt and Osa realized that most didn't even have access or visibility into their data. Initially, they decided to focus on the food preparation stage, which was underserved and could provide high returns on investment for their customers. Their objective was to convert machine learning insights into actionable steps to help restaurants make data-driven decisions.
How did you acquire your first customers?
During his time as a restaurant operator, Matt barely spoke to any sales representatives and rejected all of them. He knew that sales could be challenging in this industry, so they first did to validate if there was any demand in the market or if they had to push our product into the market. They set up their website and marketing campaigns to attract customers, and that's how they landed their first customer. A restaurant owner saw their social media posts, reached out to them, and signed up for ClearCOGS.
When did you realize you had achieved PMF?
There was a huge gap between ClearCOGS landing its first customer and finding Product Market Fit. In 2021, Matt and Osa launched the first version of ClearCOGS and realized that people are looking for solutions like theirs. Unfortunately, Matt believes they failed to onboard most of them successfully, resulting in most customers churning.
It wasn't until a year later that they managed to land a sandwich shop and reduced their bread waste by 50% through very granular baking schedules. This proved that ClearCOGS could deliver significant value, so they doubled down on improving their product.
By 2023, they had built a full-fledged SaaS and concentrated on increasing solution awareness. This was when customers began coming to them. It was then that most of their customers reported reduced food waste, and one in particular, a large US franchise, managed to save 2.3% on food costs, once again proving that what they were building could deliver value at scale.
What's your motivation?
Many local burger joints make better burgers than well-established fast-food chains but tend to be less successful. This is due to the lack of analytics and technology in their operations compared to well-established fast-food chains.
To level the playing field, ClearCOGS aims to provide these local joints with tools and technology that allow them to operate at the same level as the larger food chains in the country. This might have been a pipe dream in the past, but with the help of AI and machine learning, this is now possible, making it easier for them to compete.
At ClearCOGS, our mission is to help restaurants become more efficient stewards of their resources. This means using the data they already have to optimize inventory and pricing so they can focus on creating a great customer experience and growing their business.
What's next for ClearCOGS?
ClearCOGS has a long-term vision to create a fractional digital CFO/COO specifically designed for restaurants. The aim is to relieve restaurants from the burden of statistical analysis and planning. ClearCOGS can answer typical questions such as what to prepare for the day, whether to cut anyone earlier, or how many briskets to prepare for tomorrow's lunch. These are all tasks that restaurants don't want to deal with, but AI is very good at handling them. The goal is to simplify and streamline restaurant operations while ensuring efficient decision-making.
Tips for other founders:
If you are proud of your first release, you probably launched too late. It is always better to release your product as soon as possible so that you can receive feedback as early as possible. Your customers can provide valuable insights into what they like, want, and need. Instead of making assumptions, launch your product and allow your customers to guide you.
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Founders Wisdom
If you sell someone a tool, and they can use it to make more money than it cost them, you’re creating value.
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