#31 - Spotting Ecommerce Trends in Shipping Data – Laura Behrens Wu

**Craig Cannon** (0:00)
Hey, this is Craig Cannon, and you're listening to Y Combinator's podcast. Today's episode is with Laura Behrens Wu. She is the CEO and co-founder of Shippo. Shippo is a multi-carrier shipping API, so that means Laura knows a ton about shipping, and we went over a bunch of that in this episode. One of the fun facts is that you can ship a 20-inch alligator in the mail, which I had no idea you could do. And if you want to read the transcript of this one, it is at blog.ycombinator.com, and the video is up there as well.
All right, here we go.
How about we just start with a quick intro?

**Laura Behrens Wu** (0:31)
Cool.
Yeah, thanks for having me. My name is Laura. I run a company called Shippo.
We power shipping for e-commerce. What that means is we connect our customers, who are e-commerce stores, platforms, and marketplaces, to a network of different shipping providers. And then we help them figure out which provider to use for which one of their packages. The reason why people care about shipping today is that shipping directly affects conversion rates. So it's no longer just a means to an end to get your item from A to B.
E-commerce stores, they needed to be able to convert their customers because customers are expecting free and fast shipping. Amazon Prime has taught them that. And whenever they see shipping rates at checkout that are unexpected or too high, they drop off and they go to Amazon to try to find the same things.

**Craig Cannon** (1:12)
And so how does your customer interact with Shippo, exactly?

**Laura Behrens Wu** (1:15)
So it's an API, it's a RESTful API that they can integrate. Either they integrate the API or they use the dashboard that we've built on top of the API, both works. If you integrate the API, there's more flexibility, you can do more with that.
SMBs that are just getting started that don't have developers in-house, they typically just use the out-of-the-box dashboard solution.

**Craig Cannon** (1:37)
And so what's a normal customer of yours like? Like, what do they make, what do they sell?

**Laura Behrens Wu** (1:42)
So a normal customer of ours, they're an e-commerce store that's...
They sell products that are differentiated. They have their own brand, they don't want to sell their products on Amazon. They want to own their own brand experience, sell through their own e-commerce store, and ship typically either out of their own workshops or a warehouse, a 3PL, that takes care of shipping for them.

**Craig Cannon** (2:05)
And so what's a 3PL for people who are in the game?

**Laura Behrens Wu** (2:07)
A 3PL is a third-party logistics provider.

**Craig Cannon** (2:11)
And did you know anything about this stuff before 2013 when you guys started?

**Laura Behrens Wu** (2:16)
I did not.
And I would never have imagined that I now know all of these things. It's been crazy. I started this as a complete logistics noob, and I got into e-commerce by pure chance when trying to build an e-commerce store on the site together with my co-founder Simon. We built an e-commerce store using Shopify. It was a really easy solution, and it was just a fun thing to do on the site. And then when we tried to integrate or connect with different shipping providers, we realized that the technology experience provided by shipping providers was just so different compared to the technology experience provided by Shopify or Stripe. Like, the shipping providers aren't tech companies, so their API documentations aren't as great and intuitive. You have to be a logistics expert to be able to read the documentations.
Sometimes you have to request API access, or it's a SOAP API. It was just strange to us that everything's been solved except for the shipping component, and it was a frustrating experience. So we were like, why is there nothing comparable to Twilio or Stripe in the shipping industry? Let's give that a try.

**Craig Cannon** (3:31)
And were there other kind of critical understandings that you didn't quite get in the beginning that now are obvious as in real to running a shipping company?

**Laura Behrens Wu** (3:42)
Yes, we were learning on the job. I mean, we didn't know anything about shipping back then, and we tried to solve shipping from the customer perspective. And I think that was a good perspective to have. So we weren't influenced by the restrictions coming from a shipping industry. We were able to look at it from the perspective of, this is how an e-commerce store wants it to be, and this is what modern technology looks like. Let's build it like that.