Drexel students’ start-up delivers convenience on the go

Super Bowl Sunday is typically a day of mass consumption - when snacking is endless and the beer flowing.

GoPuff.com - a 24-hour, online delivery service conceived by two Drexel University students - hopes to deliver plenty of both, especially the beer, to your home this weekend.

It's another convergence: a Wawa on wheels - one that can deliver whatever you need - be it ice cream, toothpaste, a dog collar, and now a range of brews from Guinness to Dogfish Head 90 Minute Imperial IPA - at whatever hour, and in 30 minutes or less.

"It's amazing. They come right to my door," said Matthew Broadwater, 23, of Center City, who greeted GoPuff employee Simon Ilishayev, 23, on a recent Friday.

Ilishayev asked Broadwater for his ID card to verify his age. He then took a picture of the ID card on a tablet and had Broadwater sign. And then handed him a 12-pack of New Belgian Ranger that Broadwater prepaid $23.95 online for along with Trojan condoms for $4.95. The service offers convenience-store prices with a flat $1.95 delivery fee. And it's free for all deliveries $49 and up.

GoPuff quickly caught on in Philadelphia, where it was launched just over two years ago. It has since been added in Boston; Washington; Austin, Texas; and New York. It's going online in Denver this weekend, starting Saturday, just in time for Super Bowl 50 featuring the Carolina Panthers vs. the Denver Broncos.

GoPuff now has 40 full-time employees, not counting drivers. Although he couldn't give sales numbers (because of investors), Ilishayev said revenue was doubling every month.

The tech start-up competes against local beer distributors and Postmates, an online food-delivery service. But the convenience store is GoPuff's biggest competition.

GoPuff's edge is that it is focused on millennials. "College students and millennials spend the same everywhere," said cofounder Rafael Ilishayev, 22, who is Simon's cousin, of GoPuff's key clientele.

Business really went into overdrive, Rafael Ilishayev said, after Dec. 15, when GoPuff added beer delivery to its online menu, under the subsidiary GoBeer. "We're getting an order every two minutes" on weekends, he said.

He was recently seated in GoPuff's main warehouse office at 454 N. 12th St. in the city's Loft District beside his business partner, roommate, and best friend, Yakir Gola, also 22. Gola was his friends' "go-to taxicab" as a sophomore at Drexel.

"All my friends were always asking me to pick up snacks for them, or beer for them, anything late at night since they didn't want to leave their house," Gola recalled. "I wondered then, 'How is it that there's not a service that will deliver everything you need at whatever hour?' "

The bulb came on: He and Ilishayev would develop the app and technology for one.

Each came with a small-business background that helped. Ilishayev worked in his father's banquet halls in New York as a teenager and got to know the hospitality and logistics end; Gola's family owned jewelry stores in Philadelphia. He said he sold the jewelry online during his senior year in high school.

It took about eight months to execute the idea. GoPuff was created in May 2013 and launched in December that year to make deliveries 24/7 just within the city.

For the first eight months, each logged 16-hour workdays on GoPuff as students. Ilishayev graduated with a degree in business law and history, but Gola fell short on getting his finance degree "because of this," he said of GoPuff's ascent.

They say GoPuff.com represents the next level of customer convenience. Consumers can avoid going to malls and grocery stores by shopping online. Now they can skip the convenience store, too.

"That's our tagline, 'Goodbye convenience store. Hello GoPuff,' " Gola said. "It's on our website and on every order."

This is how the service works: You download the GoPuff app, punch in your residential address, and go to the menu of items listed under 20 categories. These include "essentials," "munchies," "homey" for home items, and "tronics" for electronics. There's even an "organic" category of food.

But warehouse space quickly became an issue. Their inventory has grown from 150 products to about 3,000.

They started with a 950-square-foot space in West Philadelphia. Later this month, they plan to triple the current 6,000 square feet, as well as add the GoBeer warehouse two doors down.

GoPuff applied for the license to deliver beer, known as a D-license, four months ago from the Pennsylvania Liquor Control Board and got it in early December.

Ilishayev said the license cost about $150,000. Those who order beer online have their ID scanned as proof that they are at least 21. GoPuff keeps a record of every ID on its computer servers.

The plan is to open a distribution center in Manayunk later this month to extend GoPuff's reach into the Main Line and Bala Cynwyd to tap the St. Joseph's and Villanova student market.

GoPuff's vast army of drivers are independent contractors who use their own cars and gas - like the Uber model. Each wears a bright blue GoPuff T-shirt. They get base pay, plus the $1.95 delivery fee and tips on each run. Ilishayev said GoPuff drivers make, on average, $25 to $30 an hour.

Ben and Jerry's ice cream is GoPuff's top seller. A pint goes for $5.49 at Wawa, and $5.89 at 7-Eleven, said Ilishayev. GoPuff sells it online for $5.49, plus $1.95 for delivery.

Ilishayev boasted that GoPuff was one of the few delivery services open during the recent snowstorm - closing only four hours that Saturday, from 6 to 10 p.m. Uber also operated all of Saturday.

"We averaged a call every four seconds on the Sunday right after the blizzard," he said. "Our drivers made a killing."

The game plan, he said, was for GoPuff to enter a new major city every two months and secure a liquor license in each. He cited San Francisco; Portland, Ore., and Miami, among others, on his radar. "We want to make sure alcohol delivery is in every major U.S. city," Ilishayev said.

He said a typical beer distributor in Philly does it "the old-fashioned way."

"You pick up the phone and ask them to please deliver a 12-pack of beer, and it could take three hours, and they may charge you $10 for delivery.

"If you go through our app, it takes 20 seconds, and we will get it to you in under 30 minutes, and we charge $2 for delivery for one case, and $1 for two cases," he said. "We're all about speed."

So how does GoPuff make money? "We're buying in huge volumes for five cities - now six - and have much more buying power," Ilishayev said. "We deal with some of the biggest distributors in the country."

In mid-2013, the young founders gathered discarded office cubicles and resold them on Craigslist and eBay to net about $60,000 to pay for developing GoPuff's app and technology, and to buy inventory.These days they no longer have to scrimp and save on their own. GoPuff is attracting serious investor money. Anthos Capital out of Santa Monica, Calif., recently put in $3.5 million to grow the business.

"We're going to keep expanding into every major city," Ilishayev said.

Perhaps a sign that GoPuff is going places: 25 SEPTA buses are wrapped in GoPuff and GoBeer signage this month.

sparmley@phillynews.com

215-854-4184@SuzParmley