Crowdsourced tipping platform for essential workers

In this interview with DrivR co-founder Sol Lipman, we learn about a new Santa Cruz startup. Sol Lipman will present at the Santa Cruz Works New Tech on November 2, 2022. Get your tickets now!

SCWorks: This is your third startup: 12seconds.tv which was (in my opinion) decades before TikTok, and YaDoggie - a “no worries” dog food company.  Then at Amazon, another entrepreneurial fire lit.  Tell us about it. 

Sol Lipman: Sure. Jacob Knobel and I actually worked in a group called Driver Assisted Technology, which by the way, is headed up here in Santa Cruz. And the goal of that group is to create new technology that helps drivers make their lives safer and more efficient. In doing that, we really got to experience what it was like to make deliveries. Jacob and I both made lots and lots of deliveries while we worked at Amazon…getting to know a lot of the drivers. Contrary to belief, Amazon drivers don’t work for Amazon.  Amazon contracts that out to Delivery Service Partners (“DSPs”). There are some 3,000 of these DSPs that Amazon drivers are employed by. And it's an interesting group of people, interesting culture, and it's not one that people know a lot about. And so when thinking about what startup we wanted to do, we wanted to do something that would be impactful and helpful, but that would also address a real need where we saw a problem. About 10% of these drivers make it beyond one year in that job. 

SCWorks: Why?

Sol Lipman: It is a really hard job. They're delivering 250 packages a day on an average day. During the holidays, it's like 400 packages or prime day. And the pay is not great: about $16-22, depending on their location. But a UPS driver makes $42 an hour and $15 an hour for their pension. They basically do  the same job, and in some ways – maybe even an easier job. So we thought, how could we address this issue of attrition? That was the first thing we started thinking about. If you want to beat attrition, you have to pay drivers more. And how are you going to do that? The margins are too thin for those DSPs to pay significantly more. And it occurred to us that this is the only type of driver - an essential worker - that doesn't get tips. Uber drivers get tips. Lyft, DoorDash, Uber East drivers all get tips. Why not the one driver that you depend on the most? It doesn't didn't make sense to us. So we thought, how could we enable a tipping platform for consumers to be able to very easily tip their driver.

SCWorks: Do customers want to tip their drivers?

Sol Lipman: Yes, from our polls, definitely. They already want to do good things. People leave out water bottles and snacks. On Reddit, we learned that a driver was even given a giant squash. People want to give to their drivers. But the method and tools aren't available. And so we built the first tool that does. We're going to launch it first here in Santa Cruz and learn about what's working, what's not working, and then we're going to expand it nationwide as quickly as we can.

SCWorks: And how much would tips help drivers financially? 

Sol Lipman: We did a study in Santa Cruz County. If 10% of households in Santa Cruz tipped $10 a month, a driver’s compensation would go up 20%. So it doesn't take a lot to have a really big impact on this demographic.

SCWorks: That's great! Better than an annual cost of living adjustment…that never comes. Please describe the driver and customer experience.

Sol Lipman: There are two apps. One is for drivers, the other is for customers. The driver app basically tracks their location. So when they go on duty, they fire up the driver app. We track their location. From that point on, as they go around, we correlate that information with what's happening in the customer app. In the customer app, when you register, you basically top off a driver tip card, very similar to a Starbucks card. Same concept. You set an amount to tip for each delivery: could be a dollar, could be fifty cents. We see what packages you're getting delivered, correlate that with the location of the driver, and we make sure the driver gets rewarded.

SCWorks: Will customers aka “tip’ers” have any concerns about their data? 

Sol Lipman: Let me make it really clear how we're using their data. In fact, most of the data is stored on the customer’s device. The most we will see is the tracking numbers of the packages getting delivered. Amazon is very conservative, protective, and respectful of customer privacy.

SCWorks: Is this scalable to other delivery services? 

Sol Lipman: While we built the platform to scale, we are starting with Amazon because we know the system so well. Amazon is an amazing value. It's almost a miracle if you think about the way the world was even five years ago compared to how it is now. But it is built on the backs of cheap labor. And that is something that I think we as a society need to start thinking about. How are we supporting the people - essential workers -  that are supporting us? You're seeing a lot of things happening in this country right now. Unionization efforts, et cetera. Because a lot of these companies are incredibly good at what they do. They become very successful. But somebody's paying the price for that, and that is in this situation. Those are drivers. So I think it's an important thing to do. The other thing I would mention to you is that when you subscribe to Driver, you get like a lawn sign basically that says, we support drivers. It's really cool. It's on the website if you want to take a look. And part of the idea there is for drivers to see, hey, this is a household who supports what I do.