When your whole business model relies entirely on one of the industries hit hardest by the pandemic, you’re in for uphill battle.
Tech startup Qwick is an on-demand staffing service for the food and beverage industry, an industry that nearly disappeared for the first months of the pandemic. Qwick nearly died, too, but it’s slowly coming back to life. Like so many other aspects of COVID recovery, Qwick’s return to its previous growth is not going to be easy, but co-founder and CEO Jamie Baxter is hopeful about his company’s future.
What is Qwick?
Phoenix-based Qwick is like Uber for the food and beverage industry, says Baxter. It connects service industry pros with places like hotels and restaurants in order to fill shifts in real-time. In an industry with such high turnover and no-show rates, shifts often need to be filled last-minute. Businesses can post open shifts, while food and beverage workers — like bartenders and dish washers — can pick up shifts to make a little extra money and set their own schedule.
Qwick was founded in 2018 by Baxter and Chris Loeffler. One day, Loeffler was visiting Baxter and talking about the staffing problems he was having in some of the hotels he owned. He mentioned how great it would be if there was a tool that could alleviate some of those issues. Baxter says that’s when he knew Loeffler was on to something. Baxter pitched the idea as a business opportunity and Loeffler agreed to be a co-founder and advisor. Baxter moved from California to Phoenix and got to work.
By the end of 2018, Qwick had raised $1.3 million. It then expanded to four more cities, starting with San Diego in January 2019. The company continued to see significant growth in 2019 and had no problem finding investors. February 2020 was the company’s second strongest month to that point. But everything changed just a few weeks later.
COVID complications
Baxter was fundraising in San Francisco when major restrictions rippled across the U.S. to try to slow the progress of the impending COVID-19 pandemic. The timing of this was especially bad for the company because they’d decided to delay fundraising efforts in fall of 2019 and start again in spring 2020. Almost immediately, venture capitalists stopped writing checks while Baxter saw his company’s revenue drop 80%.
“We were running out of cash as we saw revenue plummet,” says Baxter.
Baxter knew that the platform’s professionals and businesses were struggling, too. The service industry almost entirely shut down and employees were doing what they had to do in order to pay the bills. Many workers quit the industry to do something else.
Qwick leadership laid off 70% of their own team, which Baxter says was especially hard for a company that prides itself on how it treats its employees. “You’re not figuring out who to lay off, but who you absolutely need to keep to save the company,” Baxter says.
In order to stay afloat, the company’s current investors supplied the extra money needed to get through the pandemic – however long it took.
Baxter says the company also made a decision to use the platform to try to meet the unique needs that arose because of COVID-19. They started staffing for a hospital in New York and helped the military find staff to help feed new marine recruits in quarantine before entering basic training. They’ve also helped supply staff to help direct crowds and parking at the three vaccination sites in Phoenix.
Qwick had initially focused on providing service workers for things like sporting events, catering and hotels, but during the pandemic it began to focus more on staffing for restaurants. Before the pandemic, restaurants contributed about 5% to Qwick revenue, but during the pandemic restaurants were bringing in around 20% of total revenue.
Baxter says that the mission of the company has always been to help people provide for themselves and their families. He wanted that to remain the case, even during the struggle of the pandemic. They decided to cut fees by 50% so, instead of taking 40% of the hourly rate, Qwick would only take 20%. Baxter saw it as “an opportunity to say yes to helping out.”
And he’s seen evidence of that. He gets choked up as he tells the story of a man who said it was because of a Qwick shift that he was able to feed his daughters dinner.
Recovering from losses
Now, Baxter’s seeing the light at the end of the tunnel. Adapting the company’s platform to meet the needs of the pandemic helped them make it through, as did the extra money from investors. But Baxter says it was his team and their work culture that was key to Qwick’s survival.
So, in spite of the challenges, Baxter has a bright view of the future. He doesn’t focus on the company’s losses in 2020. Instead, he sees the company’s rocky 2020 simply as “taking a year off from growth.”
“I’ve never been more excited about Qwick than I am today,” says Baxter. The company had a great Q4 in 2020, which actually even beat the Q4 of 2019, and plans to hire more than 50 people in 2021. The platform has also expanded and is now working in 8 cities.
Qwick’s business clients tell Baxter they’re busier than ever, and Baxter tells his team to expect a “tsunami” of work the rest of 2021. He believes that as things pick back up and people get their vaccines, life will slowly return to how it was before the pandemic.
Baxter still wants Qwick to be a force for good, so he’s launching the Qwick Cares Foundation this year. The company will donate 1% of its gross revenue to help staff charities and food banks and provide workforce training to those in need.
Still, Baxter and his team are ready for things to get back to normal…Qwick.
Aren’t we all?