Munich Startup: Who are you and what do you do? Please introduce yourselves briefly!
Eik Lämmerhirt: Sebastian Engel-Wolf, Tjark Metzner and I are the founders of KeepoalaKeepoala is the leading loyalty program for reducing returns in online shopping with the help of shoppers. As a digital returns expert, we find the right lever for every return reason to reduce the volume of returns.
We're all originally from Thuringia. Tjark and I grew up on the same street, kindergarten friends, so to speak. Sebastian and Tjark went to the same school. I met Sebastian through Tjark. We're all 32 years old now, which means we've been friends for a long time. Despite our different academic backgrounds, we always knew that if we ever started a company, we'd do it together.
Sebastian studied Molecular Biotechnology at TUM and has been programming since he was 16. Tjark graduated from the University of California, Santa Barbara, with a degree in Economics. He was one of the first employees at Flixbus and has actively shaped the growth of a digital company from four to more than 1,000 employees. My name is Eik, and after studying business administration at TU Dresden and Audencia Nantes, I supported the development of more than 30 deeptech companies for a company builder.
Since this year, we have been working together from Munich on the Keepoala vision for a more sustainable e-commerce sector.
Each return costs more than 10 euros
Munich Startup: What problem does your startup solve?
Eik Lämmerhirt: We're solving the problem of excessive returns, starting with Germany, the European champion in returns. Every returned order incurs transport and handling costs of more than €10 and pollutes the environment with nearly 1 kg of CO2 per return. According to colleagues in the Returns Management research group at the University of Bamberg, the problem of returns totaled 280 million returned packages in 2018, resulting in costs of €3.4 billion, in Germany alone.
About a smart incentive program We want to reward online shoppers for not returning orders. The focus here is on closing the intention-behavior gap. This means that the will to shop sustainably is there, but the hurdle to doing something good is still too high, which hinders the implementation of what I actually set out to do. Through our app, we will make it as easy as possible for shoppers to be rewarded for their environmental awareness when shopping online and to reduce their own carbon footprint. By increasing transparency about the ecological footprint when shopping, we will help promote more conscious consumption in the long term. If an item is returned, the person placing the order can be rewarded for providing more detailed information about the reasons for the return. The participating online shops, retailers, and brands benefit from lower costs through avoided returns and return data, and from increased customer satisfaction and loyalty through the Keepoala sustainability seal.
Munich Startup: But that's been around for a long time!
Eik Lämmerhirt: It's true that there are countless bonus programs. Some of these programs also aim to reward avoided returns. Ultimately, however, these are isolated solutions run by individual brands and shops. The end customer is overloaded with various point balances, loyalty cards, and no feedback on the positive impact they can have with the right shopping behavior. Likewise, there are complementary technological approaches to prevent returns, enabling shoppers to order the right product before making a purchase. These include better product images, camera-based body measurements, and customer reviews.
Keepoala is the leading program that puts the online shopper at the center of retail across all stores to avoid returns, both preventatively and after orders have been placed. The combination of sustainable impact through the app-supported end-customer focus with an integrated digital B2B returns dashboard for partner companies is innovative and new. For the first time, scientific findings on returns are being used to positively change purchasing behavior without fear of revenue losses for shop operators.
Munich Startup: What have been your three biggest challenges so far?
Eik Lämmerhirt: Customer traction is generally the biggest challenge for early-stage startups, and that's true for us, too. Sustainability can't just be lip service for e-commerce retailers. Balancing day-to-day operations with new approaches to enriching the core business is difficult and requires a clear strategy from retailers and brands. Shops that believe environmental awareness can't be combined with increased profitability and higher customer satisfaction will most likely be left behind in a few years. We're pleased to be in discussions with numerous industry pioneers in this area.
Environmental protection is currently one of the most important future issues for almost every German. When developing the individual motivation and compensation strategies for our app, it is therefore important to leverage real savings potential rather than engaging in greenwashing.
Before joining Keepoala, we all gained several years of experience in other startups, consulting, and client projects. Our careers have been marked by one or two setbacks, but these have significantly boosted our learning curves. We can now use this wealth of experience to advance Keepoala together and make a positive impact.
Keepoala plans talks with investors next year
Munich Startup: Where would you like to be in one year, where in five years?
Eik Lämmerhirt: So far, we have been able to validate and improve our business case through numerous, highly positive feedback from customers, retailers, and academics in the returns research field. Customer traction will remain the focus of our activities over the next 12 months. We want to engage with as many interested retailers as possible in this area in order to generate added value for participating stores early on through data quality and analysis, and then build on this to scale the user app for shoppers. We will also schedule initial investor discussions for scaling in 2021 and hope to be able to announce news on the investor side in a year's time.
In five years, we aim to be THE seal of approval for sustainable consumption in online shopping in Europe. Regardless of our entry-level market of clothing and footwear. This means that if you, as a player in the e-commerce universe, want to implement your efforts toward a sustainable value chain and reducing your carbon footprint efficiently and with confidence, then it's best to work with us!
Munich Startup: How do you rate Munich as a startup location?
Eik Lämmerhirt: Munich is an excellent location for us in this early phase of our company, despite the high living and operating costs. Thanks to the university environment, we have early access to high-level professionals and working students, allowing us to expand our team to seven members. Furthermore, we benefit from a local network of former employers and strong sparring partners such as the Plant1 and its community, Plug & Play, Baystartup and its investor network, or, of course, Munich Startup. As passionate road cyclists, Munich's proximity to the mountains is the icing on the cake for Sebastian, Tjark, and me in our choice of location.
Munich Startup: Risk or security?
Eik Lämmerhirt: High risk – high return (for once, not to be translated as return). In our case, this also means high impact! We are aware of how challenging it is to target both B2C and B2B. We are convinced that only through the collaboration of all market participants can we truly leverage the potential of a sustainable e-commerce sector and will therefore position ourselves as a comprehensive returns expert.
