Australian startup snapshot: Productify

Sydney startup Productify has built a B2B service that streamlines the process for bringing products from supplier to retailer. The Australian company has a development capability in Israel and hopes to be an international player, say co-founders Doron Ostrin and Dean Steingold.

The pitch

The founders of Productify saw an increasing number of businesses moving to e-commerce but facing a pain point adding products to stores.

“At the moment, it’s done manually,” said Ostrin. “The brand or supplier will send an Excel spreadsheet filled with product information and then the retailer will get some person—a uni student or someone—to sit and load those products in.”

The process repeats every time the supplier adds a new product, and must be done individually for each retailer as they may have different requirements, Ostrin said. In addition, it can be difficult for the supplier to track whether the retailer has received any updates, he said.

“It’s just an annoying process, really.”

With Productify, suppliers store all their product information and images online and then share it to retailers online by invitation. Productify tracks the exchange between supplier and retailer and also resizes images automatically to meet individual retailers’ specifications.

Currently, Productify exports data to retailers as the Excel spreadsheet they were getting before, but it saves time on both ends of the process, said Ostrin. The startup is starting to integrate with retailer systems including Bigcommerce, Magenta and Shopify so that the products flow directly into the retailer’s backend, he said.

Starting up

Ostrin said he met Steingold through mutual friends and they decided to collaborate over dinner. “We were just talking and I was telling [Steingold] about this idea, Productify, and he was like, ‘Great! I’m in!”

Ostrin has an IT background while Steingold previously worked in property development. At Productify, Ostrin works on the technology side while Steingold has taken charge of business, funding and operations.

The two co-founders have largely self-funded the startup, but have just completed a small funding round so it can hire new developers, Steingold said.

Productify is still in closed beta but plans to launch in about three weeks. The beta has three retailers and six suppliers. “What we’re trying to do is form a very strong connection between the two [groups], and then our retailers are going to introduce us to all their suppliers,” said Steingold.

Selling it

Productify markets its service to both suppliers and retailers, but only charges suppliers.

“Both sides want it,” Ostrin said. The company is currently working on locking in as many different markets as possible, he said.

While retailers pay nothing, Ostrin said he expects that they will recommend it to their suppliers, resulting in more Productify sales. “We can get 10 or 20 suppliers in one go,” he said.

The price varies depending on the number of retailers that the supplier want to share their products with. Productify has found that customers tend to start with a basic, more limited plan and then upgrade as their businesses expand.

Going global

Productify is “100 per cent international,” said Steingold. The company has done extensive research on countries around the world since the beginning, he said.

While Steingold, Ostrin and one other full-time employee are based in Sydney, development occurs in an Israel office comprising three full-time staff. Productify opened in Israel because that’s where it found the best team, Steingold said.

Because the product is online, the founders don’t believe they will later need to move to another country. “If we get the product right, we don’t need big offices around the world,” Steingold said.

However, Ostrin noted that the company may need to add support staff in other countries to deal with different time zones.

Startup scene

Finding funding remains difficult in the Australian startup environment, according to Ostrin.

“You can get money from friends and family, and then you can get the big VC round of [between] $3 million and $10 million, but there is kind of that gap in the middle where people aren’t willing to take much risk on something that’s not proven,” he said.

Valuation of startups is also much higher elsewhere, he said. Venture capitalists that have met with Productify told the founders a valuation in the US would likely be $2 million to $4 million greater than in Australia, Ostrin said.

“I think they have it in their head that that’s the case, and therefore they follow it.”

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