Ilir Sela is the cofounder and CEO of Slice which transforms independent pizzerias with the tech, data, marketing, and shared services needed to serve today’s digital-minded customers. The company has raised over $80 million from top tier investors like GGV Capital, KKR, Primary Venture Partners, or RiverPArk Ventures to name a few.
In this episode you will learn:
- Doing things that don’t scale so that you can scale
- How funding changes across different rounds
- How to pick the best investor for your business
- The new Slice Accelerate initiative
- The need to hire better help earlier
- The superpower of storytelling
For a winning deck, take a look at the pitch deck template created by Silicon Valley legend, Peter Thiel (see it here) that I recently covered. Thiel was the first angel investor in Facebook with a $500K check that turned into more than $1 billion in cash.
The Ultimate Guide To Pitch Decks
Moreover, I also provided a commentary on a pitch deck from an Uber competitor that has raised over $400 million (see it here).
Remember to unlock for free the pitch deck template that is being used by founders around the world to raise millions below.
About Ilir Sela:
Ilir Sela is the Founder and CEO of Slice, the all-in-one ordering and marketing tech platform for local pizzerias. Ilir is “third generation pizza.”
Born to an Albanian family in Macedonia and raised in Staten Island, Ilir Sela grew up helping his family run their New York City pizzerias. After getting a degree in Computer Science, Ilir Sela started his first company, Nerd Force, in 2003 and sold it in 2008.
Ilir Sela then combined his passion for technology with his deep experience in the pizza industry to build Slice — a company that empowers local pizzerias with the tech, data, and marketing to compete with the big chains. Now discovering and ordering delicious pizza has never been easier.
Through its partnerships, Slice has driven over $1B in earnings for over 13,000 independent pizzerias nationwide.
Connect with Ilir Sela:
* * *
FULL TRANSCRIPTION OF THE INTERVIEW:
Alejandro: Alrighty. Hello everyone, and welcome to the DealMakers show. Today, I’m super excited to have the guest that we’re going to have on the show today. It’s definitely the real story where you see the American Dream simplified in a really, really good way, and definitely, nothing has been given to him. His journey is remarkable! So without further ado, I’d like to welcome our guest today, Ilir Sela, welcome to the show.
Ilir Sela: Thank you so much for having me. I’m excited to be here and excited to chat.
Alejandro: So born in the former Yugoslavia. How was being born there, obviously, Albanian by background, but how was being born in Yugoslavia?
Ilir Sela: It was pretty awesome. I was born in a really small town, which was less than 10,000 people and Albanian by background. An interesting fact is that I have a twin brother, so I would say our youngest childhood years were just fond memories of friends and family. My dad was an entrepreneur. At the time, he owned a tailor shop, and I remember always going there and asking him to buy us candy and things like that. For the most part, it was a very small town-type of upbringing until I was ten years old, and that’s when we moved to the U.S.
Alejandro: So, obviously, you land in Staten Island at ten years old, as you were saying, and a completely different world. How was that impact on you and the family?
Ilir Sela: Oh, my gosh. I remember that night when we landed. It felt like magic. Imagine I’m coming from a really small town. There are no traffic lights where I’m coming from. We’ve got no idea why those would even be necessary, and remember this we 1990 when I moved here. So there was not a lot of social media or ways to see what New York is like ahead of time. When we moved here, my uncle lived on Staten Island. We chose to live with him the first few months when we came to the U.S., but I remember landing, and there were so many lights looking outside of the airplane window. It looked like a magical place. It looked like anything could be possible coming in. That memory is etched within myself, and I’ll never forget it.
Alejandro: What would you say was the trigger? Why would your parents say, “We’re going to move the family to New York?”
Ilir Sela: My family actually lived in New York in the ‘70s before I was born. They owned a small business pizzeria in Manhattan, and then they moved back a couple of years before we were born, my twin brother and I. So my older brother was actually born in Manhattan. I think they went back-and-forth. Then, again, in 1990, they chose to come back.
Alejandro: That’s amazing.
Ilir Sela: I think both of them, to be honest, for the opportunity and to create the opportunity for their kids, for us.
Alejandro: What would you say that you learned from the drive of your parents, having their own business, moving here to seek a better life? What have you learned from that drive?
Ilir Sela: Yeah. I remember the first few months living in the U.S., in order to make ends meet, but dad had a fulltime job working in Manhattan, so he would commute. Then we converted one of our bedrooms into a shop. He would come home and then work again until 2:00 in the morning on his own clients and finding ways to make sure that he could provide for us and again, create opportunity. That happened for the first handful of years. I remember when I was 13 years old – this is three years in – I decided that it’s really important that I start chipping in somehow. I went to the deli, which was at the corner of our block, and I begged the deli owner to allow me to work there when I was out of school every afternoon. He was looking at me like I was crazy because a 13-year-old skinny kid, too young to work, obviously, but I kept going there every single day until he finally allowed me to do some work. At the time, he paid me $2.00 per hour. I didn’t want any days off, so I worked for seven days, four hours a day, and I was just helping. He was mentoring me in some ways, as well. Those were some of the things we had to do, and I would say for myself, learning that nothing comes easy. It’s all about work and commitment and dedicating yourself to whatever you want to do.
Alejandro: Absolutely. What got you into computer science?
Ilir Sela: I have an older brother, and I remember my parents buying him a computer. He was 18 because I had just started college, and we were 13 or 14. This was probably 1993/1994. I fell in love with the technology and the possibilities that it presented. Immediately, I started tinkering with the computer and trying to figure out different things that it could do, and it could accomplish. I think, also, my older brother did not want us touching it. It’s partially like this special thing, and I would say that moment on, I knew that my focus would be around technology and computer science.
Alejandro: You definitely did that. You went to university, and then after that, you launched your own business. How was that experience?
Ilir Sela: Yeah. I was in college. This is the early 2000s. There was this awesome emergence of broadband internet, network computing, wireless networks. It was a fascinating time in the world of IT. Not only myself but a ton of my friends who I went to school with, we were all doing computer repair and network support as a part-time side-gig in order to make more money. What I realized was over time was that I didn’t have all the answers. In fact, nobody did. What we did was we created this email chain where anyone of us could start asking questions when we came across a challenge we couldn’t solve. Something just kind of lit in my mind, and I thought to myself, “Look. While we’re all working independently, we would probably be much stronger if we were a community and if we worked together in some way. There was a company in Canada called Nerds On Site, which I thought was amazing. It was genius as a brand because it took this very specific field, and it made it more mainstream, and it made it more welcoming, especially if we had to go to people’s homes and fix their computers and things like that. We wanted to make sure that we had a very welcoming brand. So I launched Nerd Force in 2003. The idea was that we would create the most valuable computer technology team and make that available to small businesses and home offices who could not afford a fulltime employee to figure those things out. Initially, it was a handful of friends and me. Within two years, we actually had over 30 technicians across the entire New York tri-state area. In fact, the New York Daily News ran a special issue. I think it was on a Sunday in 2005/2006 to highlight breakout companies, post 9/11 New York City, that were carving out and blazing a trail in New York. They chose Nerd Force as one of those companies, and our brand awareness continued to accelerate, and that was the beginning of that business.
Alejandro: Nice. And, obviously, this business is experiencing growth. It’s your first business, so this experience is remarkable. Why did you decide to get the business acquired?
Ilir Sela: We got really lucky because a few years in, Best Buy launched a team, a product called Geek Squad, if you’ve ever heard of that.
Ilir Sela: Geek Squad was part of Best Buy. Everyone wanted to get into that business. It was a really cool offering. Because that was not a franchise model, no one was able to adopt that brand. So we started getting a lot of calls from people all over the country who wanted to participate in the Nerd Force business. So I franchised the business model, and we scaled it to 124 locations nationwide. These were all franchisees, independently owned, and operated. In 2008, a public company that provided managed solutions to enterprise companies wanted to get into the small business space, and they viewed Nerd Force as a vehicle to sell their products and solutions like data backup and data recovery and helped us, but sell their solutions to the small business segment. They approached me with, at the time, an offer that I felt was really compelling, but it was also compelling for me because I felt that they would give us an opportunity to really accelerate our success and scale. That was another very fortunate moment. Luck has been on my side in a lot of cases because I signed the deal, and we closed it in June of 2008.
Ilir Sela: Then, as you know, by October and November of 2008, the financial and economic world globally changed and impacted the business in a negative way. That was the conclusion of the Nerd Force journey for me.
Alejandro: Talking about timing, Ilir! So here, your full cycle with the first experience. What would you say that this full-cycle experience taught you? If you had to synthesize this in like three big takeaways that you knew you would implement for your next business, what would you say those three big takeaways were?
Ilir Sela: I would say the first one, by far, was the idea that communities, even within business, this idea that working for yourself, not by yourself, is really, really powerful because once we adopted that mentality is when we all became much better and really strong individually. So the notion of teams and communities and like-minded entrepreneurs working together is a very powerful phenomenon, which I think we’ve brought to the pizza industry with Slice incredibly well, and we can talk about that. I would say number two is just grit. I’ll give you an example. When I decided that it was time to franchise our business model, I went and spoke with an attorney who could help with that process. They quoted me $250,000. I didn’t have that money, or at least I didn’t have $250,000 to invest. So instead of using that as a reason to not franchise our business, I literally locked myself in our office for probably four or five days in a row, and I figured out how to franchise my own business. So I figured out how to trademark our brand and logo and how to create – at the time, it was called the Uniform Franchise Offering Circular, which is a massive document. I wrote it all myself, and I had someone in the franchise industry review it, and it worked. That’s how I franchised our model. I would say it’s that level of grit and failures-not-an-option type of approach was validated for me through some of those efforts. I would say the third one, as you said a few seconds ago, “Timing is everything.”
Alejandro: No kidding.
Ilir Sela: Sometimes, it’s not the effort; it’s not the idea; it’s time. Some ideas are too early. Some ideas are too late, but timing is everything.
Alejandro: Yeah. Basically, here, 18 months after the transaction has closed, you go at it again, and you’ve started with a company called MyPizza.com, which rebranded into the Slice that we know today. Tell us how this idea came in front of you, and how you went about it to bring it to life.
Ilir Sela: Of course. Knowing and understanding the franchise world incredibly well because, as a franchise business, we operated for about three years. Along the way, because we were in technology, a lot of my family members that owned small business pizzerias wanted help with websites, with their online presence. I started hearing a lot about online ordering, Papa John’s, and Domino’s. These big brands were investing heavily in those platforms. And then, the emergence of the iPhone in 2008 opened up a ton of new possibilities and opportunities. I was taken back by the consistency in the asks from my family members around their needs. Something clicked in my mind, which was that while franchise models provide this level of consistency across their franchisee base, small businesses, especially within the same vertical, within the same industry, are actually operating a very similar way; they just don’t know it, and there’s no one that’s connecting them. There’s no one that’s uniting them. So I spent a few months studying the pizza industry as a whole. I know and understand the individual unit economics end to end, but I didn’t really have an appreciation for what the pizza industry meant in America and how it was broken down. At the time, it was a 35-billion-dollar industry. Today, it’s 47 billion in the U.S. What I learned is that the overwhelming majority of that industry is actually small businesses. So about 75% of all locations in the U.S. are small business pizzerias; 25% are these big chains combined: Domino’s, Pizza Hut, Papa John’s, Little Caesars. Knowing and understanding the value of community and working together and investing in technology from my Nerd Force experience, I realized that we could create a challenge or brand and platform to unite local pizza and win the industry collectively. I came up with the name, MyPizza.com because that was the domain name that I was able to secure at the time. It was for sale for $150,000. We somehow, going back-and-forth with the owner at the time, ended up negotiating the name down to $15,000. By the way, the person who I bought it from, I’m still friends now on Facebook, and every year, he sends me congratulatory notes, which is pretty awesome.
Alejandro: Very nice.
Ilir Sela: So that was the beginning of MyPizza.com. I literally wrote my own press release. It actually still exists on the internet. If you search for MyPizza PRWEB, it will be there. You can read it. That was the beginning of My Pizza. The first 35 partners are pizzeria partners were family and friends that own these businesses.
Alejandro: So why did you decide that it was time to rebrand because rebrands are a beast. They’re not easy.
Ilir Sela: Yeah. We rebranded in 2016, which was six years later. Up until that point, we were still very much focused on the business side. So we were very B2B-focused. We had partnered by then with about 3,000 locations nationwide, and we were powering their websites and online ordering. But the consumer side of the ecosystem still didn’t know what MyPizza.com was because the websites that they were visiting were Joe’s Pizzeria, Billy’s Pizzeria, etc. In 2016, we chose to enter the direct-to-consumer space with the launch of our mobile apps on iOS and Android, which is kind of wild because up until that point – in 2015, we processed over 40 million in sales, and we didn’t even have an app. We didn’t have an iOS app; we didn’t have an Android app. So as we looked at the consumer side, and I hired a Chief Marketing Officer, we felt that it was the right time to take a closer look at our branding strategy because the risk was very low for us because the brand awareness was still very low. We took a first-principled type of approach. Someone recommended Slice as a brand, and a million people told me, “No. You can’t call it Slice because it’s a very common term.” There are a lot of other companies who own the name Slice for other reasons like the drink, the soda Slice, so on and so forth. What they told me was that it was not ownable. For me, for whatever reason, the way my brain is wired, that’s all I needed to hear, and I felt it was the best name that represents our business. It’s simple. It’s one syllable. So we went for it, and fast-forward to today, Slice is synonymous with our business.
Alejandro: Very cool. So for the people that are listening, what ended up being the business model of Slice?
Ilir Sela: Our business model is now an end-to-end platform for small business pizzeria restaurants to be in business for themselves, not by themselves. Slice, in essence, is an extension of these businesses where we manage their entire digital presence. We power their website. We power the presence of their website and brand across all of the internet, including Google, Facebook, Instagram, TripAdvisor. All of that is enabled with eCommerce, online ordering. Then we’ve got the Slice app, which is a branded app for Slice, where consumers can go and order from their local favorite pizzerias. Then we handle all of the marketing, all of the CRM. We’re now getting into supplies. We’re lowering the cost of supplies by bringing that buying power that we have on a national level and making it available to one individual small business.
Ilir Sela: In essence, we’re creating the world’s largest pizza chain and really empowering small business owners to be more successful without having to sacrifice their creative freedom and without having to sacrifice their own personal brand.
Alejandro: How big of a market is the pizzeria and pizza market? What kind of numbers are we talking about?
Ilir Sela: Today, in the United States, the pizza industry is 47 billion dollars. That is revenue that passes across 77,000 locations.
Alejandro: That’s amazing.
Ilir Sela: Twenty-five percent of those locations are to these big chains, and everyone else is a small business, local shop. So, our focus is on the local segment. We do not work with Domino’s, Pizza Hut, Papa John’s, or Little Caesars.
Alejandro: Obviously, during the first years of Slice, you really followed the typical advice from places like Y Combinator, Paul Graham that says at the beginning you’ve got to go with unscalable stuff to really understand the business inside and out. Then you can go into automating. In this case, you took that to heart. You were really doing unscalable stuff on your own cellphone, so tell us about that.
Ilir Sela: Absolutely. In hindsight, reading a lot about other entrepreneur stories and the Y Combinator companies is inspiring. At the time, I had no idea what any of that was. I didn’t even know what a venture capitalist was. For me, I think the approach that I took, which is, do things that don’t scale, was out of necessity and having a mentality that failure is not an option. For the first couple of years of our business, I’ll give you the example. Consumers visit these websites for the pizzerias that we power, and they place an order. When they place an order, they’re placing that order online. For the first two years, those orders would come to my cellphone, and then I would personally call the pizza shop to give them the order by phone because the pizzeria owner refused to have any technology in their store. It was too intimidating. So, I did that. I would say, again, for the first couple of years, to the point where I no longer had a life, and my entire day was me calling pizzerias and giving them their orders, while in the evenings, I was trying to figure out how to get more sales and things like that. It was an interesting first couple of years, but finally, the moment came for us to start hiring some help, and we could afford to do that, and that’s when we scaled, and I scaled from being individually run to surrounding myself with a team.
Alejandro: And also surrounding yourself with your family and people back in your hometown. What happened there?
Ilir Sela: Yeah. I’ll tell you a story about some of our unit economics and how much scale you actually need to be able to afford anything. Again, naively, I didn’t know what a venture capitalist was. I was bootstrapping the company because I was raised in a way that I thought business was, figure out how to build something for a dollar, sell it for two, and do that as many times as possible. With scale, you can afford more help. That was the approach I took. Once we started getting a lot of orders and a lot of menus that we had to publish on our websites, it was very difficult to keep up, but I also couldn’t afford fulltime help in New York. It’s a very expensive market. Our family still in the former Yugoslavia, now it’s Macedonia, so I hired a handful of family members to help me do data entry super early-on. I would pay them a small amount for every menu that they published, but for the market there, it was a really big sum. Making $10 a day, for example, was a huge deal. An average person, at that time, in Macedonia, probably made $50 a month. So it was an amazing win-win. It allowed me to offload some of my work to my family members in Macedonia, and it gave them the opportunity to make some money.
Alejandro: Very nice.
Ilir Sela: They did such an amazing job that if you fast-forward to today, we are one of the largest employers in Macedonia. We have over 500 team members in this small country that every time I bring up, most people are like, “Where is Macedonia?” So it’s been a journey, and I will say that I would not be here, and our company would not be as successful without the help and the sacrifice of all the team members in Macedonia.
Alejandro: Now, how many employees do you have?
Ilir Sela: We’re now over 700 people. We have a presence, and our headquarters are in New York. We have a team in Belfast, Northern Ireland, and we now have three different offices in Macedonia.
Alejandro: Very nice. It sounds like there’s a lot of payroll there, and a lot of cost, especially if you’re thinking about growing this and growing it fast. So how much capital have you guys raised to date?
Ilir Sela: In order to fuel growth, we raised our first round of funding in late 2015. It was led by the founding team of Seamless, which now is known as GrubHub. Fast-forward to today, we’ve raised 82 million dollars. Our most recent round of funding was led by KKR Growth, and that was about five months ago. That was a 43-million-dollar round.
Alejandro: Why was it harder to raise the first round versus the second round, or the other way around?
Ilir Sela: The first round was pretty simple. We had a lot of traction. Our numbers looked great. We were profitable and growing quickly. Then when you get an influx of capital, I think, in hindsight, we kind of got away from what made us special, what made us great. We lacked some discipline, and we started spending money in ways that, prior to that, I would have never imagined spending money that way. The reality is that when investors commit capital and trust in a founder, entrepreneur, the goal is to turn that capital into value. We didn’t do that very well in the first couple of years. So the second round and the third round were a little bit more challenging. But everything for me is a lesson. In some cases, I took lower valuations to partner with the right investors, and they have stood by me and stood by the business during some of those challenging times. Fast-forward to today, when everything clicks, and we’re now back in hyper-growth mode. It was a great experience raising our last round.
Alejandro: To highlight, you said the right investor. What does the right investor look like?
Ilir Sela: I’m so fortunate to have some of these great investors, and I received some really good feedback from a couple of friends that were founders of other companies, and obviously, from our original investor. The feedback was, don’t ever just simply optimize for valuation for price because this is a long journey. It’s a marathon. What’s really important is to have a relationship with an investor, where their terms are very clean, the term sheet is super company-friendly. Then the partner has a long-term view and appreciation for the business. So, for me, it was, do they believe and share in my vision, or where we’re headed, or are they asking me to make changes, and am I turning a blind eye to that simply because I know that I need capital. I think a lot of people make that sacrifice because they need the capital. They partner with an investor who doesn’t share the vision, and they actually want some changes. I think that’s challenging and presents a lot of challenges down the road. So, do they share your vision? Are they somebody that you would hire and vice versa? And will they be there during the difficult times? Part of my diligence work during that original round of funding, most investors will give you the highlights, so they’ll connect you with all these founders that they’ve backed, and those companies are now breakouts, whether it’s Airbnb or Uber or you name it. For me, that was not as important. I wanted to talk to the founders whose business had failed, and that’s okay to fail. Failures are awesome because they are lessons, but I wanted to know and hear from those founders, and I wanted to understand how did these partners, how did these investors behave or supported or not supported these teams and these companies during the most challenging times? I found those calls to be, by far, the most valuable.
Alejandro: Wow. It’s amazing that you’re sharing this because this is what I always tell entrepreneurs, so I’m right there with you. During those calls, what did you find out?
Ilir Sela: You hear a lot of stories. It’s pretty interesting because you’re talking to founders who had recently been through very difficult and tough times, and you find out that some investors – I’m not here to name names, but some investors love really favoring and being there for the winners. But the reality is, the winners don’t need them as much. So I learned that there are great investors who double-down on their time when companies go through challenging times. I also learned about investors who support founder decisions. Some founders wanted to sell their company. Did the investor block that, or did they support it? So there are a lot of battle stories like that that came up. It was a wide variety of challenges, and behaviors, and things like that. We had a number of term sheets, and by the time we made our decision, I was really confident that we had the right partner.
Alejandro: That’s really cool. Tell us now about Slice Accelerate, the new initiative.
Ilir Sela: We are very excited about Slice Accelerate. Before I go into the details of what it is, the beauty of what Slice Accelerate presents today is that it is a combination of efforts and solutions and products that we have tested and proven successful independently over the last handful of years. With Slice Accelerate, we’re taking all of these solutions and services and bundling them into one theme, one product, and applying it in full to one location at a time. For Slice Accelerate, we’re investing $15,000 in products, services, technology, and hardware in order to completely digitize and accelerate the success of independent pizzeria locations. In our first cohort, we’re going to welcome 100 locations. I’ll walk you through what that means. We partnered with Pizza Mia, which on Staten Island, here in my local market. We chose that location on purpose because it’s in my market, and I can be close to their performance and the owner, and learn and listen and have those conversations. With Pizza Mia, we took what you would see as a traditional, everyday corner store with a very dated look, with an awning that’s missing three letters. You know, your typical small business storefront. We refreshed the brand to the point where you cannot even recognize what was there prior. It’s still the Pizza Mia name. It’s still the same owner, but it’s the owner’s vision that’s now come to life in terms of their brand. It’s how the owner imagined their brand when they decided they wanted to go into business. What’s that done is created so much consumer confidence in that neighborhood that just through that branding refresh alone, business went up. But that’s just one part. We then go in, and we plugin an operating system, a technology point of sale solution to create a lot of efficiency and alleviate a lot of the workflow that pizzerias have to go through as they serve customers. Then we’ve come in with our world-class website, eCommerce solution, with Slice app. We showcase these locations on the app, and ultimately, if I were to summarize it, we’re bringing a very Domino’s-like platform, including the brand to independent locations, in order to make sure that they become more successful. The way to do that is to transform these locations from offline businesses where most of their consumers are ordering by phone and convert them into digital businesses where they’re ordering through mobile apps and online ordering on their website.
Alejandro: Very nice. Very nice, Ilir. There’s one question that I’d like to ask you that I typically ask the guests that come on the show, and that is if you had the opportunity to go back in time and have a chat with your younger self, with that younger Ilir that is thinking about launching a business. Knowing what you know now, what would be that one piece of business advice that you would give to your younger self and why before launching a business?
Ilir Sela: What a great question. Can I give you two answers?
Alejandro: Go for it.
Ilir Sela: The one that’s a no-brainer for me is, surround yourself with people who are smarter than you, align with your vision, and do that as early as possible because the earlier that you can do that, the more likely it is that you will succeed as a business owner, as a founder. I wish I had known that sooner. I would say the one that really is a much bigger opportunity in hindsight is to think incredibly big and relative to those big dreams, become a great storyteller. Have the ability to inspire people with your dreams and tell your story and tell people why because through that storytelling, through those words and emotions and dreams, then people can follow you. And when they follow you, you can recruit great talent, you can sell to the really stubborn small businesses, and really, anything is possible. I believe storytelling is the only superpower that people have, so I wish I had worked on that craft earlier. But, again, in hindsight, I would tell anyone who is either in school, I would tell my daughter to be a great storyteller.
Alejandro: That’s amazing. Ilir, for the people that are listening, what is the best way for them to reach out and say hi?
Ilir Sela: Anyone can say hi. I’m pretty active on Twitter. My handle is @IlirSela – and I’ve got the same handle on Instagram and LinkedIn. Definitely say hello.
Alejandro: Amazing. Ilir, thank you so much for being on the DealMakers show today.
Ilir Sela: Thank you so much for having me.
* * *
If you like the show, make sure that you hit that subscribe button. If you can leave a review as well, that would be fantastic. And if you got any value either from this episode or from the show itself, share it with a friend. Perhaps they will also appreciate it. Also, remember, if you need any help, whether it is with your fundraising efforts or with selling your business, you can reach me at [email protected].