The concept of pivoting – a fundamental change in concept after the original doesn't stand up to expectations – is well-known in the startup world. But for Karen Lau, startup success comes not from a product pivot, but a life one.

After pursuing a computer sciences degree specializing in artificial intelligence from the University of Toronto, Lau took a tech-focused job at Telus, where she worked for eight years. While she loved “everything” about computer sciences, she says “my job was very boring. I really didn’t think I could work to retirement that way.”

Worried it was the work and not the role, Lau turned to something completely different: interior design. She began taking night classes at Seneca and Ryerson. “I thought it was a good potential second career,” she says.

But she quickly spotted gaps in how decorators work with suppliers she knew her technical knowledge could resolve. “The logistical aspects were a nightmare,” she says. “Not just for me but for designers I met, for everybody in the industry. Every retailer has a different process, every supplier, every logistics company you hire has a different process. We would spend so much time waiting at a client’s house for multiple days, waiting for a sofa one day, waiting for a coffee table another day. Then we had to find people to assemble and set up everything. That whole home makeover thing you see on TV? That never happens.”

Instead of the reality, Lau envisioned a platform where people could input their own style preferences and room specifications to design interiors, and then have everything delivered and set up in a day. “Just like on HGTV,” she says.

Her startup, Furnishr, was born after one of her U of T friends, Mike Van – who went on to become Lau’s co-founder and the company’s CEO – ran into all of the hassles Lau had encountered working with designers while moving into a condo of his own. Van’s finance background made him the perfect complement for Lau’s technical and design skills. “His strength is knowing how to price items, knowing where you can get the best sources for wholesale. Having just gone through the furnishing nightmare himself, he knew there had to be big margins, and so he used his finance acumen to develop our pricing model. He figured out how we could group furniture into a room for people who need an entire room furnished and give them savings and also help us to make a decent margin.”

While their constellation of skills gave Lau and Van a leg up, she says falling outside of the usual SaaS model that’s common for startups posed its own challenges – particularly as Furnishr tried to court investors. When the pair appeared on an episode of Dragons’ Den, the Dragons spent most of the segment debating whether the business was a software company or a furniture company.

But being based in Toronto has helped them tap into other sources of funding within the startup community, such as a $50,000 prize in the Fierce Founders pitch competition geared to female entrepreneurs, that have helped them test new marketing channels and improve Furnishr’s underlying machine learning engine. That their model has made it easy to quickly push into new cities hasn’t hurt either. “Because we’re online we targeted North America first, not just Toronto or Canada. The operational cost is the same whether we have a customer in Toronto or New York or L.A. or San Francisco. That’s because we don’t carry any inventory. After you order from us we coordinate it.”

At the same time, the home and condo building boom in and around Toronto makes the city ideal for Furnishr’s new pilot initiative, partnering with real estate developers who can leverage the site’s tools to help buyers select kitchen finishes. “One challenge that we also faced was to figure out how to get recurring customers,” says Lau. “Partnering with real estate developers (gives us) access to many new home owners at a time as well as investors who will be furnishing the units for short-term rentals.” 

Photo credit: Zlatko Cetinic, Images Made Real