It was around 3 a.m. on Feb. 14, 2017, when Ajay Kori and Jeff Sheely knew things were starting to go wrong. Three years earlier, the two college buddies — along with friends Jereme Holiman, Chetan Shenoy and Scott Simpson — had set out to upend the stodgy, low-tech world of flower delivery with a sleek, Silicon Valley-like competitor. They named their start-up UrbanStems and based it in downtown Washington. But that Valentine's Day, it felt like it could all come crashing down.
Hours before deliveries were supposed to begin, Kori, Sheely and several employees were still entombed in their building’s mailroom, clustered around a few tables, assembling bouquets and putting them in boxes. They’d never used such a small space for prep work on a Valentine’s Day before, and this year, the number of orders had nearly tripled compared with the previous year’s. Sheely recalls worrying about whether they would finish in time for deliveries. “At a certain point, it was like, ‘We are not gonna make it,’ ” he says.
Hanging on to a sliver of optimism, they worked through the night. At sunrise, bouquets lined shelves in alphabetical order, by recipient. Each of UrbanStems' bike couriers got a list of names and hunted for the corresponding flowers. But many couldn't find their bouquets on the crowded shelves. Pickup turned into a slog.
Starting so late on the day's first set of deliveries triggered more delays. "That's when we realized we're going to have a cascading problem," says Kori. Things eventually got so backed up that by the time couriers got to their destinations, offices were closed or recipients had gone home. Even customers in the same building as UrbanStems had late or missing orders.
Customer furor came quickly. "How do you botch my order by not delivering on THE MOST IMPORTANT DAY EVER FOR FLOWER DELIVERY!!! How?!" one user tweeted. "Unhappy Wife!!!" said another. UrbanStems employees responded to as many people as possible. But by 7 p.m., the company's social-media accounts had gone dark as Kori pulled four dozen of his employees from their computers to help the couriers in the loading dock. There, he tried to rally the troops. "We screwed up," he said. They'd planned poorly, but "that being said, let's go make every single customer's day that we possibly can from here on out."
The team delivered bouquets until 1 a.m. "And the next morning, we started up again," Kori says. They suspended new orders until they delivered the last of the valentine bouquets, with a full refund. Kori sent incensed customers a mea culpa with his cellphone number and an invitation to talk things over. He got more than 300 calls.
Kori, 34, and Sheely, 33, freely admit that when they started UrbanStems, they knew next to nothing about flowers. It was more about creating something, using their brains and ingenuity to fix a problem and contribute to this era of tech disruption. "We've always been like: 'Let's do something to change the world,' " says Kori, who loves to pepper his speech with the lingo of saintly innovation.
The pair had launched a company together before, in 2006 — a social-networking site where users wrote biographies about other users, instead of just themselves. It failed to displace Facebook but became surprisingly popular in Sweden. “What we found was that Americans like writing about themselves, but Nordic Europeans like writing about other people,” Kori says.
He got the idea for UrbanStems in 2013, while living in New York and working at the e-commerce site Quidsi (which was the parent company of Diapers.com). “I was lucky enough to be mentored by Marc Lore, who started Quidsi, which had just sold to Amazon,” says Kori, name-dropping a few industry titans. (Jeffrey P. Bezos, founder and chief executive of Amazon.com, owns The Washington Post.) “Marc went on to start Jet.com, which sold to Walmart for [$3.3 billion]. And the reason all those sites were so successful was they created the best possible experience for their customers. Even if you could buy diapers cheaper, the moms who bought from Diapers.com wouldn’t go anywhere else, because they knew ... if the diapers didn’t get delivered, someone on that team would go and drive it themselves.”
At the time, Kori was in a long-distance relationship with a woman in Philadelphia and, naturally, sent her a lot of flowers. “I just kept having bad experience after bad experience,” he recalls. “It crescendoed on her birthday. I sent her this bouquet and held off on calling because I thought the flowers would surprise her. Late into the day, it hadn’t shown up. I called the company and they just told me, ‘It’s coming, it’s coming.’ ”
The flowers never came — and Kori later learned that his experience was common. Flower-delivery services are among the worst-ranked industries in customer reviews. E-commerce was supposed to make everything cheaper, faster and more efficient, but Kori argues that the opposite happened with online flower delivery. Major companies like 1-800-Flowers and FTD (also known as Florists’ Transworld Delivery) operate essentially as aggregators. When you buy a bouquet through them, your order is placed on what the industry calls the “flower wire,” a practice that dates to 1910, when a group of florists formed a cooperative to trade orders nationwide via telegraph. A local florist fills the order, but without that florist’s branding and with the aggregator taking a cut.
Those local florists, the thinking goes, will prioritize the buyers who walk through their door, pay full price and take home a bouquet stamped with their logo. “It’s often why you hear that flowers [ordered through an aggregator] got delivered at the end of the day, or they didn’t survive that long,” Kori says. “The florists are going to use their best stems on their core customers.”
A 1-800-Flowers spokesperson called the notion that its ordering system may compromise bouquet quality “ridiculous,” adding that the company’s wire service “has established and maintained the industry’s most stringent business standards for participating florists and conducts audits regularly for quality.” FTD did not respond to requests for comment.
Linda Bolton Weiser, a senior analyst for financial services firm D.A. Davidson who follows the floral industry, is skeptical of the ability of a small start-up like UrbanStems to take on established players like 1-800-Flowers and FTD. “These little companies come in and out over the years,” she says, “and they all have a solution to a different thing.” But the industry has especially thin profit margins, buoyed by holidays like Valentine’s and Mother’s Day, she explains. As such, companies like 1-800-Flowers have pivoted to selling a large portfolio of gift items, not just flowers.
Undaunted, Kori and Sheely set out to disrupt the middleman-laden industry by buying their own stems from farms in South and Central America, designing their own bouquets, and hiring delivery couriers as salaried employees. This approach was tested on the company’s first Valentine’s Day in 2014. Two days earlier, a storm had dumped six inches of snow onto Washington, rendering the roads treacherous and prompting changes to many delivery destinations, as offices closed for snow days. The co-founders and some friends took to the streets to help deliver the day’s 150 or so orders. At one point, Sheely ran through the cold — flowers tucked under his jacket to protect them — to a restaurant in Dupont Circle to deliver a bouquet tableside to a couple at dinner. (The couple remain customers, he says.)
By the end of the day, the UrbanStems team was exhausted but triumphant. In the storage closet they had co-opted to work out of for the day — sharing space with old computers and Christmas decorations — Kori collapsed onto loose rose petals and discarded boxes, asking himself: How are we ever going to scale this thing?
But scale they did. After Under Armour founder Kevin Plank invested in UrbanStems in 2015, the company raised more than $15 million. UrbanStems now has 130 employees in six offices, and hundreds of daily orders. Monthly revenue is in the seven figures, Kori says. Washington is still UrbanStems’ headquarters and largest market, but it has also expanded to New York City, Philadelphia, Austin and Baltimore. In late January, the company extended its reach to the entire continental United States through a partnership with FedEx.
Nationwide expansion was a bold gambit, especially on the heels of the 2017 debacle. Valentine’s Day 2018 would be the company’s shot at redemption, and as the date neared, sleep schedules fractured and nerves were tested. Two days out, a slightly bleary-eyed Kori said: “It’s like going to war.”
After the 2017 disaster, the company hired Seth Goldman, former head of the meal-kit delivery outfit HelloFresh, as chief operating officer. He instituted a "hub-and-spoke" system, which included a warehouse in Hyattsville, Md., and two other nearby spaces that, combined, provide a prep area 30 times as large as the tiny room used to pack flowers in 2017. Goldman also introduced bar-code and scanning technologies for organizing shipments. And he held town halls with employees to discuss what went wrong last year. "There was almost PTSD," he says. "I had a guy who said he had nightmares. Big, strong men said they cried."
Two days before Valentine’s Day, about 40 people crowd over tables in the Hyattsville warehouse organizing some of the 1.2 million stems bought for the occasion. UrbanStems plans to deliver 20 times as many flowers as on a normal day. The workers carefully construct this year’s signature arrangement, “The Valentine,” loading the completed bouquets into bright pink boxes that surround the space like a small mountain range.
On the morning of Valentine’s Day, bike couriers are gathering in the loading dock of UrbanStems’ office. To meet the increased demand, the company has supplemented its regular fleet with freelancers; there are about 15 times as many bikers as normal. Some sport massive backpacks towering over their heads that were designed by Liz O’Neal, head of brand experience. (“Military-grade Cordura,” she explains, pinching a piece of the fabric. “Resistant to the elements.”) Others ride extra-long cargo bicycles or repurposed pedicabs. In the next room, Andy Zalan, director of delivery operations, hunches over a laptop working out routes and schedules, as couriers grab bins of bouquets around him.
The weather, despite sleet the evening before, is clear and mild. This year, Kori and Sheely are also looking out for another type of disturbance: a federal government shutdown. There had been one in January, and another mini-shutdown five days earlier. If another pops up, UrbanStems could be swamped with requests to change delivery destinations from closed federal buildings to homes. Courier routes would shift from the capital’s dense downtown toward sprawling suburbs.
As of Valentine’s morning, though, no shutdown is in the offing. At 8:30, the first couriers take off, and the co-founders retreat to their office, where a huge screen displays real-time charts of order and delivery metrics. Around a large table in the center of the room, a four-person team monitors Twitter, Instagram, Yelp and other social media sites. Throughout the morning, stray tweets roll in — someone worried about their delivery window, another person mocking the company for last year’s meltdown — and the team coordinates responses, calling up relevant order numbers and shipping information.
As the morning delivery window closes, things are going smoothly. “But if something starts to go wrong,” Sheely says, “you can feel it.”
Just past noon, Kori and Sheely start to get that feeling. Zalan tells them the truck that should be shuttling 500 bouquets from the Hyattsville warehouse to their office loading dock for the afternoon delivery window is running well behind schedule. The co-founders dispatch staffers from the finance team to the warehouse to speed up packing. The truck finally pulls in at 1:45 p.m., about 45 minutes past when deliveries were supposed to start. Kori issues an all-hands-on-deck: 30-plus staffers pile into elevators to the loading dock, where interns and executives alike move boxes of bouquets from the truck to the courier pickup area. "It's going to be a sprint," Sheely says.
This year, however, the bins are organized by destination, not by recipient, and the time between the truck's arrival to the last courier's exit is just under a half-hour. Kori returns to the office to await crises that never come. Valentine's Day 2018 ends with only a few hiccups. At 7 p.m., he gives a thank-you speech to their employees. Much like the year before, many are still at the office until the early-morning hours. This time, though, they are drinking champagne.
Michael J. Gaynor is a writer in Washington.