Justin Caldbeck: Transactional Consumer Tech – An Interview with a Binary Capital Co-Founder and Former Duke Basketball Player

Transactional consumer technology opens up new opportunities for businesses, entrepreneurs, and gig workers. Apps like GrubHub and Doordash expand delivery options beyond large chains and primarily pizza and Chinese takeout to enabling every single one of our favorite restaurants. Uber helps us get to and from where we want to go safely–even if we live in a small town with no taxi service. Airbnb connects us with people all over the world who love sharing their homes and local expertise with tourists looking for a more personal travel experience.

What is Transactional Consumer Technology?

Transactional consumer technology refers to the apps and services that bridge the gap between consumers and the services they desire. Loathe the grocery store? Put in an order with Instacart to have your milk and eggs delivered when it is most convenient for you. Hate trying on clothes in a fitting room? Stichfix and Dia & Co have you covered. Send them your measurements and style preferences, and they will regularly send you a box full of apparel. Anything you don’t love can be returned in the mail for free. ‘

We were lucky enough to talk with Justin Caldbeck, the Silicon Valley venture capitalist who Co-founded Binary Capital and has funded many successful companies in their early stages including Grubhub, Stitchfix, Snapchat, Boom Aerospace, Opendoor, and GoodEggs. We had the chance to ask Justin Caldbeck a few questions about transaction consumer technology, and this is what Justin Caldbeck said:

What got you interested in transactional consumer tech?
Justin Caldbeck: Consumer technology has long fascinated me because of its incredible impact on the way we all connect and get things done. I love the “wow” experiences that social consumer applications have. They change the way we interact with loved ones and friends (e.g., Facebook, Snapchat), celebrities (e.g Twitter, Instagram, Cameo), and people we don’t know (Twitter, Instagram) and create easier ways to connect with new romantic matches ( Tinder, Hinge).

Transactional consumer technology has completely changed the ease with which we do everything from getting a ride (Uber/Lyft), securing a restaurant reservation (Open Table), traveling (Airbnb), ordering food or groceries (Grubhub, Instacart) and so many other things. They make our lives easier and create magical experiences in so many ways. Those transformational experiences are what made me fall in love with consumer technology and love the search for the next platform that can help hundreds of millions of people live better lives.

What are some notable companies in the transactional consumer tech space that you contributed to? What did you see in those companies in their early stages that attracted you to them?

Justin Caldbeck: I’ve been fortunate to invest in a number of fantastic transactional consumer technology companies. One that jumps to my mind that I invested in when I was at Lightspeed was Grubhub, which is the largest food delivery platform. They had fantastic founders in Matt Maloney and Mike Evans and had built a powerful platform for independent restaurants to more effectively market their businesses online. It was revolutionary at the time for consumers to find and order from restaurants near them.

I also was a seed investor in Stitchfix when I was at Lightspeed, which at the time was a novel personal styling service that curated a set of 5 clothing items for people to try on in their own homes. Over time, the recommendations improved based on the feedback from the customers, and the company scaled to become a multi-billion dollar public company. There were a few things that impressed me early on when I met Katrina Lake. Primarily, I was impressed with the degree to which her clients stuck around and ordered repeat boxes despite the fact that there was very little data science or operational capabilities in the company at that stage. I’m proud to have contributed a lot to that company having recruited the COO, Mike Smith (former COO of Walmart.com), VP Data Science, Eric Colson (former head of Data Science at Netflix), VP Engineering Jeff Barrett (former VPE at Opower) to the company at a very early stage (along with others) and Head of Online at Sephora, Julie Bornstein, onto the Board. I know what an impact those hires had on the company, and a number of them stayed with the company through the IPO.

Another company that I invested in was Opendoor. They blew me away with the simplicity of their solution to buy or sell homes. They took a process that was onerous, stressful, and full of intermediaries that didn’t add a lot of value and simplified it in a magical way.

The Magic in Transactional Consumer Technology

As society gets busier and our priorities change, transactional consumer technology facilitates a new relationship between consumers and businesses for continued economic growth. Consumers have greater access to goods and services no matter where they are, and businesses have new ways of advertising and promoting to markets that did not exist a decade ago, according to Justin Caldbeck.
Like this story?
SCENE Supporters make it possible to tell the Cleveland stories you won’t find elsewhere.
Become a supporter today.
Scroll to read more Cleveland News articles

Join Cleveland Scene Newsletters

Subscribe now to get the latest news delivered right to your inbox.