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Every month we feature members from the Everything Marketplaces community to help highlight their story, marketplace journey, and share more about what's ahead. In this member feature we highlight Lisa Kagan, who’s the Co-founder of Buddy. Buddy is a B2B marketplace for buying & selling scrap metal.
I started out my career as a Management Consultant at Deloitte South Africa. I was part of a specialised unit that helped ideate, incubate and commercialise new ventures. It gave me the opportunity to learn the tools to build something from nothing, and put them into practice. My most formative experience was building Tyme Bank. It set something on fire inside me and I fell in love with the unique challenges of building from 0. I put those skills to the test when my husband wanted to start a metal recycling company after we immigrated to NZ, which we built to $60m in annual revenue together. This was where I experienced firsthand how underserved the industry was in terms of tech, and the pain and inefficiency it created for these operators. This was how I was able to visualise the opportunity at hand. I validated the idea globally, and that’s how I got started building Buddy. Buddy is a B2B marketplace and tradeOS for the metal recycling industry, and the only one globally built "for scrappies, by scrappies".
The very first step we took was to put one of our GTM motions into play. We started a niche industry podcast and began posting on LinkedIn to build awareness and credibility. After all, you can’t sell a secret! The second step was to conduct 150 market validation interviews globally, on either side of the marketplace. The market was frustrated with the status quo, and they were actively seeking a better way. The third step was to design a prototype and get it in front of some potential users to get feedback. People were blown away, and we set off building an MVP off the back of those conversations.
Being my second venture, I knew how to go about setting up a business and its operations, raising capital, etc. so looking back, the only real challenges during the early days were managing runway and having the bandwidth to do everything without a team in place. And of course, doing it all from a really inconvenient timezone! As someone who isn’t on the tools coding, the toughest call I had to make was whether to build using no-code/low-code, find a CTO cofounder, or partner with a venture studio. I consulted with a lot of other founders in my network, and I landed on going the venture studio route.
Every year, hundreds of billions in recycled metal are traded via WhatsApp, text and email - or even on a spit and a handshake! Building trust is slow due to the global nature of the industry and the heterogenous nature of the material, so people tend to stick to their handful of trading partners. As a result, recyclers are leaving money on the table and buyers are always in search of more trusted supply. The status quo is time-consuming, creates key person risk, and leaves the industry without any data, forcing them to operate on gut feel alone. Buddy aligns the best interests of both sides of the marketplace, and empowers them to build trust efficiently - one trade at a time.
How do we know Buddy has proven to be a great solution? 100% of the trades done on Buddy gave our sellers a higher return than they could achieve elsewhere, and helped our buyers generate a new ongoing source of volume from trusted supply.
We asked ourselves where we had an unfair advantage, and that was having long-standing business relationships with global buyers. So we started there, and lined up the buy side before we onboarded a single supplier. We managed expectations around this and when we were ready to start bringing on supply, we activated the buy side. One of our biggest challenges was winning hearts and minds. There’s a deeply held belief in the industry that tech and relationships are mutually exclusive. We’re starting to shift that perception with our relationship-led approach at Buddy, but we have a way to go. Some key insights - find your unfair advantage and leverage that; listen not only to what people say, listen to what they do and what they don’t say; never underestimate how much inertia you need to overcome to drive lasting behavioural change.
There are times when you just need to put your head down, but there are also times when you need to put your hand up and ask for help. There have been so many people who have been generous with their time and wisdom, and all it took was an ask. The founders journey can be lonely, but it doesn’t have to be.
Buddy is building the digital backbone to empower the $760B recycled metals industry. It’s a deep vertical play in a very traditional industry, one that hasn’t yet embraced digital transformation. Think freight, trade finance, forex, hedging, data analytics, and the like. So the sky is the limit! We’ve got all the ingredients to win in this market, and to get there it’s going to take relentless execution.
We’re about to launch our domestic offering, which we brought forward in response to the tariffs. It’s something our existing user base in the US have been asking for, the tariffs just created more of a burning platform to make it happen. It’s also our first AI-play, and it’s steeped in domain expertise. It’s going to change the game! I’ve been saying for years - it’s about time tech worked for this industry, and I’m just excited to be a part of it with Buddy leading that change.
Connect with Lisa in the Everything Marketplaces community.
