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Local startup UMeTime wants to capture the youth market with university-focused daily deals app

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Austin Photo Set: News_aleks_umetime_feb 2013_1
The UMeTime team: Kyle Nathanson, Brett Berman, Kristian Zak, Dan McKernan, and Tim Rothwell. Photo by Jessica Pages
Austin Photo Set: News_aleks_umetime_feb 2013_2
Photo by Jessica Pages
Austin Photo Set: News_aleks_umetime_feb 2013_1
Austin Photo Set: News_aleks_umetime_feb 2013_2

Maybe the best way to capture the youth market, in a city saturated with college graduates who don’t want to leave the city, is to be youthful yourself.

In a converted apartment in downtown Austin, a long whiteboard with details of local shops, restaurants and bars strips across the makeshift office of UMeTime (that’s “you-me-time”), a new daily deals startup that portends to make a shot across the bow of downtrending programs like Groupon and Living Social.

The team, launched by a group of lifelong friends and college buddies, manages a mobile app geared at local merchants and the university market — cheap food and cheap drinks for upstart affluence. The core team of six men, all recent college graduates from California, all well coiffed and appropriately bearded for Austin, resemble a boy band. One of them is even British.

The six of them, including founders Tim Rothwell and Brett Berman, live together in a group-described frat house, a two bedroom apartment blocks away from their office.

“We do everything together,” says Kristian Zak, the Brit and the company’s community marketing manager. And that includes eating and drinking at what Rothwell says is more than 120 merchants in the central Austin area that have partnered with UMeTime, which primarily uses a mobile app to set up and send out deals.

 The app’s big draw — for merchants and its users — is its “blastout” feature, where deals can be created on the fly by stores and sent out to users immediately, who receive an alert on their phone. 

They’re after the students and recent graduates that have stuck to areas surrounding the University of Texas campus. The app, which they’ve been testing for more than a year and launched in earnest last week, is made up of discounts to whet the appetites of students: there are deals on pizza and nachos and half-priced appetizers, as well services like fitness classes and items like sunglasses.

The app’s big draw — for merchants and its users — is its “blastout” feature, where deals can be created on the fly by stores and sent out to users immediately, who receive an alert on their phone.

“What we’ve done is try to make the platform as simple as possible,” Berman says. “We’ve made [it] so that my grandmother, who’s not very tech-savvy, could use it. The feedback so far is pretty good.”

It’s a way for merchants, Rothwell says, to capitalize on downtimes and low foot traffic and lure potential customers for a spur of the moment, limited-time deal. The app uses phones’ GPS technology to only send out deals within close range, so you could literally stumble upon a deal.

In a moment of filmic serendipity, a user of the UMeTime app, just two days into the company’s public launch, redeemed a deal with elation right in front of us during an early meeting with Rothwell at Blenders and Bowls, which sells Açaí bowls and smoothies inside of Wanderlust Yoga downtown.

 Berman says the idea really came to them while the two were living together in Venice Beach, California, an outlying neighborhood of Los Angeles with a large young adult market. 

“She tweeted us while you were there. We didn’t even know you were there and we were talking to her from our platform,” says Dan McKernan, digital marketing and advertising director.

That moment of goodwill early in the company’s history isn’t surprising. The group is a press relations manager’s dream: they always speak on message, and so far, the rapid-fire enthusiasm has worked out well for the group.

Berman says the idea really came to them while the two were living together in Venice Beach, California, an outlying neighborhood of Los Angeles with a large young adult market.

The two became frustrated with the daily deals for their area, which didn’t seem to acknowledge that they were even living there. UMeTime was their way to corner a market they felt was underserved. “People like ourselves: young, broke, tech-savvy early adopters looking for something than the daily deals stuff. Back waxes? We don’t need those,” Berman says.

After conceptualizing, they rounded up more than $800,000 in initial funding from friends, family, and angel investors, assembled the team and moved to Austin. Hyperlocality, popular in social media and journalism ventures, is what Rothwell says UMeTime is aiming for.

Groupon and Living Social are having a really hard time cracking local. They can’t do it,” he says. “First of all, people hate them; second of all, the offers they provide aren’t relevant to local markets. It’s easy to cast a massive net over a city a get a few bites but you’re not going to get too many Brazilian bikini wax sales here in downtown Austin — especially because it’s a university-based market.”

Indeed, the quick rise and crash of Groupon and other daily deals programs offers both inspiration and careful prescience. After being touted as one of the fastest-growing companies ever, raking in what TechCrunch reported to be $644 million a quarter in 2011, its stock has since plummeted after a spectacular public debut marred by cratering earnings.

What ruined Groupon, as documented by countless tech reporters and merchants who played the Groupon game, was that the program, designed to create repeat customers by having stores offer deep discounts to get them in the door, was bad business. Those customers never returned and Groupon’s terms for merchants to join the program were steep: whatever was on sale had to be discounted by at least 50 percent and Groupon took 25 percent of those profits.

Rothwell says UMeTime still considers Groupon and other sites as competitors, if guardedly. “The issue with those sites is that they’ve already put such a bad taste in the mouths of those merchants that they’re not signing up for their platforms,” he says.

Primary competition then, might look more like other locally-based deals programs. “You have the loyalty point programs, like Belly, Goodybag. We consider them our competitors. We consider any business that takes up our merchants time as our competitors,” Rothwell says. “The problem is that their technology is not responsible for delivering the customer to the door. What they’re doing is rewarding their current customers.”

But so far, the group feels like they’ve reached important milestones in a tough, competitive market with a surfeit of startups. “We’ve all had jobs but this is taking [it] to a whole new level,” Rothwell says. “90 percent [of] startups can’t even bring a product into the market.”

And Berman will admit, with some cautious congruence from his colleagues shortly thereafter, that the company’s name can be tricky to pronounce. The most common mispronunciation is “ooo-may-time,” or as Zak describes it, “a Japanese dating site.”

“But once it catches, it catches,” Rothwell asserts.

For now, they’re enjoying the shiny and new feeling of living in Austin. Berman says the tech and startup community has been welcoming. “It’s pretty amazing to drive 10 minutes and be completely surrounded by nature and you can see downtown still,” Berman says. “The most refreshing thing for me is the people. It’s ridiculous how friendly everyone is.”

The company says it's looking to open in other large university markets soon, with an eye at an established presence back in California. UMeTime is available in the iTunes Store and on Google Play. 

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