Who is Ivo Dimitrov and what is the CozZo app all about? Why is household food waste a problem and how can CozZo help us run a waste-free kitchen? What were the initial difficulties along the way? What is CozZo’s business model and what the future plans for the project and its founder?
Watch the exclusive interview for Bloomberg TV or read the transcript of the conversation below.
T.K.: Hello, you are watching the “Business Meeting” on Bloomberg TV. I am Tanya Krasteva. In this program, we show you the faces of the Bulgarian business. We talk about the challenges they face and what inspires them to move forward.
Today we meet you with Ivo Dimitrov, who is the founder of CogZum. Hello, Mr Dimitrov
I.D.: Hello. Thank you for inviting me here.
T.K.: Before continuing with our conversation I suggest we see a short video about you
V.O.: Ivo Dimitrov is the founder of the CogZum startup. He has worked as a software engineer and as a team leader in multinational companies, among which Division, Reuters, Dow Jones, Petrotechnical Data Systems. In 2016, he decides to dedicate himself to the CogZum project. Ivo Dimitrov has a Master’s degree in Computer Systems from Sofia Technical University.
T.K.: Mr Dimitrov, how did you come up with the idea of CogZum? And what is CogZum, in fact?
I.D.: I was inspired by my own personal experience. For years I have been trying to organize my own household so as to avoid situations, like coming home from work and realizing that we are missing something vital and having to go out shopping again. Or else, I discover that 2/3 of the cooked pasta has gone bad and it has to be binned. This really upset me.
So, I experimented with different tools and even tried several mobile apps in an attempt to organize this process. But as nothing worked, I came up with an idea which started off as a hobby project. I wanted to see if this idea would catch on with other people too. I went on to do my own research and found out that that millions of households around the world, especially in the developed countries, are unable to manage their food efficiently.
As a result, an enormous amount of food is thrown away. In the US, approximately 30%-40% of the food that is purchased is thrown away uneaten. In Europe, we are talking about 20 to 30% of all food.
T.K.: Which is a solid amount! So, in fact, CozZo is a mobile app which helps you manage your food?
I.D.: CozZo is a next-gen mobile app. It features, something that a lot of consumers around the world are already familiar with, the digital shopping list. We upbuild the product with a smart catalogue of the food you have at home. When you check an item off your shopping list as “bought”, the app automatically assigns an optimal expiry date to it and moves the item to the “at home” list. This list is constantly monitored.
When an item gets close to its expiry date, a notification is pushed to your phone reminding you to use the product. The catalogue also helps you decide while shopping what you really need so as to avoid overstocking and doubling on items. This way, you are assisted in using all you have bought in time.
T.K.: I announced you as the Founder of CogZum. Did you have plans for sharing the creation of this mobile app?
I.D.: Yes, of course. Everyone knows that starting a new venture is something very hard. Everybody, in the beginning, is looking to find partners. Co-owners of the idea with whom to win the trust of the investors. Such a project requires a lengthy initial period of development, which cannot happen without serious financial support. The sort of support we have seen in many Western markets, and the sort that happened in Bulgaria in 2012, 2013, 2014 and 2015.
Unfortunately, in 2016, I wasn’t able to find a person who was ready to take this crucial step. This is indeed an important decision to make for oneself. During 2016 and 2017, I wasn’t able to raise the necessary risk capital for the project. During this period, a dark shadow hanging over such investments amassed by a line of unsuccessful start-ups. It also discouraged people from joining in as they were looking for a more secure path for self-actualization. It was impossible to find co-owner, so I was forced to continue on my own.
T.K.: How much time did the development of the app take you?
I.D.: The development of the app is work progress. It is far from over yet. Up till now, we have implemented approximately 25% of all our ideas. Work on the app started at the end of 2016. The app itself was launched on the UK and Bulgarian market on May 25th. It premiered during the MobCom Fair, here is Sofia. Next, the app was launched in the US at the end of 2017. It is currently also available in the Netherlands.
We were asked to cover that market when we became part of the Refresh Research Program. This is the program that has been assigned with the challenge of finding a solution to this problem on a European level. Refresh liked what we have developed and decided to include our app for testing with Dutch families to sample our product. This happened precisely 2 months ago. We are still waiting for the feedback, which we hope will be positive.
T.K.: How many users do you have to date?
I.D.: Right now, our active user base is around 2000 people. 80% of them are based in the UK. Since the launch, we have more than 10 000 downloads, but the early versions weren’t sufficiently functional to be appreciated by the users. These days, the situation is much improved. We have an excellent reputation on the UK App Store with a lot of positive reviews.
T.K.: Do you continue research on the topic?
I.D.: Yes, of course. This is an ongoing process. We have in mind a special program for families who want to become our “power users”. We will be working with them on an ongoing basis, constantly receiving their feedback on how to improve the app. CoZzo is an innovation that cannot occur in 2-3 months. It took us over a year to reach the minimal usability level. We have still a long way to go. But now we are sure about the direction we are heading.
T.K.: What does your research for Bulgaria show? Is there an interest in this sort of apps? Are Bulgarian households concerned about not throwing away food?
I.D.: I think that in Bulgaria food has not been depreciated in value. At least not in the way it has in the US and in Western Europe, where the food is really abundant, prices are low and people have stopped seeing it as precious. The Bulgarian consumers are still careful and mindful in their attitude towards food. We are still close to the process of growing and nurturing it. This creates an internal motivation in the Bulgarian consumer to avoid food to be thrown away at all cost. However, this is on the one hand.
On the other, we have people living in big cities, with demanding jobs who simply don’t have time. It is practically impossible for them to monitor their food every day. These days, we all have large fridges, that we fill with a lot of food. Few people can remember what food they have at home, let alone think when it expires. Nobody knows what are those unidentified frozen objects in the freezer and how long have they been sitting there! So, despite our best intentions, without a smart assistant, of the kind we are creating, it is virtually impossible for a modern family with a dynamic lifestyle to achieve a waste-free home.
T.K.: Is this the profile of the people to whom you are targeting the app?
I.D.: Yes, exactly. We believe that families that are in this dynamic life stage, especially with kids, will hugely benefit from our app. They will also be able to save quite a bit of money. Statistics show that an average UK household loses between700-720 GBP per year in food waste. In the US, we are talking about an even larger amount – between 1,500 to 2,000 USD, financial loss per year due to food waste.
T.K. It is not common that families don’t think in terms of the money they throw away in the form of food?
I.D.: Yes, as it is not a very visible process. All household members take part in the process, yet it is not a conversation topic among them. No one is saying: “I threw away the potatoes”, and the other, “I threw away the tomatoes,” and then, “let’s see how much we all threw away together?” So in reality, families are not aware of how much food they bin. The only way that this was established, two years ago, was by monitoring the amount of waste that ends up in the bins of UK families.
That is when the news broke out that households are in fact responsible for 50%+ of all food waste in Europe. Although the food is lost on consumer level by the end users, everyone participates in the process: the farmers who can’t sell the produce that is not up to “beauty standards” (maybe, you’ve heard of this problem), restaurants, supermarkets…they were the black sheep for a long time… but this has now drastically changed. There are even laws, like in France for example, that prohibits supermarkets from throwing away food.
T.K.: What do supermarkets do with the food that is close to its expiry date?
I.D.: They donate it. There are many organizations that repurpose this food. So, in general, on supermarket level the loss has significantly decreased – they currently have a 4-5% share. Yet on the consumer level, the only thing that is currently happening is awareness campaigns for consumers to become aware of the problem. They receive some simple, practical advice on how to organize this process. What we see is a big desire on the part of the consumers to make this big change in their daily lifestyle.
The benefits are multifaceted. As a technology, we don’t only help people to avoid food waste but we also assist them to better organize the process of shopping and meal planning. To avoid the so-called “failures in shopping”. By “failure” I mean, returning home from the supermarket just to remember you’ve forgotten to by something essential, or both partners in the household returning with identical items. One of the items will inevitably be forgotten inside the fridge and eventually thrown away.
T.K.: In view of the markets you’ve mentioned, obviously the app works in 2 languages – Bulgarian and English. What are your ambitions? Do you plan to diversify in terms of language?
I.D.: For us transcribing the app into another language implies not only translating the text messages and tips you receive but also translating the dictionaries. We have created a very intelligent interface for feeding in the products. It functions on the base of a very comprehensive glossary, with product names and expiry dates. So step-by-step, we are working on translating these dictionaries into German, Spanish and other languages.
T.K: You mentioned the hardship with financing this project in its initial phase. So please share with us, how were you eventually able to finance the project, and do you currently need extra finance to leap to the next level of development?
I.D.: Luckily, finally this year the progress of the project was noticed. The fact that with minimum resources we were able to create technological progress and achieve what we have achieved, played an important role to create trust in the project. We have a solid group of early adopters on the UK market, which is currently the most competitive playground for our product. So, we were backed up financially by private investors from the CEO Angel’s Club. With their help, we will be able to reach the spring of the next year. Until then, we will implement some premium features of our system
T.K.: I was just going to ask you, what is the business model that you follow, and how do you plan to return the investment?
We work according to an established model for mobile apps that are available both with free and premium features. Usually, a user downloads an app and uses it for some time, experiencing the free features of the app. If they like what they see as a free version, they can subscribe to even more benefits through the paid part of the app.
This is usually an annual or a monthly subscription which is automatically renewed. This is an operational model that functions since the creation of the App Store and Google Play Store. Apart from subscription, we will give our customers the opportunity to directly do online shopping – a major trend in the UK where 6% of shopping is online – and charge a small commission for that.
T.K.: You mean 6% of grocery shopping category? For other categories that the ratio is much higher!
I.D.: Yes, but a typical household consumes buys a lot of staff from the household consumables category. This is stuff you by non-stop and you keep running out of non-stop. These consumables can also be tracked with our app and eventually shop through our digital catalogue. You will be able to add an item and that item will be automatically tracked for its expiration. When this occurs we can aromatically add to the online shopping cart, and charge a small commission for the transaction.
T.K.: Do you have insights into how long a user must engage with the app to decide to switch to a premium subscription and make use of the additional features?
I.D.: We still lack this kind of statics but in general this period is usually between 1 week and 1 month. This upgrading timeframe is also valid for online sites that offer some sort of service based on subscription. There is usually 1-month free trial period before opting for a regular subscription.
T.K.: You have just recently returned from the European Food Venture Forum in Aarhus, Denmark. Can you tell us more about this Forum? You were among the 30 projects in all of Europe selected to present at the Forum?
I.D.: Yes, this is a big recognition for us, as in the Scandinavian region projects connected to sustainability, circular economy, efficient resource use is given high priority and the competition in this sector is serious. CogZum was the only project from our region with a solution for this huge global problem of food waste, and a solution that is specifically targeted to households, where the problem is most severe.
We are very happy with the attention we received. We presented the project. We talked to investors. The Forum is mainly targeted at investors and experts in the area of food. Aarhus is the centre for Agro-research in Denmark. But there were delegates from the Netherlands, Germany, UK. It was a great networking and knowledge sharing opportunity.
T.K.: Were there other interesting projects that were presented there? What problems did they address?
I.D.: Sure. there were some great projects. I was personally very much impressed by the virtual fence. It’s an innovative method for fencing cattle and sheep. Instead of a physical fence, each animal is equipped with a gadget that resembles a digital collar, which knows the location of each animal.
When the animal crosses the permitted virtual perimeter it has been assigned, a digital impulse and sound guides the animal back into the safety perimeter. The presentation of the project was impressive> There were also new food technologies. Biotechnology is a big theme right now and there were some very complex projects in this area.
T.K.: Do you think that by getting accustomed to using various apps, yours included, such that help us in our daily activities, we stop thinking? Can apps deprive of this capacity, as they are thinking instead of us?
I.D.: I don’t think so. Apps help us deal faster and better with technical tasks. Even if it is a simple calendar where people add their activities, meeting and events, where they set birthday reminders and things-to-do, we have all become accustomed to using them. Nobody is thinking that a calendar is substituting their thinking capabilities.
T.K.: But shouldn’t we? We don’t consider it a thinking substitute, but maybe we should?
I.D.: There have always existed earlier version of these devices. Calendar prototypes dating back 5-6 thousand years ago, from Ancient Egypt, are discovered by archaeologists.I suspect they discover shopping lists as well. I even think they already have, but can’t recall where right now.
A shopping list written in Middle Age Italy, with drawings of the various items that had to be bought. It was handed to the servant in Venice. That’s right! I remember now, I saw it in the Museum of Venice, with drawing and instructions what needs to be purchased. The drawings were there because obviously, the servant couldn’t read so they needed pictorial instructions.
T.K.: Interesting story! Obviously, nothing new is actually so new. Are you thinking of the next project?
I.D.: Not yet. We have a lot of plans for this project. It is more than just an app. We plan to develop a comprehensive solution for the modern kitchen. We will move from a mobile application towards gadgets and devices which will be integrated into the whole system.These devices will automate your home catalogue and you will automatically know exactly how many grams of rice you have in your pantry without having to check all the time.
T.K.: What inspires you?
I.D.: The challenges and the mission of the project. Our mission is sincerely important because of the fact that this is a problem that so far has no solution. We are the first who are confidently moving forward to solving this problem through technology. Indeed, this inspires not only me but the whole team. We have the ambition to succeed and in this we are determined.
T.K.: Do you have a favourite book?
I.D.: There are many. Many indeed. As a child, I had plenty of time to read as there was not much television to watch and no social media and other internet stuff. So I read tons of books, sad ones, funny ones. I shall remember the adventure books all my life since I’ve reread them more than once.
T.K.: Do you like sci-fi books, about the development of artificial intelligence?
I.D.: Yes. of course. Everybody remembers the film adaptation of Space Odyssey 2001, where a computer that is initially good decides that he knows best what needs to be done withthe spaceship. So he turns evil. And everybody is now framed by this image and are convinced that this is what will happen with AI. At first, it will be good and it will help us, but then it will become very bad because he will see that we don’t do things his way.
T.K.: Let’s hope that’s not what will happen!
I.D.: Hope so too!
T.K.: Well, thank you very much for the interesting discussion, Mr Dimitrov.
I.D.: Thank you for inviting me.
T.K.: I thank the audience for being with us, see you next time during our Business Meeting.