Saying no to a founder is never easy. Founders put their heart and soul into
their idea, often draining their own personal bank accounts. The truth is, we
say no to over 95% of the startups that we meet with and today's episode will
give you a front seat view into how we make those decisions.
We will spend weeks sometimes months vetting a concept vetting the founder
meeting with customers suppliers it's not an easy process there's simply no
way to vet a company in one meeting and if we would have invested in every
company we initially fell in love with we wouldn't be here today it's not like
Shark Tank where you listen to a pitch for 10 minutes and then you get to make
a snap decision on I'm in or if we made investment decisions solely based on the
potential the companies we meet with we would definitely be investing in the
company we're meeting with today so today the story of a startup company
that ended up ultimately not being the right investment fit for us
and we're gonna take you way back to the very beginning if you like today's
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we'll ever ask you to do for us and know that we deeply appreciate every one of
those likes that you guys give us we're meeting with the company called
hydrants they're kind of like cackle or TaskRabbit but all of their people are
off-duty firefighters Jordan met with the founder before we met with the
manner so this will really be the third meeting for you be those three things I
would be really interested in continuing this conversation this is where it gets
real our first meeting with the company was over three months ago two months
later we planned another meeting this time with one of the firefighters who
actually uses the app but first we regrouped about the deal obviously over
barbecue we not know about this place nothing like barbecue and the D burbs
where is urban sprawl so I think everything's about to be the burbs now
why are we in the burbs today because we are going to meet a fireman who actually
does this whole hydrant thing this is your deal like you brought this to us
and this is a good one and seems so simple all they are is a TaskRabbit or
what they call one of some other ones to tackle yeah and but but they use fireman
services like this already exist what's the big deal having a requirement why
because my wife will not have anyone just coming into our home I told her
that this is firemen only she's like I'm in like I will I will use that service
for everything I think the second do you tell people
what this is and it's there's firemen everybody can trust a fireman right
firemen there's a ton of moment they all have very strange hours which means
they're available a lot of times right and so if they can do a good job
advertising with some of these fire departments they can just get tons of
sign once you get in with fire departments across the country you're in
you now have your supply chain forever right you don't have to go out and
market to get random people to sign up for your services yeah you have your
supply of workers it also seems like it'd be viral in the firehouse like 100
percent this it's like hey I made an extra 200 bucks yesterday once one guy
starts using it everyone in that firehouse is gonna be like well why not
sign up Dee I want to actually use this service and I realized you know when
that giant tornado went through and basically went down my street and
knocked down trees and stuff it blew the metal cap off of my chimney yep and I
still haven't gotten around to having it fixed I'm going to use this app I'm
going to try it alright let's this
this place is awesome a little easy to over order is that what you did no
that's what Chris did $30 lunch was kind of worth it though this is the fire
station under development where's the poll that I get to slide down we always
love to dive deeper into the companies we're talking to so we really appreciate
you letting us actually talk to one of your employee workers you know what's on
my mind more than anything else is is this the type of service that we adopted
by five percent of firemen's once it got national distribution or fifty percent
like how many people in a firehouse do you actually see saying hey I would do
this part-time on the side the exact numbers I can't be sure I do know that
every firefighter I know has a second child secondary income now one
firefighter I know goes home at the end of two days percentage-wise I know that
all the guys especially during holidays or summer times vacations are always
looking to make a little extra money and asked for a hydrant pro works perfectly
for the fire department personnel where we can pick up our hours as needed with
them most firefighters I know have done jobs already on this site that's
actually really impressive in Colorado right now we're at like 12 or 13 percent
in Denver we're at about nine and a half in Austin and about eight and a half
here in Dallas although single firehouse of all firefighters in those markets
those are the number of firefighters that have signed up with us and once two
or three firemen start bragging about how great it was the use of it then it
spreads like wildfire how long you been working with hydrant year and a half now
let's say hydrant we're able to get you as many jobs you wanted through the
platform how many jobs could you handle a lot well with our schedule we work 24
hours on 48 off so really the complexity of the job that they're asking to do to
better answer it how much do I need for that month it's not many jobs I'm ready
to buckle out so ill fluctuate truthfully you do two jobs a day and the
great thing about firehouse so and firemen yeah the world's problems are
solved at our coffee table we either can do it ourselves we know a guy that can
do any job in the world I just want to say that I really like this company I
really want to invest in it they are early and us to take a lead in a round
like this is fairly unconventional we normally don't take the lead role so I
said we would consider taking the lead in this round if we had an option to
invest an equal amount at some point this next year at the same valuation
these two sided market places and the gig economy are really dependent upon
supply and it's all about supply and I think he's nailed the supply with these
fire minute he could really get anywhere near a quarter of a million yeah you can
replicate what he's done on the supply side in other markets he's done Dallas
and Denver a trifecta see just turn on one more and see if it scales as quickly
after meeting the founder and meeting one of the firemen we put the app to the
test it's a little update I just got a notification from the app that my job
has been accepted so set the fireman just arrived and he's gonna fix my
chimney this thing right here needs to go up there
this roof angle is too steep and the slick tiles would not keep him on so
he's actually going to try in the backside of the house where the slope
isn't quite as dramatic well that just happened the ladder went through the
glass panel on the front of that lantern out there they say they're gonna fix it
so we got the roof ladder and we got everything back and we tried going from
the front side of the house and the roof ladder wasn't long enough for me to
slide it all the way up over the top of the ridge and then we went to the back
of the house and the way the house is built is there's a down slope and an
upslope with the plastic shingles I can't climb on it did have an accident
did break a little piece of glass on one of the lights out front we're gonna pay
to get that big I'll find a roofer and call and see if I can get them referred
to you I guess this is the end of this episode where we actually make a
decision on whether or not to invest and if you've read the title of this video I
think you know our answer this will be our third or fourth meeting with the
founder we have some serious concerns about the app let me call Kris actually
I just want to see if we're on the same page I have a lot of concerns today here
we go
okay ready for the good the bad I want to hear it all the ugly they're here all
this is great the good your contractors were amazing
your concept behind what you're doing obviously works because she was cool
good and she was not cool with any other service when it comes to that oh but for
me so when I used it he was professional and thought he could get the job done to
a fault where he had to he didn't have a tall
enough ladder the first time so after surveying the situation he came back and
had a taller ladder wasn't tall enough to do what he needed to do
ended up in pulling the ladder down knocking the ladder through a pane of
glass oh yes still being repair not perfect experience
he tries they yeah that's the thing it's it's almost like the Apple probably
should you know have limits on what your waiter firemen are capable of saying
they're able to do in this case he really thought he could do it and he's
you know obviously experienced ladders and roofs and things like that but it
was a little too much speaking of yeah the entire process of
booking a hydrant worker that is not only light-years away from where it
needs to be in my opinion at least and I've been using services like this
TaskRabbit for years and years it has gone down the completely wrong track
nobody wants to have to determine what is an appropriate price right for the
job I paid $200 to get it done but is that too much is that not enough
communicating through the app was a little cumbersome because I wasn't
getting notifications and I'm pretty sure if it asked me for notifications I
would have said yes but like that he would respond and I wouldn't see it for
two days that you guys can build something that it at least just mirrors
what the other people are doing doesn't have to be innovative at all the roadmap
is there I think comes to hiring a TaskRabbit person it's the app it's boom
mo boom sixty seconds later I got someone coming
a house but you curse twice tomorrow that's what it comes down to idea check
founder check is a little lacking I love the feedback thank you here's a
great plan and it doesn't mean we have to just say no altogether the takeaway
for our subscribers is investing in founders and early-stage companies as a
process it's not a binary thing it's it's just a process and I have no idea
whether we'll end up investing in hydron or not but this could be a year-long
process of us working with the founder critiquing their technology watching him
evolve watching him make good on his promises or not we say no a lot more
than we say yes we just don't always show it on dumb money because sometimes
it's an uncomfortable situation for the founder this just happened to be a
situation where even the no was a maybe definitely it's a definite maybe and if
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