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Episode 92: Yotam Cohen, CEO & Co-Founder Founder of Daisy Property Management

Yotam Cohen, the visionary founder of Daisy Property Management, steps on to the New York Launch Pod. Prepare to be inspired as Yotam shares his entrepreneurial journey and how he is reshaping the landscape of real estate operations through innovative technology.

In this insightful conversation, Yotam introduces us to the transformative power of Daisy Property Management. Discover how their state-of-the-art platform leverages cutting-edge technology to streamline and optimize property management processes, ensuring seamless operations for owners.

Delving into the intricacies of the real estate industry, Yotam sheds light on the pain points faced by property owners and managers and explains how Daisy’s innovative solutions tackle these challenges head-on.

As the conversation unfolds, Yotam emphasizes the importance of customer-centricity in driving innovation and success in the real estate industry. Hear stories of how Daisy has revolutionized the landlord-tenant relationship by prioritizing transparency, responsiveness, and efficient communication.

Whether you’re a property owner, real estate professional, or simply fascinated by the intersection of technology and property management, this episode offers invaluable insights into the future of the industry. Join us as we explore the pioneering work of Daisy Property Management and its commitment to revolutionizing real estate operations through innovation, efficiency, and an unwavering dedication to customer satisfaction.

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Transcript 92: Yotam Cohen, CEO & Co-Founder Founder of Daisy Property Management

NY Launch Pod: Welcome to the New York Launch Pod, the New York Press Club award-winning podcast on the most interesting new startups, businesses and openings in the New York City area. I’m your host and New York attorney Hal Coopersmith. And in this episode we are speaking about property management. Is it an industry that is broken or guest Yotam Cohen thinks so. He saw that firsthand with his own experience. Here’s Yotam.

Yotam Cohen: I think today the standout of property management is very low and because of that, people are not paying enough for all the work that the management company needs to accomplish and I don’t think people are aware of how much work it is to run a building. It seems very simple, but actually there’s a lot of moving parts to it.

NY Launch Pod: Listen to the interview to find out how Daisy is changing property management from the ground up and a whole lot more. But before we go to the episode, we have a sponsor RezCue, New York State’s premier residential rental compliance platform for landlords, property managers and real estate agents. Rental laws in New York State are difficult to manage and RezCue helps you follow the law. If you are a landlord who wants to keep up with inflation or rental demand, you need RezCue. For example, you may not be able to increase your rent by the amount you thought or get your tenant to leave at the end of the lease. RezCue helps solve all those problems and a whole lot more. Go to rezcueme.com and enter in some simple information and RezCue will take care of the rest. It takes less than two minutes. That’s rezcueme.com, R E Z C U E me.com. And with that, let’s go to the interview. So why does the world need another property management company?

Yotam Cohen: I’m coming from a very different world of tech. I actually co-founded one company in the tech industry and it was sold to Vimeo. So I’m not coming from the real estate industry. I got introduced to this world by becoming a board member of a building and found the world of property management and how antiquated and poor disruption it is. So I think yeah, as you mentioned or as you think about it, property management, it’s been here for so many years, but as other areas of our life has evolved so much from the way we commute, the way we order our food, everything is completely different. Property management hasn’t yet changed so much. So it’s not just having another property management, it’s having the right property management that is built in the right way in order to provide great experience and to streamline the entire processes of property management.

NY Launch Pod: What do you think is wrong with property management or what did you think was wrong with property management that inspired you to build this company?

Yotam Cohen: So I think it’s starting even I think before that I was living in apartment buildings. I had amazing building life and really bad ones.  I had these amazing experiences with my neighbors. We were sharing kids, helping each other, babysitting one’s kids.

NY Launch Pod: And this was in New York?

Yotam Cohen: And this was actually in Tel Aviv where I’m originally from, from Israel

NY Launch Pod: Tel Aviv. Okay.

Yotam Cohen: And was living in this amazing apartment building at

NY Launch Pod: Didn’t sound very New York.

Yotam Cohen: No. But this is what we’re changing. I started the company when I was living in Tel Aviv and Israel, but saw that experience, having those amazing positive experiences with my neighbors. We then moved, I had my second daughter, we moved to a bigger apartment to a different building, better building, elevator parking, we had everything there. But my experience was completely different.

NY Launch Pod: In Tel Aviv.

Yotam Cohen: In Tel Aviv. And the neighbors were constantly fighting with each other on almost everything and the budget wasn’t managed. The elevator was always down; nobody knew what’s going on and I saw firsthand when I moved to a better apartment, but my quality of living went down. So I saw and kind of asked myself like any other entrepreneur, what can I do better? And I joined the board of a building to really try to improve the life in that building. And I got introduced to the role of property management through that. And I saw firsthand how antiquated it is, how much it’s not really focusing on people and the experience of people and how much potential you can actually unlock when you do things very, very differently.

NY Launch Pod: You said a lot there in terms of it being antiquated. Why do you think it was antiquated?

Yotam Cohen: Yeah, I think a lot of people, and I’ve been talking to a lot of property managers, owners of companies and those are great people, uh, really trying to improve things. But in a nutshell, the way this industry is structured doesn’t really enable those companies to succeed. I think today the standout of property management is very low. And because of that, people are not paying enough for all the work that a management company needs to accomplish. And I don’t think people are aware of how much work it is to run a building. It seems very simple, but actually there’s a lot of moving parts to it. And then those companies are not getting paid a lot, so they actually need to be much more efficient on how they do things. So they spread too thin, then the experience is really bad and then the standard is low and then people are not willing to pay enough for property management. And it’s kind of like this vicious cycle of an industry that is broken from the ground up. So we started Daisy really with a very different mindset into this industry. And I’m always saying that my biggest advantage and sometimes disadvantage is that I’m not coming from this industry. So it helped me to really rethink all the fundamentals of how things are being done today. And because we are the management company and we run those buildings, we’re able to completely change everything that has been done and use technology to scale, to create efficiencies and to provide magical experience for residents.

NY Launch Pod: And charge more?

Yotam Cohen: Sometimes more whenever it makes more sense. We have our own calculator for pricing that is actually taking into account all aspects of the buildings from the day it was built to how many units you have there to a lot of other power metals in order to find the right pricing for the building. Sometimes it’s small, sometimes it’s less, and sometimes it’s actually the same pricing. But we do provide a much better experience for everyone in the building, including the boards, the residents and the owners.

NY Launch Pod: I would say in some senses it’s not a problem to charge more if you’re doing more and if you’re providing more value. And that might be your advantage not coming from the property management world and providing a different model.

Yotam Cohen: Yeah, it’s that one aspect of it. But I think that the use of technology at our core of the company really enables us to build things very, very differently, to be much more efficient in how we run our operations. So we use technology to communicate, to create transparency, to automate a lot of the workflows in running a building. And all of that enabled us to scale and to provide a better experience.

NY Launch Pod: So you had this bad experience in your own building, you had a tech background and then you said, I’m going to start a property management company with someone seems a little crazy.

Yotam Cohen: Yeah, people say that. It is crazy. And then we started immediately in Manhattan in the toughest city I think in terms of running buildings across the US Yeah, I think that for me it’s about the customer. It’s about the people. I see a building, I see an ecosystem, I see people living together, and I see a home. And I think that for us it’s about the customer, the people that are living in the building and the potential that you have in the fact that everybody shares space, decisions and budget together. And we started with extensive research, talking to many people from the industry, brokers, property managers, lawyers, and really just to get a sense of what’s going on here. And we just heard the same horror stories that I mentioned before happening over and over again. And while really kind of like doing this research we understood that the only way to disrupt this industry and to build it in the right way is to become the management company. Because if you are selling software to other management companies, you’re not really able, you don’t have the flexibility to change the fundamentals. Our org structure is completely different from the traditional management org structure. We built ourselves completely differently. We are much more built like a software company than a traditional management company. So it enabled us to really focus on the customer, the service we’re providing to measure our performance and to scale as we scale with the buildings.

NY Launch Pod: So in terms of structure, how are traditional management companies structured and how is your structure different?

Yotam Cohen: Yeah, so I think the main problem in this current structure is that you have this one what we call gatekeeper or sometimes black box property managers that are running the building. They’re basically; you are in charge of these 10 buildings, eight buildings, seven buildings. You are the property manager and you’re doing everything. You are answering residents, you’re talking to lawyers, you’re talking to brokers, you are talking to the boards and all the knowledge of what’s happening in the building is stored in their head. It’s not distributed, it’s not on a system and you can’t really understand what’s going on with those buildings. And this is the way the industry is structured. So you have a person there. We completely broke down this structure. We have the Daisy operating system. The Daisy operating system has everything stored in it. Everything that is happening in the building from maintenance, compliance, financials, everything is within our system. We built a dashboard for the board members where they can log in; they can see everything that is running in their building in a transparent way. All the tasks, what’s their status? They can see their budget in real time, how much money they have in the bank. They can vote, they can suggest items, they can see all the residents and everything that is going on there. Basically get a full 360 understanding what’s going on in their building. For the residents, we built the Daisy Neighbors app where they can log in, they can get notification from us, they can chat with our 24/7 support team that answers in less than three minutes. They can get all the documents they need, they can see packages, their pay common charges, and everything is running within the app. And in the back office we built our own operating system that connects all the dots, all the data points on your building and enables us to automate a lot of the work that is being done today by humans.

NY Launch Pod: For example?

Yotam Cohen: So for example, insurance, if you think about insurance and renewal of insurance in a building, it’s a very repetitive type of work. You have a date, you have the insurance, you have the policy, you have all the documents, everything is stored with Daisy. And today in our system, the system is actually guiding this process as opposed to a person needing to be reminded or to think about when the insurance ends. So the system controls all the flow from the beginning to the end and then there are sometimes people involved in the process, but the system stores everything.

NY Launch Pod: Well I would say trying to get bids for different insurance too  Would be a human to human interaction.

Yotam Cohen: Yes, and we have connections and we are working with a few of them. Some of them are already connected to our system. The idea is to also connect the ecosystem outside of the building, like vendors, lawyers, accountants, brokers; all of those can be connected to it in a digital way that will provide more efficiency, fast response time and better experience in the end for everyone.

NY Launch Pod: And I just want to go back in terms of why you started it. You said I had this experience, I said it seemed crazy, but what made you say, I’m just going to jump into this property management world and found a company for it, which is a hard thing to do.

Yotam Cohen: Yeah, it’s hard and specifically property management. I think it’s a very tough and complicated business to disrupt. But I think that from my view, going back to the people living in the building, I see firsthand how much impact we’re making on people’s lives. We just had an event in one of the buildings we’re running community events and we had these parents meet each other that they never knew. They live in the same building, they have kids the same age and now they’re spending time together. So those kids now have friends within the building and this is what, you know, keeps me motivated every day because we’re improving people’s lives. This is why we believe there’s so much potential in the building because your neighbors are the ones that are actually living the closest to you and if we can create that positivity, trust, connection within those buildings where you can change people’s life.

NY Launch Pod: How many buildings are you managing in New York right now?

Yotam Cohen: Yeah, so we launched, we are a very young company. We launched mid 21 in New York in Manhattan. And since then we’ve been growing really, really fast. We’re now getting close to the a hundred buildings across the city. We’re signing buildings every week. So we are currently the fastest growing management company in the city according to the city data. Um, so it’s very, very exciting for us in the past two years and look into our next few years.

NY Launch Pod: What was it like getting the first building signed on?

Yotam Cohen: It was very exciting. Very, very exciting.

NY Launch Pod: How did you do it?

Yotam Cohen: So, as you mentioned, starting from the get go in Manhattan, we had a lot of network of people, of board members that, we are interviewing first in in order to understand the main pain points in order to come up with the best solution for them and all of those network, a lot of those people said when you are launching, let me know, we want to be the first ones. So actually our first building was signed in Soho. Our second one was in Health Kitchen just a day after. And since then it’s been going really fast.

NY Launch Pod: And how are you getting new buildings online?

Yotam Cohen: So, what’s really exciting, I think we manage to create a lot of waves in the industry and as a whole and a lot of people hear about us from different places, so most of the buildings are actually coming to us, to our website. They sign up and then we kind of walk them through our solution and how different it is than any other management company out there. And then they sign with us. But most of the buildings are coming to us either by finding us online or through referrals and we get a lot of referrals as well from existing customers, which is very, very exciting for us.

NY Launch Pod: So you talked about how you’re the fastest growing company, the first couple buildings you brought online. What happens when you bring a building online? What’s that process like? What are you doing and how do you manage the building from there?

Yotam Cohen: Yeah, that’s a great question because switching a management company is not easy. It feels like sometimes switching your bank, right? So it’s a big,

NY Launch Pod: Yeah, it’s probably a miserable process.

Yotam Cohen: Yeah. So there is a lot of trust in general in Daisy. I think one of the things we’re really focused about is building trust. Because if you build trust with boards, trust between the residents and the board and Daisy, then you can actually unlock the potential. So the switching process, we basically structured it for 60 days. Some management companies do it for 30 days. We actually believe it should be longer so we can get to know the building in the right way and set them up for success. We have a dedicated switch team that is in charge of transitioning the building from the previous management company to Daisy. But I would say it’s very different as well. Like anything that we do, it’s not just a list of documents. We are basically doing a full analysis on your building from going to your building, looking and doing an investigation, all your systems in your building, taking photos, all the models, the vendors. We kind of like really organize your building for success on the financial elements, onboarding everybody to the Daisy Neighbors app, to the dashboard, starting to engage through there. And we basically have a very cookie cutter plan for those 60 days, which we finalize with, an event usually in the lobby, we call it Daisy and Donuts, where we welcome the building to Daisy, we onboard everybody to the app, we help them with all the digital aspects of it and then we launch the building.

NY Launch Pod: And through all the buildings and launches that you’ve done, what are common threads or themes where buildings are failing and that you’re able to improve upon?

Yotam Cohen: Yeah, I think that the main pain points that we see in this industry, and that’s what we tackled from the get go, is really around transparency and trust, which in my belief comes from communication. If you don’t communicate then there is no trust. And we invested a lot on the communication aspect and giving full transparency for the boards on everything that is happening with their building as well as owners and residents within the building. So we invested a lot around that. The second thing, which is really getting things done, there are projects, there are tasks, their maintenance ticket, all those things need to get done and need to be communicated on their status. So with Daisy, with the first thing that I believe, if you want to accomplish something, you first have to be able to measure it and if you can measure it, then you can actually optimize for that specific process. So we started with really measuring all the processes, the core processes in running a building, as I said, from compliance to accounts payables to accounts receivables, to maintenance of the boiler. All those processes are mapped out with our system and we measure everything that we do to understand the time it takes us to resolve any issue within the building and by doing that we can actually communicate in a better way for you. If you have a leak in your apartment, then you know exactly what’s going to happen and we can communicate constantly with you to update you on what’s the status of that. So you trust the process, even if it’ll take two weeks. But we constantly keep you apprised on what’s going on with it, you understand it’s not going to be solved in a minute. So yeah, our ability to measure and to set KPIs, key performance indicators internally and to look at it for my view, I can now in our system go to any building and just click on it and see what’s going on, what’s currently running, what’s the status, what are the things that are stuck. So as a leader as well, I can oversee all the buildings that we manage and make sure that things are doing in the right way.

NY Launch Pod: And one of the things that you mentioned, you’re growing very quickly, you’re in property management. If you’re saying it takes 60 days to onboard a building however many days to fix a leak, how have you been able to manage the growth that you’ve had while keeping customer expectations where they are? Because if people are expecting quicker turnaround and more trust, how have you been able to do that in tech from your experience may be easier because it’s very scalable, but in real estate a little bit more of a challenge.

Yotam Cohen: Yeah, it’s a great question. I think that, again, moving from a little different industry to this industry, there’s another aspect in this industry that, that idea in a previous company that is exactly what you’re referring to, I think has its advantages and disadvantages. There’s a lot of advantage to actually having a physical presence within the building. We are growing fast and we are investing a lot in scaling our operations. We grew the team rapidly in the last year and we split a lot of initiatives and we’re focusing on all those gaps. But the idea in the end is that yes, disrupting an industry from the ground up, building a different type of property management takes time. But we are building really, really fast that I can tell you that.

NY Launch Pod: And what do you see as the future for Daisy? What’s the goal for the company and for the next few years?

Yotam Cohen: I think what gets me really, really excited is the potential of what we are doing. This market is huge. Just in New York you have 11,832 condo and coops just in New York, right? Uh, so

NY Launch Pod: You’re very familiar with that number.

Yotam Cohen: Yes, we mapped everyone . But, yeah, the market is huge. The market and the potential of what we are doing is, for me, endless, the amount of buildings, other cities. It’s really, really exciting for us to, to really dream of being here. Also within the building that we manage, the potential is, is just unlocking every day. So for us, the goal is to really build a big company that will impact people’s lives as many people as possible and continue to grow and to evolve in what we’re doing.

NY Launch Pod: Do you want all 11,832 buildings?

Yotam Cohen: We are growing here really, really fast. We want to expand to more cities. We’re going to open in Miami this year. We already talked with a few buildings and we already announced we’re going to launch it in our second city, I think eventually. Yes. We want to grow as many buildings as possible. It’s very, very exciting times in our company now.

NY Launch Pod: Well, that is a wonderful note to end things on. Yotam, thank you for stepping onto the New York Launch Pod and sharing your time with us.

Yotam Cohen: Thank you very much for inviting me.

NY Launch Pod: How do people find out more about you and Daisy?

Yotam Cohen: Daisy? joindaisy.com. Basically you can go there and reach out to us. So you can also find me on Twitter at Yotam C.

NY Launch Pod: And if you want to learn more about the New York Launch Pod, you can visit nylaunchpod.com for transcripts of every episode, including this one. And follow us on social media @ nylaunchpod. And if you’re a super fan of the podcast, Yotam, are you a super fan of the New York Launch Pod?

Yotam Cohen: I’m a fan, a big fan.

NY Launch Pod: If you are a big fan like Yotam, please leave a review on Apple Podcasts. It is greatly appreciated and does help people discover the show.

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Transcript: How You Doin’? Vol 15: JoAnna Hartzmark, Founder of Revelle

NY Launch Pod: Welcome to the New York Launch Pod, the New York Press Club award-winning podcast and the most interesting new startups, businesses, and openings in the New York City area. I’m your host and New York attorney, Hal Coopersmith. In this episode, we speak to Joanna Hartzmark, founder of Revelle. It’s been a year since we spoke to Joanna, but a lot has changed for Revelle. Learn how Revelle is shaping the way that women shop in another episode of How you doing?

NY Launch Pod: So it’s been a bit more than a year. Remind people what Revelle is.

Joanna Hartzmark: Yeah, so great to be back. I can’t believe it’s been already a year. Feels like a whole different company. I mean, at our core we’re still who we always have been. We are trying to help women find clothes that actually fit without having to stress about the inconsistency of the size chart and be frustrated by ordering two or three sizes of the same garment online and desperately hoping that one might actually fit. But as a platform, we’ve really transformed into a holistic shopping experience. So women can now go to our platform to shop right now for jeans. They don’t have to even think about the size number. Our algorithm will help find something that’s going to fit them the way that they want. We’ll tell them which size is going to be the best fit and they’re able to do all of that in one place and really feel like they’ll get something the first time that’s going to make them feel beautiful.

NY Launch Pod: So you mentioned holistic and also jeans. Are you starting with jeans and the plan is to go holistic?

Joanna Hartzmark: Yes. So the experience since we last talked has become more holistic in everything we’ve integrated onto our platform. We are currently selling jeans because we really wanted to make sure that technology was working with a single category. Truthfully. Most women wear jeans, most women hate shopping for jeans. So it was a good category to start with. But the plan is absolutely to expand to other categories and be a place where women can shop for anything with peace of mind on their own terms.

NY Launch Pod: Has the technology changed?

Joanna Hartzmark: The technology has changed both on the user facing side and on the backend. We’ve learned a lot, not just about clothing fit, but also about what fit means to each individual woman. We always knew that at the core of this problem, the reason that so many people weren’t able to solve it is because fit is subjective and it’s impossible to build a purely technical solution that tells women dictates to them that they’re supposed to feel great when they put it on. And so what we’ve really been trying to do is understand how we as a technology can understand that human element of what fit means to each individual woman. So each member has a store that’s completely unique to her and no one else is going to see the same things because we are trying to learn what fit means to her and how she prefers things to fit her own style. All of those things are individual to each user.

NY Launch Pod: And how are you able to measure that? Because I have to imagine, say someone wants something looser or tighter or any other aspect of fit.

Joanna Hartzmark: So I think they’re really two sides to that coin. One is we use a lot of qualitative interaction in order to understand each individual woman’s biases and preferences. So we triangulate a lot of her past shopping behavior, her current preferences, what she says about her body and how she feels about her body to understand what that might mean about her fit preference. But at the end of the day, she is also a major player in the shopping experience. So you can’t, like I said, dictate to a woman how she’s going to feel when she puts something on. So we need to make sure she has the final say and has some control over that process. So we find by making it collaborative, women trust us more and they feel as though we really are on their side. And so as much as we are trying to build that technology to account for all those biases, at the end of the day the woman has the final say.

NY Launch Pod: And there are also two sides to the platform. The user and the companies,

Joanna Hartzmark: The brands themselves,

NY Launch Pod: The brands. How are you able to acquire more users?

Joanna Hartzmark: So our users come to us primarily organically. They’re searching for some solution to this problem oftentimes via Google or something like that. I want to find jeans that will fit my whatever frustration and they’re able to get to us that way. The other way is social media. People, influencers, companies are talking a lot on social media about this problem because it includes not just body positivity and diet culture, but there’s so much nuance into what goes into what makes you feel beautiful when you get dressed every morning. And so social media is a huge avenue that people find us or just follow our page for inspiration and we hope that they’ll remember us when they’re ready to buy a pair of jeans. So those are really our two primary channels where our users are finding us.

NY Launch Pod: And how are you getting data about the brands themselves and nuancing that data?

Joanna Hartzmark: I would call what we have a passive partnership with the brands. So they provide us with data, data feeds of all the information and attributes of the products that they have available. And we use that to ingest into our algorithm to decide what we show or don’t show to users. So they are happy to get additional leads, but they’re not involved in dictating who might see their products. So even if we get a feed from a particular brand or one of their products, we may not expose it to all of our users because our algorithm doesn’t say it will fit certain users. In general, brands should be happy about this because it means the leads that we are sending them or having purchased their product are going to be much more likely one to buy. But more importantly not to return because we’re only going to show it to the people that it really should fit.

NY Launch Pod: And do you have data now over time that return rates are down?

Joanna Hartzmark: Yes. We can show that we have a lower than industry average return rate. I’m not going to quote a number cuz I don’t know the most recent one off the top of my head, but I’m really proud of that, that we’ve been able to show that return rate has been going down over time and it is lower than the industry average.

NY Launch Pod: What is the industry average?

Joanna Hartzmark: Depends on who you talk to. Between 60 and 80% oftentimes these days it’s wild. It depends. Certain brands with their free return policy, people really do order three of one garment expecting to return to and they end up returning all three of them cause none of them fit properly. So that return rate has gotten out of control and is a huge headache for brands. The reverse logistics of getting those products back in their warehouse, getting them ready to resell or maybe not even resell, oftentimes they aren’t even put back on the shelves or back on the site. So getting that number anywhere below 60% can sometimes be seen as a win

NY Launch Pod: If the industry average is 60% approximately, without having to quote you, are you like at 59% or you like

Joanna Hartzmark: I’m looking to get us no below 50 and I’d like to get us into the single digits. That’s going to take quite a lot of tinkering to get us that low. But we are quite lower than industry average.

NY Launch Pod: In terms of users themselves, how often are users coming back? What are they talking about? What’s been their feedback?

Joanna Hartzmark: So what I will say, one of the reasons we do want to expand to other product categories is because at the end of the day, people aren’t shopping for jeans every week. So people aren’t coming back to our site every week. We hope they’ll come back maybe quarterly or maybe even come back just to interact with some of our other content. But we find a good portion of people are coming back at that rate but not again, like I said, every day or something like that. We find that people really love our content and how we talk about this issue, how we frame, how you think about clothing fitting you is very welcoming to people. So they’re very trusting and they give us a lot of really intimate feedback on how they feel about the platform on that level. And so I really feel very proud of that trust that we’ve built. And so at the end of the day, the positive feedback we get most often is just how inspiring it is to have a brand that really seems to be on their side. The biggest negative complaint we get is if things aren’t available that people want to buy. And I definitely want to make sure we get them as much as possible, but as far as negative complaints go, that’s one I love to hear because it means people like using us and they want to use us more.

NY Launch Pod: And have brands always been a passive partner in your words? Or are they more open to providing the data of their clothing to you?

Joanna Hartzmark: So brands have always, until now been a passive partner. That was very important to me early on in order to establish that trust I was talking about, I wanted women to understand that I was trying to help them shop more effectively and feel beautiful in the clothes they buy, not just make them shop more and spend more money. And I was concerned that by partnering more actively with brands, it might dilute that message and make people doubt that authenticity. So it was very important to keep that partnership as passive as possible to build up that foundation. The truth is, as I said, brands benefit from this as much as users do with reduced returns. So we will, as we expand to other product categories, start to build that partnership a little bit more closely because we’ve been able to show brands that we have a benefit and thus have leverage to make sure that we build it in the way that we want. But we’re going to be very careful in how we build any more active partnerships to make sure that our users know that they come first.

NY Launch Pod: And in terms of your users, where are they located geographically?

Joanna Hartzmark: So all over the US I’d say we do center around urban hubs, not just you know, New York LASF, but also Philly, Dallas, Austin. But in those urban and urban adjacent areas are is when we tend to have the most coverage and we do, I’d say from a proportion standpoint, we are the strongest in New York. But that’s probably because I just won’t shut up talking about my own company everywhere that I am. But we do find urban and urban adjacent areas to be the most lucrative for us.

NY Launch Pod: And what about the age demographics?

Joanna Hartzmark: We are in the younger millennial, older Gen Z demographic. One of the best and worst parts of this company is that it appeals to almost every woman we talk to. And so even women my mom’s age want to check it out, which is fantastic. But as far as our target demographic, we’re really in the twenties and thirties of the people who find this the most valuable and whose brands we have the most coverage of from a price point standpoint, but also just from a style standpoint, those are the people that we appeal to the most.

NY Launch Pod: I was going to say, what stops you from covering all?

Joanna Hartzmark: Well that’s the vision, right? That’s the goal. One day I hope to have not just all brands and product categories, but I hope to be genderless. You know, men have this problem as well. It’s a little bit different than the way that women deal with this problem, but the truth is it’s quite universal. And so my vision long term is that I want to improve the shopping experience for everyone everywhere. And so that means that we will have brands that would appeal to my mom or your mom as well as, my little niece. But at the end of the day, if you’re going to build the technology, trying to do everything all at once is a recipe to fall on your face. So I’m trying to stay as focused as I can, which is sometimes hard because it’s so nice when you talk to your mom’s friend and she’s just as excited about the company as your friends are. That’s the high level overview of where we’re at. It’s very exciting.

NY Launch Pod: Well, that is a wonderful note to wrap things up on. Joanna Hartzmark, thank you for stepping back onto the New York Launch Pod and sharing your time with us. How do people find out more about you and Revelle?

Joanna Hartzmark: So if you want to follow me, I’m Joanna Hartzmark Mark on Instagram, and I do post a lot of fun behind the scenes of the ridiculousness of being a startup founder in New York. We are Revelle Nation on Instagram and revellenation.com. Please check us out today and shoot me some feedback in the dms. I love to hear what people are thinking about it. So that’s the easiest way to keep in touch.

NY Launch Pod: And if you want to learn more about the New York Launch Pod, you could follow us on social media @ nylaunchpod or visit nylaunchpod.com for transcripts of every episode including this one. And if you’re a super fan of the podcast, Joanna, are you a super fan of the New York Launch pod?

Joanna Hartzmark: Of course. I came back twice, didn’t I?

NY Launch Pod: If you are a super fan like Joanna, you don’t have to come back twice but if you do leave a review on Apple Podcasts, it is greatly appreciated and does help people discover the show.

NY Launch Pod: Thank you for listening to this episode of the New York Launch Pod. For more information, please visit nylaunchpod.com.

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How You Doin’? Vol 15: JoAnna Hartzmark, Founder of Revelle

JoAnna Hartzmark, steps back on the New York Launch Pod to discuss the growth of Revelle. Revelle is a groundbreaking platform reshaping the way women shop for jeans. In this engaging conversation, JoAnna takes us through the incredible journey of Revelle’s transformation over the past year.

Discover how Revelle is tackling the age-old problem of finding clothes that fit perfectly without the frustrations of inconsistent size charts and multiple returns. JoAnna shares how Revelle’s algorithmic technology has evolved, empowering women to shop with confidence and ease. From starting with jeans as a testing ground to becoming a holistic shopping experience, JoAnna sheds light on the brand’s mission to help women feel beautiful in their own skin.

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Transcript: How You Doin’? Vol 14: Tximista Lizarazu, Co-Founder and CEO of Fraîche

NY Launch Pod: Welcome to the New York Launch Pod, the New York Press Club award-winning podcast highlighting the most interesting new startups, businesses, and openings in the New York City area. I’m your host and New York attorney, Hal Coopersmith and in this episode we speak to Tximista Lizarazu, founder of Fraîche. It’s only been a few months since we spoke to Tximista, but a lot has changed for Fraîche. Fraîche is an innovative vending machine, delivering fresh food to offices as companies return to the office and trying to attract talent. So learn more about Fraîche in another episode of How you doing?

NY Launch Pod: So remind people what is Fraîche?

Tximista Lizarazu: Sure. Basically we are building a better generation of cafeterias for offices. We have this smart fridge technology. We’re placing those smart fridges in offices. So employees have 24/7 access to good quality food.

NY Launch Pod: And you were with us in episode 88. We published it October of last year. It’s been more than a few months since you’ve been on, but not even a year. What’s happened to Fraîche in this period of time?

Tximista Lizarazu: I mean a lot of things. We continue to grow; actually, we multiplied our revenue by 10 in the last nine months total.

NY Launch Pod: You 10 x your revenue in nine months?

Tximista Lizarazu: Yeah, so that has been crazy and with the same team and only one sales rep. So we’re pretty happy about that. So we are actually now about to close an extension round to hire a few more sales rep and continue to grow basically.

NY Launch Pod: And 10 xing, your revenue doesn’t happen by accident. How did that happen?

Tximista Lizarazu: A lot of reasons, I think the market is finally ready for the product we have. Return to the office has been booming. You know, all the leaders need new perks to make the office a more exciting place. I think that’s one. Two, all those big cafeterias don’t really make sense anymore. They were built basically to have 100% of the people at the office and 70% penetration rate, I will say and this doesn’t make sense when you only have 50 to 60% of people at the office. So the way we are doing business makes more sense and the unit economics makes more sense because we can provide basically a cafeteria to any offices of more than 40, 50 people at the office, which is also way beyond market.

NY Launch Pod: So you said a couple of things which were pretty interesting to me. One, return to office is booming, but two, that occupancy is less and you’re certainly on the ground for both of those things. What is going on? Because you’re truly on the ground for these companies?

Tximista Lizarazu: Yeah, definitely. I mean, so we never retargeted tech companies because actually they were the last ones to go back to the office. So we are more, you know, working with contracting firms, financial services firms also we’re pretty big in the luxury world. We have four, five clients and we have a lot of conversations ongoing with big leaders in the luxury world. So I mean, the policies that we’re seeing are three to four days a week at the office, but everybody now, almost everybody, has a policy, which was not the case, I will say six, seven months ago when we had this conversation. But now there is a policy in place with all the companies, so it makes all life easier, I will say.

NY Launch Pod: And you’re saying that the old style cafeteria doesn’t work for the new way that companies are operating in a return to office way. Why are your unit economics more favorable than a traditional cafeteria?

Tximista Lizarazu: It’s super simple. There is no labor on site. So we’re just placing a smart fridge and we are refilling this smart fridge with fresh food every single day and the fresh food is coming from the coolest restaurants of the city. So we are only working with local brands, but basically, you know, we just need one delivery a day and then we have the technology with the mobile app and the smart fridge itself. So, no CapEx. So basically we’re profitable from day one because we’re financing those fridges. So every time we’re watching a location, those locations are profitable from day one.

NY Launch Pod: And I have a feeling I know what you’re going to say, but I’m going to ask this question anyway. In the face of the current economic environment, there have been a lot of job cuts. There have been a lot of economic headwinds. Why is this a worthwhile investment for companies? Because they’re saying, we have to belt tighten and now all of a sudden we’re investing in this smart fridge in a way that we never did before. This smart fridge is great, but I’d rather have my coworker.

Tximista Lizarazu: So there are few answers, like I will say three answers. The first one is that all the companies at the moment need a true job boost, I will say. If you fire 10% of your team, you want to make sure that the remaining 90% are staying and are retained and they are happy to come to the office. You still need to offer them perks and, and ways to be still excited about what you are as a company. Also, you know, so many people have been at home for the last three years and we have a lot of feedback that Fraîche basically is a culture boost and that even like people that are from the fourth floor are meeting people from the first floor for the first time because of Fraîche, and one of those main feedback and argument that we have is that Fraîche is a way to bring back people together and I think so many companies need that today because they lost a little bit of their culture in the last three years. So even though they’re in cutting mode, all the employees still need to eat and they usually have budget, for catering or a budget for the cafeteria that they are subsidizing, or at least they’re paying for the infrastructures, and even sometimes they have subsidy on, on the delivery platforms but what we are doing is way more sustainable. So we are offering them an alternative to delivery, for example, which is going to be one cheaper and two, way more convenient and sustainable.

NY Launch Pod: And how has Fraîche helped build culture? Because some people may say, you know what, here it is, I get it is a smart refrigerator, we’re giving our employees meals, but how are they able to bond over?

Tximista Lizarazu: I mean, the feedback that we have is that, Fraîche is like the new water cooler or the new coffee machine, in France, and people are meeting around the fridge and then sometimes even waiting in line, discussing and basically what we’re trying to sell is that instead of leaving the office and losing 20 minutes in line, it’s better to reinvest this time, being with your coworker and discussing with your coworker at the office. So that’s the value proposition but then we are also organizing small events. So basically every month, we have what we call the surprises and we have our brand ambassadors going to the office and bringing something different that is not in the fridge, on a regular basis too. So everybody comes at the same time around the fridge and there is some interaction and sometimes, little gifts and stuff like that. So we’re trying to really build some momentum and some events on top of what we are. It goes way beyond the fridge; it’s also about educating people about health and wellness, about sustainability. It’s about just telling the stories of all the food partners also that we have in the fridges. So we are doing all that stuff and then we are also now working on some software features, in our mobile app to connect people with like after work we have discounts. So the company will pay for those discounts, for example, and everybody will come around the fridge at the same time, and it will be a way to mingle and connect.

NY Launch Pod: And it all sounds wonderful. You talked about the app, the connectedness, the events and how you’re going to raise more funding. What do you think 2024 holds for Fraîche?

Tximista Lizarazu: I mean, 2024 is going to be, I think, very exciting. The beginning of this year has been tough for everyone with the kind of financial crisis and the impact of the world and all this stuff. Hopefully it’s going to be more exciting for everyone and the market conditions are going to be less tense, but for us it’s going to be a big growth phase. Hopefully we’ll raise our Series A by either end of the year or early next year when the market conditions also are better and from that the idea will be to go get the New York market, it is a huge, huge market for us. It’s basically any office of more than 50 people. So it’s going to be building a big sales team and structuring the sales team. We’ve better processes so we can go faster building some channel partnerships. Also, we’ve startups that are already in some of those offices, we’ve landlords, and we’ve potentially the big food services companies. We’re talking with some of them already and they’re interested in what we’re building. So I think it’s going to be exciting for us.

NY Launch Pod: Well, that is a wonderful note to end things on. Tximista Lizarazu, thank you for stepping back on to New York Launch Pod and sharing with us, plus how did people find out more about you and Fraîche?

Tximista Lizarazu: We’re pretty active on LinkedIn. It’s Fraîche on LinkedIn and the Fraîche has just gone on Instagram as well, if you want to check it out. We have a big foodie community, a lot of good food content. Exciting. If you are looking before your lunch.

NY Launch Pod: And if you want to learn more about the New York Launch Pod, you can follow us on social media @NYLaunchPod or visit nylaunchpod.com for transcripts of every episode. And if you’re a super fan of the show, Tximista, are you a super fan of the New York Launch pod?

Tximista Lizarazu: Of course.

NY Launch Pod: If you are a super fan like Tximista, please leave our review on Apple Podcasts. It is greatly appreciated and does help people discover the show.

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How You Doin’? Vol 14: Tximista Lizarazu, Co-Founder and CEO of Fraîche

Tximista Lizarazu, the Co-Founder and CEO of Fraîche steps back on to the New York Launch Pod. Since the last time Tximista was on the podcast, a lot has changed for Fraîche . Fraîche is an innovative vending machine that delivers fresh food to offices, catering to companies as they return to the office and seek to attract talent. Tximista explains that Fraîche has experienced tremendous growth, multiplying their revenue by ten in just nine months. They have achieved this with a small sales team and are now looking to close an extension round to hire additional sales reps and continue their expansion.

Tximista highlights a few reasons behind their rapid growth, including the booming return-to-office trend and the need for new perks to make the office an exciting place. Traditional cafeterias no longer make sense for companies with reduced office occupancy, whereas Fraîche’s smart fridge technology provides a more sensible and cost-effective solution. With no on-site labor required, Fraîche can offer fresh food from local restaurants with a single daily delivery, making it profitable from day one.

The conversation delves into how Fraîche helps build culture within offices, acting as a gathering point for employees and fostering interaction and bonding. Tximista emphasizes that Fraîche goes beyond being just a smart fridge, organizing events and incorporating software features to enhance connectivity and wellness.

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Episode 91: Drew Fabrikant, Co-Founder and CEO of Scout

Looking to find the ideal customer? Scout helps with just that by engaging you with your ideal customers 10x faster using AI. With a focus on real estate transactions, Scout has a database of over 300M profiles and can automate an entire outreach in just seconds.  For individuals and businesses, this can not only save valuable time but also helps increase productivity. Find out how Drew Fabrikant and his team at Scout are saving their clients time, increasing their productivity, and increasing their revenue. 

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Transcript 91: Drew Fabrikant, Co-Founder and CEO of Scout

NY Launch Pod: Welcome to the New York Launch Pod, the New York Press Club award-winning podcast on the most interesting new startups, businesses, and openings in the New York City area. I’m your host and New York attorney, Hal Coopersmith. In this episode, we are speaking all about AI. You may have heard about ChatGPT, our Guest Drew Fabrikant has come up with Scout an AI platform that started out with real estate agents but has become a lot more. But before we go to the episode, we have a sponsor RezCue, New York State’s premier residential rental compliance platform for landlords, property managers, and even real estate agents. Rental laws in New York City are difficult to manage and RezCue helps you follow the law. If you are a landlord who wants to keep up with inflation, you need RezCue. For example, you may not be able to increase your rent by the amount you thought RezCue helps solve that problem and a whole lot more. Go to rezcueme.com and enter in some simple information and rescue will take care of the rest. That’s rezcue me.com or R E Z C U E M E.com. And with that, let’s go to the interview. So what’s wrong with tipping?

NY Launch Pod: So what is Scout?

Drew Fabrikant: Scout is a platform that helps people get in touch with their ideal customers 10 times faster using artificial intelligence and data.

NY Launch Pod: Well, you just said a lot there. Can you explain it to me like, I have no idea what’s going on.

Drew Fabrikant: So what Scout helps people do is it helps them find their ideal customer. It then helps them figure out what to say to them, and then it automates the actual outreach. So it’s really kind of like a Swiss Army knife and you can use it for whatever you want, but most people use us right now to help find their ideal customer and then figure out what to say to them and then reach out to their email.

NY Launch Pod: Is there a particular business that you focus on for an ideal customer?

Drew Fabrikant: We do. We work with about 95% residential real estate agents and brokers right now.

NY Launch Pod: And how did you get into this area?

Drew Fabrikant: Six years ago, we built a lead generation tool for residential real estate agents, and we were helping them acquire buyers and sellers, and then we would use performance data to send that lead to a residential real estate agent. And what we realized was that the, the biggest problem in residential real estate wasn’t exactly getting the leads, but it was helping the real estate agent really perform at a much higher level, but also helping them become more informed, right? Take that knowledge set that they had about a particular person or home or neighborhood, and be able to apply that on a massive scale. There are tens of thousands of people that live in a particular area. A real estate agent has to be very knowledgeable about that area, but also those 10,000 homes. And what we realized was there was a data play there where we could take that data and we could actually help that real estate agent scale that knowledge. And that’s kind of how we started down this path was really just by helping the agent to become more knowledgeable.

NY Launch Pod: And how does the platform work Right now? You’re focusing on real estate agents finding their ideal customer. How does that actually work?

Drew Fabrikant: So the first thing that we do is we use predictive data analytics. So we have a huge database of hundreds of millions of Americans and all of the homes around the country. We know bed square footage. We know when they were purchased, what the appreciation of the home is. we take all that information and then we

NY Launch Pod: Nationwide? All the homes in the United States?

Drew Fabrikant: All of the homes in the United States of America. Yeah.

NY Launch Pod: And where does that exist? Is that on a local level or that’s just someone knows something about my house?

Drew Fabrikant: Oh, well it comes from a bunch of different places. It comes from the local level, but then we have a lot of other data sets that we integrate. So it can come from MLS data, it can come from self-reported data, it can come from Department of Finance and we don’t just stop there at residential real estate. We also have data that we acquire through other means automobile data as well. So we take all of this data , hundreds of millions of rows, and then we have about 600 data points on each one. That allows us to create ideal customer profiles. So we can determine, well, maybe somebody’s a prospective mover, maybe, they fit the age range, maybe they fit the family size, there’s more people in the household than they have bedrooms, things like distressed assets. So we have access to all that information and then what we’ll do is we will boil down that list and we’ll provide lists of contacts that would be suggested to reach out to. So essentially scoring an entire neighborhood for who is the most likely mover.

NY Launch Pod: And how are you getting agents to use this platform?

Drew Fabrikant: Agents need help, right? They need a ton of help. They need to save time. Our value proposition to them is, you can describe who your ideal customer is, we can actually find them for you. So if you tell us what you’re looking for, we have the data to do it. We have the contact information, we have everything that they need. If they have the contact information, we can help them score who is the most likely consumer or the ideal consumer for that. So what we’ll do is, we’ll tell real estate agents about this, how we can help them save time, how we can help them increase their business and automate the entire process. We have a number of communities that we do it through built on Facebook, LinkedIn, and also just good old-fashioned networking.

NY Launch Pod: And these are people reaching out to purchasers of property or sellers of property?

Drew Fabrikant: It can be either or. You know, we have mostly sellers because that’s where the data is the strongest. It’s kind of harder to grab renter data, it’s more ephemeral in nature, but for the most part we’re able to identify likely sellers and then those people obviously end up becoming buyers after they’ve sold their homes.

NY Launch Pod: About how many customers do you have right now?

Drew Fabrikant: Oh man. So when we opened up the wait list for this, we probably had two to 3000 people on our wait list within the first three months. We’ve launched our beta just a couple of months ago and have on boarded about 170. We’ve got a couple of agreements with call them, national or regional brokers who have two 3000 real estate agents who are rolling out to right now. So, we’re growing pretty quickly.

NY Launch Pod: And of these people in your beta test, how have they seen their revenues grow?

Drew Fabrikant: 95 x r o I plus

NY Launch Pod: Sounds like a good investment in 95 x.

Drew Fabrikant: It’s a pretty good investment when you’re selling something like residential real estate, it’s a pretty big windfall at the closing table and we’ve had agents sign up in day one, they’ve gotten customers, so we’ve executed outreach for them and the agent gets an inbound, Hey, this is so amazing. How did you know, like all this information about my home? I was actually just thinking of selling, can we schedule a call? Can you come by; can you let me know more information? So some agents have actually landed listing agreements day one of campaign one. So like 90 days later they’re realizing actualizing, you know, 60, 70, $80,000 depending on that home value. And, and at that point, they sign up for three years.

NY Launch Pod: And how do agents reach out to owners with the data?

Drew Fabrikant: So that’s where GPT comes into play. So everybody knows about open AI these days and it basically writes your outreach for you. The problem with that is that it’s not very informed about the specifics or kind of the context in which you’re using this data. So what we’ve done is we’ve built a bunch of AI models that get fed into, into GPT and we write the outreach for the actual real estate agent. And it’s a combination of kind of knowing what the consumer, the recipient wants to hear, plus some data feedback loops. We’re able to actually see the response rates so we can tailor our language for the outbound. So for the most part our software can speak real estate agent almost better than the real estate agent can.

NY Launch Pod: So it’s reaching out by email?

Drew Fabrikant: Yeah, that’s the first channel that we’re using, email automation and obviously we’ll be able to do this through SMS or LinkedIn. We actually have some integrations with robots that will pick up a ballpoint fan and they’ll write an outbound, uh, postcard to somebody. But we’re starting with email.

NY Launch Pod: I was wondering if there was going to be mail involved because you actually know the person’s address.

Drew Fabrikant: Yeah absolutely. There’s still nothing like a handwritten card.

NY Launch Pod: So one of the things that I think about when you talk about AI and all the things that you’re doing and all these integrations and how you know about every single house in the country is it’s a little bit scary. Should people be scared?

Drew Fabrikant: I think no more scared than they are of their information kind of already being out there being targeted by advertisements that are irrelevant. I would say they should probably be happy that they’re being targeted with relevant information. I kind of dread going to the mailbox these days. I weighed it the other day, I had something like 18 pounds of junk mail that literally just went straight into the recycling bin and when you think about, you know, how irrelevant that stuff is and the toll it’s taking on the environment, just from that perspective alone, when somebody actually sends me something that is relevant to me, it kind of makes me, I guess smile a little bit that they did their research.

NY Launch Pod: What happens when every realtor starts using your platform and everyone is relevant?

Drew Fabrikant: Uh, hyper saturation, then we kind of become snail mail and everybody dreads getting a hyper personalized inbound. But we actually take a lot of precaution against that. So we implemented limited exclusivity in the platform. We implemented a batching and throttling system that actually limits the number of outbounds that any individual can actually send. So we actually do our best to make sure that we’re not saturating the market or hyper saturating the market or we’re kind of letting somebody get over their skis

NY Launch Pod: Before that. What is the ultimate goal and success look like for Scout?

Drew Fabrikant: Well, the world is changing very, very quickly. I think in no less than six to eight months, you and I are probably going to be having email correspondences with each other where our emails will then brief us on what happened. The technology that we’re building around it’s going to do for the world. What I think Google initially did and when Google came out, nobody ever had the excuse to say, I don’t know anymore. Great. What GPT is now doing is it’s eliminating the excuse to say, I don’t have the time. And when I think about that, it’s going to make everybody incredibly more productive. And I think that Scout will be able to sit at the center of data, but also context and workflow automation. So the actual delivery of that content. The internet changed a lot over the last decade. It used to be a place where you could get just data. Fast forward to the last couple years, you have to contextualize that data. What Scout is doing is actually automating the contextualization, but also the delivery. So how do you have very personalized conversations with people that you either know, limited information about or nothing about in a very personalized way. That’s really what I hope that Scout can do for everybody.

NY Launch Pod: Well that is a wonderful note to end things on. Drew Fabrikant, thank you for stepping on to the New York Launch Pod and sharing your time with us. How do people find out more about you and Scout?

Drew Fabrikant: You can look me up. I am on LinkedIn, Drew Fabrikant. You can look up Scout www.trustscout.com.

NY Launch Pod: And if you want to learn more about the New York Launch Pod, you can follow us on social media @nylaunchpod, or visit nylaunchpod.com for transcripts of every episode, including this one. And if you’re a super fan, Drew, are you a super fan of the New York Launch pod?

Drew Fabrikant: I’m the biggest fan.

NY Launch Pod: If you are the biggest fan like Drew, or even if you’re not, please leave a review on Apple Podcast and is greatly appreciated and does help people discover the show.

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Transcript 90: Zach Colonder, Co-Founder and CEO of Grazzee 

NY Launch Pod: Welcome to the New York Launch Pod, the New York Press Club award-winning podcast on the most interesting new startups, businesses, and openings in the New York City area. I’m your host and New York attorney, Hal Coopersmith. In this episode, we are speaking all about tipping. Our guest, Zach Colonder thinks tipping is broken, specifically cash tipping, and he wants people to tip through his app Grazzee. Here’s Zach:

Zach Colonder: We service all buildings. I’m in non doorman buildings, walkups that deal with a super and a porter. It doesn’t have to be a high volume building, it just has to be a building where people want to send money to staff members that if you’re in a non doorman building, you don’t see the super all the time. So now you can send a money and not even have to worry about it.

NY Launch Pod: Listen to the episode to find out how Zach is growing the app, how it even works, and what’s next for Grazzee. But before we go to the episode, we have a sponsor RezCue, New York State’s premier residential rental compliance platform for landlords. Rental laws in New York City are difficult to manage and RezCue helps you follow the law. If you are a landlord who wants to keep up with inflation, you need RezCue. For example, you may not be able to increase your rent by the amount you thought RezCue helps solve that problem and a whole lot more. Go to rezcueme.com and enter in some simple information and rescue will take care of the rest. That’s rezcue me.com or R E Z C U E M E.com. And with that, let’s go to the interview. So what’s wrong with tipping?

Zach Colonder: What’s wrong with tipping? Well tipping is an old school way where people still go to the bank, they get the cash, they go to Dwayne Reed and buy the cards. Then they go upstairs and they fill out the cards. They put the money that they take out of the bank and the cards, they seal them up and then they try and hand 10, 20, 30 cards down to one guy. Hope that it all goes to the same place. But who wants to go to the bank anymore? If I ever go to the bank, it’s one time. It’s for tipping only. That’s it. One time a year. That’s what’s wrong with tipping.

NY Launch Pod: And so you wanted to change what was wrong with tipping?

Zach Colonder: I wanted to make tipping as easy as possible for someone who wants to give money to the staff. That’s what I want do. And that’s what we did. Because I live in a residential doorman building and I am lazy and I didn’t wanna go to the bank, in the freezing cold, I didn’t wanna buy cards and I didn’t wanna have to fill out cards and I didn’t want to try and find everyone. It’s a pain. It’s an hour and a half to two hour process for something now where it takes one minute.

NY Launch Pod: And when you were looking at this, did you realize that other people had problems?

Zach Colonder: Yes. Everyone I talked to, it’s an issue. No one wants to do it. Now when I say no one, I shouldn’t say that. Most people don’t want to do that. Now there’s always gonna be the people that want to go to the bank. They want to get the cash, they wanna find their guy, they want to give him the big hug, give them their envelope. That will always be the case. But for a lot of people, especially the people that are out of town, people that order Uber eats for everything, they don’t wanna do that.

NY Launch Pod: I was gonna say, the big hug, that’s one of the best things.

Zach Colonder: Big hug. I know, I know. But you can’t hug 20 people in your building anyway. And you’ll still see your main guy downstairs and you can still hug him, Hey, did he get my Grazzee? And he’s going to say yes cause it’s immediate. They see it.

NY Launch Pod: Have you heard of people not receiving their cash?

Zach Colonder: It happens a lot. How about this? It happened one time to me where I handed I think 20 envelopes out. Cause I lived at a big building and like one of the guys came up to me and was like, “Hey, just to let you know, there was nothing in my envelope”. Now did I forget to put money in there? Probably, but it’s embarrassing for him to come ask me. It was embarrassing for me because I don’t know. I mean do people just go there and say “Hey, there was nothing in here”. Like did someone else go in his envelope and take it? That stuff happens all the time. Like all time.

NY Launch Pod: And this is a secure way of doing that, right?

Zach Colonder: My way is a secure way. The other way of handing the envelopes. 20 envelopes. Do you know how many envelopes end up at the front desk? Take a building of 400 units, say 200 units tip, cause not everyone tips, 200 units, 20 envelopes. It’s 4,000 cards with cash in them. It’s very tempting. People are going to take them.

NY Launch Pod: That’s a lot of cash. And you wanted to do something differently? Yes. Okay. So how does it work?

Zach Colonder: So, how does it work? Well the resident, they log into the app and they search for their building. Once they pull in the building, you enter your apartment number and then you see a whole list of staff in a Venmo type fashion where you can send everyone money all in one transaction. So you can see all 20 employees. You put down whatever money you want to give them, 20 times, you know the different 20 people and hit send. You can pay with your credit card, you could pay with Apple Pay, which makes it super easy. You could pull it from your bank. So you could do it that way.

NY Launch Pod: And how does your platform make money?

Zach Colonder: So we charge a resident to use it, a small transactional fee. It comes out to a little bit less than the amount of money that you would spend at cards. Its Duane Reed. But if you want buy a generic, just happy holidays card, it’s probably $7 for 10. You get a big building that’s 14, $15 just in cards. So my fee is actually, it’s cheaper my way. Saves you two hours of time and everyone gets their money.

NY Launch Pod: And can I use this not for the holidays.

Zach Colonder: Yeah. So I have buildings that use it all the time. Obviously not everyone uses it. This is mainly for, it’s a one time during Christmas and the holidays people use it then. But I have buildings where people say they did so they snake the drain or they got the packages upstairs. I see, $5 here, $10 here again thrown around all the time.

NY Launch Pod: Right. And so how have you been able to get this into buildings?

Zach Colonder: It’s a little bit harder than I thought it was going to be, but it’s a lot of hustling. I go to most buildings in the city, I speak to everyone from the doorman to the supers, to the building managers. I try and find people on the co-op boards or the condo boards. I do shows. I, do a lot of stuff and eventually once they get on there, they see the value and they love it. You know we’re in almost a hundred buildings now. We haven’t lost one building. Everyone keeps on coming back because it’s easy. And since it doesn’t cost the building anything. So the residents pay a little bit of a fee. But for the building it’s free.

NY Launch Pod: Per year? The residents pay per year or per transaction?

Zach Colonder: No, the residents pay per transaction. So if they want to use it, they can pay. If they want to go to the bank and do it the old way and get the cash and the cards, then they have to spend their time. You know, I’m a convenience play but it’s free for the building, it’s free for the staff. If I want to send someone $50, it’s $50 into the staff’s account. Then there’s a couple ways for them to get the money per se. You could transfer to their bank and it’s free for them. You know, there are little fees involved but Grazzee takes care of that.

NY Launch Pod: Like an ach?

Zach Colonder: Like an ach. So their ach, transactional fees, 50 cents, 60 cents, whatever, it’s, we pay for that. So we want to make everything free for the staff. They can put it on a prepaid debit card. So the money actually never goes to the bank. It sits on their phone so they can use it. We can send them a check. You know, there’s different options for them to get their money.

NY Launch Pod: I was gonna ask, how can the staff get their money and how do the staff feel about this?

Zach Colonder: Well you know, some staff, most staff love it and there’s always a staff here and there that is an old school person that doesn’t like technology and, but they get used to it. And I have had buildings where 80% of the people will be a part of the app for Christmas or holidays and they get sent money and the people that didn’t wanna be on there end up calling me because they see all their colleagues getting money. They want to get involved because it doesn’t cost them anything. I don’t know why they don’t wanna do it, but some people are just such old school and they, they don’t wanna do it.

NY Launch Pod: How long have you been doing this for?

Zach Colonder: So we’re going on our fourth winner. So I created this in 2019.

NY Launch Pod: So you’ve been doing this for four years?

Zach Colonder: Yep.

NY Launch Pod: Four holiday seasons. Question everyone wants to know is we’re going into this holiday season, how much should people tip? And I think you probably have the data on that.

Zach Colonder: I do, but each building’s different.

NY Launch Pod: Okay.

Zach Colonder: You got the rental buildings, you got the condo, you got the co-ops, you got the five star gloves, you got everything. So it really is based on what people want to spend. It’s different. I’ve seen monster tips of thousands of dollars and I’ve seen the lowest is $5.

NY Launch Pod: Right.

Zach Colonder: It depends on what you feel like giving averages between a hundred, 150 per doorman. Supers obviously get more depending on what they’ve done for you that year. And the porters, I mean the porters and the handyman kind of get left out. They do most of the grunt work in your building that you don’t even know about. But they really make the building run. So I mean everyone should get the same amount but you know, obviously people have their favorites and they see people every day. But it takes a lot of people to make the buildings run that most people, especially myself included, had no idea.

NY Launch Pod: And just going back to the resident experience, you are pricing this on a per transaction basis. Is that based off of how much someone is tipping?

Zach Colonder: Yes.

NY Launch Pod: Okay. And so based off of that, you’re calculating it should be about the same as what someone’s doing for

Zach Colonder: The cards? Yeah.

NY Launch Pod: For cards, everything else like that.

Zach Colonder: Listen, if you’re a big tipper, obviously you’re gonna spend more money on the app, but that’s the same type of fees as Uber Eats. You know, if you’re ordering a lot of food for seven people, the fees higher.

NY Launch Pod: Right.

Zach Colonder: You’re on StubHub, you know, it’s like one of the worst things out there. They crush you. But yeah, StubHub, you buy a ticket is $400. You’re spending a hundred dollars in fees. Now obviously our fees are way low than that, but it’s a percentage of what they spend.

NY Launch Pod: And if I pay by credit card, I reimburse you for the credit card processing plus your fee.

Zach Colonder: Yes. You’re paying for the credit card processing. The way we built the system is we wanted a hundred dollars to be a hundred dollars to the staff member. So with credit cards we’re not gonna pay it and I don’t think you want the staff to pay it so the people pay it. And I’d say about 70% of the people pay with credit cards. They get the points they put on their business. They have a record of it. Even though it’s, it’s cheaper to pay with their bank. They use a credit card. I don’t know why.

NY Launch Pod: And what’s been some of your biggest challenges?

Zach Colonder: My biggest challenge is to get more buildings. That’s it. I mean once I get a building on board and they use it, they love it. You know, I hope the word of mouth starts growing. Uh, so more people want to use it. But getting buildings on board, it’s hard. I deal with a lot of people. I deal with the staff, I deal with the supers, I deal with the building managers, I deal with the property managers, I deal with the board members and that’s a lot of moving parts and nothing gets done overnight and I wish it did.

NY Launch Pod: And once a building is signed up, how do you advertise it to all the unit owners?

Zach Colonder: So the building actually does it for me. There’s a couple ways. I have postcards that I hand the supers and the building managers. If the building is one of those buildings where they hand out cards during the holidays, we could attach our card to their card. If they don’t and they hand out a piece of paper, say all their staff list, we could put our website and a QR code on the bottom. If they use something like called Building link or some other portal for the buildings, they can send out an email saying, somebody asked for electronic tipping cause I’m away in Florida, how can I do it? Here’s the link. So all they would do is log into the website and find their building and send them money.

NY Launch Pod: Once you’re in a building. Have you seen usage increase over time?

Zach Colonder: I’ve seen tips increase over time in terms of usage. I guess I have. Yeah, it’s a lot. People use it the same people keep coming back and using it, which is great. I don’t really know. I don’t really have stats. If they were on it and didn’t use it and went and got to the bank, maybe one or two cause they didn’t want to pay the fee. But that’s in everything, if you don’t want to pay Uber Eats and you want to go downstairs and go to the restaurant and pick it up, people could do that too.

NY Launch Pod: What I love about your business is that it certainly solves a very New York problem.

Zach Colonder: New York it’s very niche.

NY Launch Pod: It’s very niche. What’s it like doing business in New York and growing your company in New York?

Zach Colonder: One of the good things is I could walk around to building, to building viewer at another city per se. It’s very hard and difficult to go to all the buildings. So here I can hit 20, 30, 40 buildings in, in, in a day just going around walking. So I’m not parking everywhere, I’m not driving. It’s, so that makes it easy. Also, the the, the volume of people that live in the, in the city. And if I get a building with 500 units, that’s, you know, that’s, that’s a nice building. We service all buildings. I’m in non dormant buildings. Walkups that deal with a super and a porter. It doesn’t have to be a high volume building, it just has to be a building where people want to send money to staff members that if you’re in a non dormant building, you don’t see the super all the time. So now you can send them money and not even have to worry about it.

NY Launch Pod: And what is the future of Grazzee? What do you want it to become?

Zach Colonder: I want every building to use it. I really think it’s gonna get

NY Launch Pod: Every building in New York City.

Zach Colonder: Why not? Why not? Here’s, how I equate it. I don’t know if you remember this, but you remember back in when cabs were cash cabs, do you remember you had to pay cash for cabs? Yeah.

NY Launch Pod: Yeah.

Zach Colonder: And there was a time where it went from cash to credit cards and the cab drivers wouldn’t pick you up if you didn’t have cash. Do you remember that? There was like one year where they all got angry, I’m only taking you if you have cash. Do you remember that?

NY Launch Pod: I also remember just as an aside, when the credit card receipt, when you paid, listed the full credit card number in cabs.

Zach Colonder: Oh, I don’t remember that.

NY Launch Pod: Okay.

Zach Colonder: Yeah.

NY Launch Pod: But I do remember when they said cash only

Zach Colonder: Cash only. I’m not picking you up. My machine’s broken. They would always say my machine’s broken.

NY Launch Pod: Right? Yeah.

Zach Colonder: And then you know what happened? They got used to the credit card fees. They’re all making way more money cause they see people on there oh, 20%, 30% people don’t care. And half these guys are a corporate anyway and they’re just putting on there. They don’t care what they tip, they’re not paying it. They’re making more money now and they love it. They probably don’t even want cash. So the same thing’s happening with this. This was a cash business. Once these guys, once the staff members realized they’re gonna make more money because to take out a thousand dollars of the bank, first of all it’s a process, but it hurts. It hurts for me. It hurts. Giving a thousand dollars out a thousand dollars on my credit card feels like nothing, right? It doesn’t even feel like anything. So it’s easier to give money on a credit card when you don’t see it and feel it. So people give more.

NY Launch Pod: Do you have to report these transactions?

Zach Colonder: Great question. We don’t 10 99, we don’t K one. But if you really think about, and I’ve talked to accounts before we even started this company, these aren’t tips. So we’ve all been calling it tips forever. Christmas tips, whatever, holiday tips. Oh, you’re my doorman, here’s a tip. A tip is a bartender, a waiter, someone providing an exact service. And usually the tip is a percentage of that service. I like my doorman, I like my super during the holiday times. If I give him money, they didn’t do anything. I like you, here’s a hundred dollars. Did I tip you?

NY Launch Pod: Well? You could call it a gift.

Zach Colonder: Call it a gift.

NY Launch Pod: Is that what you’re calling them?

Zach Colonder: We call them gifts. So these are the holiday gifts, cash gifts. Now the gift tax law, if you look@theirs.gov says you can give up to $16,000 per person per year. So technically I can give you 16 grand. I can give her 16 grand, a million people, $16,000 and it’s tax free. So we’ve all been calling it the wrong thing. Everyone thinks it’s a tip. In reality it’s not. And I have to educate people on that. And that’s a holiday, cash gifting.

NY Launch Pod: Holiday Gifting.

Zach Colonder: Yeah.

NY Launch Pod: That is a wonderful note to end things on. How do people find out more about you and Grazeee?

Zach Colonder: Then go to the website, uh, G R A Z Z E E. So that’s two Zs and two E’s. So it’s grazzee.com. Download our app on the app store or Samsung store, Android store. And that’s it. If you don’t have your building signed up, send me an email to support S U P P O RT @grazzee.com. I’ll try and get your building on board. If you’re a condo member or a super, contact me immediately. It takes very short time to get you guys on board. But you’ll see an increase in tips in your staff. You’ll make your residents really happy cause it’s a good option for them to use it. And again, it does. They don’t have to use it. They can still go the old school way. We’re just trying to appease the people that want the new school way.

NY Launch Pod: Well, Zach Colonder, thank you for stepping onto the New York Launch Pod and sharing our time with us.

Zach Colonder: Thank you very much.

NY Launch Pod: And if you wanna find out more about the New York Launch Pod, you could visit nylaunchpod.com for transcripts of every episode, including this one. And follow us on social media @nylaunchpod. And if you’re a super fan of the podcast, Zach, are you a super fan of the New York Launch pod?

Zach Colonder: Oh yeah. I’m a super fan.

NY Launch Pod: If you’re a super fan like Zach, please leave your review on Apple Podcast. It is greatly appreciated and does help people discover the show.

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Episode 90: Zach Colonder, Co-Founder and CEO of Grazzee

In this day and age who wouldn’t like the benefit of not having to stand in a line at the bank to draw money or risk that your building’s service staff might not receive their holiday tip? Zach Colonder realized this gap in the market and thought of a way to make this process better and simpler by creating Grazzee and now tipping has never being more convenient. Find out how Zach thought of this business opportunity, how he is overcoming the challenges of gaining traction in the market and how the app can make your life easier especially entering the holiday season.

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