How Two Friends Built a $750 Million Barber Tech Company

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Speaker 2: Rolls out as real. He wrote, Troy talk about the tags list.
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Speaker 1: About finance, but we talk in alish that is common to the people.
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Speaker 3: That's from the dreunies that we grew up with.
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Speaker 4: You all are the bright spot thank rudership for Black Americans.
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Speaker 2: This is the knowledge that actually matters.
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Speaker 1: I plaug both of you for the Saint isn't it a country issue. It's not American issue, it's a world issue.
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Speaker 5: You came to earn Lisa.
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Speaker 2: All right, guys, welcome back e y l a special episode, you know, long overdue friends of ours and people that have really built tremendous business and really revolutionized the industry that for a long time kind of was in the dark ages. When it comes to technology in the barbershop, we think of barbershop industry. So yeah, we got a song David from Squire. If you're not familiar with Squire, that's an app that actually allows well i'll let you guys talk about it, but how I know. It is an app that allows you to book for appointments for your barber. Right, it allows the barber to manage the schedule to run a barbershop like an actual operation. Right. What's the other tech that's behind it as well?
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Speaker 6: That allows Another part that's important is the payments.
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Speaker 7: So we make that, you know, really really simple and easy, kind of like that experience and when you're tak an uber, you just get in, you know, through your ride and then get out. You know, we have to worry about tipping and cash and all that. We take that kind of experience like to the barbershop as well.
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Speaker 4: Yeah, I mean, and when we started this business like nine years ago, you know, it was nothing Uber fifteen twenty sixteen. Uber was just getting traction and the experience of going down to the barbershop, having everything handled, just walking out after. We just wanted that seamless experience. And then we realized once we were in the business, the real opportunity was streamline.
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Speaker 5: No entire operations of the business.
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Speaker 4: So that's kind of how Squire was born as a full management system that it is today.
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Speaker 2: And the valuation right now is seven hundred and fifty million. Yes, congrats, So congratulations. Thank you first and foremost, thank you God for joining us. Man, appreciate it.
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Speaker 1: We run into y'all a lot, Dave. I feel like we've run into each other all the time. So it's good to have you out here, man, And like you said, something that's disruptive, but it's helped our community for sure.
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Speaker 3: Lots of communities.
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Speaker 1: Get back time, which is the one asset that you can't replicate, and you guys have done that.
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Speaker 3: So congratulations.
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Speaker 2: All right, so let's get into it. So, Okay, you guys start an app which seems like that somebody should have been in that, right. It wasn't something that was like too far out of the realm of like thought process as far as being able to book online, being able to process payments correctly, being able to manage appointments for barbers, like, it seems like something that you know should have been in existence, right, but it wasn't. So walk us through a how you guys developed a relationship and the process of actually coming up with the idea and then getting the idea off the ground into market.
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Speaker 6: Yeah.
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Speaker 7: So David and I we were friends before actually starting Square.
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Speaker 6: We both were in New York.
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Speaker 7: I was working at a law firm at the time and he was like in finance. So we had a lot of friends that come and going out. You know, we were in our twenties at the time, and after a few years we were like really wanted to work on something that would be more impactful, and we weren't really kind of fulfilled with the corporate trajectory we were on. So we were literally brainstorm ideas on the weekends instead of going out. We used to sneaking to Columbia campus because we both lived up uptown in Harlem and we were literally just white whiteboard ideas like what could we work on, what could we do that would actually, you know, could have a legacy that they would have a bigger impact on you communities just be more positive. And through that process we came up with this this experience of the barbershop.
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Speaker 6: Like both of us have been going to barber since we were kids.
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Speaker 7: I started going like around six or seven off my pops back in the day, and the experience of getting haircut hadn't changed twenty years later. You go in, you wait, it could be ten minutes, it could be two hours. You might you know, you have to pay cash, you text back and forth as your barber, And didn't make sense that this one experience of life that was like so important and so like joyous and one on the one hand was also so painful. So that that's why we came up the idea like how can we solve this with technology.
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Speaker 4: Everybody got the experience when you go to barber shop there's a big homie comes in and were like he's next.
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Speaker 3: I was seeing that for three hours.
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Speaker 4: Everybody has that experience, and you know, like that used to having me an all the time with a little kid, because you know, I grew up, you know, I used to go to barbershop by myself because my alm was working or whatever the case maybe. But with technology now you can't do that because everything is ready, edgimented, everything is on point.
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Speaker 5: And that's a harder.
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Speaker 4: That's harder pill the swallow for the barbershop, older barbers to like say, nah, somebody else was.
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Speaker 2: Next, and a matter of what happens you used to happen all the time. You make appointment at twelve, and then even if nobody took your spot, the barber's just running late, so it's taking an hour and a half forty five minutes, so you don't actually get into the chair until two o'clock, and it's like you you can't really run your day by like kind of hoping and wishing that there's a ninety minute window that you might potentially get get cut. So if you have set slots every hour right like that, it holds I think it holds everybody accountable.
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Speaker 1: I think it's done a job for barbers. It's made them more efficient with the time, but they're able to cut more efficiency knowing like hey, I got somebody coming out the here, let me be precise with this one, make sure I can because I can get more people in rather than wasting the time where it's like you'll waiting for this dude or your next who I don't know is they're actually becoming more efficient, which actually means more customers, more clients, more.
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Speaker 4: Moment Absolutely absolutely, And now you know, with the AI and being being in the squire now and having then AI kind of like focused companies, the tools that we able to leverage now is just incredible. Like we built Operator, which you know I demo at LV barber Xpo. It's a way for barbers to never have to answer their phone. You know, people just call the barbershop and this human like voice picks up and does all the scheduling for you and really is able to like do like the operations that normally a human would do. So we're just it's just making the barbers and the barbershop owners lives more efficient, and efficiency leads to more money.
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Speaker 1: At the end of the day, when y'all first figure out that you're going to create a solution for this problem, where's the first shop that you go to to tell them about this technology that you're about to use. Do you go back to the same spot, like, yo, bro, I'm not sitting here for three hours, here's this product that how did that go?
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Speaker 4: So the thing the thing with that is like what we did was like we went out like when we first had the idea, then we went out with a iPad and and just ask questions like if we would build this thing, would you use it? Like ask the feedback, you know, interviews and like it's hard to tell somebody know when you're ready been involved in the process all along. So so what we did early on is we built with the guys or with the owners, and we had them a part of the process. And then when it was time to launch, you can't really say you're not doing this because you were lockstep the entire process.
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Speaker 2: So let me ask you this, as far as the idea, it's a relatively it's not a complex idea, right, but what does it take to actually get that tech to make it come to life and make it the application actually happen? Like how much money does that cost? And what was the process as far as on the technical side to actually make that app get up and running in actually in the app store.
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Speaker 7: Yeah, So when we were at that stage, you know, this was like almost ten years ago. There was no vibe coding at the time. It's a total different world where it was a lot harder to build that first like MVP, first vision of the product to get in front of the customers. So the approachure we took was we wanted to recruit a co founder to be technical that's like part of the team instead of outsourcing and like paying And you know, some people do it in different ways, but our philosopher is always like, if you're paying somebody to build your product, you have inverse like goals, like they want to do it for as fast as possible and make as much money as possible, and you want to get the best quality and pay as little as possible. So you're already kind of set up for failure. So we were really focused on recruiting somebody to be our CTO and co founder, and it took some time and we went through some you know, a couple iterations where like it didn't work out, but eventually we did find that person, and that person kind of joined the company at the time and helped us build that first first version of the product.
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Speaker 1: Yes, you guys don't come obviously when Lull you in finance. How in depth did you have to get in the technological side, right, because you're trying to build an app that is going through Obviously you're going to recruit people to find but how much did y'all have to get in the weeds inside of tech to realize that we have to understand this industry just as much as the one that we came from.
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Speaker 7: It was a learning process. Like we didn't know anything about tech, had never you know, started a tech company, didn't have any connections in tech after at the time. So honestly, we didn't know what we were doing. What we did have is pretty good product instincts because we were so close to the customers, so we understood the pain points and kind of like what we were trying to solve for. But in terms of under the hood and act the actual process of like building something and like actually like building the first version of the app, which was an iOS app, were we were completely clueless as to what was actually happening.
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Speaker 4: Yeah, and we're it's a consumer facing application, so you know, directionally, we you know what felt right in terms of like a what a product actually operates, but in terms of like under the hood, we didn't know anything.
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Speaker 7: I mean, how would you know, Like you're just starting out. You have an idea and you're like I want to go build this, but you don't actually know like what it takes. Now, of course we've learned a lot, but that you know further was like more reason and why we wanted to have somebody on the team who was aligned incentives and could help help build it out. Because when you're non technical, especially back then before AI was was the way it is now, like it's it's very difficult to like understand from a from a technical process, like what is actually required, Like something could take a day and they could say it takes a month. You have no idea, so you're really at it. There's an asymmetry of like knowledge at that point. So when I talked to early stage founders who want to be you know, tech founders and want to start companies, I said, you know, either learned the code.
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Speaker 6: Now you can learn a lot with AI and.
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Speaker 7: You can vibe code your way to a lot, but really like you want to have someone on your team who has a strong technical foundation if possible.
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Speaker 2: So how did what was a marketing campaign as far as to get Barbers on board. Was it to get barber's on board? Was you get the clients of barbers on board? Like what was the.
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Speaker 4: First you know, we did everything under the sun, but it was just so. So what happened in the beginning is we thought that if we built this beautiful application and folks started to use it, everything would run smoothly. The barbers love it, the customers love it. Early financial models had us get into ten billion dollars in three years.
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Speaker 5: But but that's before.
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Speaker 4: But but what was interesting is it didn't work. You know, it didn't work anything that when we sent customers barberas use would use it as a client acquisition tool and.
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Speaker 5: It would be a jancade experience for the users.
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Speaker 4: So folks would come in and a barber would have them pay twice in the app and in the store again because he didn't trust he or she didn't trust the application. So there was stuff like that. There was double bookings. So even though we would say, hey, use this for your your all your appointments, he would then or she would then just keep on taking appointents appointents to a ways from existing customers. So we realized that if we didn't have the entire back end for the entire barbershop. It would we would still run into these problems over and over and again. So we had to make sure all the appointments and the barbershop went through this system. So that was the first kind of unlock of like, hey, we're not just building app, we have to build a comprehensive system that manages everything through the barber shop.
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Speaker 2: So you targeted the barbershops. Yeah, did you give it out for free at first? Absolutely?
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Speaker 7: So we were literally he and I walk into every shop we could, like near our office in New York or near where we lived, Like we were just like walking ourselves. Wait, talk to the owner, try to get them to use the app. Sometimes, you know, they didn't want to hear from us because they were like, you know, like where are you selling kind of things, especially in New York. And sometimes we had to actually like book a service, like what's the cheap of service you got?
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Speaker 6: Or beer trim?
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Speaker 7: All right, I'll pay you for that time, and then when you're in the chair you can talk to them and kind of get their attention. So we was really like hand in hand combat.
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Speaker 2: How many how many did you give way for free? First?
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Speaker 4: Before you started, I mean, we didn't start charging for the software into.
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Speaker 5: Like twenty twenty eighteen, so how many weeks?
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Speaker 6: Years?
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Speaker 4: Yeah, three years, yeah, just basically here. But we made money on the like the transaction, so it's like, hey, we still had some revenue coming in. But you know, in the first you just got to when you're unproven, when it's a new motion, you got to give it away free to get product market fit.
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Speaker 3: So how did it? Most people probably thinking like how do you guys make the money?
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Speaker 1: So the transaction fee, there's a percentage that goes from it, then the subscription from the barbershops that use it.
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Speaker 3: That's how you built the business model.
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Speaker 6: Yeah, yeah, yeah.
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Speaker 2: How much is that? How much is the subscription right now? Like today?
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Speaker 4: So it's a one hundred dollars or two point fifty depending on yeah, mo, yeah, depending on what features set you have.
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Speaker 7: He starts at thirty individual parmer, Yeah starts at thirty.
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Speaker 1: Yeah, so if he has his own salon, that's just like alright, So like now that there's the business part of it, Like you're making the money, but you're giving away for free, but you're trying to get it on it's iOS you said, so you know that Apple's got coming for that thirty percent? How did how you guys envisioned in this and you're bouncing it to say, all right, we need to make revenue.
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Speaker 3: We're giving the product way for free.
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Speaker 1: Yes, we're making some from the transactions, but we need to keep the business alive.
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Speaker 7: Well, you know that's where earlier, when you're that early before you're like making meaningful revenue, if you're able to raise money, that kind of that capital and fusion is what keeps the lights on it. And we were fortunate to be able to raise like some angel rounds from our network of people who we knew, not not big checks, but you know, familiarhere, from like twenty thirty thousand to up too hundred, So that that was our first capital that they were able to raise, and that sustained us over the first two or three years, just these these angel checks that we were getting from from people we knew, and because the revenue wasn't we were definitely not making enough revenue to like support the business.
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Speaker 1: Was that was that a space that you all were familiar with because the angel investment, I mean it's not common to a lot of people.
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Speaker 4: Nothing, it's a network, you know, One of the guys that gave us a big, you know, sign of approval early on was Richard Luke Dennis Uh he invested money when we have anything because what we had traction, but not a lot of traction compared to today, but with venture, you know, and the way we did it, because we didn't have access to the traditional networks. We used to just build something, get a little traction. Look what we built, give us some like, go out to our network, get some more traction. Go out to that network again, because you know, back then it was very it was very difficult to raise, you know, money, like for over four years. It was just this piecemeal type of thing. We went through y Commator, which is a big inflection point in twenty sixteen, so we were able to raise some money out of that. But we were very fortunate because a lot of folks back then didn't didn't make it. But because of our network, because of our pedigrees, because of the hustle mentality, we were able to kind of just raise some money.
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Speaker 2: So at what point do you start, Like the pathway that being died at seven hundred and fifty million dollars, right that comes from you obviously had multiple rounds of being raising money, right, and then you have revenue coming in as well, So when does it start becoming like profitable as far as okay, this is now a real business that we're running full.
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Speaker 7: Time, Say around the time we raised our Series A, which was twenty nineteen, that was the first institutional money so so meaning like a big firm that that will give you, you know, one check that would be enough to sustain you to get to the next How much was that when that was for eight million paper that was the most money we ever had at once and the first time we ever had enough to not be worried about fundraising.
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Speaker 2: So what made them value the company enough to raise to give you a check for eight million dollars? Future future valuations based off of revenue models like what was the.
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Speaker 6: So to raise a Series A?
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Speaker 7: You know, typically at that point they want to see signs of like consistency, so like a consistent go to market motion that you're making, which is called urprov like average revenue per user that it was consistent, So they can kind of see a pathway of like okay, if they can get to this, we can we can see how they can get to that, you know, a bigger level. Typically back then it was like if you can basically a million dollars in annual recurring revenue used to be the kind of milestone when you were about ready for a Series A. And that's where we were at that time. I think now that goal post has moved from what I've heard for early stage founders. But back in twenty nineteen, that was that was it. So we were doing a million roughly in arr We had you know, a consistent sales process, you know that you could see how our art pool would grow over time as the shops were coming on the square. All of that was evidence for an investor to see, okay, if they can do this, I could see how they could get to you know, ten million, fifty million, one hundred million because they have like a process that's repeatable, that makes sense.
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Speaker 3: How was the retention right for you guys early stage into the Series A?
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Speaker 6: How was our attention?
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Speaker 5: Then?
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Speaker 6: It's a lot better now, we.
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Speaker 4: Love I mean Son, even that fundraise was difficult, Like I just think back like it was a fundraise from hell, Like I think we had about sixty meetings and it got like one term seet like one offer, you know, and based on the numbers.
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Speaker 5: I mean, we should have had at least four or five in my view.
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Speaker 4: So so it was not an easy process with all the credentials, with all the BACKENDU of Y Combinator. We went through a Y Comedy Series A program and we still it was still difficult.
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Speaker 2: So okay, how did you know the process of actually even going through to try to get venture capital money? Would you? Did you have a mentor that was like ushering you through these different meetings or you just cold calling different firms?
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Speaker 6: Yeah?
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Speaker 7: So as they adventure, we did Y Combinator in twenty sixteen. So when we did that, we moved to the Bay Area, we moved to the entire company kind of there, and we went through that process. Did that Saying fast forward twenty nineteen, at the time, why Combinator had a Series A program.
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Speaker 2: Can you explain why combination for people that people that may not be familiar.
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Speaker 7: Yeah, So it's what I would call like the pre eminent accelerator program for early stage startups. You know, base based in Silicon Valley. Uh, some of the people who are affiliated with there is essentially like the highest echelon of tech. For example, like Sam Altman was there when we were there, so you know, we got we got to know him pretty well. Michael Seigel, mentor of ours, and you know, used to run the run the program.
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Speaker 6: When the co founders of Twitch, you know.
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Speaker 7: Pretty much they are like the biggest name in tech for early stage companies, and so when you have that stamp of approval, it's equivalent to like going to Harvard or Stafford or something for in the tech world. So it was a big deal when we did it. And then twenty nineteen at the time, they had a Series A program. So for the companies that went through the core program that they thought were like ready for Series A, you could kind of reply and then redo it. But for Series A, so they would help us like set up investor meetings, connect us with the right people, help us with our pitch. So we had about as much help and support as any company could have in raising a Series A. And today's point, you know, we still had you know, sixty meetings of different VC funds and fifty nine rejections and we ended up getting one.
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Speaker 6: And that's what allowed us to get to the next level.
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Speaker 5: But all you need is one, that's it is one.
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Speaker 1: What was that process like we talked to a lot of people who've created businesses and founders that moment when you take the on money. Right before it was just you guys and you got a CTO, and now you have investors that you have to answer to and you know, make sure that they're all on board. What's going on? What was that process like for you? Was at an adjustment space for sure? For sure it was the first time.
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Speaker 7: So when it when you get in an institutional UH fund fund, then invest usually they want a board seat. So that was the first time that we, you know, had an actual investor on our board and had to start being more formal in terms of having like board meetings and reporting and.
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Speaker 6: All that stuff.
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Speaker 7: So at the time it was a bit stressful, if I fun honest, and it was. It was a change, but in retrospect, it definitely made us mature as a company and mature as founders. So so it was a healthy thing for the company. But it's it's increased scrutiny. Like now you're you're you're literally accountable responsible every quarter, you have to report how you're doing, and someone who's kind of in a sense a little bit over you because they you know, they they're the board is like saying, you know, giving your feedback and really pushing you to go further.
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Speaker 6: So yeah, it was a big change.
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Speaker 5: And the best board members, you know, I think are.
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Speaker 4: Super helpful because they can use their experience as operator and or their experience from other boards that they sit on. So you know, sometimes you don't agree with what they are saying in the present moment, but you know there's been times like six months a year later, hey, no, maybe it made sense, but I didn't see it because you haven't experienced that or you haven't lived through that.
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Speaker 2: So what mistakes did you make or what lessons did you learn as far as in pitching your company to VC firms that if you did it now, you might do differently.
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Speaker 7: So I think what separated in the early days when we really struggled, we're getting them excited about the opportunity, and later on when we got better at it, is the size of how big can get. I think a lot particularly a lot of a lot of founders, you know, from our communities, like we tend to be like very practical and like we want to paint a vision that we think we can really achieve, but like the ethos of like, particularly like Silicon Valley is like you have to go big. You have to have the biggest possible vision imaginable and sell that because that's what gets people excited. You know, they get excited about, you know, how can this company be a billion dollar company or ten billion dollar company or one hundred million dollar company. So in the early days, like it was, it was hard for us to like make our native shape our native to fit something so big. Over time we started getting better at it. And over time, the more you know, data, the more that we learned about our business, we started being able to see a pathway like, Okay, this is how we get to a hundred million revenue, this is how we get to you know, a billion plus valuation. And then if you believe it, they can believe it. But if you can't even see it, the investors never going to see it either.
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Speaker 3: Is that the goal?
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Speaker 1: Like did you guys sit down one day obviously as a vision become clear and said, yeah, we're going to be a unicorn like this we have the potential to do it.
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Speaker 4: Believe it, I mean, but it's communicating it. In Silicon Valley, it over emphasizes the outliers. You know, like the whole business model, the whole VC model is outliers. They want the folks that is like the zo point one of one percent because that can return the fund and you know if you invest, So the math is the math.
00:26:25
Speaker 5: They don't out of ten portfolio companies.
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Speaker 4: One they hope one is going to be that one hundred x return and that one hundred x return will pay out the pay back to fund and make the individual partner very rich. So you have to understand that. So if you don't, if you don't like pitch one hundred x type of opportunity, then it just doesn't excite them as much.
00:26:49
Speaker 1: How does it look for Ford revenu if you guys in terms of valuation, Like what's that forward multiple?
00:26:54
Speaker 3: Is it like a four five ten?
00:26:57
Speaker 4: It?
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Speaker 7: Honestly, it varies and there's so many facts like macroeconomic factors.
00:27:02
Speaker 3: Yeah.
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Speaker 7: So the last fund raise that we did was in twenty twenty one, and that was a very different climate. Interest rates were super low. It was like what they call it the you know zerp era where the interestrace from you know, almost zero. So as a result, like there's an inverse relation on multiples. So multiples were just much higher across the board for all companies, and you know that that gives in takes, and that changed with the economy. So our focus is always on building a really great business. If you build a great business that fundamentally is strong, has great unique economics and a pathway to like being really big regardless of the of the economic climate, like you're going to you're going to be successful.
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Speaker 1: That was one of those things and that you finished it was like if you create a business, make sure you have these components, right, so make sure you have the tech component and some of it, like all those components. As you're doing it, you're checking off those like, oh we have all those things.
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Speaker 7: Yeah, I mean yeah, I think so, and I think you know, the more we learn about our business, and you know, the more mature we get, like we see like, okay, this is fundamentally this is a really solid, strong business that's going to endure. And the great thing about about our customers is that, like people keep getting haircuts.
00:28:11
Speaker 6: It's very resilient.
00:28:13
Speaker 7: You know, if there's an economic downturn, actually people tend to get more haircuts because it's one of those luxuries you can afford even if you're not making as much money. So I think we're really well positioned to continue to thrive like kind of regardless of what happens in the economy.
00:28:28
Speaker 5: Yeah, I want to So, so a couple of things.
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Speaker 4: And we're seeing that I was at a dinner last last night and a seed early stage and they're raising two hundred x revenue, these AI companies. So so it's just it just shifts with the tie, you know. So so it's still there if you're the hot the hot company a hot industry at that time, and this competition people pay whatever irrational.
00:28:57
Speaker 5: So so that that's one thing.
00:28:59
Speaker 4: And second thing I want to go back to is like, you know, paint the vision a lot of folks, you know, because we're two black founders that we're just focusing on black barbershops, and you know, we made it really clear that we were not. In fact, in our early pitch decks, there was no mention of everything was like these hipster type barbershops. So people can relate to because most of the investors that that you were, you know, meeting were not of color, so it had we had to make sure it resonated with them and those little social cues that you pick up on that you need to kind of incorporate the story to make it seem like hey, And then still some investors said, are you guys still targeted black barbershops when like it just didn't make any sense to me, And you know, I get it, but like, you know, we made it really clear that we were going after the.
00:29:56
Speaker 5: Entire market, not just a slither of the market.
00:29:59
Speaker 2: What's the percentage of barbershops as you think you have that are not black?
00:30:04
Speaker 7: I mean, I think it probably matches the population overall, so probably you know eight.
00:30:14
Speaker 2: So marketing to barbershops? Right, are you marketing? At the beginning you were to face you were going in hand in hand? So were you doing that with white barbershops? Also?
00:30:27
Speaker 5: Absolutely?
00:30:29
Speaker 2: Well how did that work out?
00:30:31
Speaker 7: So funny enough, when we were first kind of thinking through how we're going to do this, we had a bias against ourselves.
00:30:37
Speaker 6: We thought we probably couldn't.
00:30:39
Speaker 7: Go in there and like you know, resonate with with with these like non black barbershops. So we ended up hiring a friend of ours who's actually still with the company, who's white, and like his job was going to be kind of BIZDV like going to the shops, So he was doing that, we were still doing it. And over time this on experience, we started finding out there like, actually we were better even at the white shops selling them than he was. And some of the bias that we had, you know, the preconceived notion that we had that these shop owners, because we didn't look like them, weren't going to want to hear us out. Actually it was just totally not true. And then you know, and it turns out, you know, the white guy who we hire wasn't good at that, He ended up being really good at other things, so he moved into like product on the product side. So you just never you never know, and sometimes there's a tendency to sell yourself short because you know, you think somebody's going to think something about you. But if you have a great product and you go there and you meet them, iy to you know, we found that for the most part, customers are willing to hear you out, you know, regardless of what you look like.
00:31:43
Speaker 5: Yeah, are you solving the hair on fire problem? You know?
00:31:47
Speaker 4: And if you solving that problem, I don't get whatever you are. I think they gotta listen to you because it's you're addressing a real pain. Point in their lives.
00:31:55
Speaker 1: All right, correct me if I'm wrong on these numbers. Thirty two thousand barber shops.
00:32:00
Speaker 5: Thirty two thousand barber shops, yet barber's.
00:32:03
Speaker 3: Barbers ten million clients.
00:32:06
Speaker 6: Last time I checked it somewhere in that.
00:32:08
Speaker 3: How are we like?
00:32:09
Speaker 1: This is because like you're talking from twenty sixteen to this point, how are we scaling year to year?
00:32:15
Speaker 3: Like?
00:32:16
Speaker 1: Are you like what trends are you watching to say? He's an opportunity, his opportunity. This is a potemographic this is that we haven't touched this place. How are y'all going about that? That's a lot. Congrats, Thank you, thank you, thank you. It's never enough, though. Let's get to the next.
00:32:32
Speaker 7: So what we learned is a super super important to scales that you really have to scale your team. So you know, in the early stages, you know, it was us and then a few other early employees, but as you get bigger, you really have to bring on folks who have the experience of kind of getting to the next level where you're trying to get. And over time, we built up a really incredible kind of bench of our executives. Uh, and that that has helped you know, helped tremendously, and in the early days you do you know, it's called doing things that don't scale, like walking into the barbershop yourself and pitching them like that's great, but like you can't. That's not going to get you to where we are now. So over time you have to figure out how do you build like repeatable motions, reputable processes that's like scalable and you know, that's essentially essentially what we've been able to do.
00:33:25
Speaker 2: So So as far as this number of seven hundred and fifty million dollar valuation, what can you break that down? As far as like what does that actually mean in layman terms for somebody that just they hear that, but it's like.
00:33:39
Speaker 4: That is the enterprise value or the kind of like market cap of your business. So if somebody were to purchase the building business, they would have to pay seven hundred and fifty million dollars for entire business. And if somebody is investing, you know, based on the dollar mode they invest, that's percentage amount of the seven hundred fifty million.
00:34:02
Speaker 2: And that seven hundred fifty million would come from investors valuing the company at that As far as okay, I'm gonna put this amount of money in per percentage and then that equals to seven fifty or does that come from revenue that is projected to be like okay, ten x revenue, like what it?
00:34:18
Speaker 4: I mean, there's some formula that they create, but that's essentially the former is like, hey, look, you know, for one percent, it's seven point five million, so times that by ten. If you want ten percent, you got to put up seventy five million. So that's kind of how the math works. And it's just supply and demand.
00:34:39
Speaker 5: Uh.
00:34:40
Speaker 4: You know, if you have a great product, if you have some proprietary technology that they think might you know, transform the world, they're gonna they're gonna pay whatever they're gonna pay for. It's just like, you know, what the company, what people think the company is worth.
00:34:56
Speaker 3: How does the ownership table look?
00:34:58
Speaker 7: Right?
00:34:58
Speaker 1: Because a lot of times startups, you know, we don't have money, right, we haven't got a venture capital and so a lot of times people will off of equity right like as an exchange or collateral to say, hey, I need you a part of the team.
00:35:12
Speaker 3: How does ownership look then?
00:35:13
Speaker 1: How does it look Now obviously you've got a board, you've got investors. Are you guys majority owners still, Like, how does this work?
00:35:21
Speaker 7: Yeah, So as far as the equity, like all of our employees have some degree of equity.
00:35:26
Speaker 6: We think that's important.
00:35:27
Speaker 7: We think it's important one to align incentives, and it's also important as a wealth building mechanism.
00:35:34
Speaker 6: Our company is I don't know.
00:35:36
Speaker 7: For sure, but I would say it's probably maybe the most diverse and one of the most diverse of a company like at our scale in terms of like the breakground of our employees. So we think it's you know, it's really important for them to have skin in the game, and like when we do have the big exit, you know, hopefully we'll be creating a lot of millionaires and creating a lot of wealth in the community. So that so that's important. The second was the second part of your question, ownership. I think, oh, yeah, get diluted. I mean it's natural, you know, it's the pie gets gets bigger, but you're you know, year, a percentage of the pie goes down over over time, so you know, Unfortunately, no, I wouldn't say we have we have majority, but you know that's just kind of the name of the game.
00:36:18
Speaker 4: Yeah, but you know, control, I think is also super important, like you know, you know, when you go through this fundraising, take on more more investors, you know, you lose control. But we were still like a board can't get rid of us if they if they wanted to, because of the structure we have in place, and that's equally important control.
00:36:42
Speaker 2: So the decision making process, you guys still make all able to make decisions without having to have input or.
00:36:48
Speaker 7: You get you get input and and you know you take you know, the feedback. But but today's points, as you founders are raised, raising and bringing on investors is super important to understand, like the control provisions and control mechanisms with respect to like majority of equity, but also board dynamics. So that's a lot of times people aren't thinking about that and they raise money, they get these boards and the next thing, you know, they have a bad quarter and then the boards like all right.
00:37:19
Speaker 2: So can you explain that? Is there a set term that has to be in the contract to be like okay, you know, even though I'm not a majority shareholder, I still cannot be removed from.
00:37:29
Speaker 4: I think it's pretty much just a couple of way this uh, like marks upwork has this uh we don't have this, but he has super majority voting, so essentially one of his shares equal like ten or whatever shares that he has, and ultimately that's super rare way he has at a public stage, he can do whatever he wants and they just literally can't get rid of. And you know, you have to think about like, especially in the public markets, investors are quarter quarter very short term. You guys know this, but you know, as a founder led you know you're thinking three four quarters ahead, so you might you know, max out cap X for a couple of quarters, but your vision is you know this will ultimately pan out, and if you're looking at it from a quarter over quarter basis, you're not going to make those long term decisions. So super majority is one, and then the second is board seats. So if you have the board, you know controls the company, and if you have if your investors have more board seats than you have, they can just vote you out.
00:38:40
Speaker 6: You know.
00:38:40
Speaker 4: But in our city scenario, we have the same amount of board seats as investors, so in any case, it's going to be a kind of like a deadlock situation.
00:38:52
Speaker 3: Okay, so you mentioned the exit.
00:38:56
Speaker 1: And I think a lot of people get this misconscrewed, especially if there's no education around it. Talk about the vision for that? Is there a number that we have in mind? And it's like all right, and then obviously there's a borderp proof explain it the process because we've seen people sell their businesses and a lot of times they're like, oh, they sold out the business.
00:39:16
Speaker 3: They sell out.
00:39:18
Speaker 1: They don't understand the functionality behind creating a business, getting capital and then saying all right, we're going to exit potentially just start something new. Doesn't happen too frequently. What is there a number that we got in mind? Like, what's the vision for?
00:39:31
Speaker 4: I think I think we just want to build a great business. I think our metrics is like, hey, the best businesses are bought, not sold. And if you are, you know, continued to add value, continue to build, continue to you know, drive revenues up untol the right like businesses will will bigger businesses or you know, public markets will will come calling. H So I guess you know that's kind of what we're focus on right now and you know when it gets there.
00:40:01
Speaker 5: But like to answer it, to speak to your first.
00:40:04
Speaker 4: Point, Troy is like capital has to be returned at some point you know, like, you can't just do this if you take capital as investors, You've got to return to capital someway somehow, at some point. So so you can't have these evergreen situations where you're just building because you know, like there needs to be exit at some point.
00:40:27
Speaker 3: I got'ta pay back.
00:40:29
Speaker 2: So how are you marketing? Is like, I know you did the barbershop ex bow with Jay, shout out to him. That's a way to get barbers on board. I'm assuming you're running ads, Like what is the main source of actually creating awareness to make sure that the message is being spread to all barbershops in a diverse manner.
00:40:51
Speaker 7: Yeah, so those those are two big ways. We're really big on events. So we do a lot of trade shows. We do big trade shows like ct barber Expo, which which we're you know, I know you attended, which was super dope. But then we do a lot of smaller events also we do like local community events. Uh so we'll partner with like a barbershop that's got like a good reputation in a certain city or neighborhood and then invite all the other barbershops around and host things like that. And part of it is marketing, but part of it is also just kind of like being there in the community, showing up, you know, where our customers are and meeting them where they are. We do a lot of advertisements, you know, online digitally. Our customers are very active on social particularly on like Instagram and then now like TikTok as well. Uh so you know, we try to be like, you know where they are. And then a lot of it is honestly bordermouth. Like Barbara Barbera's are naturally very very communal type of businesses, so like in every neighborhood, each shop knows all the shops around there.
00:41:55
Speaker 6: It's like hyper local.
00:41:57
Speaker 7: So we we try to incentivize, uh, you know, our customers to like share a square for other shops that they know and like it's kind of spreads that way as well.
00:42:07
Speaker 4: And also we have a sales team out in Austin, Texas, and they they reach out to shops on a daily basis. They monitor cold call, but more so like warm warm leads. Essentially, you know, they know where they are, they might meet them on the show, they might comment on that page. But they're also always like sourcing opportunities. But you know, I think the community there in that Austin office is incredible. Everybody says together, I think there's value now in office environments because I know a lot of people don't like it, but you know, we see the value of people coming to get coming to to work every day, being amongst people. You're saying at the same age, you sharing stories, learning from each other in real time. I think it's ready impactful and we're seeing it with the culture and also like the winds and the scale that we're achieving that in Austin office.
00:43:15
Speaker 1: You guys created something when it needed to be created, right, So I remember having squired early on and I'm like, in a barber shop.
00:43:23
Speaker 3: My barber didn't have.
00:43:25
Speaker 1: It really yeah, yeah, yeah, he was in a bronze Jamaican You know, we stubborn. But that was a time when you guys were the only person doing it. And now twenty twenty five, there are people who have apps that are some I wonder at this point, how do you guys look at the landscape from a competitive standpoint?
00:43:44
Speaker 3: What keeps you ahead?
00:43:45
Speaker 1: Like, what's the technology that gives you the mode to keep squire at that evaluation, to keep growing?
00:43:53
Speaker 6: Yeah?
00:43:53
Speaker 7: No, that's that's a good point at that the time when we started, there were definitely like fewer people trying to go out to this market. And then you know, as we've been more successful, people see it, you know, so they're kind of trying to get in. But most of the competitive landscape is still software companies that are really focused on salons, spas, yoga studios, everything, and then they also try to do barbers like on the side, but it's not really their focus. So part of our differentiation is just like we're so laser focused on building the best products specifically for this this user base, and that allows us to go deeper and just build things that like a lot of these other companies, many of them are even bigger than us, aren't.
00:44:35
Speaker 6: Willing to do.
00:44:36
Speaker 7: But then now, like what we're really excited about is just this AI lens and really having like an AI first approach. What we see in the landscape is that there's a lot of attention and a lot of investment going into too building AI solutions for like at the enterprise level for like big companies and then at the consumer level, but for the small business level, like there's really not a lot of becus I'm bringing this like powerful technology, like to these small business entrepreneurs and like that's where we step in, Like we think they were really really well positioned to do that, and that's what we're doing.
00:45:11
Speaker 2: What was the most recent raise It was you had a D.
00:45:14
Speaker 6: Yeah, yeah, twenty twenty one.
00:45:16
Speaker 2: Okay, So now with Tiger Tiger Global. So walk us through that that one, Like what was the difference between that Series D in the Series A, and like what did you know? How did how did that look?
00:45:27
Speaker 4: So so we raised our Series A May of twenty nineteen, we raised our B, series C and D over the next fourteen months, so in the year we raised over one hundred million dollars.
00:45:46
Speaker 5: Over the year over year.
00:45:49
Speaker 3: Technology was that right?
00:45:55
Speaker 4: So over year we raised about one hundred million and and what happened was like we got that first check and we executed, you know, we went, you know fast, We started gaining a lot of customers, and the folks that you know passed on the Series A came back and led the B six months later, and then nine months later we raised the C and And that was.
00:46:20
Speaker 5: On the back of COVID.
00:46:22
Speaker 4: So when COVID went, When COVID kind of was like an inflection point for us because we were the first company to you know, wave substution fees, so we didn't charge our customers. Then we built things tools that allowed our barbershops to operate during that time, so virtual waiting room because everybody was trying to do social distances COVID forms because people need to check they haven't been to an area in two weeks or whether the case may be you know, access to you know, low access to you know, the various government programs, so streamlining the operations to get the required documentation to get those those those the the federal government help. So in the matter of six weeks, we launched like four or five products and then we when everything opened back up, like we had a boom effect because we were a community first, our message was cleared that we're not going to charge you subscriptions, and also we built all this product that made these lives, the lives of our customers better. So coming out of that best month sales because everybody had to use some form of technology now because of the regulations. And then we raised in September, we raised our Serious C and then ten months later we raised our Series D And what was coming in is like we weren't pitching.
00:47:39
Speaker 5: People were just coming to you, coming to us. So it was like.
00:47:43
Speaker 4: One eighty from our Series A where we had to guard and do a lot of the pitching to like VC's pitching us.
00:47:49
Speaker 2: Now, when you get the infusion of one hundred million in a very short period of time, what did you do with the one hundred million dollars?
00:47:56
Speaker 5: We held on to it.
00:48:02
Speaker 4: It's like, you know, like we always remember like how difficult it was. So so I guess you know a lot of folks they go out and they spend, they do all this stuff.
00:48:12
Speaker 5: I think we were very careful because.
00:48:15
Speaker 4: We were of the of the school of thought that we didn't want to go out and have to raise again if we wanted under because we've been in both sides of the spectrum where we had to really make it really difficult to us to raise, and then when it came really easy, we said, hey, we just want it easy, you know, like we just want to save this money, build a business martialwards profitability, and if.
00:48:37
Speaker 5: We want to raise, we.
00:48:38
Speaker 2: Will, Like what does that look like all right for the average person?
00:48:41
Speaker 3: Right?
00:48:42
Speaker 2: They think you get a hundred million dollars and like there's one thing to get a hundred million dollars, but how do you deploy that properly? Like, because that's deploying one hundred million dollars is not as easy as somebody would think, right, So, like, how do you know? This is how much we're going to save to have reserved, This is how much we're going to put marketing, This is how much we're going to like is there a team, is there a board? The people that give you the money have stipulations on what to do with the money, like kind of walk us through that whole process.
00:49:12
Speaker 7: Yeah, so they give you the money. You know, the money is in the bank account of the business, so you can kind of use it as you see fit. But what they do is they're going to hold you accountable for kind of the growth and the performance the performance of the business. So that's you know, what you have to do is like really be measured about how you're spending it. And what allows you to do is take more risks so you can try to do things like that you couldn't have afforded to do before to fuel that growth. Some things will work, some things won't work, and that's kind of the nature of an early stage startup. So you know, investors are usually pretty forgiving of that, but ultimately, like when you raise a big amount, they're investing that based on where they think you're going to get to at a certain point and that's going to return their money and you're going to be you're that more than when they invested. So if you're not hitting those milestones and you're not kind of growing into that, eventually they will start being like, okay, like, what's up this company's not performing well?
00:50:09
Speaker 1: Is there a time threshold that they put on it? Right, Like, if they're invested in it, is it have to be?
00:50:15
Speaker 4: I think they want to see it a growth rate, a growth rate, and if the thumb is uh for late stage, probably at least thirty percent year over your growth yeah over yeah, yeah, as far as revenue revenues, yeah, and they want to see revenue going up and cash burns going down.
00:50:35
Speaker 5: So you're growing.
00:50:37
Speaker 4: If you're growing like one hundred percent, it's different, but if you're growing like thirty percent, they want to see you growing thirty percent but getting more efficient at the same time.
00:50:46
Speaker 1: Yeah, since the we I think about y'all, and obviously the thirty two thousand Barbers I wanted to learn about the global expansion, right, like we travel a lot. We would just in Dubai, I have to figure out to get barbers for the wedd end. Where in Africa? How does this work? Are you guys? Do you guys have a global imprint? And is that on the vision board to expand into the continent and the broad Yeah.
00:51:13
Speaker 7: Yes, so right now we are in other countries. We're in US obviously, UK, Canada, so kind of English speaking for now.
00:51:22
Speaker 6: I totally agree with you.
00:51:23
Speaker 7: I think that the global opportunity is crazy because like there's barbers everywhere, people getting haircuts everywhere, and the businesses don't vary that much, but there's always like the culture nuances and things that you need to think about. So long story shore, Like I do think eventually there's a place for us to be, you know, I would love to be on the continent. Like you know, I spent some time in Kenya last year and just there were so many barbershops there and like every every time I'm going in there be like every when are you coming? So but also you know, it's it's not easy, like you have to really do it right, and it's you it's easy to kind of mess up in Globaloks mansion if you're not thoughtful about it. So it's not going to be in the near term probably, but eventually I see I see us being like in way more countries than we're in now.
00:52:15
Speaker 4: Yeah, if you need a barber anywhere, it just hit me, like we have some London based barbers you know, operate in Dubai, but they're from London because we operate a lotter so you know, everybody goes back from London to Dubai. So you ever in the city and they'll have a barber. Just messes me.
00:52:35
Speaker 2: Now, I've been pretty good that just referrals. That's one thing like I feel like any city, I never had a problem finding the ball because like the people that I know in the city, I just asked them who's the best bar but who do you recommend? And it's never really failed me so far.
00:52:49
Speaker 4: And we're building we're building something like that to help that from a digital perspective, you know, like hey, we have a city pages where you can go in the city and then you can look at all the barbers and we have the referrals on that as a product we launched last year and you can actually you can actually a connection put a video of their work and it's really really cool to see the videos.
00:53:12
Speaker 5: And that's like a next level feature.
00:53:14
Speaker 2: Yeah, because that would be good because I mean, fortunately for us, we know a lot of people. Yeah, but sometimes people they might not know somebody. They might just be in Cleveland, Ohio for work and just randomly, like they just need a barber. They don't know anybody in Cleveland. So that's like a good, good tool.
00:53:28
Speaker 1: That's that's that power of a you talked about launching in terms of customer service. When I heard you talk about cash Buran, the first thing when I think AI is efficiency. So how else are you guys looking to incorporate it to become more efficient?
00:53:42
Speaker 3: Obviously the revenue goes up, cash burn goes down. Yeah, So.
00:53:46
Speaker 4: I think we launched, you know, a product called Cursor internally over the last twelve months are engineering efficiency amongst other things, we got to do cpt O the VP of engineering from Strike. But our output is ninety four percent more than last year. And because of that, because of all those that I mentioned, but AI plays a big part in that.
00:54:13
Speaker 2: In that So from that standpoint, how many employees do you have.
00:54:18
Speaker 5: Just a little over two hundred, like around two hundred.
00:54:21
Speaker 2: So do you see AI taking jobs from existing employees that you have to run more efficiently at a lower cost point.
00:54:30
Speaker 3: So he's dipped us off by his head shape.
00:54:32
Speaker 6: Yeah, we see that.
00:54:35
Speaker 7: We think we'll be able to do kind of more with the existing So I don't think that we're like, Okay, we're gonna need to cut ex percent, but with the two hundred we have, we think we'll be able to actually achieve a lot more and then we'll as we grow, we'll be able to probably hire a fewer than we would have needed to hire like a couple of years ago.
00:54:52
Speaker 4: Yeah, so they think about it like, you know, the two hundred engineers, well probably get three hundred three hundred engineering output, which is meaningful.
00:55:04
Speaker 2: Okay, So any hair salons.
00:55:10
Speaker 7: We actually have a few and they come on Square organically and we have a handful and there we talk to them and kind of learn about how how it's working with them. Our focus is barberous, you know right now, like that that's the focus. But you know there's a lot of hair salons out.
00:55:26
Speaker 2: There, probably more than barbershop. There's ten more times ten. Yeah, and they spend more money.
00:55:33
Speaker 7: They spend more money. They don't get their haircut as often, but when they do, they spend more.
00:55:37
Speaker 6: Yeah.
00:55:38
Speaker 2: Yeah, yeah.
00:55:38
Speaker 4: And if you go like extensions, if you go like you know, color, it gets these braiders.
00:55:44
Speaker 7: Have you all seen these braiders that have been popping up? They open twenty four to seven. They're all over.
00:55:48
Speaker 1: I live in Harlem, there's like five on every block. My system lowers that one ahead in the morning through incredible business.
00:55:54
Speaker 6: I don't fully understand it, but it's it's amazing.
00:55:57
Speaker 3: It's time consuming.
00:55:58
Speaker 4: Yeah, but I just saw something they have like a on a like a.
00:56:05
Speaker 6: Harvard the robot.
00:56:07
Speaker 3: Yeah, yo, I saw that.
00:56:08
Speaker 5: It just depressure just starts it.
00:56:10
Speaker 1: They just starts to cut time into like out like twenty minutes. Some some crazy.
00:56:15
Speaker 2: Boss of the AI bar You saw the ar thing.
00:56:17
Speaker 6: That's not real.
00:56:18
Speaker 2: That's not real.
00:56:19
Speaker 7: Put your head into the well.
00:56:24
Speaker 2: But all right, that's not real. But do you think that that's gonna come as far as having an AI barber, I mean or a machine a machine.
00:56:32
Speaker 4: Barber decision cut maybe like twenty twenty five, thirty years maybe, but like the cost doesn't like the investment is just not worth it at this point to do it, and it's like so nuanced. Like you know, I think there's better uses of AI, like solving cancer.
00:56:48
Speaker 5: Thing that makes sense from a return expected return process.
00:56:53
Speaker 1: I think I know the answer to this, But I'm just gonna ask any of the cost of haircuts beneficial for you?
00:57:00
Speaker 6: They've gone up, right.
00:57:02
Speaker 3: They're going up to stay.
00:57:04
Speaker 5: You know, I saw something the other day.
00:57:07
Speaker 3: What are your thoughts on it?
00:57:08
Speaker 2: Right?
00:57:08
Speaker 1: Like we come from it? Ever, was like it was ten dollars and if you're getting fifteen. That was a tip. Recently we've seen numbers inflate, like you said, but that helps business. No, right, the higher the price the commission close on yourself.
00:57:22
Speaker 6: It helps. It helps our business.
00:57:23
Speaker 7: It helps the business of the barbers who are able to raise their prices and then keep their books full. So what I think about I think it's great. I think it's capitalism. It's it's it's the market. Like for those who over overcharge and their prices go higher than their the market of their consumers are willing to bear, like they're going to have fewer bookings and they're going to have to calibrate real quick or they're not going to stay in business. So every every people, everybody that you know like that complains about the prices. I'm like, the consumers ultimately have power, and people are paying these prices. People are paying fifty sixty seventy hundred dollars a cut, So that means that's that's what the market is saying that the price should be. If it goes too high, maybe it'll come down.
00:58:02
Speaker 4: I don't know, but man, look at Nike's people charge one hundred and fifty people still paying it. You think if they weren't paying like you would still charge that they were cut their prices. But I think, what would I try to communicate when I'm talking to barbers about the prices in general? I said, hey, it's okay to increase your prices, but at the same time, are you increasing the experience?
00:58:28
Speaker 5: Because the experience should justify the prices.
00:58:31
Speaker 4: If you haven't your client's rate, you know, fifteen thirty minutes for a haircut, and then that's not a good experience, Like why am I paying this? You know, and a lot a lot of folks everybody can get it do a decent haircut, you know. I've gotten a lot of haircuts all the time, and like a lot of barbers can get you there. What people do understand and the ones that are very successful is a customer service. It's always on time. You get the Olympics, like you get in that chair eleven a clock. And and I think that is a difference in what people value nowadays, especially if you're charging those high dollar amounts. They just value their time.
00:59:09
Speaker 2: What how do you like delegate who's making the decision or what area you guys are focusing on or who you know who's where what needs to be communicated as well as your leadership roles are concerned.
00:59:26
Speaker 7: Yeah, So it's funny, so early on when we first started, it was just like everybody's doing whatever, like everybody wear as many hats and and that works. I think as the company gets bigger and more mature, you start bringing on these executives, there starts to be more of a need for like clearly like defined roles and and and and whatnot. So I mean where it is now is that you know, I'm the CEO, Davis a president. You know, I have like kind of like typical CEO kind of you know role that most companies would have in terms of you know, the c suite report and all that stuff. Davis like has some really really dope initiatives that I actually think we should talk about, like the barber school and partnerships, and you want to talk about barber.
01:00:10
Speaker 4: School Yeah, yeah, so so so barber schools initiative that you know we're undertaking where you know, we want to get we want to get the barber's doing the right behaviors early on. So what we launch is a Square for Schools, which is essentially we give the software to barber schools for free and it gets some indoctrinated in the right way to do business, right way to take appointments, right, professionalism right, you know, just operational excellence from the beginning. So we partner with like one hundred one hundred or about one hundred schools right now, and we see that program being like, you know, how we step into the future a bit.
01:00:55
Speaker 1: We start from law and finance, we've become successful entrepreneurs. How are you guys doing outside of business right, because we always talk about balancing and balancing it's subjective. How have y'all managed to navigate your new found lives over the past five years as opposed to what we were prior to this journey.
01:01:17
Speaker 6: Yeah, it's been it's been a journey.
01:01:18
Speaker 7: It's been, uh, honestly the best experience that I could have ever wanted, just going through this and going through the struggles and the triumphs and us being together throughout throughout the whole you know process as co founders. And you know, during this I've you know, we both had children. I've had you know, two kids that they've had a child, and I've gotten married, so like we've our personal lives have also, you know, there's been so much change, you know over the last ten years. And you know, we know at some point we were very broke in those early days, and and you make a lot of sacrifices, and then when you start to do better, you know, the situation changes and quality of life and lifestyle changes. So I think we we've we've really managed there's really no work life balance when you're a founder, Like it's just all life. It's all part of the same thing. Like you're never really turning off, and it goes with you everywhere. And I think, you know, for me, I think it's you know, it's important to have other outlets and to really be focused on like you know, wellness, working out, like trying to keep your energy level high because it's a marathon.
01:02:28
Speaker 6: This ship is hard, like it will.
01:02:29
Speaker 7: I've seen a lot of founders like crash out, burnout, and like you know, they've had to close the companies down and that's mentally they just haven't been there. So but I think we're doing you know, doing well now.
01:02:40
Speaker 4: Stress yeah, you know, but but I think outlets, like my outlet is like music. You know, I love I love music, and you know, you know also you know we we have a lounge and a lounge and health.
01:02:58
Speaker 2: You talk about talk about that.
01:03:00
Speaker 5: I mean it's creative, you know.
01:03:01
Speaker 4: I think the great thing about saying is like it's a place where the community gret could like gather. I think there was avoid in the market for that avoid that you know, folks of color, ages like twenty five to forty five come in Manhattan, feel welcome.
01:03:19
Speaker 6: You know.
01:03:20
Speaker 4: We have a great operator James Jones, who you know is a friend of mine for twenty twenty years and he's been doing this so yeah, I mean, yeah, it just was an opportunity.
01:03:33
Speaker 2: And then so you guys, I mentioned like as far as exit right, so you're planning for the exit right.
01:03:39
Speaker 7: Is that it to say, Yeah, I mean you're always planning. So we're in building the company and trying to get as big as possible like that in a sense as planning for the exit because you know that's going to help the ultimate exit, but we're not actively like in a process.
01:03:51
Speaker 2: Yeah, but even that, because it's like even how a company's built, like you got to keep in mind to build a company to exit, right, like, and that's something that people might not be fully aware of also, so like talk about that as far as like having that end in mind even when building a company and having it structured so it's like eventually gets to that point, it's already you don't have to like rework things and try to you know, figure it out on the fly.
01:04:22
Speaker 7: Yeah, if you if you're raising money from professional investors, they're they're investing with the expectation there's going to be a liquidation, a liquidity event, an exit event some time. If you have a small business and it's like a lifestyle business and you haven't taken on, you know, money from professional investors, like that's different. You could just run that forever and that's just your lifestyle. It just kicks off cash. It provides income for you, and that's cool, but that's a different kind of business what we have as a venture backed, you know, business of scale. So the expectation is there will be some type of event and that could be an I P O or that could be getting acquired. That's really only two ways and so those are you know, just like any other company like us, like those would be the two options to get liquidity.
01:05:11
Speaker 3: Yeah, there's there's not many.
01:05:13
Speaker 1: I'm glad we spoke about why commenty we had did episode a couple of years ago to speak about it.
01:05:17
Speaker 3: But if there's like a young group of.
01:05:19
Speaker 1: Guys of girls that are trying to get to Y Combinator have their startup being, I have more eyeballs on it. What are the type of qualities that founder should have prior to going there.
01:05:34
Speaker 3: I mean, I think that the.
01:05:36
Speaker 4: Founder quality traits are like I think the number one trade is resilience because it's not gonna be easy, Like you don't have to be the smartest. You just have to be the folks that will like it's a war attrician engine that won't give up.
01:05:52
Speaker 5: I think that's the really the folks. There's folks that I see.
01:05:57
Speaker 4: And I'm like, that person is gonna make it because of the nasty and the let's say, hey, I'm making somehow.
01:06:04
Speaker 5: And also.
01:06:08
Speaker 4: What's really telling if you give somebody advice right on how to do something and they they need to do it themselves to find out early on, like later on like hey you live, you have experts or you have experiences, but early on, like the best ospregeurs I met, even if you gave them the advice, they have to see it through themselves to understand it from their perspective, and you learn a lesson. But I think that the number one quality is the determination and kind of grit.
01:06:40
Speaker 3: When you saw Sam, you saw that Sam Oltman.
01:06:44
Speaker 7: Oh yeah, yeah, for sure. We didn't know what's going to be a level Now.
01:06:51
Speaker 4: Sam's cool dude, Like he gets a lot of you know, flack sometimes, but you know he's the same person that he was nine ten years ago.
01:07:00
Speaker 3: Very important gun he was.
01:07:02
Speaker 4: He was he had a Sympsons like he was thinking about universal Basic Income UBI ten years ago and there are and.
01:07:13
Speaker 2: So what's next for you guys? And where can people you know find you like talk about what's next as far as initiatives and then website, social media and all that stuff.
01:07:23
Speaker 4: Yeah, I mean, what's next just doubling down on this AI uh and and really trying to incorporate it more in the business as well as, you know, continue to add value for our customers.
01:07:35
Speaker 7: Yeah, you can go to get squared AI Scott. It's got the latest on that.
01:07:40
Speaker 2: And the AI, like you said, it's calling is it more than that or is that the main focus more?
01:07:46
Speaker 6: That's just one.
01:07:47
Speaker 2: That's what's what's the what's the other people?
01:07:48
Speaker 7: So we're essentially we're embedding like this AI layer throughout the entire like back in like platform, so it's really going to be touch everything and and is designed to make the barber's lives more efficient and help them make more money. The other way that we already have it incorporated is through our marketing future, which is called Engage, which allows the barbers and the barbershop owners to like message send messages to their client base like email, text, pusification. So we've supercharged that with AI now, so now they can just type in what they want to achieve, like I want to get my customers to come in for Howiday cut, and it'll literally create the campaign and then tell them who to send it to and then send it out, so it's like their personal like business partner that just like executes on things for them. So we're in the early early phases. Those are the first two things, but we have so much more coming.
01:08:43
Speaker 2: Well, appreciate you guys, man, thank you, thank you for your time and yeah, man, look forward to it for sure.
01:08:50
Speaker 3: Appreciate thank you for being disruptive.
01:08:54
Speaker 2: All right, y'all, thank you for rocking us. To see you next week. Peace.
01:08:58
Speaker 3: Earners, what's up?
01:08:59
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