Laundromat Franchises: Worthless or Worth it?

Laundromat franchises are gaining popularity fast in America but there isn’t much information about them out there yet. That’s about to change. Alex Smereczniak of Laundrolab joins us on the podcast this week to talk about the ins and outs of laundromat franchises.

Many wonder what value a franchisor brings to the laundromat business and Jordan asks him that outright. They talk through the good, the bad, and the ugly of the laundromat franchise model. They discuss who is a good fit for a franchise and who might not be a good fit. They even discuss how much a franchise location costs and what their model is.

But this episode isn’t only for those who are interested in learning about franchises. Alex has experience running successful laundromats himself and has insights into successful franchisee businesses. And he shares those success tips with us on the show today, as well!

In addition, Alex is joining Jordan for a free live webinar/Q&A on all things franchising on Thursday, May 24, 2022. If it has already passed, you can view the replay of that webinar and all of the other webinars we’ve done by joining the Pro Community.

In today’s show, Alex and Jordan discuss:

  • How Alex grew a laundry service business 10x while in college
  • How he would change the Washio/Rinse business models to make them more successful
  • How he built a laundry pick-up and delivery service, 2ULaundry, to do 3,000lbs/day
  • How he raised $400,000 to open a location in Raleigh
  • What the value in a franchise is
  • How you can grow your laundry pick-up and delivery business to 3,000lbs/day
  • Finding one-to-many relationships
  • The process of buying a franchise from start to finish
  • What a franchise helps franchisees with
  • What you get with a Laundrolab franchise
  • Resource from outside the industry that can help you grow your business

And a lot more!

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Episode Transcript

00;00;00;01 – 00;00;21;26
Jordan
Hey. Hey. What’s up, guys? It’s Jordan with the Laundromat Resource Podcast. And as always, I am pumped to be here with you today because today we have on just a solid dude, Alex Merzenich, with a kind of laugh when I say his name, because his name looks really difficult to say when you see it spelled out, but not that hard to say when you know how to say it.

00;00;22;00 – 00;00;41;26
Jordan
But anyways, good, dude. And we’re going to talk about a couple of things. Number one, we’re going to we’re going to talk a lot about franchises. What they’re all about. How do they work? We talk about specific numbers, how much does it cost? And actually, I ask him specific questions that a lot of you guys have a lot of questions that I had.

00;00;41;26 – 00;01;00;27
Jordan
And I don’t pull any punches like, hey, what’s what’s the value of having a laundromat? A lot of people say there’s not a value in it. So and Alex is is awesome. You roll with the punches and and answers thoughtfully. A lot of these questions. So ask him a bunch of those questions. So we’re going to talk about that in the episode today.

00;01;00;27 – 00;01;29;14
Jordan
But also, Alex built a a a laundromat service business in college that boomed and he’s gotten into the laundromat business. And obviously he’s got a franchise now and sees a lot of what it takes to succeed in this industry. So yes, we’re talking about Laundromat franchise, but also we talk about a lot of things that it takes to succeed in this business, whether you’re doing a franchise or not.

00;01;29;14 – 00;01;50;21
Jordan
And, you know, he’d be the first one to tell you franchising is not for everybody. However, if you’re going to franchise laundromats, you better know what it takes to succeed. In this business because a franchisor needs its franchisees to succeed, to stay alive. So we talk about, hey, what does it take to succeed so a lot of really good information here.

00;01;50;21 – 00;02;19;24
Jordan
I know you’re going to love it. And in fact, if this is something that you’ve been thinking about or you have questions about Laundromat franchising or you’re thinking about maybe doing a a laundromat franchise, Alex and I are doing a live free live kind of half webinar, half Q&A this coming Thursday, which is May 26, 20, 22 and everybody’s welcome to join us for that.

00;02;19;24 – 00;02;43;05
Jordan
If you’re listening to this after the fact, this webinar as well as every other webinar that we do is available replay with the pro community over there a lot of our resource dot com slash pro so go check that out if you want access to this webinar and any other ones. But also you can just reach out to Alex and he leaves his contact information.

00;02;43;05 – 00;03;06;01
Jordan
It’s down in the show notes which is that a lot of my resource dot com slash show 95 and if you’re on YouTube down below in the description OK enough of that I want to do real quick fast lane tip fast lane is just a way that a tool a resource something that we have at a lot of my resources dot com can put you on the fast lane towards success.

00;03;06;01 – 00;03;28;00
Jordan
So today I just wanted to mention that we have a both for the free community and obviously the pro community as well has access to this a sample pro forma spreadsheet that you can download and play around with. And it’s good for a couple of different things. Number one, it’s good to help you sort of do preliminary evaluations on a laundromat.

00;03;28;08 – 00;03;43;26
Jordan
You know, if I if I buy a laundromat or I see a certain laundromat I can put in how many of each type of machines, how much they cost, and I can play around with, OK, you know, how much money what I bring in at two turn today, three turns a day, four turns a day. If I’m killing it, I’m doing 15 turns a day.

00;03;44;05 – 00;04;16;02
Jordan
You know, how much could I make right and so that sample pro forma is obviously good for that. But another thing that I always mention, there’s a lot of actually kind of interesting usage for a pro forma nothing that I kind of mentioned in some of the webinars that I do on buying and analyzing a lot of that is you can use those pro forma expense line items in your evaluation of a laundromat to make sure that you are not missing any of the big common expenses because I’ve seen that happen before.

00;04;16;02 – 00;04;46;15
Jordan
And it, it makes you overpay for a laundromat, so you don’t want to miss expenses. And sometimes sellers either on purpose or inadvertently omit expenses. And this just helps you make sure you’re keeping track of all of the big expenses. That’s a good use for the pro forma. There are two also, you can use the pro form if you’re looking to upgrade equipment you can put in new equipment mixes, new pricing and maybe increase the terms per day a little bit to see how much money you’d be bringing in to see if it’s worth it for you.

00;04;46;27 – 00;05;09;00
Jordan
To, you know, to to put in a new client. So lots of different uses there. Again, that’s available for free for both free community members and also the pro community has access to it also. So go check that out. All you got to do is log in and then go either up to the member resources or go up to the pro resources tab in the menu after you’re logged in.

00;05;09;21 – 00;05;21;08
Jordan
All right. Hope you guys find that useful. And I know you’re going to find this podcast episode useful. So let’s jump into it with Alex right now. Alex, how’s it going, man? Thanks for coming on the show.

00;05;21;22 – 00;05;22;24
Alex
Good things are great.

00;05;23;04 – 00;05;26;12
Alex
Appreciate you having me on. And look forward to digging in.

00;05;27;11 – 00;05;50;20
Jordan
Yeah. Oh, me too. You know what’s interesting about this interview? I’m trying to think this might be the first time this has happened, but I’ve actually met you in person before. You’ve come on the podcast. I think maybe everybody else I’ve had on the podcast, I had them on and then, you know, some of them I met in person either because they live local or at the Laundromat Millionaire conference where we got to hang out.

00;05;51;25 – 00;05;55;20
Alex
Yeah, it was kind of the inverse for me. I feel like I had heard a couple dozen.

00;05;55;20 – 00;06;08;26
Alex
People say, You got to talk to Jared, you got to talk to Jordan. I figured we would have had a phone call or something at some point, but instead it was the first time meeting was I think we’re getting lunch on the roof actually at the conference. And if you popped into the seat next to me and we started chatting.

00;06;08;26 – 00;06;10;09
Alex
About you.

00;06;10;09 – 00;06;17;06
Alex
And Laundromat resource and seeing the show, the conference and it’s kind of funny how backwards order of.

00;06;17;07 – 00;06;17;23
Alex
Doing things.

00;06;18;06 – 00;06;39;29
Jordan
Yeah, that is funny. That is funny. Well, hey, man, super cool that we finally got to connect on the podcast you way. Even more important than in person for sure. But hey, I am super intrigued by what you do. I think a lot of people are going to be super interested in what you’re doing, how you’re doing it, and we want to get into all of that and all the details we can get into.

00;06;39;29 – 00;07;00;20
Jordan
And, you know, what I’m really excited about is just through chatting with you at the conference and you know, since the conference you chatted a couple of times that you are just down to earth, dude, that is open, transparent and good. So this is going to be awesome. But before we get into kind of what you’re doing, how you’re doing it, what it all looks like, tell us a little bit about you and your background.

00;07;01;23 – 00;07;05;13
Alex
Yeah, so I I’m from Minnesota originally sitting.

00;07;05;13 – 00;07;06;27
Alex
In Charlotte, North Carolina though.

00;07;06;28 – 00;07;10;17
Alex
Today, and how I ended up getting from.

00;07;10;17 – 00;07;12;27
Alex
Minnesota to Charlotte was by way of.

00;07;12;27 – 00;07;13;15
Alex
School.

00;07;13;26 – 00;07;15;15
Alex
I’d actually always wanted to get.

00;07;15;21 – 00;07;15;27
Alex
Out of.

00;07;15;27 – 00;07;23;05
Alex
The six months of frozen winter in Minnesota. So I was looking at schools in Texas and the ICC going up and down.

00;07;23;06 – 00;07;27;27
Alex
The East Coast. And actually something I don’t really.

00;07;28;03 – 00;07;29;25
Alex
Share too too often is I wanted to go to.

00;07;29;25 – 00;07;30;08
Alex
Duke.

00;07;30;22 – 00;07;45;04
Alex
First. I just grew up watching basketball loved watching the tournament and loved the ICC basketball especially, and got weightless that Duke. And I remember being crushed and thinking What did I do wrong? What could I have done differently?

00;07;46;11 – 00;07;48;16
Alex
And ended up getting into Wake Forest.

00;07;48;26 – 00;07;52;28
Alex
Which is one of the one of the ICC rivals. I’m still a good basketball.

00;07;52;28 – 00;07;54;22
Alex
School, still good academics.

00;07;55;14 – 00;07;59;14
Alex
And ultimately went to Wake Forest. So that’s how I ended up down in North Carolina.

00;08;00;13 – 00;08;08;25
Jordan
Speaking of speaking of opposites, not to cut you off, but now Duke is wondering, what did we do wrong? How do we go? You know, it’s like an experience.

00;08;09;12 – 00;08;11;29
Alex
Right? Exactly. Yeah. It honestly, things.

00;08;11;29 – 00;08;12;15
Alex
Worked out because.

00;08;12;15 – 00;08;13;23
Alex
I my.

00;08;13;25 – 00;08;14;10
Alex
Thought as an.

00;08;14;10 – 00;08;17;27
Alex
18 year old was whatever school I get into is I’m.

00;08;17;28 – 00;08;26;10
Alex
Going to let dictate my major because I had no idea what the hell I wanted to do. As an 18 year. I think most eight year olds probably don’t either. But remember this.

00;08;26;18 – 00;08;27;28
Alex
This sense of.

00;08;27;28 – 00;08;30;14
Alex
Overwhelming kind of anxiety around like.

00;08;30;26 – 00;08;36;11
Alex
Do I go business I do premed to become a lawyer or like I don’t, I don’t know what I want to do.

00;08;36;11 – 00;08;40;18
Alex
And so my whole thought as an eight year old was let the school to decide. And what I meant by that.

00;08;40;18 – 00;08;46;25
Alex
Was whatever that school was known doing laundry.

00;08;46;25 – 00;08;48;01
Alex
And being in business.

00;08;49;16 – 00;08;53;13
Alex
And because I once a week ended up doing business and.

00;08;53;21 – 00;08;54;24
Alex
Found my way the laundry.

00;08;56;12 – 00;09;10;29
Jordan
OK, well, hold on. Because it cut out for a second or froze. And I heard I’m going to let the school decide and then I’m in laundry. So we’ll have Phillies in there for a second. Well, how did you get from there to there?

00;09;11;20 – 00;09;14;08
Alex
Yeah, so the idea that I had as an 18.

00;09;14;08 – 00;09;15;19
Alex
Year old was whatever that school.

00;09;15;19 – 00;09;17;06
Alex
Is known for, you know, top.

00;09;17;06 – 00;09;27;29
Alex
Ten in poli sci or business or pre-med, I was going to let dictate what I majored in because I thought if I got in here, this is what they’re good at and I have an interest in it, why not give it a shot?

00;09;28;08 – 00;09;29;03
Alex
And so had I gotten.

00;09;29;03 – 00;09;33;24
Alex
Into Duke, I’d probably be a doctor and not not in the laundry industry. And instead I got it.

00;09;33;24 – 00;09;35;00
Alex
No way can that.

00;09;35;01 – 00;09;40;24
Alex
A top 15 business program. I was a finance major and eventually found my way into the laundry.

00;09;41;06 – 00;09;41;14
Alex
Yes.

00;09;41;29 – 00;10;03;11
Jordan
OK, all right. Well, you know, good for us that you didn’t become a doctor. Nobody wants to do that anyways. What’s the point of that now? Just it. But OK, so I mean, I feel like you can’t just say, oh, well, you know, I went to Wake Forest, a business school, and then I ended up in laundry. Like how how did you make your way?

00;10;03;17 – 00;10;17;20
Jordan
I’m always interested in this question anyways because I’m like, how does anybody get into this industry? So how did you get into this industry? You went and studied you know, business or finance. So how did that lead you to the laundromat industry?

00;10;18;16 – 00;10;20;21
Alex
Yes, I growing up and I grew.

00;10;20;21 – 00;10;30;29
Alex
Up in a small town in Minnesota, called Redwing, our claim to fame is Redwing shoes. So if you’re familiar with Redwing boots, Drake raps about them in a song that’s on the map.

00;10;30;29 – 00;10;32;13
Alex
Now, but it’s a.

00;10;32;13 – 00;10;49;02
Alex
Town of 15, 16,000 people. Half of them work for Redwing Shoe. And you? I grew up in a smaller town. My dad had this mentality that he put in there instilled in me and my two older brothers. I’m just like constantly working and learning how to work with people.

00;10;49;02 – 00;10;49;09
Alex
And.

00;10;50;11 – 00;11;02;00
Alex
Various jobs and I’m pretty sure we were doing the cutting grass, doing the paper route, and then probably I think we were illegally working at a ski resort too. When I was 14, I was operating a ski lift and I was looking back, I.

00;11;02;00 – 00;11;03;05
Alex
Don’t think 14.

00;11;03;05 – 00;11;03;18
Alex
Year olds.

00;11;03;18 – 00;11;08;21
Alex
Are allowed to do that technically, but I was and so when I got to wake that.

00;11;08;21 – 00;11;09;25
Alex
Kind of that mentality didn’t.

00;11;09;25 – 00;11;10;21
Alex
Stop it.

00;11;10;29 – 00;11;20;24
Alex
Had this kind of agreement with all of us that even though you’re going to school, you also work on the side. That’s what he had to do. And he was self through college and he worked two or three jobs while he was a full time student.

00;11;21;19 – 00;11;23;08
Alex
And so we wanted to do that. So you wanted.

00;11;23;08 – 00;11;28;01
Alex
Us to do that to some extent, just to learn time management and working for what.

00;11;28;01 – 00;11;29;21
Alex
You do. And so I.

00;11;29;21 – 00;11;40;22
Alex
Worked for the student run startup on campus called Wake Wash. And then it was door to door laundry and dry cleaning delivery for college kids. And it started out as a classroom project. It was originally.

00;11;42;06 – 00;11;44;06
Alex
Three, three founders.

00;11;44;17 – 00;12;01;15
Alex
A class of 20 people. So there was four or five groups of three or four. And the professor was basically like, Here’s $40, you know, professor, give him cash of his own money and 40 bucks at the beginning of the semester, the first part of the semester, an idea to concepts, what kind of things could you put the mark?

00;12;01;15 – 00;12;12;19
Alex
What kind of business could you build then? Going to do customer research, they’re going to do prototyping, then you’re going to launch it and then at the end of the semester we’re going to come back together. And one of the results of the measure you on is how much revenue growth you had, how many customers you had.

00;12;13;06 – 00;12;13;27
Alex
And so.

00;12;14;18 – 00;12;16;10
Alex
Then the semester one group goes.

00;12;16;10 – 00;12;17;00
Alex
They did.

00;12;17;00 – 00;12;21;17
Alex
150 hundred and $70 in revenue and they sold hot dogs on the quad. You know, the late.

00;12;21;17 – 00;12;22;20
Alex
Night students.

00;12;22;20 – 00;12;38;12
Alex
Come and they’re coming across campus. The second group, you know that for 50 or $500 in revenue and they were selling T-shirts to sororities and fraternities and they played on to that around their classroom, excited for 500 bucks.

00;12;38;23 – 00;12;39;27
Alex
And then the.

00;12;39;27 – 00;12;42;23
Alex
Third group, the squash group came and said.

00;12;43;08 – 00;12;45;20
Alex
Yeah, you guys aren’t going to believe us, but we ended up.

00;12;45;20 – 00;12;55;01
Alex
Doing about $7,000 in revenue and the professors, your jaw dropped and like you guys are doing this passively with 40.

00;12;55;01 – 00;12;55;23
Alex
Dollars.

00;12;56;10 – 00;13;12;07
Alex
And as a classroom project and then after you dug in there, really convinced I was like, there’s a business here. You guys should keep doing this next year or the year after. So I worked for them, not when they were in the class, but the year or two after when they’d grown it to I think 30, 40 grand in revenue at that time.

00;13;13;04 – 00;13;16;09
Alex
And so that was my first kind of foray into laundry.

00;13;16;23 – 00;13;17;18
Alex
I fell in.

00;13;17;18 – 00;13;20;20
Alex
Love with the model that they were operating on when I started working.

00;13;20;20 – 00;13;21;19
Alex
For them and.

00;13;21;19 – 00;13;25;18
Alex
Thought, Hey, this could work. I do Chapel Hill, Vanderbilt, all these other schools.

00;13;25;28 – 00;13;26;21
Alex
I want to buy it.

00;13;27;15 – 00;13;35;25
Alex
And so that was my first introduction and and then I started having that conversation with them around what would buying it look like jeez.

00;13;35;25 – 00;14;02;16
Jordan
OK, so this I mean, that’s awesome. That’s an awesome class for one, and that’s an awesome, you know, store to go from 40 bucks to, you know, seven. I was a little I’ll be honest with me, I was a little underwhelmed with the 140 or 200 bucks or whatever. Yeah. Hot dog sales a little underwhelming. But dude, that’s pretty cool to, you know, to go was it semester.

00;14;03;20 – 00;14;04;08
Alex
Yeah, it was awesome.

00;14;04;20 – 00;14;13;18
Alex
Most of the semester was done. There’s class work involved so like, hey, this month we’re going to do ideation. So they’d read a book on ideas and concepts and they’d do customer surveys.

00;14;13;18 – 00;14;14;15
Alex
And I think that was.

00;14;14;15 – 00;14;19;19
Alex
A huge part of it. The actual sales were over the course of two or three weeks.

00;14;20;05 – 00;14;22;07
Jordan
Yeah, that’s awesome. You know, maybe.

00;14;22;07 – 00;14;23;07
Alex
Maybe even a week.

00;14;23;27 – 00;14;28;23
Jordan
I know that a lot of my donors that like to have an extra seven grand and in a month or.

00;14;28;23 – 00;14;29;10
Alex
Whatever, you know.

00;14;30;11 – 00;14;43;12
Jordan
There you go. There’s an idea for you right off the bat, go hit up your college or college campuses. Yeah, yeah. Dang. OK, so, so you so you ended up working for them after you graduated.

00;14;43;28 – 00;14;47;02
Alex
So while that was my freshman year. And so yeah, it was I.

00;14;47;02 – 00;14;53;00
Alex
Was a bag runner. My job was go pick up bags of dirty laundry and dry cleaning and bring it to vendors off campus.

00;14;53;11 – 00;14;53;16
Alex
OK.

00;14;53;25 – 00;14;58;27
Alex
And that’s again, that’s when I fell in love with like you’re really you’re kind of this marketplace between students.

00;14;58;27 – 00;14;59;19
Alex
Awake and.

00;14;59;29 – 00;15;01;10
Alex
Vendors and Winston-Salem.

00;15;01;24 – 00;15;03;14
Alex
And so I wanted to buy it.

00;15;03;27 – 00;15;07;22
Alex
You guys are seniors. You’re going to graduate. I want to buy it. What do you mean gonna sell it for?

00;15;08;02 – 00;15;08;12
Alex
And they were.

00;15;08;12 – 00;15;12;26
Alex
Doing something like one times revenue, which was like 30 to $33,000 in my.

00;15;13;08 – 00;15;14;27
Alex
Yeah. 18 years.

00;15;14;29 – 00;15;17;25
Alex
19 year old job at the time you dropped again.

00;15;17;25 – 00;15;19;20
Alex
And I don’t have 32.

00;15;19;20 – 00;15;22;01
Alex
Thousand dollars, I have two grand, maybe.

00;15;22;01 – 00;15;22;22
Alex
Saved up.

00;15;22;22 – 00;15;27;08
Alex
And the responses kind of shrugged it off and said, if you don’t figure it out, someone else will.

00;15;27;08 – 00;15;27;28
Alex
And we.

00;15;27;28 – 00;15;29;07
Alex
Know what we have here and it’s worth.

00;15;29;07 – 00;15;29;16
Alex
That.

00;15;30;20 – 00;15;32;19
Alex
And so I went and found two other partners.

00;15;33;00 – 00;15;33;08
Alex
I think.

00;15;33;10 – 00;15;35;24
Alex
That got us up to a grand total of 9000 or ten.

00;15;35;24 – 00;15;41;03
Alex
Thousand well $22,000 short and thankfully.

00;15;41;03 – 00;15;47;20
Alex
One of their, one of their parents was willing to personally guarantee a loan from the bank for the difference, and it was already cash flowing. I think.

00;15;47;20 – 00;15;49;28
Alex
I had the difference for this.

00;15;49;29 – 00;15;50;21
Alex
Versus it’s kind of.

00;15;50;21 – 00;15;51;25
Alex
Typical any.

00;15;51;25 – 00;16;03;12
Alex
Businesses that there is breakage like a gym membership almost. So on that 32,000 they were profiting 20 to 23,000 just really good margins because people would pay for the whole semester the whole year up.

00;16;03;12 – 00;16;05;13
Alex
Front and then fill the.

00;16;05;13 – 00;16;10;15
Alex
Bag half full or forget to leave the bag out one week or so. There’s all this breakage almost like.

00;16;10;21 – 00;16;10;28
Alex
You know.

00;16;11;00 – 00;16;16;27
Alex
The $10 a month plan of fitness membership. Most of those people never go and they just never cancel yeah.

00;16;17;01 – 00;16;20;16
Jordan
Dang, that’s not so. You guys bought it from them.

00;16;21;13 – 00;16;23;02
Alex
So we end up yeah, we end up getting it together.

00;16;23;02 – 00;16;24;13
Alex
We bought the business.

00;16;25;07 – 00;16;26;05
Alex
And I had more.

00;16;26;10 – 00;16;33;20
Alex
Fun and life experience running that college laundry business than any class I took at Wake. And that’s not a not a day gone weeks.

00;16;34;03 – 00;16;36;15
Alex
You know, academic ability.

00;16;36;15 – 00;16;39;29
Alex
Or classes or professors. It was just running something tangible.

00;16;39;29 – 00;16;41;04
Alex
That you could test.

00;16;41;11 – 00;16;48;29
Alex
Marketing things and either succeed or fail on or hire fire manage people negotiate stuff with the university and getting access to buildings.

00;16;48;29 – 00;16;51;00
Alex
And that whole.

00;16;51;00 – 00;16;53;25
Alex
Experience really kind of changed my point of view on just.

00;16;54;11 – 00;16;56;16
Alex
I don’t know, work and building.

00;16;56;16 – 00;16;57;28
Alex
A career and what you can do in.

00;16;57;28 – 00;17;00;03
Alex
Life. And one of the.

00;17;00;03 – 00;17;01;23
Alex
First things we did at Wake was.

00;17;02;08 – 00;17;02;14
Alex
We.

00;17;02;14 – 00;17;13;02
Alex
Immediately went to the school and said, Hey, there should be a checkbox option for families coming in. It should be get your meal plan, get your parking pass, get your books, get your laundry package. And so again, like handling that with.

00;17;13;11 – 00;17;14;00
Alex
Dean of.

00;17;14;10 – 00;17;17;28
Alex
Residence Life and Housing that you know, these 19 year old kids trying to negotiate.

00;17;17;28 – 00;17;21;06
Alex
With with an adult, you know that.

00;17;23;13 – 00;17;29;01
Alex
Was an awesome experience and thankfully they listened to us and yeah, we’ll give you a booth at orientation and we’ll make it an option on the.

00;17;29;01 – 00;17;30;22
Alex
Website and that.

00;17;30;22 – 00;17;36;22
Alex
Ten next our sales the first year just because of that exposure that channel went from doing you know 32 K ad revenue.

00;17;36;22 – 00;17;37;00
Alex
To.

00;17;38;06 – 00;17;48;18
Alex
Just under 300,000 in revenue with still super high margins. So now not only is this a tremendous learning experience for us we’re now actually making legitimate.

00;17;48;18 – 00;17;50;21
Alex
Money and you’re.

00;17;50;26 – 00;17;54;21
Alex
Graduating and able to help pay for college and have money left.

00;17;54;21 – 00;17;56;17
Alex
Over is.

00;17;56;17 – 00;18;00;25
Alex
An awesome experience. We ended up selling it for about ten times what we bought it for.

00;18;01;20 – 00;18;02;18
Alex
I wanted to keep going.

00;18;02;18 – 00;18;05;12
Alex
I wanted to go to Duke and Chapel Hill, but my partners were.

00;18;06;04 – 00;18;06;10
Alex
You know.

00;18;06;16 – 00;18;21;08
Alex
They got into it as a resume builder initially and thought, Hey, I want to go to investment banking in New York. I want to go do marketing for Coca-Cola in Atlanta. And I didn’t want to be the guy that held them back from doing those things because I was obsessed with the laundry business.

00;18;21;18 – 00;18;37;13
Jordan
Yeah, that’s crazy. Well, I don’t want to like, dwell on this too long, but it’s so interesting and so fascinating. Did you take it OK? You said you took it. You would run it to vendors. Who were these vendors? Are they are they laundromats or are they someone else?

00;18;37;14 – 00;18;40;02
Alex
We so it was it was a mom and pop.

00;18;41;04 – 00;18;50;09
Alex
She actually ran a dry cleaner. And so she wanted to make all of her margin, the dry cleaning. So basically the way in and working was we’d go get all this dry cleaning for her, acquire all these customers, get people signed up.

00;18;50;21 – 00;18;51;22
Alex
And I think we made.

00;18;52;26 – 00;18;55;11
Alex
Maybe 5%, maybe not even 5%.

00;18;55;27 – 00;18;56;04
Alex
Of.

00;18;56;04 – 00;19;03;04
Alex
Anything on the dry cleaning. And in exchange, she would process all the laundry. So she would go to different laundromats, should hire her own.

00;19;03;04 – 00;19;04;13
Alex
Team and basically.

00;19;04;13 – 00;19;11;20
Alex
Rent out other people’s laundromats to do all the processing. And she still made money on that. It was just a thinner margin for her than the dry cleaning was.

00;19;13;02 – 00;19;13;09
Alex
And so.

00;19;13;09 – 00;19;19;25
Alex
That’s how we worked it out as we found her. And she would basically these different laundromat owners to rent out their space to.

00;19;19;25 – 00;19;21;02
Alex
Clean, clean all the volume.

00;19;21;23 – 00;19;26;22
Jordan
To hang. That’s pretty cool. And you were able to keep your margins pretty high, too, same time.

00;19;26;22 – 00;19;28;20
Alex
Yeah. And the thing that worked really well is just because.

00;19;28;20 – 00;19;40;15
Alex
Again, there was breakage, I mean, people would pay for a £40 bag assuming or £40 it when in reality the breakage and college was we still have it and to use model now and that’s part of why I think the way that we’ve approach things have worked the way that.

00;19;40;15 – 00;19;43;29
Alex
They have but in college people were on.

00;19;43;29 – 00;19;47;17
Alex
Average filling it was 11.8. I remember this number because it.

00;19;47;17 – 00;19;48;18
Alex
Was blue my.

00;19;48;18 – 00;20;03;05
Alex
Mind as £11.8 per bag we could hold 40 and so we could think about we’re only paying the vendor off campus for £11.8 a bag not the whole 40 but we’re taking revenue in on the whole 40 so there was plenty to go around for everyone.

00;20;03;26 – 00;20;19;29
Jordan
Yeah, that’s awesome. I mean, I think that’s really awesome. So OK, so you ran that. Did you run that all three years or sophomore to senior year? Yeah, I think that’s awesome. OK, so then you sold it. Who, who bought it?

00;20;20;26 – 00;20;23;21
Alex
So we had we had a couple offers, two.

00;20;23;21 – 00;20;28;02
Alex
Or three student groups and then one that was called University Laundry at the time.

00;20;28;14 – 00;20;29;16
Alex
And this guy.

00;20;29;26 – 00;20;31;05
Alex
I forget Nathan.

00;20;31;05 – 00;20;34;20
Alex
At the center, what Watkins, he was out of Texas was.

00;20;34;20 – 00;20;43;02
Alex
Doing this like ten other college campuses. We had built up a pretty big college laundry business and so he was going around and buying these other kind of student runs because, you know, we.

00;20;43;02 – 00;20;43;17
Alex
Weren’t, you.

00;20;43;17 – 00;20;46;21
Alex
Know, that class wasn’t the first college laundry business idea had ever.

00;20;46;21 – 00;20;50;15
Alex
There come to come up so he gave.

00;20;50;15 – 00;20;56;07
Alex
Us an offer. He then eventually got bought by Tide, by Procter and Gamble bought it, and it’s now called Tide University.

00;20;56;17 – 00;20;57;03
Alex
So that’s how.

00;20;57;04 – 00;21;17;15
Alex
University Program is what used to be Nathan’s University Laundry. And he also tried to buy a week wash, but we ultimately felt really passionate about keeping a student run again, like I just shared. It was one of the best learning experiences I’ve ever had as an individual. And as much as we want, we had made enough money at that point more than we thought we would.

00;21;17;15 – 00;21;30;25
Alex
It wasn’t really about self or as much as we can possibly make. It was find the biggest group of students that could benefit in the same way that we did. And so we end up selling it to a group of eight students that were also able to come up with.

00;21;31;15 – 00;21;31;19
Alex
You know.

00;21;31;21 – 00;21;38;06
Alex
Most of the money that we were asking for. And so those are going to win win for everyone. And it’s now this is this makes me really happy.

00;21;38;06 – 00;21;38;14
Alex
As.

00;21;39;08 – 00;21;49;29
Alex
It’s turn hands. I think six or seven other times since I graduated, they said that you had all these different group has all been student run the whole time.

00;21;50;20 – 00;21;53;25
Jordan
That’s awesome. Super. And so it’s still going well.

00;21;54;28 – 00;21;55;15
Alex
So cool.

00;21;56;13 – 00;22;05;17
Jordan
All right. So you sell you sold the business after you graduated. You got a friend who went to be an investment banker. When did marketing Coca-Cola and you did what?

00;22;06;11 – 00;22;08;14
Alex
So I went to I thought all right, you know.

00;22;08;21 – 00;22;15;09
Alex
What’s as entrepreneurial as what I was doing or as close to without upsetting my parents too much by going to a four.

00;22;15;09 – 00;22;23;02
Alex
Year private school and then starting a business and living in their basement or whatever it was and.

00;22;23;02 – 00;22;31;24
Alex
Consulting was, the closest thing I could come up with was you’ll change projects, you’ll see different problems. You’ll help different companies with different things. You’ll work with different people.

00;22;31;27 – 00;22;32;27
Alex
Flow change.

00;22;32;27 – 00;22;34;06
Alex
It felt like it’d be faster pace.

00;22;34;06 – 00;22;35;27
Alex
So I moved to Charlotte.

00;22;36;10 – 00;22;37;13
Alex
From Winston-Salem.

00;22;37;25 – 00;22;38;05
Alex
To.

00;22;38;05 – 00;22;48;03
Alex
Do consulting for Ernst and Young, and this was on the tax or the audit side. It was more business strategy, business implementation, predominantly with banks. So I’d be.

00;22;48;10 – 00;22;48;20
Alex
You.

00;22;48;20 – 00;23;12;20
Alex
Know, Wells Fargo was rolling out a new consumer application for its wealth management customer and clients, and so helping to design and do customer of customer surveying and research. And there are a lot of elements that I liked and there was a lot of elements that I didn’t that didn’t feel as entrepreneurial and as fast and as fulfilling and as rewarding as even how I felt running a small college laundry business.

00;23;13;23 – 00;23;15;10
Alex
So did consulting for two years.

00;23;15;28 – 00;23;17;09
Alex
And then at that.

00;23;17;09 – 00;23;19;09
Alex
Point it had the edge too much. I think the big thing.

00;23;19;09 – 00;23;20;08
Alex
That kicked me.

00;23;20;23 – 00;23;24;02
Alex
Off of wanting to stay in this kind of corporate path was.

00;23;25;08 – 00;23;26;04
Alex
My roommate.

00;23;26;04 – 00;23;30;29
Alex
The first two years I was, I bought a condo out of college with similar way cash money.

00;23;31;06 – 00;23;31;12
Alex
Had.

00;23;31;12 – 00;23;32;10
Alex
Roommates from work that.

00;23;32;10 – 00;23;32;20
Alex
Were.

00;23;32;28 – 00;23;48;06
Alex
Working in the city. One of them worked with me anyway, and so we had very similar to the same job, basically. And my whole life I’ve kind of been somewhat of a systems thinker. Like I go to school and I think, OK, what’s the goal here is I’m supposed to get A’s, how do I get A’s with the least amount of work possible like that?

00;23;48;10 – 00;23;49;26
Alex
I don’t want to do any more than I need to.

00;23;49;26 – 00;23;56;13
Alex
Do as long as I can get the result, the highest result, I’m not going for the 120% of 100% is, yeah, I don’t need 100.

00;23;56;22 – 00;23;57;24
Alex
Yeah, I mean, yeah.

00;23;58;06 – 00;24;08;09
Alex
And so I’d always done fairly well in school just kind of gaming the systems. And same thing was true the wise at the beginning during orientation, they said, here’s the five pillars, right, to get.

00;24;08;13 – 00;24;08;17
Alex
A.

00;24;09;14 – 00;24;19;10
Alex
Five star. That was kind of what they did for that was for promotions, for increase in compensation. All that stuff was like, All right, what do I need to do to get a five with the least amount of workforce.

00;24;20;10 – 00;24;20;28
Alex
So I.

00;24;21;02 – 00;24;21;28
Alex
Did my I played.

00;24;21;28 – 00;24;23;09
Alex
The networking game.

00;24;23;09 – 00;24;28;22
Alex
I tried to get onto the right projects. I made sure I was involved in recruiting and other extracurricular type stuff.

00;24;29;09 – 00;24;29;27
Alex
And at.

00;24;29;27 – 00;24;32;08
Alex
The end of our first year, I promised a point to.

00;24;32;09 – 00;24;34;12
Alex
This. My roommate.

00;24;34;12 – 00;24;43;12
Alex
Who was in the same job I was, we compared our utilization and that’s a big thing that consulting firms track on because they’re billing you out hourly and they want you being utilized and build out.

00;24;43;12 – 00;24;44;27
Alex
To different clients.

00;24;45;19 – 00;24;57;02
Alex
Realization was like, right, a little over 40 hours a week, which is not typical advice, especially as an entry level person. They usually work you pretty hard. And my roommate was at 80, 81 or 82 hours.

00;24;57;02 – 00;24;58;04
Alex
So basically double.

00;24;58;12 – 00;25;02;15
Alex
On average a week his first year and I was 41 or 40.

00;25;02;15 – 00;25;03;27
Alex
Two, I end up.

00;25;03;27 – 00;25;07;28
Alex
Getting a five. So the highest rating you can get, you end up getting a three which is still really.

00;25;08;00 – 00;25;08;12
Alex
Three is.

00;25;09;03 – 00;25;09;28
Alex
Still considered really.

00;25;09;28 – 00;25;10;06
Alex
Good.

00;25;10;21 – 00;25;20;09
Alex
And I share that because it was the last kind of like thing I had been thinking and feeling of, you know, I feel capped here. I feel like the harder I work, it doesn’t, I don’t get rewarded anymore.

00;25;20;09 – 00;25;21;00
Alex
I don’t start.

00;25;21;00 – 00;25;22;05
Alex
Moving fast enough is not.

00;25;22;05 – 00;25;22;27
Alex
Fulfilling.

00;25;24;01 – 00;25;31;25
Alex
And that was the last straw. Just like seeing how hard that guy work is way smarter. I can certainly be way smarter than I am. And for him to not be.

00;25;31;25 – 00;25;33;12
Alex
Treated the same way.

00;25;33;18 – 00;25;35;11
Alex
Because of some system that was.

00;25;35;24 – 00;25;38;10
Alex
Created and he followed and he, you know.

00;25;38;15 – 00;25;39;08
Alex
He was a part of.

00;25;39;08 – 00;25;40;11
Alex
But didn’t.

00;25;41;07 – 00;25;42;01
Alex
Gain that that way.

00;25;42;01 – 00;25;44;10
Alex
And so it just didn’t feel genuine. It didn’t feel good.

00;25;45;18 – 00;25;49;25
Alex
I was happy with the result, but it wasn’t fulfilling on the work I was doing to get there. And so.

00;25;50;27 – 00;25;51;02
Alex
At.

00;25;51;02 – 00;26;16;22
Alex
That point, I saw two companies on the West Coast, Washoe and Rents. I’m sure your listeners are probably familiar with. There is a ton of money. $30 million at the time when Uber for X was raising money for everything dog walking, massages, grocery delivery, and they were just another we’re going to Uber for laundry and this is venture capitalist love that I don’t want to miss out on the next Uber.

00;26;17;01 – 00;26;17;10
Alex
So they did.

00;26;17;10 – 00;26;21;09
Alex
Raise $30 million and I was just sitting there watching this happen.

00;26;21;22 – 00;26;22;06
Alex
And the thing.

00;26;22;06 – 00;26;41;28
Alex
I was most excited about was, Hey, they’re proving that customers, you know, people want this, they want someone else to do their laundry for them, which isn’t new outside of New York and Chicago and L.A. But in some of these other cities, where laundry service isn’t as prevalent, they proving that, hey, some people want this. But operationally I thought, no way their model works, no where they make money doing what they’re doing.

00;26;43;19 – 00;26;47;03
Alex
Because of what I learned doing this in college, you know, on a small scale in college, I knew.

00;26;47;03 – 00;26;48;08
Alex
You can’t have.

00;26;48;08 – 00;26;50;05
Alex
1099 contractors sitting around.

00;26;50;16 – 00;26;51;05
Alex
Going to pick up.

00;26;51;05 – 00;27;07;25
Alex
Jordan’s laundry at 2 p.m. on a Wednesday. Like, you probably don’t need that. You probably don’t necessarily even want that. But it’s very expensive for the company to have drivers just sitting idle and waiting, and it was very inefficient. So I thought, I’ll hate myself if I hit 30, 40, 50 years old.

00;27;07;25 – 00;27;08;00
Alex
And.

00;27;08;20 – 00;27;12;08
Alex
Regret not going after this with what I learned in college and at least taken.

00;27;12;08 – 00;27;13;15
Alex
A stab at it.

00;27;15;15 – 00;27;30;05
Jordan
Yeah. OK, so you were just kind of observing, you know, what was going on with these companies and saying, I’ve learned a little something about this already, so maybe I’ll take a stab at it. Is that basically?

00;27;30;14 – 00;27;31;09
Alex
Yeah, like honestly, the.

00;27;31;09 – 00;27;32;21
Alex
Timing was perfect.

00;27;32;21 – 00;27;33;26
Alex
Just me seeing that.

00;27;33;26 – 00;27;34;22
Alex
Happening and.

00;27;34;22 – 00;27;36;19
Alex
Saying, Hey, I have some.

00;27;36;19 – 00;27;45;17
Alex
Experience here at the same time, kind of growing descent from me at the job that I was in, just not feeling fulfilled and not feeling like it was moving fast enough for.

00;27;45;21 – 00;27;46;05
Alex
I was trying.

00;27;46;05 – 00;27;56;28
Alex
To learn as much as I possibly could, and I felt like that was to some degree at the job I was in. And so I thought, Hey, you know, if I were to do this, what would the three differences be?

00;27;57;14 – 00;27;58;09
Alex
What would I do differently.

00;27;58;17 – 00;28;05;26
Alex
Than last year? What would I do differently than rents? What is what is the right approach? And I started really starting to obsess over that problem probably for.

00;28;06;12 – 00;28;06;29
Alex
A year.

00;28;06;29 – 00;28;08;09
Alex
Before I actually quit my job.

00;28;10;11 – 00;28;25;23
Alex
You know, working on ideas at night, really just thinking about the model, not really trying to get customers or anything more, just thinking about how could this work with your intensities? I’ve been one. What about 50? How do you how does this evolve over time? And the three themes I came up with were sort of Uber for laundry.

00;28;25;23 – 00;28;47;11
Alex
This has to be FedEx or UPS for laundry. So think statics scheduled routes instead of on demand. You know, point to point delivery, which is most of those on demand businesses. And the reason that made sense to me was laundry is not an acute impulse decision like ridesharing or food delivery. Like if you need a ride somewhere, you’re probably going to a meeting or to meet with friends.

00;28;47;11 – 00;28;50;22
Alex
You want to get there. Now, it’s not planned super far in advance.

00;28;51;05 – 00;28;51;26
Alex
Say that same.

00;28;51;27 – 00;29;05;12
Alex
Thing with food delivery as your pride is hungry right now and so on. That can deliver some things I don’t want to cook right now. Again, you want that food quick and you want it hot. Whereas laundry, how often you sit there your desk like Man, I wish someone would come take the shirt off my back and clean it right now it’s.

00;29;05;22 – 00;29;06;05
Alex
Probably.

00;29;06;05 – 00;29;07;19
Alex
Never right. Like maybe all the.

00;29;07;19 – 00;29;13;03
Jordan
Time for me right now just harms somebody else. Yeah.

00;29;14;23 – 00;29;15;24
Alex
Like maybe there’s.

00;29;15;24 – 00;29;30;14
Alex
Edge cases that are going to a wedding or something. That crap. The wedding is tomorrow. I didn’t get my suit dry cleaned or whatever. And for the most part, laundry is recurring and chronic. You do it every Sunday, you do it every night. Like there’s sure that everyone’s got their own routine, but there’s a routine that’s the difference.

00;29;31;03 – 00;29;31;29
Alex
And so the first.

00;29;31;29 – 00;29;32;28
Alex
Pillar for me.

00;29;32;28 – 00;29;34;04
Alex
Was static.

00;29;34;04 – 00;29;41;21
Alex
Predictable, scheduled routes. It’s going to be way cheaper on our end to pick it up and deliver it. Have one driver going to a neighborhood, pick up 30 orders versus.

00;29;42;14 – 00;29;42;23
Alex
You know.

00;29;43;01 – 00;29;46;02
Alex
30 trips back and forth, picking up all those those orders randomly.

00;29;46;17 – 00;29;47;01
Alex
And so that.

00;29;47;01 – 00;30;04;03
Alex
Was the first big driver. The second was instead of targeting New York, Chicago, L.A., you know, the top three or four cities in the country I thought was go, go target the majority of the population and where they are, meet them where they are. And that was in your secondary and tertiary cities, which don’t have to be small.

00;30;04;03 – 00;30;13;09
Alex
This isn’t, you know, Redwing, Minnesota, where I grew up. This is your Charlotte, North Carolina. You’re Austin, Texas, you’re San Antonio, you’re Raleigh, North Carolina. You’re Nashville, Tennessee.

00;30;15;18 – 00;30;16;10
Alex
And then go.

00;30;16;10 – 00;30;19;22
Alex
To the New York, then go to Chicago. Since you’ve really proved this out in markets.

00;30;19;22 – 00;30;22;08
Alex
That maybe look like.

00;30;22;08 – 00;30;34;23
Alex
They work under your model in New York because there’s 10 million people there but probably aren’t going to work anywhere else because not anywhere else. That’s 10 million people. And so I just didn’t want to give a false positive. Hey, Washoe worked in New York or it looks like it’s working in New York.

00;30;35;13 – 00;30;38;01
Alex
But then it has no legs in Charlotte.

00;30;38;01 – 00;30;44;17
Alex
And so at that point, I figured what’s what’s the point? So I was the second team. The third and final theme was quality has to.

00;30;44;17 – 00;30;45;15
Alex
Be at.

00;30;45;22 – 00;31;00;15
Alex
The core of everything that we do. Laundry is I personally believe it’s a very personal thing. It’s the first thing big decision we all make every day is what am I going to wear? What do I look the best and where I feel the best and depending on what I have to do today. And so we wanted to really protect quality.

00;31;00;15 – 00;31;17;14
Alex
And there was always this idea of how do we get to vertically integrating where we we process everything ourselves upfront. We don’t have the money to do that. Our thought was, how do we get to that pretty quickly, knowing that that’s going to drive and dictate most of the quality is how all clothes are being clean, what chemicals are being used, a process is being followed, all of that.

00;31;18;10 – 00;31;19;29
Alex
So that was a kind of.

00;31;20;06 – 00;31;21;02
Alex
Theme from.

00;31;21;02 – 00;31;27;05
Alex
The beginning of how do we have more and more ownership over the cleaning process.

00;31;28;20 – 00;31;50;03
Jordan
Yeah, I like those. I think those three kind of distinctives and you know, obviously the well, I shouldn’t say obviously, but the the static, you know, predictable planned out routes, you know, do save you a lot of money. And they can help you batch, you know, the pick ups and the deliveries because you’re going in certain areas at certain times.

00;31;50;03 – 00;32;13;10
Jordan
And you can kind of structure that in a way that provides you efficiencies where, you know, on demand, you know, maybe can’t do that as much because if somebody over here needs their laundry picked up and somebody over here needs their laundry picked up or now you’re going all over the place or you got multiple people going in different places, so in there, pick it up one order at a time as opposed to maybe multiple orders at a time, too.

00;32;13;10 – 00;32;43;22
Jordan
So I like that. I like the I like that I really like the targeting the secondary and tertiary markets because like you said, they’re obviously there’s, you know, bigger cities that are more densely populated that, you know, you can you can find some proof of concept but you don’t know if the concept is going to work widespread. So I like that and kind of I mean, I feel like one of the themes already is like flipping things you know, the other way.

00;32;43;22 – 00;32;44;12
Jordan
The other side of.

00;32;44;15 – 00;32;45;22
Alex
Us is the opposite.

00;32;45;22 – 00;32;47;02
Alex
Of everything the other two.

00;32;47;02 – 00;32;48;04
Alex
Are doing. Yeah.

00;32;48;16 – 00;33;07;02
Jordan
Yeah, it is. Yeah. And then obviously you know, quality being the core. You know, we talked about that a lot here on the on the podcast and I like I like the thought process behind, hey, you know, first you know, one of the first things we do every morning is figure out what we want to wear, how we want to present ourselves, how we want to look.

00;33;07;13 – 00;33;29;11
Jordan
And keeping that in mind, you know, and I can’t remember, man, apologies to whoever was the guest who said this on the podcast, but, you know, it was whoever it was was talking about how, you know, when when people give us their calls and you said it’s a very personal thing. Right. But also, there’s just a lot of monetary value wrapped up in clothes, like clothes are not cheap.

00;33;29;17 – 00;33;55;11
Jordan
Right. So people are giving you you know, sometimes a thousand plus dollars worth of their belongings to take care of. And so quality is huge because not only is there a monetary value, but there’s also an image value. And there’s I mean, there’s a whole lot of value that goes along with it. So I love that. So what did you decide to like how did you how did you get into it then?

00;33;55;11 – 00;34;01;14
Jordan
OK, you’re like, OK, I’m basically going to do what they did, except for the opposite, you know? What did that look like when you got started?

00;34;01;29 – 00;34;04;03
Alex
So at first, you know, I had actually had one.

00;34;05;14 – 00;34;08;19
Alex
Small failed attempt at trying to scale the college business. First I.

00;34;08;19 – 00;34;10;05
Alex
Tried and this is.

00;34;10;05 – 00;34;14;20
Alex
I a good advice for if there’s any like entrepreneurs lesson or people staying on starting their own thing is that.

00;34;15;08 – 00;34;16;00
Alex
I always.

00;34;16;00 – 00;34;23;24
Alex
Knew I liked working with other people and I just knew how hard a startup was going to be. And so I always wanted to work with a co-founder, you know, find someone.

00;34;23;24 – 00;34;25;14
Alex
To to do this with.

00;34;25;27 – 00;34;32;10
Alex
And so when I was at E y, I met another consultant. I thought, hey, let’s go try to scale us to two or three other schools. Versus at that point, it was just very this is.

00;34;32;10 – 00;34;33;11
Alex
Pre, you know.

00;34;33;11 – 00;34;34;09
Alex
To you and everything I just.

00;34;34;09 – 00;34;36;14
Alex
Shared. And one school.

00;34;36;14 – 00;34;47;24
Alex
Said no to us, not other that other guy just like gave up. So they said, no, people don’t want to, you know, I’m not. And at that point in time and we realized you don’t just find a co-founder, a business partner because it’s convenient or they’re close to you because it.

00;34;47;24 – 00;34;49;09
Alex
Was to two of the.

00;34;49;09 – 00;34;52;28
Alex
Same people at the same skill set. It was like finance consulting type people.

00;34;53;09 – 00;34;54;00
Alex
And it wasn’t.

00;34;54;00 – 00;35;12;13
Alex
Me being intentional. And and I really reflected on that a lot. So I was I thought it about, you know, to you in those three pillars, I also thought about how do I do this with someone else that has a skill set that complements mine? You know, I’m finance operations. I needed to be like a really gross marketing intensive business I need someone with that kind of skill set and background.

00;35;12;28 – 00;35;38;05
Alex
And as I started doing that, who I knew in my network, one of my best friends from growing up came to mine not because he was my best friend, but because he was at startups in Minneapolis doing sales and marketing, very scrappy, growth minded individual, but also understood start ups. He saw the company that he was at go from ten employees to 150 employees and all the revenue that came with that and challenges that came with that and everything that came with that.

00;35;38;23 – 00;35;42;26
Alex
And so I at first was just kind of picking his brain, riffing on the idea with him.

00;35;43;09 – 00;35;44;29
Alex
And, you know, one.

00;35;44;29 – 00;35;55;06
Alex
Conversation a month turned into one a week turned into one a night. And also next thing you know, like we’re founding a company together and he didn’t even realize it. I was like, hey, are you like you were just like helping me at first. Now it’s.

00;35;55;06 – 00;36;00;13
Alex
Like, this is a lot of time and commitment like, let’s do this.

00;36;00;18 – 00;36;15;24
Alex
Let’s do it properly. That’s good. No LLC stood up and, you know, ownership percentages and let’s quit our jobs and we just that really escalated. And so we both quit our jobs in 20, 15 and then launched to you in January of 2016.

00;36;16;20 – 00;36;17;16
Alex
And the idea.

00;36;17;16 – 00;36;21;14
Alex
Was those three pillars that I mentioned, you basically being the opposite of what you were doing.

00;36;22;01 – 00;36;22;18
Alex
And.

00;36;22;18 – 00;36;30;08
Alex
We thought it’d be millennials, busy professionals is our core customer. We thought it’d be, you know, bankers consulting lawyers, everyone going uptown.

00;36;30;08 – 00;36;30;29
Alex
With, you.

00;36;30;29 – 00;36;32;08
Alex
Know, making more money than they have time.

00;36;33;00 – 00;36;34;12
Alex
And so we, when.

00;36;34;12 – 00;36;46;05
Alex
We first started, we were driving Uber from 6 a.m. to 8 a.m. just not eating to our savings too much. And we also got our first customers that way. We made promo cards that because everyone always would ask, why are you guys driving Uber?

00;36;46;14 – 00;36;46;28
Alex
You know, you.

00;36;46;28 – 00;36;48;24
Alex
Look like you’re like a 2324 year.

00;36;48;24 – 00;36;50;28
Alex
Old. What are you like, what are you doing.

00;36;51;06 – 00;37;02;24
Alex
At 6 a.m. during the Uber thing? Oh, it was on this laundry dry cleaning thing. We’d love for you. Check it out. So we get a lot of our first customers that way, and then we’d work ten to 12 hours in the day and we would drive over again.

00;37;02;24 – 00;37;03;04
Alex
To.

00;37;03;13 – 00;37;22;26
Alex
The end of the night. And those first ten months is something I would describe as the most fun I never want to have again. Really, really taught us a ton. I mean, instead of it being the banker and consultant, we very quickly realized it’s the dual income family with kids, predominantly women, making the purchasing decision for the house.

00;37;23;22 – 00;37;34;27
Alex
Women ages 36 to 45 to kids lasting as parents they want to do when they get home from work is more work. So they’re using the grocery delivery, they’re using something to cut their grass. They have someone come clean the house.

00;37;35;06 – 00;37;36;17
Alex
Like they are purely.

00;37;36;17 – 00;37;43;05
Alex
An outsourced lifestyle. You know, there’s two sources of income coming in and they just want to get their time back to spend with each other, their family, their friends.

00;37;43;25 – 00;37;45;27
Alex
And that just took off.

00;37;45;27 – 00;37;51;07
Alex
We bootstrapped the I think 60, 65,000 monthly revenue within five or six.

00;37;51;07 – 00;37;52;10
Alex
Months of.

00;37;52;10 – 00;38;05;02
Alex
Dana. And I just like doing kind of growth hacky marketing pretty cheap free stuff and that that mom that that family customer base really just took off. They started sharing them on Facebook groups.

00;38;05;02 – 00;38;05;10
Alex
And.

00;38;05;28 – 00;38;19;28
Alex
With their neighbors and at that point we realized, hey, we got something here. Let’s go raise some outside capital to get help to do this faster because our ambition was always how do we build a nationally recognized brand in the category yeah.

00;38;19;28 – 00;38;31;22
Jordan
OK. So I mean, you have you’re building a laundry at this point. You don’t have like a location or anything. How how are you doing it? What’s the tell me about the logistics of this actually.

00;38;31;22 – 00;38;33;05
Alex
So we’re, we’re 24 at the.

00;38;33;05 – 00;38;33;16
Alex
Time.

00;38;33;17 – 00;38;33;24
Alex
Have.

00;38;34;16 – 00;38;35;19
Alex
No bank is going to lend us.

00;38;35;19 – 00;38;38;04
Alex
Money. We had no money to buy.

00;38;38;10 – 00;38;53;05
Alex
A laundromat or so. You know, at that point we thought, let’s just do what we were doing in college. Let’s find a dry cleaning vendor to partner with us. Let’s find a laundromat vendor to partner with and you know, they’ll be happy to the process of buying. We say we’ll handle customer acquisition, the logistics, the customer support, everything else.

00;38;53;25 – 00;39;11;04
Alex
And so we found Laundromat. So we’re willing to do it. We found a dry cleaner and very quickly realized the dry cleaning industry as well as wholesalers doing a majority of the cleaning for the drop stores that you and I would go to as consumers. So we go right to those wholesalers that have the plants, the equipment, the team of 15, 20 plus employees, and we would outsource the dry cleaning.

00;39;11;04 – 00;39;12;15
Alex
To those wholesalers.

00;39;13;01 – 00;39;22;10
Alex
On the laundry side, there wasn’t an equivalent know wholesale provider for Cintas and also that do big hospital linens and uniforms and hotel stuff.

00;39;22;23 – 00;39;23;09
Alex
But they.

00;39;23;09 – 00;39;29;25
Alex
Can’t keep Jordan’s clothes up from Alex’s and Jordan might want Island Breeze scented detergent and I want hypoallergenic.

00;39;29;25 – 00;39;30;17
Alex
And Dos.

00;39;30;27 – 00;39;32;11
Jordan
Island scented for sure.

00;39;33;10 – 00;39;35;14
Alex
And so we had to go to.

00;39;36;02 – 00;39;37;01
Alex
These my mom and pop.

00;39;37;08 – 00;39;38;21
Alex
Laundromats and.

00;39;38;21 – 00;39;39;15
Alex
We went to one and we.

00;39;39;15 – 00;39;40;18
Alex
Said we’re.

00;39;40;18 – 00;39;49;24
Alex
Going to start bringing you guys a couple of thousand pounds a day is what we believe. And they laughed. They just laughed at us. It’s a couple thousand pounds a day. Who are you? What are you.

00;39;49;24 – 00;39;50;10
Alex
Kidding?

00;39;51;12 – 00;40;02;18
Alex
Let alone £1,000 a week. Like, if you could bring us a couple thousand a month, we’d be happy. And like, we don’t see you doing that, but just trust us. Let’s negotiate price tiers based on volume.

00;40;03;05 – 00;40;03;19
Alex
And so.

00;40;03;19 – 00;40;04;17
Alex
Looking back and I think they.

00;40;04;17 – 00;40;07;12
Alex
Maybe, you know, put them.

00;40;07;12 – 00;40;14;09
Alex
In a bad negotiating position, I agree, because I didn’t think we’re going to do it, but they’re like, yeah, if you get to a thousand a day, we’ll do it for $0.60 a pound or something incredibly.

00;40;14;09 – 00;40;17;01
Alex
Cheap. And so then I liked it that was, All.

00;40;17;01 – 00;40;28;13
Alex
Right, here’s the goal. Let’s get down to $0.60 as quickly as possible and just start flooding them with laundry. And so that mom group got a hold of it. Those families got a hold of it. We were bringing them two or £3,000 a day.

00;40;28;24 – 00;40;29;23
Alex
They were overwhelmed.

00;40;31;21 – 00;40;32;23
Alex
And at that point.

00;40;33;17 – 00;40;33;29
Alex
You know.

00;40;33;29 – 00;40;42;25
Alex
We lost them. We raised the outside capital. We learned a very pivotal thing for our whole story. At that point in the 400 K that we raised was originally to go launch. Raleigh is our second.

00;40;42;25 – 00;40;43;06
Alex
City.

00;40;44;08 – 00;40;52;22
Alex
And a week after we raised that money, Washoe completely shut its doors down and deemed a massive failure after raising $20 million.

00;40;53;13 – 00;40;54;02
Alex
And so then I.

00;40;54;02 – 00;40;54;17
Alex
Was looking at each.

00;40;54;17 – 00;40;54;27
Alex
Other like.

00;40;55;11 – 00;41;10;02
Alex
What are we about to do? The same thing? Are we going to even though the three things that we decided are going to define our approach or the opposite of what they were doing, are we missing anything else or is this just an unsolvable problem? If they couldn’t figure it out, the 20 million, how are we going to figure out with 400 K?

00;41;10;21 – 00;41;13;14
Alex
And so we were we’ve always been.

00;41;14;04 – 00;41;30;21
Alex
I think, smart enough to know what we don’t know and ask questions of people that are smarter than we are, know have a better experience than we’ve had in certain things. And so we reached out to the founders of Washoe we reached out to their lead investors came and partners out of San Francisco that I think invested 12 or 13 million into the deal.

00;41;32;04 – 00;41;32;19
Alex
And the.

00;41;32;19 – 00;41;33;19
Alex
Thing that was really amazing.

00;41;33;19 – 00;41;37;10
Alex
Just like kind of, I don’t know.

00;41;38;00 – 00;41;49;22
Alex
Selflessness of certain folks. I mean both Washoe founders and Kane and his partners at this firm were willing to spend a couple of hours a day in know just been like, Hey, here’s what we did that worked well, here’s what we did that didn’t work well, avoid this.

00;41;50;02 – 00;41;53;05
Alex
Don’t do this, do that. And, you know, dozens.

00;41;53;05 – 00;41;57;21
Alex
Of things learned massive, valuable lessons. But the two things that really stuck out to us were.

00;41;58;06 – 00;41;59;08
Alex
The.

00;41;59;08 – 00;42;07;05
Alex
Logistics model that we were operating on. That point to point delivery just doesn’t work. That -20% plus gross margins are nowhere near.

00;42;07;10 – 00;42;07;19
Alex
Getting.

00;42;07;19 – 00;42;17;15
Alex
Out of that, you know, getting on the right side of zero. And whereas we had, you know, just around 30% gross at the time, and for eight months and didn’t feel like we were fully at scale and that there was probably room to get even more over time.

00;42;18;23 – 00;42;19;03
Alex
But the.

00;42;19;03 – 00;42;21;01
Alex
Thing that caused us to not launch Raleigh.

00;42;21;01 – 00;42;24;12
Alex
Was the the quality.

00;42;24;20 – 00;42;27;08
Alex
Quality control on the laundry side of the house.

00;42;27;08 – 00;42;28;08
Alex
To what we were doing.

00;42;28;09 – 00;42;29;06
Alex
At the coin laundromat.

00;42;29;26 – 00;42;31;07
Alex
And you.

00;42;31;07 – 00;42;36;18
Alex
Know, probably makes sense to a lot of Laundromat owners listening is that, you know, laundromats typically aren’t designed or built.

00;42;36;18 – 00;42;37;00
Alex
For.

00;42;37;09 – 00;42;41;01
Alex
Massive volume production. It’s designed as a self-service coin laundromat.

00;42;42;02 – 00;42;44;05
Alex
Or laundromat and the.

00;42;44;05 – 00;42;47;22
Alex
Pain that we were feeling at that one store I mentioned where we were overwhelming them with volume.

00;42;47;22 – 00;42;49;18
Alex
They you know, they had they were.

00;42;49;18 – 00;42;54;05
Alex
One of the few attended stores in all of Charlotte. That one maybe two part time employees.

00;42;54;19 – 00;42;55;02
Alex
You know that.

00;42;55;02 – 00;43;10;15
Alex
We’re doing some of this volume we started then they started adding at the second or third, fourth or fifth or sixth as we were bringing them more volume. But if you keep in mind before us, they were running a pretty straightforward self-service business with maybe one employee five to 10 hours of their time a week in many instances, because they were mature laundromat.

00;43;10;15 – 00;43;11;18
Alex
They weren’t just getting started.

00;43;12;05 – 00;43;13;09
Alex
And we.

00;43;13;09 – 00;43;20;27
Alex
Like Wash. Yeah. And this is the main thing we learned from last year, flipped that model on its head for them. They were now, you know, needing to be there 30, 40 hours a week, hire.

00;43;21;05 – 00;43;21;15
Alex
Ten.

00;43;21;15 – 00;43;22;12
Alex
Plus people instead.

00;43;22;12 – 00;43;22;28
Alex
Of two.

00;43;23;22 – 00;43;26;26
Alex
Layering technology of their business, which there wasn’t a ton of.

00;43;26;28 – 00;43;27;07
Alex
You know.

00;43;27;16 – 00;43;36;08
Alex
Even five years ago, there wasn’t a lot of technology even two years ago. There’s not a lot of technology in the laundromat industry. And so now you’re asking these kind of legacy owners for the most part.

00;43;36;21 – 00;43;36;25
Alex
To.

00;43;36;25 – 00;43;58;25
Alex
Do three things they’re not comfortable with. It’s managing a lot of people. It’s using a ton of technology and it’s being a hands on operator versus a passive operator, like a really hands on operator. And Washoe learned the hard way. They raised all that money. They scaled the six cities Boston, DC, New York, Chicago, L.A., San Francisco had six or seven Laundromat owners in each city.

00;43;58;25 – 00;44;27;16
Alex
So 40 laundromats that they’re working with all your typical kind of 24,000 square feet or maybe even smaller locations, all trying to keep up with all this volume that the Washoe marketing machine that they’re just burning cash is spending that $20 million to grow. It’s bringing all this demand into these stores that are just overwhelmed. And all of them started losing dozens of orders a day, mixing Jordan’s clothes with mine because again, they hadn’t built a process of that scale or a lot of them had built that type of process.

00;44;27;16 – 00;44;27;24
Alex
At that.

00;44;28;06 – 00;44;28;15
Alex
Point.

00;44;29;00 – 00;44;49;28
Alex
We couldn’t keep up with the volume and so Washoe was losing one, one out of every five orders a day, not making money on it. They just had to shut down. And I going to share that because we were feeling some of those growth pains just in Charlotte with one laundromat. And instead of launching Raleigh as our second city, we all kind of put our heads together up to those conversations and said, Look, we either keep doing what we’re.

00;44;49;28 – 00;44;51;05
Alex
Doing and.

00;44;51;05 – 00;45;01;21
Alex
Increase the risk of us doing the same thing Washoe did and just kind of relying on a supply chain that might not be built to handle tens of thousands of pounds of laundry a month in each.

00;45;01;21 – 00;45;04;06
Alex
Market. What do we.

00;45;04;06 – 00;45;22;20
Alex
Do? How do we build this process ourself? Going back to that pillar I mentioned at the beginning is how do we really take quality back in so that we can guarantee a consistent experience for our customers? And what we noticed is laundromats generate, you know, 50 to 60% of their revenue on the weekends, Monday through Friday, all that equipment is just they’re dead underutilized for the most part.

00;45;23;06 – 00;45;45;00
Alex
And so we went back to the laundromat owner that we were working with and said, Why don’t we rent out? You’re off our capacity. You’re, you know, you’re ecstatic because you have this whole revenue stream you didn’t have with the same amount of hours that you’re used to putting in each week. You can go back to that. So you’re happy we’re happy because we now have full control over the cleaning process without the CapEx of buying washers and dryers in a building and.

00;45;45;10 – 00;45;45;27
Alex
All of that.

00;45;46;16 – 00;46;14;00
Alex
And most importantly, our customers going to get just a much better experience consistently. And so we did that for about ten months. Talk about luck and right timing and serendipity. One of one of my fraternity brothers or friends that I met in college, his family had been in laundry and dry cleaning for 105 years. He was working in Raleigh hated his job, saw what we were doing, happened to reach out right around the time we’re talking to Washoe.

00;46;14;00 – 00;46;14;29
Alex
And I was just saying like, Look.

00;46;15;09 – 00;46;15;20
Alex
I see what.

00;46;15;20 – 00;46;28;16
Alex
You guys have been doing the last seven months. Like, I never thought I’d be wanting to get back in the laundry. I told my dad I wasn’t going to take over the family business like I was the last generation kind of thing. And he saw we were doing. I think I could be helpful here, and I like startups.

00;46;28;16 – 00;46;35;06
Alex
I want to be a part of something bigger. And the reason I mentioned him is there is back Miller. His background.

00;46;35;20 – 00;46;37;05
Alex
Is very.

00;46;37;05 – 00;46;39;20
Alex
Interesting in that not only does families run laundromats and dry.

00;46;39;28 – 00;46;40;15
Alex
Cleaners.

00;46;40;26 – 00;47;01;12
Alex
They did massive volume, individualized production for all these camp kids in Asheville. So hundreds of kids clothes had to keep separate. And so what they did is how much larger capacity washers were there, like orders, you know, let’s say also all the island breeze customers could get mesh bagged into separate separate mesh bags and put into a massive industrial washer.

00;47;01;22 – 00;47;18;23
Alex
But then they have a wall of dryer that would split out the orders back into the individual orders. And so he’d seen this kind of high volume custom cleaning before. And so he came in and help us build the same thing, but leveraging other people’s clothing. Laundromats did that for ten months, cut costs 15 20% quality was through the roof.

00;47;19;05 – 00;47;24;26
Alex
We hadn’t seen anyone else in the industry doing that approach in Washoe was purely Uber for laundry.

00;47;24;26 – 00;47;25;17
Alex
Rinse was.

00;47;26;03 – 00;47;28;23
Alex
Basically more of the same cleanly in New York, same.

00;47;28;23 – 00;47;32;10
Alex
Thing we hadn’t heard.

00;47;32;10 – 00;47;39;10
Alex
Of another model. Try to tackle the laundry industry by controlling the quality that way, but leveraging.

00;47;39;15 – 00;47;39;27
Alex
That.

00;47;40;01 – 00;47;50;08
Alex
That assets basically. And so we’re all high fiving. This is it. This is going to be the model and eventually had some other walls that we had to break.

00;47;50;09 – 00;47;54;25
Alex
Breakthrough but I’ll stop there if you hear any kind of questions.

00;47;55;02 – 00;48;23;04
Jordan
Yeah, no, it’s just a fascinating kind of story saga almost where you know, just I’m feeling the feeling the highs, feeling the lows as you’re talking about like, oh yeah, man, I see where that, you know, as you’re talking, I’m like, oh, they’re going to run into this problem. Oh, yeah. They ran into the problem like, you know, like you can see, you know, being on the back end of things and now seeing how more people have tried different things since you guys have, you know, started and known a little bit of your story.

00;48;23;04 – 00;48;46;08
Jordan
Just know and like, oh, man, you know, it’s an issue. And I mean, I think there’s you know, there’s there’s companies out there right now who are trying to do, you know, similar type things where people are doing laundry in their neighborhoods, at their homes. And, you know, I think they’re going to have a lot of the same issues, probably even more so actually, in my view.

00;48;46;08 – 00;49;10;06
Jordan
I’ve yet to be seen, but or determined, I guess. But I think they’re they’re going to run into issue. So it’s just it’s interesting. It’s fascinating to kind of hear the the saga of everything that you went to in iterations and, you know, how you guys evolved along the way. What was I mean, did you guys set off set out to do business for yourselves?

00;49;10;06 – 00;49;22;02
Jordan
Or do you already have your your sights set higher to say, hey, we’re going to either scale us out to multiple locations or franchises or or like that. What what was your initial ambition?

00;49;22;16 – 00;49;24;20
Alex
Yeah, that’s another piece of advice I’d like to get.

00;49;24;20 – 00;49;41;09
Alex
Anyone starting their own thing is like have that honest conversation with yourself. If it’s just if it’s you on your own, but if it’s you and another partner, have that conversation with yourself and them at some point to be like, Hey, Jordan, is this something we want to do for the next 30 years? Lifestyle business you know, kicking off cash for both of us?

00;49;41;21 – 00;49;43;02
Alex
Or is this like, Hey.

00;49;43;02 – 00;49;48;23
Alex
Jordan, do you want to be the laundry guy forever? Or do you want to try to get in and make something really big.

00;49;48;27 – 00;49;49;26
Alex
Own less of a.

00;49;50;02 – 00;49;51;17
Alex
Hopefully a much bigger pie.

00;49;51;28 – 00;49;53;03
Alex
And then sell it to.

00;49;53;29 – 00;49;56;25
Alex
You know, strategic partner or private equity group?

00;49;57;13 – 00;49;58;06
Alex
And so then I.

00;49;58;06 – 00;50;03;04
Alex
Got into it, you know, I think being coming from success, him coming from the startup world, his company that he was.

00;50;03;04 – 00;50;04;02
Alex
At had.

00;50;04;02 – 00;50;13;13
Alex
Just been bought by NBC Sports for 400 and some million dollars. And so I think he sees Nike’s sports engine. What’s the name of it? They’re building websites basically for like high school sports.

00;50;13;14 – 00;50;18;22
Jordan
Use it for my kids little league to keep track of all the games and practices got the athletes sound.

00;50;19;04 – 00;50;26;22
Alex
He was at sports engine fairly early not now like he wasn’t a founder or anything but he was part of the sales marketing team, sports engine.

00;50;28;07 – 00;50;28;14
Alex
And so.

00;50;28;14 – 00;50;49;29
Alex
He just seen that happen. And I had known enough about startups at that point that I think we’ve had that conversation with each other and determined we want to build a national brand in laundry. And if that takes 15 years, that’s fine. If it takes 20 years, that’s fine. And then five, that’s fine. Our definition of national was that it was in 30 or 40 of the NFL cities that has been and continues to be our ambition.

00;50;49;29 – 00;50;50;09
Alex
And at that.

00;50;50;09 – 00;50;51;13
Alex
Point we’ve.

00;50;51;13 – 00;50;56;00
Alex
Agreed that you’ve created, you know, optionality. You know, we had 30 or 40 cities and we’re both.

00;50;56;15 – 00;50;57;00
Alex
The tank.

00;50;57;00 – 00;51;05;06
Alex
Is still full and we’re both as passionate and energetic about the space and what we’re doing as we are right now, then we’ll keep going. But the important.

00;51;05;06 – 00;51;05;25
Alex
Thing to.

00;51;05;25 – 00;51;12;28
Alex
Him and I was to have the option to do that, that was the focus really was not necessarily a timeframe or a number or revenue goal.

00;51;12;28 – 00;51;13;28
Alex
Or it was.

00;51;14;18 – 00;51;21;14
Alex
Want to solve a really hard problem that hasn’t been solved before in our in our eyes. And we’re open to how long it.

00;51;21;14 – 00;51;21;29
Alex
Takes.

00;51;22;11 – 00;51;33;10
Alex
Depending on our, you know, our passion and energy in the industry. Because if that’s not there, it’s not fair to our team, it’s not fair to our investors, it’s not fair to us. Some of those are a long winded answer that.

00;51;33;22 – 00;51;41;23
Jordan
Yeah, no, I mean, just that’s fascinating. And I mean, I’m not sure that there are 40 NFL cities. I don’t know if there they’re like 32 or 33 teams.

00;51;41;26 – 00;51;42;25
Alex
So so we started out the.

00;51;42;25 – 00;51;48;15
Alex
30 as the 30 NFL cities you want to it’s like the 40 or 50 major cities in the country. Let’s start with the NFL cities.

00;51;49;29 – 00;52;02;23
Jordan
Now just give me our time OK so at this point in the saga you guys are you guys are running the business right like you’re running the operations and all that stuff. It’s your guys’s company. Is that right?

00;52;03;13 – 00;52;05;20
Alex
Yep. So once he raised the capital, I mean.

00;52;05;20 – 00;52;08;14
Alex
Usually when you raise around the capital, you going to give up anywhere from five.

00;52;08;14 – 00;52;08;22
Alex
To.

00;52;09;04 – 00;52;13;00
Alex
15% of the company every time you raise money is a rule of thumb.

00;52;13;16 – 00;52;13;26
Alex
And so.

00;52;14;02 – 00;52;18;26
Alex
His and his company and we know that as we take money and we’re actually giving some equity and ownership out.

00;52;20;23 – 00;52;21;16
Alex
You know, I think.

00;52;21;16 – 00;52;24;28
Alex
Where things really started to accelerate was after we took the process in house.

00;52;25;14 – 00;52;27;05
Alex
We saw one.

00;52;27;05 – 00;52;33;12
Alex
How much of an opportunity there is to do something big. But then to how expensive it’s going to be to build the technology required to do this out of.

00;52;33;12 – 00;52;35;12
Alex
Scale and really, you know.

00;52;35;23 – 00;52;50;04
Alex
Protect that quality to the degree that we want to really building tools for every aspect of the business, the drivers to be set up for success, the person managing the vehicle, the fleets and the vehicles, we saw the success, individuals folding, individuals sorting, individuals washing, drawing you know, all the every.

00;52;50;05 – 00;52;51;12
Alex
Stuff needed.

00;52;51;12 – 00;52;52;09
Alex
Some sort of.

00;52;52;18 – 00;52;52;24
Alex
Your.

00;52;52;24 – 00;53;09;13
Alex
Guide, right? This is all done on paper and pencil. It would be possible, but be much harder and slower, I think, to do and so we knew we needed to make an investment in technology into growth and grabbing market share and knew that that was going to take, you know, unless we wanted this take 40 or 50 years.

00;53;10;00 – 00;53;10;18
Alex
We knew that.

00;53;10;18 – 00;53;36;09
Alex
Raising outside capital would allow us to get there faster. So then we went and raised two and a half million dollars around the capital, got accepted into the Techstars accelerator. So it’s like going to get your MBA that one of the top five schools, they’re going to Harvard, we’re going to Stanford. They accept less than half a percent of the companies that apply Dropbox went through on Airbnb, went through on a lot of these major brands that we all know went through one of these top two or three accelerators.

00;53;36;21 – 00;53;58;22
Alex
And we were fortunate enough to get accepted we use that to launch Atlanta as our second city in January of 18. And at that point we started to run into those other roadblocks and challenges that I mentioned. And that was we had three laundromats in Charlotte at that point because we outgrew the first one very quickly. Just because there’s laundromats are not designed for this much volume coming in every day.

00;53;59;01 – 00;54;10;04
Alex
And so we very quickly to three, they’re kind of spread out all over the city. Different owners, different personalities, different equipment, some as hip, some as dexterous, some as Electrolux, some is 20 years old.

00;54;10;04 – 00;54;12;23
Alex
One store had some new equipment.

00;54;13;19 – 00;54;17;26
Alex
Some one was 1500 square feet, one was 4000 square feet. There’s all this.

00;54;17;26 – 00;54;18;18
Alex
Variability.

00;54;19;28 – 00;54;27;09
Alex
You had some goofy stuff happen to. I’ve shared this anecdote before, but, you know, one owner understood, hey, you’re bringing me another 15 to 20 grand a month in revenue.

00;54;27;09 – 00;54;29;24
Alex
I didn’t have another owner was like, you know.

00;54;30;03 – 00;54;38;12
Alex
Kind of harping us, Alex, you know, your team is using my bathroom too much nerves flying through toilet paper. I need to start charging you $40 a month for toilet paper.

00;54;38;26 – 00;54;41;22
Alex
I’m like, Steve, a brand new 15,000.

00;54;41;22 – 00;54;42;19
Alex
Dollars in revenue.

00;54;42;19 – 00;54;50;21
Alex
You didn’t have to buy that at Costco. Get more toilet paper wise bugging you and that just like it’s not that.

00;54;50;21 – 00;54;52;25
Alex
It was a huge challenge, but we just realized.

00;54;53;08 – 00;54;54;16
Alex
We’re kind of at the whim of.

00;54;54;16 – 00;54;57;09
Alex
The laundromat and dry cleaning partners that we find.

00;54;57;09 – 00;54;58;08
Alex
And the.

00;54;58;08 – 00;55;14;12
Alex
Laundromat part seems so sensitive because it’s we’re asking people to do even. It’s also our own team coming in. It’s just still so different to what they’re used to as the dry cleaning wholesaler. Again, it’s like yeah, bring me the volume. I want to be I’m an operator. Bring me thousands of more pieces. That’s my dream. I want more volume in here.

00;55;14;12 – 00;55;30;00
Alex
And that’s, that’s how I make money. Or as a laundromat owner, is like, this is an and this isn’t their main business is a laundromat business at its core. And that’s why they got into it. And now they can have some pick up in delivery volume from customers that might not ever step foot in their laundromat. It’s not competitive.

00;55;30;00 – 00;55;34;03
Alex
It’s not replacing what they used to do. It’s more work, you know, for them to think about.

00;55;34;03 – 00;55;36;13
Alex
And so we just kept.

00;55;36;13 – 00;55;52;19
Alex
Seeing that theme and thought and we were hearing about rents at that point and cleanly kind of running into some of these challenges at a larger scale than we were at. And there was just more and more evidence we have to vertically integrate. We have to design stores for this kind of hybrid use. We have to make sure that the right size.

00;55;52;19 – 00;55;54;09
Alex
Layout still.

00;55;54;09 – 00;55;58;07
Alex
Don’t use the money we raise to build the store because it’s, you know, we’re giving up equity to.

00;55;58;07 – 00;55;58;14
Alex
To.

00;55;58;28 – 00;56;19;18
Alex
You know, to get this money. And we felt like technology and growth had more of a return on it than one single store would have. And so still not bankable because we’re burning through money. There’s growing spending on marketing and growing and launching Atlanta. So we’re still going to stuck in this crossroads. And that’s when we have our stroke of luck and right timing Electrolux they’re an $18 million appliance company.

00;56;19;27 – 00;56;24;23
Alex
They do a lot more than just washers and dryers. They’re more well known for kitchen appliances.

00;56;24;23 – 00;56;25;18
Alex
And big.

00;56;25;21 – 00;56;27;17
Alex
Commercial kitchen appliances, vacuums, et.

00;56;27;17 – 00;56;29;18
Alex
Cetera. But their North.

00;56;29;18 – 00;56;44;02
Alex
American headquarters happens to be here in Charlotte, where we are and where we started there. Head of laundry Tom Wash. Brooks sits here and we are connected to Tom. I think you’ve seen a couple of Charlotte business journal journal articles about us. And, you know, we all just start talking.

00;56;44;02 – 00;56;44;13
Alex
About.

00;56;45;05 – 00;56;51;27
Alex
You know, what we’re doing. And, you know, they like the approach of having our own team leveraging these underutilized assets and.

00;56;52;19 – 00;56;52;29
Alex
You know.

00;56;53;10 – 00;56;54;22
Alex
Kept encouraging us to build our own.

00;56;54;22 – 00;56;56;13
Alex
Store and.

00;56;56;19 – 00;57;00;23
Alex
Explained why we couldn’t. And that’s where things got pretty interesting. Electrolux and Laundry.

00;57;00;23 – 00;57;01;06
Alex
Likes.

00;57;01;19 – 00;57;04;20
Alex
We’re both like, Hey, well, we can help with that. We can finance you 100% of the.

00;57;04;20 – 00;57;06;13
Alex
Equipment we can give you, you know.

00;57;06;13 – 00;57;19;09
Alex
Some, you know, good pricing and we want to, you know, like basically want to test and see how this works out. Or if you guys build a store and run all of your pick up and delivery volume into it, what does that look like on a large scale? And if you guys designed and built it the way that you’re saying you want to.

00;57;19;09 – 00;57;35;22
Alex
So we ended up buying an old McDonald’s in Charlotte is 6300 square feet. And the idea that was that 4700 square feet would be customer facing the other 2000 basically in the back would be for office and processing know people doing all that additional.

00;57;36;16 – 00;57;36;25
Alex
Pickup and.

00;57;36;25 – 00;57;37;14
Alex
Delivery volume.

00;57;38;04 – 00;57;40;12
Alex
And we had no idea.

00;57;40;12 – 00;57;49;00
Alex
What to expect on the laundromat side. And then keep in mind the first three or four years we were purely pickup and delivery marketplace type approach to now owning this physical.

00;57;49;00 – 00;57;51;25
Alex
Land and building and completely.

00;57;51;27 – 00;57;55;22
Alex
A different customer base coming in. It’s typically you know lower income demographic and.

00;57;56;04 – 00;57;56;10
Alex
These.

00;57;56;10 – 00;57;58;12
Alex
Non-Major markets that are using laundromats.

00;58;00;03 – 00;58;01;28
Alex
And we treated the same way we did two years.

00;58;02;11 – 00;58;06;20
Alex
Customer at the forefront beautiful design all these amenities. Well let’s.

00;58;06;20 – 00;58;07;13
Alex
Say, you.

00;58;07;13 – 00;58;13;12
Alex
Know surveying customers that use laundromats to see what things do you want or need out of a laundromat. Really put that same level of thought into to and I.

00;58;13;13 – 00;58;15;05
Alex
Just we had no idea.

00;58;15;05 – 00;58;21;10
Alex
Once we build this four people show up there’s a laundromat right across the street. People may be in their habits and want to use that person.

00;58;22;00 – 00;58;22;28
Alex
Pretty risky and.

00;58;22;28 – 00;58;23;22
Alex
A scary time.

00;58;24;08 – 00;58;25;22
Alex
And have just blown.

00;58;25;22 – 00;58;50;11
Alex
All of us our way. The walk in revenue grew faster than we thought we we eclipsed 40 grand in monthly walk in revenue within four and a half months. Of starting the business the cash flow on its own covered the loan to you know laundry and Electrolux covered the note on the land cover you know all the expenses for not just a walk in customer but also the pick up and delivery volume we’re doing to cover all those variable costs and a cash flow on top of it’s all.

00;58;50;28 – 00;58;51;28
Alex
This is way better than we thought.

00;58;51;28 – 00;58;54;22
Alex
It would be we were hoping the walking would even break even that would’ve been.

00;58;54;22 – 00;58;55;05
Alex
Fine.

00;58;57;08 – 00;59;01;18
Alex
And so you we’re all really excited. This is the model, right? We have to build more of these. There are not cheap.

00;59;02;09 – 00;59;02;24
Alex
Million to a.

00;59;02;24 – 00;59;04;20
Alex
Million and a half if you’re going to call de novo.

00;59;04;20 – 00;59;05;08
Alex
New and.

00;59;07;04 – 00;59;14;19
Alex
So at another crossroads again, how do we rebuild more of these faster? I’m going to pause right there just to see if there’s any new kind of questions or comments as.

00;59;14;19 – 00;59;14;26
Alex
We.

00;59;15;27 – 00;59;16;25
Alex
Are going through the story.

00;59;17;11 – 00;59;45;06
Jordan
Yeah. No, I mean, I’m I’m just taking it in, dude. I’m just it’s it’s so fascinating to me, you know, as somebody who you know, I’m a I’m a laundromat aficionado, of course, but I’m also just sort of a business and startup aficionado. And so here in kind of the experience there and you know, and I want to encourage anybody who’s listening to this right now, you know, who, you know, is maybe just more into the Laundromat thing and all that.

00;59;45;15 – 01;00;27;07
Jordan
Like we’ve been thinking of this and in your context, right? There’s a lot of things that apply to whatever context, context you’re in, whether that’s you just own a mom and pop laundromat in your small city or you’re trying to build a pickup delivery business or whatever, you know, be applying some of these principles and, you know, what I’m hearing a lot of is a lot of iterations, a lot of evolution, a lot of, you know, figuring out how to take the next step a lot of, you know, reaching out to other people for, you know, input and advice and, you know, connecting and finding ways to partner in ways that benefit both parties.

01;00;27;07 – 01;00;44;18
Jordan
And, you know, I hear a lot of all of those things that I think benefit everybody. So I just want to point that out as you know, as you keep telling your story and and also just kind of tease like, hey, you know, I’m going to ask Alex about, you know, some of this the franchising questions here soon as soon as we get there.

01;00;44;18 – 01;00;49;10
Jordan
So that’s what you’re hanging on for. Hang on just a little bit before we’re getting there. So keep going.

01;00;49;10 – 01;00;54;16
Alex
I’m almost to the yeah, I’m almost to the franchising part. You know, so at that point when we.

01;00;54;16 – 01;00;57;10
Alex
Thought, hey, we have to build more of these, but how we’re going to do that, they’re expensive.

01;00;58;26 – 01;01;00;24
Alex
We had been approached.

01;01;00;24 – 01;01;07;17
Alex
To the franchise a few times already at that point, but we’d always told, look, we want to get to three or four cities and then we’ll we’ll think about it.

01;01;07;26 – 01;01;08;20
Alex
Entertaining it again.

01;01;09;03 – 01;01;14;19
Alex
And so we’re very much in the mindset of this first one open. We’re going to still do this corporately. 100% corporate.

01;01;14;19 – 01;01;14;28
Alex
Owned.

01;01;16;01 – 01;01;17;17
Alex
Want to find ways to, you know.

01;01;17;18 – 01;01;17;28
Alex
Either.

01;01;18;10 – 01;01;19;08
Alex
Raise bank debt.

01;01;19;08 – 01;01;20;28
Alex
Or private equity.

01;01;20;28 – 01;01;27;14
Alex
Debt or have to figure out another way to raise the money we need to build to build these stores. Or maybe Electrolux alone will actually help finance those.

01;01;28;28 – 01;01;29;19
Alex
And so.

01;01;30;08 – 01;01;42;26
Alex
You know, the success of the first one, we realized we need to go do this in Atlanta. We were in Atlanta at that point, but during the old model where we were hiring our own team to go into other people’s laundromats. So we kind of had two things going on. You know, one way or another, people stores one or in our own in Charlotte.

01;01;43;19 – 01;01;44;25
Alex
And so at that point.

01;01;45;09 – 01;02;03;26
Alex
We raised $6 million from investors, I think because of how well the first started knowing that we were gearing up to start scaling it much faster at that point. This was in the fall of 2019 launched Raleigh in January of 2020 and then as we all year we all know the world kind of flipped upside down with COVID.

01;02;04;10 – 01;02;05;01
Alex
And.

01;02;05;13 – 01;02;08;16
Alex
We had another big kind of inflection point in our story.

01;02;08;17 – 01;02;10;22
Alex
You know talking about the.

01;02;10;22 – 01;02;22;28
Alex
Highs and the lows. We had just come off of raising $6 million. I never even imagined what that would look like having responsibility over, you know, as an entrepreneur this is like a first in many ways and the level of responsibility.

01;02;22;28 – 01;02;24;19
Alex
Of people believing in you that much.

01;02;25;12 – 01;02;34;10
Alex
But still a really good feeling, you know, high all around the team’s excited. This money means we have more capabilities. We can add more resources, invest in other things and.

01;02;34;10 – 01;02;38;13
Alex
Projects and so there’s this huge high.

01;02;38;18 – 01;02;40;07
Alex
We launch really huge high.

01;02;40;16 – 01;02;40;28
Alex
And then our.

01;02;40;28 – 01;02;44;17
Alex
Board calls a meeting the first week in February, late January.

01;02;45;00 – 01;02;47;24
Alex
And you know, to this day is one.

01;02;47;24 – 01;02;52;28
Alex
Of the most tremendous displays of foresight that I’ve ever experienced, though like.

01;02;53;13 – 01;02;53;23
Alex
We’re all.

01;02;53;23 – 01;03;08;19
Alex
Naive. I don’t know why our society and other companies aren’t are responding more appropriately, but this is going to get only worse before it gets better. And this is at a time where there’s only two or three cases in Washington State. There’s like zero elsewhere in the country at this point. And they say, look, look at Europe, look at Asia.

01;03;08;28 – 01;03;23;03
Alex
There are hospitals are overwhelmed. All their businesses are like shut down and they’re doing stay at home orders. It’s not a matter of where if you know, it’s a matter of when this is going to happen. So just start acting like it’s here already. So what would you do? Like you probably shut Raleigh down. You just lost it.

01;03;23;03 – 01;03;37;01
Alex
It’s wasting, you know, it’s burning money. It’s not going be profitable for a year. So just just give up on Raleigh for now until we know more about what’s happening in the world. Atlanta will keep open to see because we’re under contract to build a store there but even then, they’re like, it might just be too late to start.

01;03;37;01 – 01;03;51;23
Alex
That building project is expensive and time consuming, and everyone’s going to stop working and want to be backwards all of a sudden, if things do go that direction, and so they just called everything. Those businesses are going to shut down. Hospitals are overwhelmed. Everything’s going to stop, and you guys going to be sitting on this pile of cash.

01;03;51;23 – 01;04;12;07
Alex
And so focus on that. Focus on getting this team to the point where it’s the best, you know, the best members on the team. You’ve got that money and you can now have two months to really focus on what parts of our business were working, what parts were not, what parts would you double down on, et cetera. And sure enough, everything they said in late January happened almost exactly how they called it.

01;04;12;07 – 01;04;39;06
Alex
And it just blew my mind. And I think the importance of surrounding yourself with smart people, good people and that experience. And so we listened to them. We took those two months. And the theme that we came up with, the themes that we were noticing, we looked at, we build software exclusively for laundromats and dry cleaners. Do we use our pickup and delivery software in our fleet to deliver other things that was too crowded with Amazon and the million other pickup and delivery companies?

01;04;40;17 – 01;05;05;02
Alex
And the themes we kept coming back to is our laundromat grew 22% throughout the first six or so months of COVID, when most their retail businesses were down 20 to 30%. Restaurants, fitness concepts retail shopping, all of it was down. Laundry was deemed essential in all states. I think people were flocking to our city. There are others shut down or they weren’t taking safety precautions to the level that we were as far as social distancing.

01;05;05;02 – 01;05;19;22
Alex
Hey, wait in your car, outside of our outdoor seating, while your clothes are in the washer dryer, you’re giving people masks. It’s like really leaning into what our customer was telling. They wanted to feel comfortable. So we started doing all those things, social distancing before it was cool.

01;05;21;03 – 01;05;21;09
Alex
Again.

01;05;21;09 – 01;05;40;27
Alex
Just from customers telling us, I would feel safer if you did X and we would do X nine out of ten times. And you know, so we saw that theme. We need to build more of these stores faster. How do we do that without raising 50 to $100 million? Which seems like an impossible task in and of itself. And the second thing was we’re trying to do too much.

01;05;40;27 – 01;05;52;24
Alex
We have a pickup and delivery fleet of 20 vehicles and 25 drivers. We’ve got operations in three cities or had operations in three cities. We’re running a retail laundromat about to build more of them.

01;05;53;05 – 01;05;53;14
Alex
And we have.

01;05;53;14 – 01;05;59;27
Alex
A team of like a small army of people processing the amount of volume we’re doing in Charlotte. I mean we had 50 part time employees because we were.

01;05;59;27 – 01;06;00;10
Alex
Doing.

01;06;01;01 – 01;06;04;24
Alex
130 hundred and £40,000 a month at that point. It was just an insane amount of.

01;06;04;24 – 01;06;09;08
Alex
Volume and so when we saw.

01;06;09;08 – 01;06;12;00
Alex
Those two teams we thought, Hey, maybe we can solve both at the same time and.

01;06;12;13 – 01;06;13;02
Alex
Could we.

01;06;13;02 – 01;06;14;11
Alex
Explore that franchising.

01;06;14;19 – 01;06;15;03
Alex
You know.

01;06;15;13 – 01;06;25;14
Alex
Opportunity that people been asking us about sooner because one that allows us to build a lot more of these retail laundromats faster. We could provide value to them through.

01;06;25;29 – 01;06;26;08
Alex
Everything.

01;06;26;08 – 01;06;28;00
Alex
That we’ve learned over the store.

01;06;28;06 – 01;06;28;18
Alex
The.

01;06;28;18 – 01;06;32;29
Alex
Preferential pricing, helping with the data driven site selection approach.

01;06;33;12 – 01;06;34;00
Alex
You know, kind of all.

01;06;34;00 – 01;06;35;10
Alex
The stuff that a distributor would.

01;06;35;10 – 01;06;36;22
Alex
Typically you know, help with.

01;06;37;21 – 01;06;47;07
Alex
A laundromat. So I’m getting into the laundry industry and then the two value adds on top of it were all the technology we’ve built to make running a laundromat easier. Processing almost pick up and delivery volume easier.

01;06;48;10 – 01;06;50;14
Alex
And then the volume itself.

01;06;50;22 – 01;06;57;15
Alex
Could we go acquire that volume? We’ll take care of all of that. We’ll take care of the pickup and delivery, we’ll take care of the customer care and.

01;06;57;15 – 01;06;58;01
Alex
Support.

01;06;58;18 – 01;07;06;00
Alex
The franchisee. We’ll have this additional revenue stream that could generate, you know, three to 500,000 in revenue per location.

01;07;07;03 – 01;07;07;22
Alex
All they need to do.

01;07;07;22 – 01;07;15;02
Alex
Is they need a washer dryer fold. And so their operation isn’t dislodged too, too much. Then the typical laundromat that goes over the counter Wall Street.

01;07;15;02 – 01;07;16;07
Alex
Fold they don’t.

01;07;16;07 – 01;07;24;25
Alex
Have to worry about vehicles and drivers and acquiring two different customer based customer support and all that. So we started putting that thesis together.

01;07;25;13 – 01;07;26;00
Alex
And.

01;07;26;16 – 01;07;32;25
Alex
The power of the network really exhibited itself. Again, here we sent one email out to all of our investors, and within a week we’re talking to the Chick-Fil-A.

01;07;32;25 – 01;07;33;19
Alex
Family, the.

01;07;34;07 – 01;07;54;28
Alex
Founders of sports Eclipse, the guy that founded Anytime Fitness, like all these amazing franchise brands, and they’re giving us the dos and do nots in the category. Don’t set up royalties like this. Make sure that you’re providing value in these three ways. Make sure there’s this massive crash course in franchising. And so launched Laundry Lab is the franchise.

01;07;54;28 – 01;07;56;12
Alex
Brand in.

01;07;56;12 – 01;07;58;03
Alex
February of 2020.

01;07;58;03 – 01;07;58;12
Alex
One.

01;07;59;11 – 01;08;05;07
Alex
And our goal last year sell sell 17 license. So let’s see if this is a concept that people even want to get into.

01;08;05;16 – 01;08;05;22
Alex
It’s.

01;08;05;22 – 01;08;08;15
Alex
A high investment point just given the amount of equipment and machinery in.

01;08;08;21 – 01;08;09;29
Alex
The category.

01;08;10;21 – 01;08;29;28
Alex
Let’s see if people want it and now we’re about a year into starting to sell it and we’ve sold 47 licenses now we’ve won more than doubled what our initial goal was. It turns out people really are receptive to the category. 80% of those franchisees want the two you pick up in delivery volume. So a lot of them are coming in.

01;08;29;29 – 01;08;31;04
Alex
Thinking they’re.

01;08;31;04 – 01;08;34;10
Alex
Going to do three to five of these, not just one off or.

01;08;34;23 – 01;08;34;27
Alex
Two.

01;08;35;03 – 01;08;37;20
Alex
Ones and twos, any type of deal they want to.

01;08;38;05 – 01;08;38;21
Alex
And they’re coming.

01;08;38;21 – 01;08;42;15
Alex
In with a pretty hefty balance sheet or groups are coming in together to buy, you know, three to five.

01;08;42;15 – 01;08;43;01
Alex
Plus.

01;08;43;18 – 01;08;50;05
Alex
To really build out a core operation that will handle a ton of pickup in delivery volume at each disparate location.

01;08;51;10 – 01;08;52;23
Alex
So that’s the full story of how we got.

01;08;52;23 – 01;08;57;19
Alex
Into franchising, how I got into the industry, the pickup and delivery component, the retail component.

01;08;57;19 – 01;08;58;19
Alex
And, you know, the.

01;08;58;19 – 01;09;03;10
Alex
Story is not over yet. I’m sure there’ll be some more ups and downs, but that’s the chapter on right now.

01;09;03;27 – 01;09;43;13
Jordan
Yeah, what a wild story, man. So, so cool to hear from college class to where you’re at now with 47 franchise licenses and grow. And I’m sure, you know, I get asked about franchises all the time and so, you know, I’m going to pass some of those questions on to you, the expert here in a second. Real quick, one question that I’ve had since way back in the story is how how are we I mean you’re you’re bringing in you were bring in at one point you know these laundromats before you had your own stuff and all that two to £3,000 a day.

01;09;43;21 – 01;10;01;07
Jordan
I mean, I think there’s probably going to be a lot of laundromat owners listening to this being like, how, how how did you do that? I like to be that. How how did you do that? So how are you getting the volume that you were getting of of laundry? So as far.

01;10;01;07 – 01;10;02;17
Alex
As the acquisition on the to you.

01;10;02;17 – 01;10;04;06
Alex
Side, I mean, I think having.

01;10;04;18 – 01;10;20;29
Alex
A service offering where we could go pick up laundry and dry cleaning. So was a one stop shop. You know, we all have Amazon for this, Instacart for that. I think they’re becomes like subscription or service fatigue. And so I think anything to make why Amazon people like so much is you can go there for thousands of different things versus.

01;10;21;26 – 01;10;23;23
Alex
You know even Walmart.

01;10;23;23 – 01;10;28;15
Alex
Or something that has stores a ton of SKUs. It’s less so and so it feels like well if they don’t have.

01;10;28;15 – 01;10;31;19
Alex
That you know target that I need to go to this.

01;10;31;19 – 01;10;43;16
Alex
This category. You know so this is again this idea of a one stop shop really help with cross-selling people that were you came in on laundry then we converted the laundry and dry cleaner came in on dry cleaning converted so leveraging our existing customer base.

01;10;44;00 – 01;10;44;26
Alex
And the rest was just a.

01;10;44;26 – 01;10;55;08
Alex
Ton of word of mouth and leveraging those family, you know, those really those kind of mom influencers and ambassadors to post on next door and Facebook groups and.

01;10;55;24 – 01;10;55;29
Alex
The.

01;10;56;00 – 01;11;02;22
Alex
Moms of South Charlotte and those those various kind of groups just like we have in the laundry industry. I mean, with the.

01;11;03;11 – 01;11;03;27
Alex
Laundromat.

01;11;03;27 – 01;11;19;03
Alex
Owners group and the was three or four of them that come to mind right now that, you know, a lot of us go to for tips and advice the same thing is happening for parents. And, you know, this is again, a family service that families need. And so where are those families and how do you meet them where they are?

01;11;19;22 – 01;11;36;01
Alex
So a lot of our acquisition was word of mouth in those groups, our vans and our branding you can’t miss. It’s hot, hot, bright, hot pink. Our vans are all wrapped. So when you’re in, you know, you’re working from home or you’re up for a walk and you see a bright pink van driving by that says laundry pick up and delivery, it’s hard to miss.

01;11;36;01 – 01;11;52;02
Alex
And then you see your neighbors have pink and blue bags on their front steps. You start thinking what do they know? Something I don’t know. Should I be doing that? And they start thinking about how much time they’re spending on laundry, and it becomes a pretty quick, easy decision for them to say, Yeah, I outsource the lawn cutting, I outsource grocery pick up.

01;11;52;02 – 01;11;53;24
Alex
Why am I not outsourcing this?

01;11;55;13 – 01;12;20;07
Jordan
Yeah, I love that. Well, and I mean, I don’t know, way back I don’t know, probably in the early like twenties or something of episodes I was talking, I don’t even remember who maybe was Matthew Simmons or I forget who we’re talking about, dude. I think we underutilized influencer marketing and laundromats because there’s a lot of local influencers and that’s basically what you did.

01;12;20;07 – 01;12;42;28
Jordan
I mean, it wouldn’t probably fall under traditional influencer marketing where you go find, you know, some person with a really in-person audience, but that’s what it is, right? It’s like finding people who are influential in the community that and the demographic that you’re, you know, that you’re trying to serve and you know, get them to endorse you and, and promote you and, and spread it.

01;12;42;28 – 01;13;04;09
Jordan
And people trust that. Right? And so, I mean, I think that’s genius. Whether you did it on purpose, or not, I don’t know. But I mean, I think it’s genius to do that because it’s so powerful and we should be thinking more and more, you know, just as Laundromat owners, how how do you utilize influencer marketing in our in our marketing plans?

01;13;04;19 – 01;13;05;11
Jordan
So I like that.

01;13;05;28 – 01;13;09;22
Alex
Yeah. And the second thing, too, is like, we tried to we obsess over how we find.

01;13;09;22 – 01;13;16;23
Alex
One too many relationships. Like can we get a partnership with an apartment building that will send an email to the 250 people that.

01;13;16;23 – 01;13;17;25
Alex
Live here and.

01;13;17;25 – 01;13;19;19
Alex
That was really effective or like going.

01;13;19;19 – 01;13;22;22
Alex
To we.

01;13;22;22 – 01;13;30;06
Alex
Did. We tried stuff with hospitals. I think at one point, even like people that works, we thought like, hey, if you just had a surgery or something, you probably don’t want to go home and do laundry. You need.

01;13;30;06 – 01;13;30;16
Alex
Help.

01;13;31;12 – 01;13;35;18
Alex
Doing that. So we were trying to get like hospital groups to do this as like gifts or care packages.

01;13;35;18 – 01;13;36;05
Alex
For.

01;13;36;23 – 01;13;48;13
Alex
Their family members. Asked how they could help or another one was like registries you know, for people having babies is like if you’re not a kid and you’re probably tired and you got your hands full now and you want to be doing laundry. So could this be.

01;13;48;13 – 01;13;48;27
Alex
Like a.

01;13;49;11 – 01;13;50;05
Alex
Registry gift.

01;13;50;05 – 01;13;50;24
Alex
For.

01;13;51;14 – 01;13;54;00
Alex
The friends of a family that just had a child.

01;13;54;17 – 01;13;55;02
Alex
And they’re going.

01;13;55;03 – 01;14;02;00
Alex
To these like things where you could do one or two efforts but reach dozens of people? We were constantly trying to find where do those exist in the world.

01;14;02;28 – 01;14;21;26
Jordan
Yeah, and just to throw a couple I love that. I mean, that’s huge. And just throw a couple more out that I have heard or just come to mind right now is, you know, property managers. You know, I know a lot of people who are who are able to there’s some unique challenges about serving Airbnb and stuff like that.

01;14;21;26 – 01;14;48;19
Jordan
But if you’re able to, you know, figure that out, working with property managers who are managing short term rentals is another good one. You know, different associations, too, you know, that that you can kind of reach out to and advertise with that that serve, you know, particularly like commercial clients or customers who, you know, you might be able to service, you know, their laundry.

01;14;48;19 – 01;15;20;07
Jordan
So looking for the one to many relationships are huge and there’s a whole lot of different ways. I like the apartment, you know, complex and and that not only is a one to many, but it also adds a lot of efficiency you’re right. If you got to go, you know if you can figure out how to pick up everybody’s laundry on Tuesday and bring it all back on Thursday and pick up a new batch on Thursday, when you drop off the other and bring it back on Tuesday or whatever, like huge efficiencies in that you can even offer, you know, perks or discounts or whatever to people for doing stuff like that.

01;15;20;07 – 01;15;46;27
Jordan
So there’s a lot of benefits to linking to those one. Too many love that. That’s an awesome OK, so let’s talk let’s talk franchising here. What does it look like? Walk me through the process. First of all, let’s say I come to you, Alex, dude, I’m a baller and I’m looking to, you know, getting in this business here, you know, what does it look like for me to become a franchisee?

01;15;48;04 – 01;15;53;21
Jordan
Well, first of all, before we get into that, what are the franchising option offerings that you guys offer?

01;15;53;21 – 01;15;57;20
Alex
What yeah, so the main approach and after all those.

01;15;57;20 – 01;16;01;16
Alex
Conversations we had with, you know, the other massive franchise or brands out.

01;16;01;16 – 01;16;01;26
Alex
There.

01;16;02;20 – 01;16;22;22
Alex
You know, there are some approaches where people will sell like a whole state like Jordan could buy the rights to their Colorado. And now you’re basically reselling our licenses to other people and you’re making some percentage on that. But we’ve we got a lot of advice that can dilute the quality of the candidates you’re bringing in. It gives, it gives basically creates a layer between us and our franchisee.

01;16;22;23 – 01;16;24;22
Alex
And then I’ve always been very intimate with.

01;16;25;08 – 01;16;25;17
Alex
You know.

01;16;25;17 – 01;16;30;04
Alex
The cleaning process who are working with us, being pretty methodical and thoughtful about who we partner with.

01;16;30;20 – 01;16;31;05
Alex
And.

01;16;31;05 – 01;16;50;27
Alex
We didn’t like. And we got a lot of advice to avoid that. So we didn’t we don’t sell out, you know, whole states or whole cities. But what you can do is you could come in and say, hey, based on my net worth, my liquidity, you know, et cetera, making sure that you’re qualified and this isn’t going to be you kind of going out in front of your skis or getting yourself under water because we need we need our franchisees to be successful.

01;16;50;27 – 01;16;51;29
Alex
We’re completely aligned.

01;16;53;13 – 01;16;53;15
Alex
Yeah.

01;16;53;18 – 01;17;15;27
Alex
So depending on that that person or that family or that group’s background, you could come in and say, hey, I want a two pack. They call them packs. And franchisees say, I want to passing on two locations. I want three or five or ten. And you’ll basically say, I want them in Charlotte or whatever market you’re in. And I guess before you make that decision, you know, you’re probably exploring other franchise concepts that might work for you.

01;17;15;27 – 01;17;23;27
Alex
And that’s either because you found it on your own and you’re Googling and doing your own research, or a franchise broker reached out to you and said, Hey, Jordan, based on your background, I think.

01;17;24;17 – 01;17;24;19
Alex
You.

01;17;24;19 – 01;17;30;06
Alex
Might be interested in a gym franchise or whatever. And they start to kind of do that process with you almost like a business broker or.

01;17;30;06 – 01;17;30;13
Alex
A.

01;17;31;08 – 01;17;32;04
Jordan
Gym franchise.

01;17;33;05 – 01;17;34;12
Alex
They saw your profile picture.

01;17;34;12 – 01;17;36;17
Alex
And thought, This is a joke.

01;17;36;20 – 01;17;42;20
Jordan
Yeah, this is all my physique. When I was swimming in the Speedo and they’re like, This guy’s got to own a gym right now.

01;17;42;20 – 01;17;45;25
Alex
Like a whole series in theory. That’s right.

01;17;47;23 – 01;17;49;11
Jordan
All right. So there you go.

01;17;49;13 – 01;17;50;15
Alex
And so they’ll.

01;17;50;16 – 01;17;53;28
Alex
Reach out and they’ll help you figure out, you know, what is the right concept for you.

01;17;54;13 – 01;17;55;03
Alex
And.

01;17;55;16 – 01;17;58;28
Alex
You know, based on that, worth your interest your lifestyle, all that.

01;17;59;06 – 01;17;59;21
Alex
And so let’s say.

01;17;59;21 – 01;18;03;07
Alex
You find your way to Lawndale out at that point, whether it was through a broker or.

01;18;03;07 – 01;18;04;09
Alex
Through just your.

01;18;04;09 – 01;18;07;22
Alex
Google searching or hearing us on a podcast or a Facebook ad or.

01;18;07;22 – 01;18;08;29
Alex
Whatever way you heard about it.

01;18;09;13 – 01;18;19;11
Alex
You’re then going to do a business overview call with one of the owners, one of the founders, and they’re gonna walk you through like, hey, here’s a launch. A lab is all about here’s how we’re different. Here’s the value that we provide you, the support we.

01;18;19;11 – 01;18;23;11
Alex
Provide to you. Here’s the candidate that we typically look for.

01;18;23;14 – 01;18;41;01
Alex
In a partner. If you’re still interested in qualified, at that point, you’ll do a unit economics call, and that’s where you just kind of tear the model apart. You know, how much revenue does one of these do? What’s the cost to get into it? What’s the margin profile look like? Labor profile utilities run every line of the detail.

01;18;42;03 – 01;18;59;13
Alex
You do a couple of other calls about, you know, what the commitment is over the next ten years. Kind of what you’re committing to. And then the last step is to go to what’s called the Discovery Day. And this is pretty common again for regardless of the franchise brand is what franchising the process looks like. So Discovery Day, you typically fly to the headquarters of the brand.

01;18;59;13 – 01;19;04;07
Alex
You see a couple of stores in person. You meet other franchisees that are.

01;19;04;07 – 01;19;07;01
Alex
There you meet the team.

01;19;07;08 – 01;19;14;01
Alex
It’s really just kind of day and a half final date before you decide you’re going to get married or not. And at that.

01;19;14;01 – 01;19;16;02
Alex
Point, you know, it goes both ways.

01;19;16;02 – 01;19;22;09
Alex
We’re interviewing candidates just as much as candidate candidates are interviewing us. We want to make sure that this is something we want to work with for ten years because again, this is a ten year.

01;19;22;17 – 01;19;22;25
Alex
You know.

01;19;22;28 – 01;19;24;21
Alex
In many cases, ten years plus commitment.

01;19;26;00 – 01;19;26;10
Alex
And so.

01;19;26;10 – 01;19;27;29
Alex
It’s kind of a two way interview.

01;19;28;16 – 01;19;28;25
Alex
And let’s.

01;19;28;25 – 01;19;30;21
Alex
Say at that point, you say, you know, I want to go into launch.

01;19;30;21 – 01;19;31;00
Alex
Lab.

01;19;31;10 – 01;19;54;01
Alex
At that point, it’s you’re paying upfront for the rights to territory that you’re buying. So it’s 49,000 for the first license. That’ll be the let’s say let’s pick on Dallas Texas I there’s 20 that could fit there. You might say I want five of them so you’ll pay 49 for the first license, 39 for the second time for the third, 25 for the fourth, 19 for the fifth and anybody on the fifth this fall at.

01;19;54;01 – 01;19;55;19
Alex
90 and the reason.

01;19;55;19 – 01;20;00;11
Alex
I guess franchising works that way is to so that the company can sell out territories and know who’s going to own each.

01;20;00;11 – 01;20;00;27
Alex
Place.

01;20;01;04 – 01;20;06;01
Alex
And then you start building, it’s basically you, no one else can touch those five out of the 20 that you picked in Dallas.

01;20;06;01 – 01;20;09;11
Alex
At that point anywhere in the ground.

01;20;09;16 – 01;20;27;22
Jordan
Real quick, I just want to point out this is April that we’re recording this of 20, 22. So if you’re listening to this years down the line, those numbers may have changed. But I just want to point that out as a caveat. This is for right now and I mean, we didn’t talk about that. I’m assuming some point down the line that may or may not change.

01;20;27;23 – 01;20;36;10
Jordan
I just want to point that out. Yeah, you’re listening to this. Those numbers may or may not be accurate, but if they’re if they’re not accurate, is there a is there a place you can point them?

01;20;37;10 – 01;20;39;10
Alex
Yeah. So a lot of people, when they start to get into.

01;20;39;11 – 01;20;41;18
Alex
Franchise and you look at what’s called an FDA.

01;20;41;18 – 01;20;41;20
Alex
It.

01;20;41;20 – 01;20;45;19
Alex
Stands for franchise disclosure document. Every franchise.

01;20;45;19 – 01;20;46;27
Alex
Business legally has.

01;20;46;27 – 01;20;47;29
Alex
To do this in all states.

01;20;48;12 – 01;20;49;10
Alex
Some, you.

01;20;49;10 – 01;20;51;13
Alex
Know, take it a step further in their registration states.

01;20;51;13 – 01;20;51;24
Alex
Where.

01;20;52;09 – 01;20;56;29
Alex
You know, there’s very formal audits and other requirements that are met.

01;20;56;29 – 01;20;58;23
Alex
But for the core.

01;20;58;23 – 01;21;04;20
Alex
Document that anyone uses directly that shows startup costs, everything is audited by third parties, et cetera.

01;21;05;19 – 01;21;06;13
Alex
So, yeah, basically.

01;21;06;13 – 01;21;12;23
Alex
When you’re looking at the opportunity, look at the then current FTD because that will change once a year. It’s required to change every year and to reflect.

01;21;13;08 – 01;21;14;20
Alex
You know, those those fees.

01;21;14;20 – 01;21;15;14
Alex
Or the cost.

01;21;15;14 – 01;21;15;22
Alex
Of.

01;21;16;01 – 01;21;17;28
Alex
You know, materials going up or.

01;21;18;13 – 01;21;19;06
Alex
You know, 15.

01;21;19;06 – 01;21;31;03
Alex
More stores open this year. We want the results that they’ve experienced to be showcased. So you get to see every store pretty transparently how they’re doing. And if I’m a bottom quartile star, this is my risk. And if I’m a top quartile, this is what I could make.

01;21;31;03 – 01;21;31;07
Alex
A.

01;21;32;19 – 01;21;33;27
Jordan
How does somebody get a hold of that?

01;21;34;24 – 01;21;38;01
Alex
So it’s all franciscos, it’s all public, but I’ll I’ll.

01;21;38;01 – 01;21;52;24
Alex
Share a version with you that you can attach to the notes on the podcast. But otherwise you could go to our website at Lounge Alive, USA dot com, and you’ll get kind of put into that process. Or you can meet with my co-founder Dan that after he gets sent out.

01;21;54;01 – 01;21;56;23
Alex
If you Google, if you ever want to know any.

01;21;56;23 – 01;21;59;01
Alex
Franchise concept, a trick that we’ve learned is.

01;21;59;26 – 01;22;00;20
Alex
Go Google.

01;22;00;20 – 01;22;04;17
Alex
A registration state like California or Minnesota and then just say the brand after us.

01;22;04;17 – 01;22;07;18
Alex
Like laundry lab feed.

01;22;07;27 – 01;22;21;23
Alex
Minnesota. And it could be Orange Theory after the Minnesota. And the reason I say Minnesota is because it’s a registration state. And so they’re all there are lots of links to download all these different companies that it is typically when you search using that format.

01;22;22;09 – 01;22;37;23
Jordan
Awesome. Yeah. Thank you. And then I’ll put that in the show notes or if you’re on YouTube, there’s a link to that down below. All right. Sorry, I didn’t mean to interrupt you just want to point out that, you know, these things live for a long time on the Internet and, you know, so go ahead. Keep going.

01;22;37;25 – 01;22;38;27
Alex
I appreciate that’s that.

01;22;38;28 – 01;22;40;21
Alex
There’s that that’s the first element. Is that upfront.

01;22;40;21 – 01;22;41;05
Alex
Fee.

01;22;41;27 – 01;23;02;21
Alex
That varies depending on how many locations you want to buy or, you know, reserve upfront. And then from that point, you know, we get to work hand in hand working with you on finding the right side. We’re working with a private equity group in Atlanta called El Five, the largest large three fitness center in the country. Investors in Restore, which is like a big new kind of cryotherapy concept.

01;23;03;05 – 01;23;03;15
Alex
Big Blue.

01;23;03;15 – 01;23;05;11
Alex
Some school, a bunch of other franchise brands.

01;23;05;25 – 01;23;06;23
Alex
And what they’ve.

01;23;06;23 – 01;23;31;18
Alex
Helped us with is MAP. Basically, every territory in the major markets we want to go to and how many laundromats they believe could still be in that market successfully considering your competition, population growth, where the kind of gentrification is happening, in which direction it’s happening. And we use tons of data points and tons of data to map these sites to see just how many there can be in each city.

01;23;31;29 – 01;23;33;06
Alex
So you’ll pick those sites.

01;23;34;03 – 01;23;55;28
Alex
You’ll reserve them in that given market. We’ll hope you find a site within that territory in that market. Help you with construction and equipment, mix, layout, story design, branding, grand opening marketing, where that marketing dollars for those marketing dollars should go, getting your team staffed up, trained. I mean, literally everything you can imagine from the day to day operations to grand.

01;23;55;28 – 01;23;56;18
Alex
Opening to.

01;23;57;17 – 01;24;04;11
Alex
The right financing and how you should think about financing your equipment versus your improvements versus going to every kind of angle and scenario you can think.

01;24;04;11 – 01;24;04;17
Alex
Of.

01;24;05;22 – 01;24;07;22
Alex
And then once you’re open, the technology.

01;24;07;22 – 01;24;10;01
Alex
That we’ve built to help.

01;24;10;15 – 01;24;12;01
Alex
Make managing your store easier.

01;24;12;01 – 01;24;12;20
Alex
To.

01;24;13;03 – 01;24;29;03
Alex
Processing over the counter wash or fold to pick up a delivery washer fold in the main value add again, is that pickup in delivery volume that we can bring you. And that’s that that’s not an additional fee or anything. It’s we’re going to pay our franchisees what they would charge for over the counter wash drive fold.

01;24;29;15 – 01;24;29;21
Alex
Because.

01;24;29;21 – 01;24;30;13
Alex
We want them to.

01;24;30;13 – 01;24;30;25
Alex
Be.

01;24;32;01 – 01;24;49;27
Alex
Profitable. We want them to be as excited about the volume coming in the back door in a pink van as they are what the volume coming through the front door and branded laundry bag that sounds dropping off over the counter to really show that we’re aligned to the fullest extent. We’re not asking for some massive 30% discount because we’re bringing new volume.

01;24;51;13 – 01;25;04;13
Alex
There’s a royalty on that pick up and delivery volume we bring in. But again, we’re in a charge we’re going to pay you at a rate that you would charge a walking customer so that it’s exciting and kind of margin for you to want to keep doing that. The quality that we need you to do that.

01;25;05;27 – 01;25;29;25
Jordan
Yeah, that’s awesome. OK, so I mean, can we can we just talk plainly here? I mean, because here’s the thing. It’s like I get I’m sure you do too. I get people who are all about the franchise model. I get people who are critical of the franchise model. And I’ve got criticisms of some aspects of some franchise models and stuff, too.

01;25;29;25 – 01;25;31;18
Jordan
So I mean, can I ask you about some of those?

01;25;31;25 – 01;25;34;16
Alex
Yeah, let’s do. Yeah, I’m transparent. I’m an open book.

01;25;34;23 – 01;25;55;19
Jordan
Yeah. I love it. I love it. I love it. OK, so I mean, one of the big questions I get is can a distributor help me do a lot of the things that you just described? You know, that your franchise model will do. Do I need to go the franchise route or can a distributor do you know what you just said at the same quality?

01;25;56;05 – 01;25;56;15
Alex
Yes.

01;25;56;15 – 01;26;02;12
Alex
I think there’s there’s, I guess, a nuanced answer that depends on the person asking the question. Right. If you’re coming.

01;26;02;12 – 01;26;06;02
Alex
In with the idea of how I want one store.

01;26;07;18 – 01;26;12;19
Alex
And I’ve done a ton of research already, I grew up in family businesses.

01;26;14;01 – 01;26;14;06
Alex
And.

01;26;14;12 – 01;26;22;12
Alex
You know, I’m comfortable with labor and site selection and all these kind of other elements. As long as there’s some support through a distributor, I think this is a one off one off store.

01;26;22;12 – 01;26;23;22
Alex
I would say going.

01;26;23;22 – 01;26;29;06
Alex
The distributor route is probably the better route over time if the person they’re coming.

01;26;29;06 – 01;26;29;23
Alex
In is.

01;26;30;19 – 01;26;49;13
Alex
Hey, you know, I’ve I’ve built up this massive investment portfolio. I want a semi absentee business understanding. I have to be in the business for the first year to get it ramped up. And I’m willing to make that commitment or, or hire a team to help do that. But this is a diversification plan it’s a real estate play where they want to buy the land and then you have a laundromat on top of it.

01;26;49;21 – 01;27;05;25
Alex
We’re getting a lot of people interested in franchising for that reason because they don’t want to spend the time learning the laundromat industry up front. You know, I guess for like until they made the decision, they know that they’re going to learn it over that first year of running it and that we can help accelerate that speed to which they feel comfortable running their own store.

01;27;05;25 – 01;27;08;17
Alex
Then it might be all the trial and error that they did on their own.

01;27;08;17 – 01;27;09;21
Alex
We we talked about that.

01;27;09;21 – 01;27;13;09
Alex
Theme throughout this podcast of all this iteration and trial and error.

01;27;13;23 – 01;27;14;05
Alex
Know we get.

01;27;14;05 – 01;27;34;07
Alex
To do it. Those franchise owners did in those four or 5 hours of phone calls we get to do each of our franchisees avoid years of mistakes and learning. Hopefully in the course of, you know, a couple of weeks of training, we’re going to put them through and then constantly being a resource for them as questions come up. So that’s one person and the other is the kind of sophisticated investor that’s looking at this in a very big way.

01;27;34;07 – 01;27;49;05
Alex
They want to be the next Williford brothers. They want to be like the clean laundry is out of the northeast where they own, you know, three to five to start and then do another ten to 15 and really have 15 to 20 laundromats and a whole system. And so that that.

01;27;49;06 – 01;27;49;25
Alex
System.

01;27;50;22 – 01;28;07;12
Alex
Thinker is another persona. And then the last one is anyone that wants to pick up on delivery volume, they’re realizing that that revenue that we bring far surpasses the royalty that they’re going to pay us over the course of ten years is three to five X in the pickup in delivery volume that they’re going to be getting from us.

01;28;07;12 – 01;28;10;20
Alex
And also the preferential pricing that we’re getting and whatnot.

01;28;11;01 – 01;28;12;02
Alex
Makes up for.

01;28;13;19 – 01;28;25;20
Alex
The franchise royalties. And so long winded answer, but I think it depends on the persona and the intention of the person coming in, what are their motivations or their goals. And I think there’s a lot of people that their goals align exactly with what we’re offering those others that.

01;28;25;26 – 01;28;26;20
Alex
The goals don’t.

01;28;27;04 – 01;28;34;19
Alex
And so depending on which category you fall into, a distributor can be a great option. I mean, we work closely with all the distributors for our franchisees.

01;28;35;25 – 01;28;36;04
Alex
And.

01;28;36;07 – 01;28;47;15
Alex
Kind of are both there holding their hand and agree and might disagree on certain things as it comes to that point as well. The last thing I’ll say is, you know, distributors as much knowledge as they have.

01;28;48;03 – 01;28;48;14
Alex
You know.

01;28;48;14 – 01;29;07;28
Alex
They’re incentivized in a big way to sell equipment. Right. And so they’re trying to move equipment. Whereas if you think about our incentives, we can’t be done once the equipment’s installed, we we have to make sure that Jordan stores are successful. This we understand the investment that you’re putting into this. And if Jordan’s launch lab fails, he’s not going to open a second one that he bought or his third one.

01;29;07;28 – 01;29;11;20
Alex
And he’s also going to tell the next ten people that ask them, hey, what was your experience like with landlords?

01;29;11;29 – 01;29;12;17
Alex
Hey, these guys.

01;29;12;17 – 01;29;17;01
Alex
Said they’re going to do X, Y, and Z with an investment tank. And it was a work. I never would have done it.

01;29;17;01 – 01;29;18;14
Alex
And I would you know.

01;29;18;26 – 01;29;29;00
Alex
It’s going to create a terrible brand experience and reputation for us. So again, our incentives and motivations are more aligned with the end laundromat owner than I think your typical.

01;29;29;00 – 01;29;30;03
Alex
Distributors as well.

01;29;30;26 – 01;29;56;15
Jordan
Yeah, and I see that aligned interest piece. I mean, that’s kind of been one of the themes that’s come up, you know, throughout. Also and I just had a really great question. I really should have written it down was like rails like so good man. OK, oh yeah. OK, well, let me I want to make sure I’m understanding this correctly and a probably not so just correct me and set the record straight here.

01;29;56;15 – 01;30;22;19
Jordan
So if I come to you and I want to do you know, I want to franchise. So, you know, I go through the whole process, discovery day, all that stuff and like, yes, I’m in a buy one to ten, whatever and what am I getting at my buying a self-serve laundromat. And then you guys own the pickup in delivery, but you’re running it through my self-serve laundromat and and paying as if it’s a drop off laundry.

01;30;22;19 – 01;30;24;23
Jordan
Is that is that the models that basically how it works?

01;30;25;02 – 01;30;26;03
Alex
That’s the gist of it.

01;30;26;03 – 01;30;31;17
Alex
So you’re basically buying into the free launch lab the franchise like a McDonald’s franchisee would bind a McDonald’s.

01;30;31;17 – 01;30;33;15
Alex
So you’re getting all right. You’ll help with.

01;30;33;15 – 01;30;41;12
Alex
Site selection, machine mix discounts on equipment, staffing, training, ongoing maintenance programs and support.

01;30;41;12 – 01;30;41;24
Alex
There.

01;30;42;18 – 01;30;47;25
Alex
The right to those territories in the market that you’re you’re getting. But then on an ongoing basis on the to you side, the.

01;30;47;25 – 01;30;50;12
Alex
Value is think of to you is.

01;30;50;12 – 01;30;54;27
Alex
What DoorDash or Postmates does to any restaurant. Right. The restaurant doesn’t have to go.

01;30;55;06 – 01;30;56;13
Alex
Buy a bunch of vehicles.

01;30;56;23 – 01;31;04;28
Alex
The restaurant does have to maintain and manage a bunch of vehicles or drivers, even the restaurant when that customer complains now my food was wrong or it.

01;31;05;25 – 01;31;08;00
Alex
Didn’t show up or it was called DoorDash.

01;31;08;00 – 01;31;10;12
Alex
Is taking those calls and routing and solving.

01;31;10;13 – 01;31;10;21
Alex
You know.

01;31;10;24 – 01;31;22;29
Alex
Their customers issues not the restaurant having a man, you know a bunch of phones and solve all that stuff. And then lastly, that restaurant enough to build all that technology to do it. So think of what to you or what DoorDash and Postmates is to a restaurant.

01;31;23;06 – 01;31;24;08
Alex
Is what to you.

01;31;24;08 – 01;31;35;17
Alex
Is to launch a lot of franchisees. The franchisee runs a retail laundromat, which we all know can be a really good business in and of itself. Just a laundromat can be highly cash flow, positive.

01;31;35;25 – 01;31;36;13
Alex
Machine.

01;31;37;27 – 01;31;57;11
Alex
But then you bolt on this this whole other revenue stream to basically double and not to double your revenue from a customer base. I would never step foot in a laundromat that’s being logistically handled by someone that you trust and or close with on the two side. Those customers are being acquired without marketing dollars that you even have to think about as a franchisee.

01;31;57;22 – 01;32;16;26
Alex
And when those customers have issues, again, that support team is the cost is covered by this other company, not you for you as the franchisee. You’re just going to clean it, clean the street and fold it just like you would if someone walked in with a bag of laundry off the street and said, Hey, Jordan, I want to drop this off at number one, clean laundry and.

01;32;17;14 – 01;32;19;19
Alex
I want you to clean it.

01;32;20;20 – 01;32;22;18
Alex
Same idea. We’re just bringing a lot more volume.

01;32;23;05 – 01;32;46;06
Jordan
Yeah, what’s what I like about that, which is kind of interesting. So, like, I’ve had I’ve had critique criticisms of I mean, I’ve criticized Laundromat franchises before and I and I do I still have, you know, criticism of certain models of Laundromat franchise. And, you know, my one of my main criticisms is like, hey, what do you what do you actually get?

01;32;46;06 – 01;33;06;16
Jordan
And nobody’s going to, you know, ex laundromat because they’ve heard of X Laundromat in their city and they’re traveling or they moved or whatever. And it’s the same thing they know they’re going to get. It’s not McDonald’s. Right. And and I still think that criticism holds up for now. I don’t know that it always hold up, but for now, I think it holds up.

01;33;06;26 – 01;33;35;00
Jordan
However, what I what I’m intrigued by in your model is that is that extra I mean, and I’ve said this a lot on the podcast in the past is when you add pickup in delivery number one, it could be super lucrative for you. So if you want to go that route, go that route, however, you’re utilizing assets that you already have to start a new business, basically it’s related, it’s tangentially related, but it’s a logistics business.

01;33;35;00 – 01;33;58;05
Jordan
You’re now, you know, managing drivers. You’ve got vehicles you’ve got to manage and you’re, you know, it’s it’s a it’s a different business that you’re utilizing the same assets which can make it super powerful if you want to go that route. But it is adding a whole new level of of business onto your complexity. Yeah, complexity. Thank you for being.

01;33;58;06 – 01;33;58;17
Jordan
Well, that.

01;33;58;17 – 01;34;01;02
Alex
Was the thought, too. Like when we were when we were looking.

01;34;01;02 – 01;34;02;23
Alex
At what we were doing is like we’re running a retail.

01;34;02;23 – 01;34;03;12
Alex
Laundromat.

01;34;03;27 – 01;34;06;16
Alex
Coin laundromat, and then we’re processing our own volume there, which like.

01;34;06;23 – 01;34;07;02
Alex
That.

01;34;07;02 – 01;34;17;15
Alex
On itself is, is challenging. But then you throw in a whole fleet of vehicles and that’s why we wanted to split the two out as if we franchise the whole concept, you know, basically said, Hey, Jordan, we’ll get you stood up. And I’m trying to think.

01;34;17;15 – 01;34;17;21
Alex
Of.

01;34;18;25 – 01;34;27;26
Alex
If there’s anyone else out there like this, it’d be like merging wave max with happiness or a wave max with it’d be like those two combined and then try to package it up to you.

01;34;28;06 – 01;34;28;25
Alex
Felt way.

01;34;28;25 – 01;34;33;23
Alex
Too complicated because now you’re trying to manage hundreds of thousands of dollars worth of equipment.

01;34;34;00 – 01;34;34;14
Alex
On the.

01;34;34;23 – 01;34;36;07
Alex
Laundromat side, but they’re also having.

01;34;36;21 – 01;34;37;11
Alex
You know, 20.

01;34;37;11 – 01;34;41;09
Alex
Thousand dollar vehicles. You maybe, you know, five of those drivers, it’s.

01;34;41;09 – 01;34;42;22
Alex
Just too much here.

01;34;43;01 – 01;34;45;05
Jordan
Where are you getting $20,000 vehicles?

01;34;45;20 – 01;34;47;25
Alex
Oh good. Yeah. Now, yeah, right now.

01;34;48;28 – 01;34;52;23
Jordan
If you can even find them, it’s crazy. All right, guys. So that whole.

01;34;52;23 – 01;34;53;24
Alex
Other, that whole.

01;34;53;24 – 01;34;58;07
Alex
Category, you’re not running a whole other business. Our thought was how do we keep this as simple as possible and really just keep.

01;34;58;07 – 01;34;59;21
Alex
Like just like we do with the dry.

01;34;59;21 – 01;35;02;24
Alex
Cleaners. They’re really good operators. They understand throughput.

01;35;02;24 – 01;35;03;00
Alex
And.

01;35;03;10 – 01;35;15;27
Alex
And moving in quality controls, and they’re really good at that. And so our thought was, can we create basically a supply chain that thinks like the dry cleaner of today does in the laundry industry, where traditionally or predominantly.

01;35;16;09 – 01;35;16;16
Alex
It’s a.

01;35;16;16 – 01;35;30;01
Alex
Lot of legacy family owned businesses that are used to doing things the way that they’ve always done them for the past few decades. And so trying to bring a level of operational rigor in because the model that we’re needing from our partners.

01;35;30;13 – 01;35;31;02
Alex
Is that of.

01;35;31;02 – 01;35;36;00
Alex
The dry cleaning wholesaler, not of your, you know, your typical mom and pop coin laundry.

01;35;36;00 – 01;35;37;21
Alex
They’re just like you said, it’s two.

01;35;37;21 – 01;35;41;04
Alex
Completely different businesses you just happen to be using the same asset base.

01;35;42;16 – 01;36;06;20
Jordan
Yeah. So and I like that. I mean, I think that there is value in that in the same way or actually probably even in a better way than you were bringing value to those early laundromats when you’re bringing service because now you’re also supporting them on the the self-serve kind of wash dry fold side of things too, because they’re your franchisee and you need them to succeed and you’re providing that level of support.

01;36;06;20 – 01;36;41;06
Jordan
So I know I’m intrigued by that model. I think that that model makes a lot more sense to me than just a strictly self-serve franchise. Model, which, again, I, you know, to each their own. And I think, you know, that there is value in certain circumstances even for that. But I I’m more intrigued by what you’re doing and in the value that you’re creating for your franchisees by literally bringing them customers that they don’t have to go out and find themselves.

01;36;41;10 – 01;37;05;12
Jordan
They just have to process laundry. Super simple. OK, so that’s your that’s your sort of franchise model. I like that. Thank you for clarifying that for me because, you know, I wanted to make sure I was clear and everybody else is clear on what exactly you’re getting with that franchise model. Where are you guys at now? I mean, like, what locations are you are you guys represented in?

01;37;06;08 – 01;37;07;08
Alex
Yeah. So we’ve got.

01;37;07;08 – 01;37;08;27
Alex
Two corporate stores in Charlotte.

01;37;09;11 – 01;37;16;27
Alex
And then we’re opening stores in this year. It’ll be Tampa, Atlanta, Charlotte.

01;37;17;06 – 01;37;18;00
Alex
Charleston.

01;37;18;15 – 01;37;19;11
Alex
Phenix.

01;37;20;01 – 01;37;22;29
Alex
Denver, San Antonio, Austin.

01;37;23;23 – 01;37;24;16
Alex
Dallas.

01;37;27;04 – 01;37;32;11
Alex
Miami, Tampa, Burlington, Vermont.

01;37;32;25 – 01;37;36;22
Alex
Detroit, Raleigh.

01;37;39;27 – 01;37;40;20
Alex
And Philly.

01;37;42;29 – 01;37;52;21
Jordan
That’s a lot of places I’ve got to I’ve got to take some issue with you right now, though, because I do not hear any West Coast representation in.

01;37;53;01 – 01;37;55;01
Alex
LA, so we purposely avoided.

01;37;55;01 – 01;37;55;21
Alex
California.

01;37;55;23 – 01;37;56;17
Jordan
Oh, my.

01;37;58;18 – 01;38;00;15
Alex
And New York just because the.

01;38;00;25 – 01;38;04;09
Alex
The and not from a laundry perspective, maybe a little bit of laundry perspective to.

01;38;04;09 – 01;38;05;27
Alex
But the franchise.

01;38;06;07 – 01;38;10;22
Alex
Regulations and kind of just hurdles is so much more stringent in California, in New.

01;38;10;22 – 01;38;11;25
Alex
York and so.

01;38;11;25 – 01;38;19;19
Alex
Similar our approach of let’s go after the secondary tertiary cities first kind of feel that way about California in New York because there’s so much more country and.

01;38;20;00 – 01;38;20;14
Alex
Cities.

01;38;20;14 – 01;38;23;09
Alex
To go into. Let’s focus on on those first and then.

01;38;23;09 – 01;38;25;17
Alex
We’ll all eventually be there.

01;38;26;08 – 01;38;56;07
Jordan
Yeah well we we both New York and California and we like to make things difficult on our business owners around here. So don’t make it easy. And there’s a whole lot of fingers in your pockets when you’re over here. So yeah, so I don’t blame you there, but I mean I like again, I like the going after the secondary tertiary markets kind of the, the forgotten low hanging fruit actually where I think a lot of people see the low hanging fruit being in these super populated, dense locations.

01;38;56;07 – 01;39;01;11
Jordan
But there’s a lot of other obstacles and competition gets steeper when you’re in.

01;39;01;13 – 01;39;03;18
Alex
Everything’s more expensive and more.

01;39;03;24 – 01;39;24;00
Jordan
Yeah, absolutely. And we were just talking before we hit the record button about how much like fast food workers in Stouffer are being offered jobs for right now. So it’s. Yeah, absolutely. OK, so you guys are all over the place. I love that. Do you guys have any big goals for 22? What is it, 20, 22.

01;39;24;25 – 01;39;29;22
Alex
Yeah. So we really want to get these first our goals of 12 of those.

01;39;29;22 – 01;39;33;16
Alex
Stores this year or two of them are opening next two months in.

01;39;33;16 – 01;39;33;28
Alex
June.

01;39;35;15 – 01;39;40;04
Alex
So we’re continuing to build out the team around supporting our.

01;39;40;04 – 01;39;42;05
Alex
Franchisees then scaling.

01;39;42;05 – 01;39;43;15
Alex
To U behind. So we have a.

01;39;43;15 – 01;39;44;22
Alex
Still a decent.

01;39;44;22 – 01;40;07;09
Alex
Level of complexity in our business to support the franchisees the way that we want to to provide that five star experience for them but also the to new customer base that’s coming behind acquiring that selling of vehicles. So we are actually gearing up to raise another ten to $15 million capital round to hire those those resources can do to make those investments.

01;40;07;09 – 01;40;08;11
Alex
To really.

01;40;08;11 – 01;40;12;29
Alex
Deliver on the commitment we’re making to our franchisees and customers beyond.

01;40;14;02 – 01;40;24;24
Jordan
Awesome awesome. What’s a real quick what’s the lead time on if I come to you today slept on my 49 grand that’s my what’s my lead time looking like.

01;40;25;06 – 01;40;27;25
Alex
Yeah so it varies.

01;40;27;25 – 01;40;49;22
Alex
Depending on the market right now but 12 months is what we’re shooting for and that’s everything from site selection to our offering. Our allies are at least negotiations design and construction permitting with the local municipalities grand opening or pre marketing leading up to grand opening. What we’re finding the biggest hurdle is right now is.

01;40;49;22 – 01;40;50;08
Alex
Is.

01;40;50;08 – 01;40;53;17
Alex
Site selection. This is all very picky about.

01;40;53;29 – 01;40;54;04
Alex
You.

01;40;54;04 – 01;40;58;22
Alex
Know once you put all this equipment in your location, you can’t move it. And so we’re probably more rigorous.

01;40;58;22 – 01;40;59;07
Alex
Than we.

01;41;00;06 – 01;41;11;08
Alex
Will need to be over time as we get more and more data to support kind of our thoughts on what makes up a good laundromat location. You know, a ton of data has already been poured into it, but I think until.

01;41;12;10 – 01;41;12;26
Alex
You have.

01;41;12;26 – 01;41;20;27
Alex
The scale of like a laundry capital, those are got 80 plus laundromats. It’s it’s hard to get really good data anonymous because it’s so fragmented.

01;41;21;23 – 01;41;57;29
Jordan
Yeah. Yeah I’ve been harping on that for a while, but I think there’s more and more data coming coming our way. So awesome. OK, so I want to pinpoint right now if somebody is like, man, I might be interested in franchising or even just buying their first laundromat. But franchising in particular, do you have this is the segments called Pro Tips, by the way, do you have any advice for maybe that newbie who’s looking to get into the business, maybe through the franchise model, what what they should be doing first or what they should be doing now?

01;41;58;27 – 01;42;00;09
Alex
Yes, I’m going to cut.

01;42;00;10 – 01;42;14;26
Alex
You two answers. One, from the franchise perspective, you’re just interested in franchising in general, whether it’s a laundromat or a gym concept. I think using the brokers is it’s helpful. It doesn’t cost you anything. Those brokers make money. If you buy licenses from the franchisor.

01;42;15;10 – 01;42;15;29
Alex
You have to pay that.

01;42;15;29 – 01;42;27;06
Alex
Fee that 49 K any way. Whether you came through a broker or not, the brand is just going out to then turn around and cut a check to that broker. So for you as an individual, it’s free exploration. You got a resource that’s going to listen to you.

01;42;27;19 – 01;42;29;13
Alex
The thing to look out for, you know.

01;42;29;15 – 01;42;49;00
Alex
In that category is that brokers are typically going to push brands that are in their network. So there might be a hundred concepts out there, but they might only show you 20. And so just being aware of that as you get into franchising, as do some of your own research on the side, as far as brands that you like that a broker might not be exposing to you or showing you, but they’re a great resource to help.

01;42;49;10 – 01;42;49;13
Alex
You.

01;42;49;18 – 01;43;06;16
Alex
Hold your hand through that kind of franchise discovery process. And if it’s laundry, you know, in particular the tip to get into the space is the same thing that you have to do a ton of research, go into stores, go to the top rated stores in your market, go into the lowest rated stores in your market and see the differences and how they’re run and treated.

01;43;07;01 – 01;43;18;04
Alex
But then I’d say go through a discovery day with a Laundromat franchise, go through our Discovery Day, go through way that Discovery Day, especially if you if you qualify, if you go all the way through.

01;43;18;14 – 01;43;20;02
Alex
You’re going to get a ton.

01;43;20;02 – 01;43;30;09
Alex
Of time spent by the brand educating you on the space, the economic model of of the business. And then you’re going to get a mostly all expenses.

01;43;30;20 – 01;43;31;03
Alex
Paid.

01;43;31;03 – 01;44;00;23
Alex
Trip into the home market of that brand because they want you to come in person. And so to me, it’s a good way to want to do a ton of research. But also you might find that you like the franchise model and you want to do it. And if you don’t, you at least learn that while you were there and learned about laundromats in a very kind of classroom type setting, very structured, lots of different point of views and topics covered everything from site selection to machine mix to marketing to grand opening to technology.

01;44;00;23 – 01;44;02;03
Alex
I mean, you’re going to get a crash course.

01;44;02;03 – 01;44;02;11
Alex
On.

01;44;02;27 – 01;44;04;17
Alex
All those things. And again, it’s in a.

01;44;05;26 – 01;44;06;02
Alex
Pretty.

01;44;06;02 – 01;44;10;03
Alex
Unique setting outside of just perusing online or in forums.

01;44;10;03 – 01;44;11;07
Alex
And whatnot.

01;44;12;06 – 01;44;37;19
Jordan
Yeah, awesome protests. Love that. Hey, I mean, franchise broker, I mean, like you mentioned though, you know, just I was mention, you know, keep in mind that brokers get paid when they sell you something. So I’m I’m a broker here in California. So I feel like I can say that about our time you know, they’re going to invest time with you, but, you know, just keep that in mind.

01;44;37;19 – 01;44;48;25
Jordan
So awesome. Awesome. Protests are another segment of the podcast called Recommended Resources. Do you have any resources you recommend to help people either grow personally or grow their businesses?

01;44;50;17 – 01;44;52;21
Alex
It’s a good question. Any resources.

01;44;55;08 – 01;44;58;08
Alex
One of the things that and this is just a reading, I guess I do, but like.

01;44;59;04 – 01;45;00;11
Alex
Subscribing to like term.

01;45;00;11 – 01;45;01;00
Alex
Sheet.

01;45;01;00 – 01;45;13;27
Alex
And the hustle and these kind of various email newsletters about business. Like it’s amazing how much you can learn from reading, you know, short snippets or stories on strategies that other categories are doing that.

01;45;14;08 – 01;45;15;09
Alex
Apply to you. I mean.

01;45;15;16 – 01;45;28;02
Alex
There’s one about how Subway was talking about the $5 footlong and although that campaign was crushing it for Subway as a brand, the franchisees were losing tons of money. And so although they were not selling sandwiches like that was a learning lesson that I got.

01;45;28;15 – 01;45;29;20
Alex
This was well before we were.

01;45;30;03 – 01;45;41;13
Alex
Thinking about franchising. I just remember the story because it was interesting in that newsletter, but now I can recall that article I read and use it for, Hey, let’s not, let’s not have our $5 footlong equivalent for our lounge allowed franchisees.

01;45;41;13 – 01;45;44;19
Alex
So are just these like very short, quick.

01;45;44;19 – 01;45;58;21
Alex
Digestible newsletters that are business strategy oriented. So I can term sheet was one of them and then the hustle is another one that I really like that has those kind of engaging interesting stories that helped me think strategically regardless of the category business.

01;46;00;14 – 01;46;38;09
Jordan
Yeah, I like that and I think I feel like we don’t get enough of that recommendation and recommend a resources segment, but like looking outside of our industry and looking for principles to apply, you know, and while maybe the $5 footlong may not apply to a single mom and pop laundromat owner, there’s other stories in other contexts where and I do this all the time, I pull in stuff all the time from other, you know, YouTubers or, you know, who are doing business different ways or blogs or newsletters or, you know, these kinds of things where you’re doing basically case studies and, and pulling in principles that you can apply in in the context of

01;46;38;09 – 01;46;41;02
Jordan
your business. So I love that great.

01;46;41;05 – 01;46;43;03
Alex
Well, I think something I’m sure like this gets.

01;46;43;03 – 01;47;01;21
Alex
Said a lot. But again, the network and the network and again, like my mom had always said to me and my brothers, grandma’s like, you don’t ask you don’t get. And I had a professor at work said something very similar. It was like reach out thoughtfully to people that you aspire to be or to learn from. And you’ll be surprised just how willing there are to spend their time with you.

01;47;02;09 – 01;47;03;21
Alex
And so go look at what.

01;47;03;21 – 01;47;14;10
Alex
You believe are the best laundromats in the country. You know, they’ve got, you know, 1005 star reviews. I bet if you thoughtfully reach out to that owner and say, hey, I’m a laundromat owner across the country.

01;47;15;03 – 01;47;18;13
Alex
You’re a huge fan of what you’re doing, would be I would love to buy you.

01;47;19;01 – 01;47;23;29
Alex
I’ll send you a Venmo for a coffee or I’d love to just pick your brain for 30 minutes over a video call and.

01;47;23;29 – 01;47;27;01
Alex
I guarantee you they’ll do it. And so I just.

01;47;27;05 – 01;47;45;01
Alex
Whatever it is ask out thoughtfully whether it’s in industry or out of industry. Again, there’s a lot to learn from those adjacent businesses. And maybe it’s a carwash operator in your market that’s just a powerhouse, great operator. Everyone loves that location. I’m sure a lot of what they’re doing can be applied to your single Laundromat store.

01;47;45;29 – 01;48;03;01
Jordan
Killer, killer advice. I love that and I love that the word thoughtfully, thoughtfully reach out. You know, I get unsolicited stuff all the time. You know, for me, I’m sure you do, too. And, you know, if you get the same kind of thing over and over and over and it really doesn’t provide any value, you’re less likely to respond to it.

01;48;03;24 – 01;48;32;24
Jordan
So be thoughtful in the way that you reach out to people. And especially, you know, the bigger they are, the more successful they are, the more thoughtful you should be. And yeah, so awesome. Awesome. Last question I have for you is if anybody’s interested in learning more about the franchise or maybe they just want to connect with you because you have a lot of great experience, you know, in this industry and they want to hear about how you grew your pickup delivery or they want to hear about how you killed it on your self-serve laundry that you guys opened or whatever the case may be.

01;48;32;24 – 01;48;41;26
Jordan
What’s the best way they can a learn about franchising through laundry lab and B connect with you if you have questions?

01;48;42;17 – 01;48;43;09
Alex
Yep. So anything.

01;48;43;09 – 01;48;49;05
Alex
On the franchise side, you can go to Laundry Lab USA dot com and that’s Landro.

01;48;49;10 – 01;48;50;23
Alex
Like laundromat only.

01;48;50;23 – 01;48;52;12
Alex
Lab instead of Mat USA.

01;48;52;12 – 01;48;54;20
Alex
Ecom. And then if people have.

01;48;54;20 – 01;49;06;29
Alex
Questions about anything honestly and I’ve we’ve only gotten to the point where we’ve gotten and we’re still going and continuing to learn is by reaching out thoughtlessly to other people. And so I’ve always been quick to return that favorite other people.

01;49;07;02 – 01;49;09;08
Alex
Who are whatever.

01;49;09;08 – 01;49;18;09
Alex
Stage you’re in. If you think that I have something of value to add to, I want to provide it, I want to add it. And so you can email me at Alex at laundry lab U.S.A..

01;49;19;03 – 01;49;19;20
Alex
Or.

01;49;19;20 – 01;49;25;13
Alex
Honestly, text call is fine as well. My cell phone 65176.

01;49;25;13 – 01;49;26;03
Alex
Four.

01;49;26;11 – 01;49;32;20
Alex
0342. Again happy to have you just give that time and help in any way that I can.

01;49;33;02 – 01;49;43;12
Jordan
Oh man. You are a glutton for punishment putting your phone number out there and I think you realize the millions of people listening to this right now, you’re going to get bombarded with texts.

01;49;45;02 – 01;49;45;15
Alex
And if I don’t.

01;49;45;24 – 01;49;50;09
Alex
If I respond the first time follow up because I again, it’s not because I don’t want to talk to you, because it’s because.

01;49;50;09 – 01;49;58;11
Jordan
There’s millions of people millions. This is awesome.

01;49;58;11 – 01;50;00;07
Alex
Our thing. Billions of people.

01;50;00;07 – 01;50;17;20
Jordan
1 million. Yeah. This is awesome, dude. I appreciate you coming on and sharing your story, which was super fascinating to me. I think a lot of people will be fascinated by that, but also coming in and talking, you know, just frankly about franchising and what that looks like and the pros and the cons and all that stuff. That’s awesome.

01;50;17;20 – 01;50;41;22
Jordan
And you know, to if you have questions about franchising or maybe you’ve heard, you know, critiques about franchising or you’re not sure about something, one of the things I love about Alex is that he is willing to field those questions even if they seem counter to, you know, what he’s trying to do. He’s, you know, a thoughtful guy and will be able to have those conversations.

01;50;41;22 – 01;50;44;09
Jordan
So, man, appreciate you thanks so much for coming on, dude.

01;50;44;26 – 01;50;45;22
Alex
Yeah, thanks for having me.

01;50;45;22 – 01;50;49;14
Alex
I really enjoyed the conversation and what you’re doing and not just for.

01;50;50;10 – 01;50;50;22
Alex
The last.

01;50;50;22 – 01;50;52;20
Alex
2 hours, but what you’ve been doing the last few years.

01;50;52;20 – 01;50;53;03
Alex
Building.

01;50;53;18 – 01;51;00;07
Alex
The Laundromat resource and what you’ve done. A huge, huge kudos to you as well. And thank you for you taking your time with me as well.

01;51;00;20 – 01;51;07;17
Jordan
Oh, absolutely. Appreciate that. A lot of fun for me, so it works out nicely. All right, man. Looking forward to connecting again.

01;51;08;03 – 01;51;08;26
Alex
Yep. Yeah.

01;51;10;00 – 01;51;35;07
Jordan
All right. What a super cool episode with Alex. Man. Huge. Thank you to Alex both for being on the podcast and also for doing this webinar that’s coming up. Make sure you join us again. That is May 26 that’s a Thursday. You can sign up at lot of my resource dot com slash events there for that and get pumped about it because it’s good bring your questions and he’ll he’ll be there to answer them for you.

01;51;35;08 – 01;51;59;12
Jordan
All right so very cool. My one big takeaway every week I want you to take something away from the episode put it into action members the action that gets us to success. So pick an action maybe go shared on the forums a lot about resources dot com slash forums get that accountability go in there but also my one takeaway I’d like to share that with you is a couple of different things.

01;51;59;12 – 01;52;19;24
Jordan
Number one, I kind of like just perspective on the franchise model versus relying on distributors. I thought there are some good points in there. That’s not really an action item for me, but I thought it was a good perspective to have the other one that I loved was when you were sharing about how to grow your pickup and delivery business.

01;52;19;24 – 01;52;55;22
Jordan
His point number five was finding one to many relationships, right? One to many relationships. You gave examples of, you know, trying to, you know, talk to apartments, different associate homeowners associations, registries, property managers looking for, you know, when you make a sale, you don’t just, you know, you don’t just make one sale. You make many sales. Right. And if you can get, you know, pick a delivery from one apartment complex, you know, from a property manager, whatever, maybe you can get like five or six or ten or 15 or 20 orders at one go.

01;52;55;22 – 01;53;15;20
Jordan
And I loved that. So I’m going to apply that both to my laundromat businesses. And also all the other things that I’m working on because I love that concept, the one to many relationships. All right. What is your big takeaway that you’re going to take action on I want to hear about it. Go to the forums and share it over there or, you know, shoot me an email.

01;53;15;20 – 01;53;32;14
Jordan
I’d love to hear your takeaway. Put in the subject line. Big takeaway and, you know, put into action this week. All right. That’s what’s going to take you to success. And that’s what we’re all about, finding financial freedom through laundromat ownership. Let’s do it this week and we’ll see you next week. Piece.

00;00;00;01 – 00;00;21;26
Jordan
Hey. Hey. What’s up, guys? It’s Jordan with the Laundromat Resource Podcast. And as always, I am pumped to be here with you today because today we have on just a solid dude, Alex Merzenich, with a kind of laugh when I say his name, because his name looks really difficult to say when you see it spelled out, but not that hard to say when you know how to say it.

00;00;22;00 – 00;00;41;26
Jordan
But anyways, good, dude. And we’re going to talk about a couple of things. Number one, we’re going to we’re going to talk a lot about franchises. What they’re all about. How do they work? We talk about specific numbers, how much does it cost? And actually, I ask him specific questions that a lot of you guys have a lot of questions that I had.

00;00;41;26 – 00;01;00;27
Jordan
And I don’t pull any punches like, hey, what’s what’s the value of having a laundromat? A lot of people say there’s not a value in it. So and Alex is is awesome. You roll with the punches and and answers thoughtfully. A lot of these questions. So ask him a bunch of those questions. So we’re going to talk about that in the episode today.

00;01;00;27 – 00;01;29;14
Jordan
But also, Alex built a a a laundromat service business in college that boomed and he’s gotten into the laundromat business. And obviously he’s got a franchise now and sees a lot of what it takes to succeed in this industry. So yes, we’re talking about Laundromat franchise, but also we talk about a lot of things that it takes to succeed in this business, whether you’re doing a franchise or not.

00;01;29;14 – 00;01;50;21
Jordan
And, you know, he’d be the first one to tell you franchising is not for everybody. However, if you’re going to franchise laundromats, you better know what it takes to succeed. In this business because a franchisor needs its franchisees to succeed, to stay alive. So we talk about, hey, what does it take to succeed so a lot of really good information here.

00;01;50;21 – 00;02;19;24
Jordan
I know you’re going to love it. And in fact, if this is something that you’ve been thinking about or you have questions about Laundromat franchising or you’re thinking about maybe doing a a laundromat franchise, Alex and I are doing a live free live kind of half webinar, half Q&A this coming Thursday, which is May 26, 20, 22 and everybody’s welcome to join us for that.

00;02;19;24 – 00;02;43;05
Jordan
If you’re listening to this after the fact, this webinar as well as every other webinar that we do is available replay with the pro community over there a lot of our resource dot com slash pro so go check that out if you want access to this webinar and any other ones. But also you can just reach out to Alex and he leaves his contact information.

00;02;43;05 – 00;03;06;01
Jordan
It’s down in the show notes which is that a lot of my resource dot com slash show 95 and if you’re on YouTube down below in the description OK enough of that I want to do real quick fast lane tip fast lane is just a way that a tool a resource something that we have at a lot of my resources dot com can put you on the fast lane towards success.

00;03;06;01 – 00;03;28;00
Jordan
So today I just wanted to mention that we have a both for the free community and obviously the pro community as well has access to this a sample pro forma spreadsheet that you can download and play around with. And it’s good for a couple of different things. Number one, it’s good to help you sort of do preliminary evaluations on a laundromat.

00;03;28;08 – 00;03;43;26
Jordan
You know, if I if I buy a laundromat or I see a certain laundromat I can put in how many of each type of machines, how much they cost, and I can play around with, OK, you know, how much money what I bring in at two turn today, three turns a day, four turns a day. If I’m killing it, I’m doing 15 turns a day.

00;03;44;05 – 00;04;16;02
Jordan
You know, how much could I make right and so that sample pro forma is obviously good for that. But another thing that I always mention, there’s a lot of actually kind of interesting usage for a pro forma nothing that I kind of mentioned in some of the webinars that I do on buying and analyzing a lot of that is you can use those pro forma expense line items in your evaluation of a laundromat to make sure that you are not missing any of the big common expenses because I’ve seen that happen before.

00;04;16;02 – 00;04;46;15
Jordan
And it, it makes you overpay for a laundromat, so you don’t want to miss expenses. And sometimes sellers either on purpose or inadvertently omit expenses. And this just helps you make sure you’re keeping track of all of the big expenses. That’s a good use for the pro forma. There are two also, you can use the pro form if you’re looking to upgrade equipment you can put in new equipment mixes, new pricing and maybe increase the terms per day a little bit to see how much money you’d be bringing in to see if it’s worth it for you.

00;04;46;27 – 00;05;09;00
Jordan
To, you know, to to put in a new client. So lots of different uses there. Again, that’s available for free for both free community members and also the pro community has access to it also. So go check that out. All you got to do is log in and then go either up to the member resources or go up to the pro resources tab in the menu after you’re logged in.

00;05;09;21 – 00;05;21;08
Jordan
All right. Hope you guys find that useful. And I know you’re going to find this podcast episode useful. So let’s jump into it with Alex right now. Alex, how’s it going, man? Thanks for coming on the show.

00;05;21;22 – 00;05;22;24
Alex
Good things are great.

00;05;23;04 – 00;05;26;12
Alex
Appreciate you having me on. And look forward to digging in.

00;05;27;11 – 00;05;50;20
Jordan
Yeah. Oh, me too. You know what’s interesting about this interview? I’m trying to think this might be the first time this has happened, but I’ve actually met you in person before. You’ve come on the podcast. I think maybe everybody else I’ve had on the podcast, I had them on and then, you know, some of them I met in person either because they live local or at the Laundromat Millionaire conference where we got to hang out.

00;05;51;25 – 00;05;55;20
Alex
Yeah, it was kind of the inverse for me. I feel like I had heard a couple dozen.

00;05;55;20 – 00;06;08;26
Alex
People say, You got to talk to Jared, you got to talk to Jordan. I figured we would have had a phone call or something at some point, but instead it was the first time meeting was I think we’re getting lunch on the roof actually at the conference. And if you popped into the seat next to me and we started chatting.

00;06;08;26 – 00;06;10;09
Alex
About you.

00;06;10;09 – 00;06;17;06
Alex
And Laundromat resource and seeing the show, the conference and it’s kind of funny how backwards order of.

00;06;17;07 – 00;06;17;23
Alex
Doing things.

00;06;18;06 – 00;06;39;29
Jordan
Yeah, that is funny. That is funny. Well, hey, man, super cool that we finally got to connect on the podcast you way. Even more important than in person for sure. But hey, I am super intrigued by what you do. I think a lot of people are going to be super interested in what you’re doing, how you’re doing it, and we want to get into all of that and all the details we can get into.

00;06;39;29 – 00;07;00;20
Jordan
And, you know, what I’m really excited about is just through chatting with you at the conference and you know, since the conference you chatted a couple of times that you are just down to earth, dude, that is open, transparent and good. So this is going to be awesome. But before we get into kind of what you’re doing, how you’re doing it, what it all looks like, tell us a little bit about you and your background.

00;07;01;23 – 00;07;05;13
Alex
Yeah, so I I’m from Minnesota originally sitting.

00;07;05;13 – 00;07;06;27
Alex
In Charlotte, North Carolina though.

00;07;06;28 – 00;07;10;17
Alex
Today, and how I ended up getting from.

00;07;10;17 – 00;07;12;27
Alex
Minnesota to Charlotte was by way of.

00;07;12;27 – 00;07;13;15
Alex
School.

00;07;13;26 – 00;07;15;15
Alex
I’d actually always wanted to get.

00;07;15;21 – 00;07;15;27
Alex
Out of.

00;07;15;27 – 00;07;23;05
Alex
The six months of frozen winter in Minnesota. So I was looking at schools in Texas and the ICC going up and down.

00;07;23;06 – 00;07;27;27
Alex
The East Coast. And actually something I don’t really.

00;07;28;03 – 00;07;29;25
Alex
Share too too often is I wanted to go to.

00;07;29;25 – 00;07;30;08
Alex
Duke.

00;07;30;22 – 00;07;45;04
Alex
First. I just grew up watching basketball loved watching the tournament and loved the ICC basketball especially, and got weightless that Duke. And I remember being crushed and thinking What did I do wrong? What could I have done differently?

00;07;46;11 – 00;07;48;16
Alex
And ended up getting into Wake Forest.

00;07;48;26 – 00;07;52;28
Alex
Which is one of the one of the ICC rivals. I’m still a good basketball.

00;07;52;28 – 00;07;54;22
Alex
School, still good academics.

00;07;55;14 – 00;07;59;14
Alex
And ultimately went to Wake Forest. So that’s how I ended up down in North Carolina.

00;08;00;13 – 00;08;08;25
Jordan
Speaking of speaking of opposites, not to cut you off, but now Duke is wondering, what did we do wrong? How do we go? You know, it’s like an experience.

00;08;09;12 – 00;08;11;29
Alex
Right? Exactly. Yeah. It honestly, things.

00;08;11;29 – 00;08;12;15
Alex
Worked out because.

00;08;12;15 – 00;08;13;23
Alex
I my.

00;08;13;25 – 00;08;14;10
Alex
Thought as an.

00;08;14;10 – 00;08;17;27
Alex
18 year old was whatever school I get into is I’m.

00;08;17;28 – 00;08;26;10
Alex
Going to let dictate my major because I had no idea what the hell I wanted to do. As an 18 year. I think most eight year olds probably don’t either. But remember this.

00;08;26;18 – 00;08;27;28
Alex
This sense of.

00;08;27;28 – 00;08;30;14
Alex
Overwhelming kind of anxiety around like.

00;08;30;26 – 00;08;36;11
Alex
Do I go business I do premed to become a lawyer or like I don’t, I don’t know what I want to do.

00;08;36;11 – 00;08;40;18
Alex
And so my whole thought as an eight year old was let the school to decide. And what I meant by that.

00;08;40;18 – 00;08;46;25
Alex
Was whatever that school was known doing laundry.

00;08;46;25 – 00;08;48;01
Alex
And being in business.

00;08;49;16 – 00;08;53;13
Alex
And because I once a week ended up doing business and.

00;08;53;21 – 00;08;54;24
Alex
Found my way the laundry.

00;08;56;12 – 00;09;10;29
Jordan
OK, well, hold on. Because it cut out for a second or froze. And I heard I’m going to let the school decide and then I’m in laundry. So we’ll have Phillies in there for a second. Well, how did you get from there to there?

00;09;11;20 – 00;09;14;08
Alex
Yeah, so the idea that I had as an 18.

00;09;14;08 – 00;09;15;19
Alex
Year old was whatever that school.

00;09;15;19 – 00;09;17;06
Alex
Is known for, you know, top.

00;09;17;06 – 00;09;27;29
Alex
Ten in poli sci or business or pre-med, I was going to let dictate what I majored in because I thought if I got in here, this is what they’re good at and I have an interest in it, why not give it a shot?

00;09;28;08 – 00;09;29;03
Alex
And so had I gotten.

00;09;29;03 – 00;09;33;24
Alex
Into Duke, I’d probably be a doctor and not not in the laundry industry. And instead I got it.

00;09;33;24 – 00;09;35;00
Alex
No way can that.

00;09;35;01 – 00;09;40;24
Alex
A top 15 business program. I was a finance major and eventually found my way into the laundry.

00;09;41;06 – 00;09;41;14
Alex
Yes.

00;09;41;29 – 00;10;03;11
Jordan
OK, all right. Well, you know, good for us that you didn’t become a doctor. Nobody wants to do that anyways. What’s the point of that now? Just it. But OK, so I mean, I feel like you can’t just say, oh, well, you know, I went to Wake Forest, a business school, and then I ended up in laundry. Like how how did you make your way?

00;10;03;17 – 00;10;17;20
Jordan
I’m always interested in this question anyways because I’m like, how does anybody get into this industry? So how did you get into this industry? You went and studied you know, business or finance. So how did that lead you to the laundromat industry?

00;10;18;16 – 00;10;20;21
Alex
Yes, I growing up and I grew.

00;10;20;21 – 00;10;30;29
Alex
Up in a small town in Minnesota, called Redwing, our claim to fame is Redwing shoes. So if you’re familiar with Redwing boots, Drake raps about them in a song that’s on the map.

00;10;30;29 – 00;10;32;13
Alex
Now, but it’s a.

00;10;32;13 – 00;10;49;02
Alex
Town of 15, 16,000 people. Half of them work for Redwing Shoe. And you? I grew up in a smaller town. My dad had this mentality that he put in there instilled in me and my two older brothers. I’m just like constantly working and learning how to work with people.

00;10;49;02 – 00;10;49;09
Alex
And.

00;10;50;11 – 00;11;02;00
Alex
Various jobs and I’m pretty sure we were doing the cutting grass, doing the paper route, and then probably I think we were illegally working at a ski resort too. When I was 14, I was operating a ski lift and I was looking back, I.

00;11;02;00 – 00;11;03;05
Alex
Don’t think 14.

00;11;03;05 – 00;11;03;18
Alex
Year olds.

00;11;03;18 – 00;11;08;21
Alex
Are allowed to do that technically, but I was and so when I got to wake that.

00;11;08;21 – 00;11;09;25
Alex
Kind of that mentality didn’t.

00;11;09;25 – 00;11;10;21
Alex
Stop it.

00;11;10;29 – 00;11;20;24
Alex
Had this kind of agreement with all of us that even though you’re going to school, you also work on the side. That’s what he had to do. And he was self through college and he worked two or three jobs while he was a full time student.

00;11;21;19 – 00;11;23;08
Alex
And so we wanted to do that. So you wanted.

00;11;23;08 – 00;11;28;01
Alex
Us to do that to some extent, just to learn time management and working for what.

00;11;28;01 – 00;11;29;21
Alex
You do. And so I.

00;11;29;21 – 00;11;40;22
Alex
Worked for the student run startup on campus called Wake Wash. And then it was door to door laundry and dry cleaning delivery for college kids. And it started out as a classroom project. It was originally.

00;11;42;06 – 00;11;44;06
Alex
Three, three founders.

00;11;44;17 – 00;12;01;15
Alex
A class of 20 people. So there was four or five groups of three or four. And the professor was basically like, Here’s $40, you know, professor, give him cash of his own money and 40 bucks at the beginning of the semester, the first part of the semester, an idea to concepts, what kind of things could you put the mark?

00;12;01;15 – 00;12;12;19
Alex
What kind of business could you build then? Going to do customer research, they’re going to do prototyping, then you’re going to launch it and then at the end of the semester we’re going to come back together. And one of the results of the measure you on is how much revenue growth you had, how many customers you had.

00;12;13;06 – 00;12;13;27
Alex
And so.

00;12;14;18 – 00;12;16;10
Alex
Then the semester one group goes.

00;12;16;10 – 00;12;17;00
Alex
They did.

00;12;17;00 – 00;12;21;17
Alex
150 hundred and $70 in revenue and they sold hot dogs on the quad. You know, the late.

00;12;21;17 – 00;12;22;20
Alex
Night students.

00;12;22;20 – 00;12;38;12
Alex
Come and they’re coming across campus. The second group, you know that for 50 or $500 in revenue and they were selling T-shirts to sororities and fraternities and they played on to that around their classroom, excited for 500 bucks.

00;12;38;23 – 00;12;39;27
Alex
And then the.

00;12;39;27 – 00;12;42;23
Alex
Third group, the squash group came and said.

00;12;43;08 – 00;12;45;20
Alex
Yeah, you guys aren’t going to believe us, but we ended up.

00;12;45;20 – 00;12;55;01
Alex
Doing about $7,000 in revenue and the professors, your jaw dropped and like you guys are doing this passively with 40.

00;12;55;01 – 00;12;55;23
Alex
Dollars.

00;12;56;10 – 00;13;12;07
Alex
And as a classroom project and then after you dug in there, really convinced I was like, there’s a business here. You guys should keep doing this next year or the year after. So I worked for them, not when they were in the class, but the year or two after when they’d grown it to I think 30, 40 grand in revenue at that time.

00;13;13;04 – 00;13;16;09
Alex
And so that was my first kind of foray into laundry.

00;13;16;23 – 00;13;17;18
Alex
I fell in.

00;13;17;18 – 00;13;20;20
Alex
Love with the model that they were operating on when I started working.

00;13;20;20 – 00;13;21;19
Alex
For them and.

00;13;21;19 – 00;13;25;18
Alex
Thought, Hey, this could work. I do Chapel Hill, Vanderbilt, all these other schools.

00;13;25;28 – 00;13;26;21
Alex
I want to buy it.

00;13;27;15 – 00;13;35;25
Alex
And so that was my first introduction and and then I started having that conversation with them around what would buying it look like jeez.

00;13;35;25 – 00;14;02;16
Jordan
OK, so this I mean, that’s awesome. That’s an awesome class for one, and that’s an awesome, you know, store to go from 40 bucks to, you know, seven. I was a little I’ll be honest with me, I was a little underwhelmed with the 140 or 200 bucks or whatever. Yeah. Hot dog sales a little underwhelming. But dude, that’s pretty cool to, you know, to go was it semester.

00;14;03;20 – 00;14;04;08
Alex
Yeah, it was awesome.

00;14;04;20 – 00;14;13;18
Alex
Most of the semester was done. There’s class work involved so like, hey, this month we’re going to do ideation. So they’d read a book on ideas and concepts and they’d do customer surveys.

00;14;13;18 – 00;14;14;15
Alex
And I think that was.

00;14;14;15 – 00;14;19;19
Alex
A huge part of it. The actual sales were over the course of two or three weeks.

00;14;20;05 – 00;14;22;07
Jordan
Yeah, that’s awesome. You know, maybe.

00;14;22;07 – 00;14;23;07
Alex
Maybe even a week.

00;14;23;27 – 00;14;28;23
Jordan
I know that a lot of my donors that like to have an extra seven grand and in a month or.

00;14;28;23 – 00;14;29;10
Alex
Whatever, you know.

00;14;30;11 – 00;14;43;12
Jordan
There you go. There’s an idea for you right off the bat, go hit up your college or college campuses. Yeah, yeah. Dang. OK, so, so you so you ended up working for them after you graduated.

00;14;43;28 – 00;14;47;02
Alex
So while that was my freshman year. And so yeah, it was I.

00;14;47;02 – 00;14;53;00
Alex
Was a bag runner. My job was go pick up bags of dirty laundry and dry cleaning and bring it to vendors off campus.

00;14;53;11 – 00;14;53;16
Alex
OK.

00;14;53;25 – 00;14;58;27
Alex
And that’s again, that’s when I fell in love with like you’re really you’re kind of this marketplace between students.

00;14;58;27 – 00;14;59;19
Alex
Awake and.

00;14;59;29 – 00;15;01;10
Alex
Vendors and Winston-Salem.

00;15;01;24 – 00;15;03;14
Alex
And so I wanted to buy it.

00;15;03;27 – 00;15;07;22
Alex
You guys are seniors. You’re going to graduate. I want to buy it. What do you mean gonna sell it for?

00;15;08;02 – 00;15;08;12
Alex
And they were.

00;15;08;12 – 00;15;12;26
Alex
Doing something like one times revenue, which was like 30 to $33,000 in my.

00;15;13;08 – 00;15;14;27
Alex
Yeah. 18 years.

00;15;14;29 – 00;15;17;25
Alex
19 year old job at the time you dropped again.

00;15;17;25 – 00;15;19;20
Alex
And I don’t have 32.

00;15;19;20 – 00;15;22;01
Alex
Thousand dollars, I have two grand, maybe.

00;15;22;01 – 00;15;22;22
Alex
Saved up.

00;15;22;22 – 00;15;27;08
Alex
And the responses kind of shrugged it off and said, if you don’t figure it out, someone else will.

00;15;27;08 – 00;15;27;28
Alex
And we.

00;15;27;28 – 00;15;29;07
Alex
Know what we have here and it’s worth.

00;15;29;07 – 00;15;29;16
Alex
That.

00;15;30;20 – 00;15;32;19
Alex
And so I went and found two other partners.

00;15;33;00 – 00;15;33;08
Alex
I think.

00;15;33;10 – 00;15;35;24
Alex
That got us up to a grand total of 9000 or ten.

00;15;35;24 – 00;15;41;03
Alex
Thousand well $22,000 short and thankfully.

00;15;41;03 – 00;15;47;20
Alex
One of their, one of their parents was willing to personally guarantee a loan from the bank for the difference, and it was already cash flowing. I think.

00;15;47;20 – 00;15;49;28
Alex
I had the difference for this.

00;15;49;29 – 00;15;50;21
Alex
Versus it’s kind of.

00;15;50;21 – 00;15;51;25
Alex
Typical any.

00;15;51;25 – 00;16;03;12
Alex
Businesses that there is breakage like a gym membership almost. So on that 32,000 they were profiting 20 to 23,000 just really good margins because people would pay for the whole semester the whole year up.

00;16;03;12 – 00;16;05;13
Alex
Front and then fill the.

00;16;05;13 – 00;16;10;15
Alex
Bag half full or forget to leave the bag out one week or so. There’s all this breakage almost like.

00;16;10;21 – 00;16;10;28
Alex
You know.

00;16;11;00 – 00;16;16;27
Alex
The $10 a month plan of fitness membership. Most of those people never go and they just never cancel yeah.

00;16;17;01 – 00;16;20;16
Jordan
Dang, that’s not so. You guys bought it from them.

00;16;21;13 – 00;16;23;02
Alex
So we end up yeah, we end up getting it together.

00;16;23;02 – 00;16;24;13
Alex
We bought the business.

00;16;25;07 – 00;16;26;05
Alex
And I had more.

00;16;26;10 – 00;16;33;20
Alex
Fun and life experience running that college laundry business than any class I took at Wake. And that’s not a not a day gone weeks.

00;16;34;03 – 00;16;36;15
Alex
You know, academic ability.

00;16;36;15 – 00;16;39;29
Alex
Or classes or professors. It was just running something tangible.

00;16;39;29 – 00;16;41;04
Alex
That you could test.

00;16;41;11 – 00;16;48;29
Alex
Marketing things and either succeed or fail on or hire fire manage people negotiate stuff with the university and getting access to buildings.

00;16;48;29 – 00;16;51;00
Alex
And that whole.

00;16;51;00 – 00;16;53;25
Alex
Experience really kind of changed my point of view on just.

00;16;54;11 – 00;16;56;16
Alex
I don’t know, work and building.

00;16;56;16 – 00;16;57;28
Alex
A career and what you can do in.

00;16;57;28 – 00;17;00;03
Alex
Life. And one of the.

00;17;00;03 – 00;17;01;23
Alex
First things we did at Wake was.

00;17;02;08 – 00;17;02;14
Alex
We.

00;17;02;14 – 00;17;13;02
Alex
Immediately went to the school and said, Hey, there should be a checkbox option for families coming in. It should be get your meal plan, get your parking pass, get your books, get your laundry package. And so again, like handling that with.

00;17;13;11 – 00;17;14;00
Alex
Dean of.

00;17;14;10 – 00;17;17;28
Alex
Residence Life and Housing that you know, these 19 year old kids trying to negotiate.

00;17;17;28 – 00;17;21;06
Alex
With with an adult, you know that.

00;17;23;13 – 00;17;29;01
Alex
Was an awesome experience and thankfully they listened to us and yeah, we’ll give you a booth at orientation and we’ll make it an option on the.

00;17;29;01 – 00;17;30;22
Alex
Website and that.

00;17;30;22 – 00;17;36;22
Alex
Ten next our sales the first year just because of that exposure that channel went from doing you know 32 K ad revenue.

00;17;36;22 – 00;17;37;00
Alex
To.

00;17;38;06 – 00;17;48;18
Alex
Just under 300,000 in revenue with still super high margins. So now not only is this a tremendous learning experience for us we’re now actually making legitimate.

00;17;48;18 – 00;17;50;21
Alex
Money and you’re.

00;17;50;26 – 00;17;54;21
Alex
Graduating and able to help pay for college and have money left.

00;17;54;21 – 00;17;56;17
Alex
Over is.

00;17;56;17 – 00;18;00;25
Alex
An awesome experience. We ended up selling it for about ten times what we bought it for.

00;18;01;20 – 00;18;02;18
Alex
I wanted to keep going.

00;18;02;18 – 00;18;05;12
Alex
I wanted to go to Duke and Chapel Hill, but my partners were.

00;18;06;04 – 00;18;06;10
Alex
You know.

00;18;06;16 – 00;18;21;08
Alex
They got into it as a resume builder initially and thought, Hey, I want to go to investment banking in New York. I want to go do marketing for Coca-Cola in Atlanta. And I didn’t want to be the guy that held them back from doing those things because I was obsessed with the laundry business.

00;18;21;18 – 00;18;37;13
Jordan
Yeah, that’s crazy. Well, I don’t want to like, dwell on this too long, but it’s so interesting and so fascinating. Did you take it OK? You said you took it. You would run it to vendors. Who were these vendors? Are they are they laundromats or are they someone else?

00;18;37;14 – 00;18;40;02
Alex
We so it was it was a mom and pop.

00;18;41;04 – 00;18;50;09
Alex
She actually ran a dry cleaner. And so she wanted to make all of her margin, the dry cleaning. So basically the way in and working was we’d go get all this dry cleaning for her, acquire all these customers, get people signed up.

00;18;50;21 – 00;18;51;22
Alex
And I think we made.

00;18;52;26 – 00;18;55;11
Alex
Maybe 5%, maybe not even 5%.

00;18;55;27 – 00;18;56;04
Alex
Of.

00;18;56;04 – 00;19;03;04
Alex
Anything on the dry cleaning. And in exchange, she would process all the laundry. So she would go to different laundromats, should hire her own.

00;19;03;04 – 00;19;04;13
Alex
Team and basically.

00;19;04;13 – 00;19;11;20
Alex
Rent out other people’s laundromats to do all the processing. And she still made money on that. It was just a thinner margin for her than the dry cleaning was.

00;19;13;02 – 00;19;13;09
Alex
And so.

00;19;13;09 – 00;19;19;25
Alex
That’s how we worked it out as we found her. And she would basically these different laundromat owners to rent out their space to.

00;19;19;25 – 00;19;21;02
Alex
Clean, clean all the volume.

00;19;21;23 – 00;19;26;22
Jordan
To hang. That’s pretty cool. And you were able to keep your margins pretty high, too, same time.

00;19;26;22 – 00;19;28;20
Alex
Yeah. And the thing that worked really well is just because.

00;19;28;20 – 00;19;40;15
Alex
Again, there was breakage, I mean, people would pay for a £40 bag assuming or £40 it when in reality the breakage and college was we still have it and to use model now and that’s part of why I think the way that we’ve approach things have worked the way that.

00;19;40;15 – 00;19;43;29
Alex
They have but in college people were on.

00;19;43;29 – 00;19;47;17
Alex
Average filling it was 11.8. I remember this number because it.

00;19;47;17 – 00;19;48;18
Alex
Was blue my.

00;19;48;18 – 00;20;03;05
Alex
Mind as £11.8 per bag we could hold 40 and so we could think about we’re only paying the vendor off campus for £11.8 a bag not the whole 40 but we’re taking revenue in on the whole 40 so there was plenty to go around for everyone.

00;20;03;26 – 00;20;19;29
Jordan
Yeah, that’s awesome. I mean, I think that’s really awesome. So OK, so you ran that. Did you run that all three years or sophomore to senior year? Yeah, I think that’s awesome. OK, so then you sold it. Who, who bought it?

00;20;20;26 – 00;20;23;21
Alex
So we had we had a couple offers, two.

00;20;23;21 – 00;20;28;02
Alex
Or three student groups and then one that was called University Laundry at the time.

00;20;28;14 – 00;20;29;16
Alex
And this guy.

00;20;29;26 – 00;20;31;05
Alex
I forget Nathan.

00;20;31;05 – 00;20;34;20
Alex
At the center, what Watkins, he was out of Texas was.

00;20;34;20 – 00;20;43;02
Alex
Doing this like ten other college campuses. We had built up a pretty big college laundry business and so he was going around and buying these other kind of student runs because, you know, we.

00;20;43;02 – 00;20;43;17
Alex
Weren’t, you.

00;20;43;17 – 00;20;46;21
Alex
Know, that class wasn’t the first college laundry business idea had ever.

00;20;46;21 – 00;20;50;15
Alex
There come to come up so he gave.

00;20;50;15 – 00;20;56;07
Alex
Us an offer. He then eventually got bought by Tide, by Procter and Gamble bought it, and it’s now called Tide University.

00;20;56;17 – 00;20;57;03
Alex
So that’s how.

00;20;57;04 – 00;21;17;15
Alex
University Program is what used to be Nathan’s University Laundry. And he also tried to buy a week wash, but we ultimately felt really passionate about keeping a student run again, like I just shared. It was one of the best learning experiences I’ve ever had as an individual. And as much as we want, we had made enough money at that point more than we thought we would.

00;21;17;15 – 00;21;30;25
Alex
It wasn’t really about self or as much as we can possibly make. It was find the biggest group of students that could benefit in the same way that we did. And so we end up selling it to a group of eight students that were also able to come up with.

00;21;31;15 – 00;21;31;19
Alex
You know.

00;21;31;21 – 00;21;38;06
Alex
Most of the money that we were asking for. And so those are going to win win for everyone. And it’s now this is this makes me really happy.

00;21;38;06 – 00;21;38;14
Alex
As.

00;21;39;08 – 00;21;49;29
Alex
It’s turn hands. I think six or seven other times since I graduated, they said that you had all these different group has all been student run the whole time.

00;21;50;20 – 00;21;53;25
Jordan
That’s awesome. Super. And so it’s still going well.

00;21;54;28 – 00;21;55;15
Alex
So cool.

00;21;56;13 – 00;22;05;17
Jordan
All right. So you sell you sold the business after you graduated. You got a friend who went to be an investment banker. When did marketing Coca-Cola and you did what?

00;22;06;11 – 00;22;08;14
Alex
So I went to I thought all right, you know.

00;22;08;21 – 00;22;15;09
Alex
What’s as entrepreneurial as what I was doing or as close to without upsetting my parents too much by going to a four.

00;22;15;09 – 00;22;23;02
Alex
Year private school and then starting a business and living in their basement or whatever it was and.

00;22;23;02 – 00;22;31;24
Alex
Consulting was, the closest thing I could come up with was you’ll change projects, you’ll see different problems. You’ll help different companies with different things. You’ll work with different people.

00;22;31;27 – 00;22;32;27
Alex
Flow change.

00;22;32;27 – 00;22;34;06
Alex
It felt like it’d be faster pace.

00;22;34;06 – 00;22;35;27
Alex
So I moved to Charlotte.

00;22;36;10 – 00;22;37;13
Alex
From Winston-Salem.

00;22;37;25 – 00;22;38;05
Alex
To.

00;22;38;05 – 00;22;48;03
Alex
Do consulting for Ernst and Young, and this was on the tax or the audit side. It was more business strategy, business implementation, predominantly with banks. So I’d be.

00;22;48;10 – 00;22;48;20
Alex
You.

00;22;48;20 – 00;23;12;20
Alex
Know, Wells Fargo was rolling out a new consumer application for its wealth management customer and clients, and so helping to design and do customer of customer surveying and research. And there are a lot of elements that I liked and there was a lot of elements that I didn’t that didn’t feel as entrepreneurial and as fast and as fulfilling and as rewarding as even how I felt running a small college laundry business.

00;23;13;23 – 00;23;15;10
Alex
So did consulting for two years.

00;23;15;28 – 00;23;17;09
Alex
And then at that.

00;23;17;09 – 00;23;19;09
Alex
Point it had the edge too much. I think the big thing.

00;23;19;09 – 00;23;20;08
Alex
That kicked me.

00;23;20;23 – 00;23;24;02
Alex
Off of wanting to stay in this kind of corporate path was.

00;23;25;08 – 00;23;26;04
Alex
My roommate.

00;23;26;04 – 00;23;30;29
Alex
The first two years I was, I bought a condo out of college with similar way cash money.

00;23;31;06 – 00;23;31;12
Alex
Had.

00;23;31;12 – 00;23;32;10
Alex
Roommates from work that.

00;23;32;10 – 00;23;32;20
Alex
Were.

00;23;32;28 – 00;23;48;06
Alex
Working in the city. One of them worked with me anyway, and so we had very similar to the same job, basically. And my whole life I’ve kind of been somewhat of a systems thinker. Like I go to school and I think, OK, what’s the goal here is I’m supposed to get A’s, how do I get A’s with the least amount of work possible like that?

00;23;48;10 – 00;23;49;26
Alex
I don’t want to do any more than I need to.

00;23;49;26 – 00;23;56;13
Alex
Do as long as I can get the result, the highest result, I’m not going for the 120% of 100% is, yeah, I don’t need 100.

00;23;56;22 – 00;23;57;24
Alex
Yeah, I mean, yeah.

00;23;58;06 – 00;24;08;09
Alex
And so I’d always done fairly well in school just kind of gaming the systems. And same thing was true the wise at the beginning during orientation, they said, here’s the five pillars, right, to get.

00;24;08;13 – 00;24;08;17
Alex
A.

00;24;09;14 – 00;24;19;10
Alex
Five star. That was kind of what they did for that was for promotions, for increase in compensation. All that stuff was like, All right, what do I need to do to get a five with the least amount of workforce.

00;24;20;10 – 00;24;20;28
Alex
So I.

00;24;21;02 – 00;24;21;28
Alex
Did my I played.

00;24;21;28 – 00;24;23;09
Alex
The networking game.

00;24;23;09 – 00;24;28;22
Alex
I tried to get onto the right projects. I made sure I was involved in recruiting and other extracurricular type stuff.

00;24;29;09 – 00;24;29;27
Alex
And at.

00;24;29;27 – 00;24;32;08
Alex
The end of our first year, I promised a point to.

00;24;32;09 – 00;24;34;12
Alex
This. My roommate.

00;24;34;12 – 00;24;43;12
Alex
Who was in the same job I was, we compared our utilization and that’s a big thing that consulting firms track on because they’re billing you out hourly and they want you being utilized and build out.

00;24;43;12 – 00;24;44;27
Alex
To different clients.

00;24;45;19 – 00;24;57;02
Alex
Realization was like, right, a little over 40 hours a week, which is not typical advice, especially as an entry level person. They usually work you pretty hard. And my roommate was at 80, 81 or 82 hours.

00;24;57;02 – 00;24;58;04
Alex
So basically double.

00;24;58;12 – 00;25;02;15
Alex
On average a week his first year and I was 41 or 40.

00;25;02;15 – 00;25;03;27
Alex
Two, I end up.

00;25;03;27 – 00;25;07;28
Alex
Getting a five. So the highest rating you can get, you end up getting a three which is still really.

00;25;08;00 – 00;25;08;12
Alex
Three is.

00;25;09;03 – 00;25;09;28
Alex
Still considered really.

00;25;09;28 – 00;25;10;06
Alex
Good.

00;25;10;21 – 00;25;20;09
Alex
And I share that because it was the last kind of like thing I had been thinking and feeling of, you know, I feel capped here. I feel like the harder I work, it doesn’t, I don’t get rewarded anymore.

00;25;20;09 – 00;25;21;00
Alex
I don’t start.

00;25;21;00 – 00;25;22;05
Alex
Moving fast enough is not.

00;25;22;05 – 00;25;22;27
Alex
Fulfilling.

00;25;24;01 – 00;25;31;25
Alex
And that was the last straw. Just like seeing how hard that guy work is way smarter. I can certainly be way smarter than I am. And for him to not be.

00;25;31;25 – 00;25;33;12
Alex
Treated the same way.

00;25;33;18 – 00;25;35;11
Alex
Because of some system that was.

00;25;35;24 – 00;25;38;10
Alex
Created and he followed and he, you know.

00;25;38;15 – 00;25;39;08
Alex
He was a part of.

00;25;39;08 – 00;25;40;11
Alex
But didn’t.

00;25;41;07 – 00;25;42;01
Alex
Gain that that way.

00;25;42;01 – 00;25;44;10
Alex
And so it just didn’t feel genuine. It didn’t feel good.

00;25;45;18 – 00;25;49;25
Alex
I was happy with the result, but it wasn’t fulfilling on the work I was doing to get there. And so.

00;25;50;27 – 00;25;51;02
Alex
At.

00;25;51;02 – 00;26;16;22
Alex
That point, I saw two companies on the West Coast, Washoe and Rents. I’m sure your listeners are probably familiar with. There is a ton of money. $30 million at the time when Uber for X was raising money for everything dog walking, massages, grocery delivery, and they were just another we’re going to Uber for laundry and this is venture capitalist love that I don’t want to miss out on the next Uber.

00;26;17;01 – 00;26;17;10
Alex
So they did.

00;26;17;10 – 00;26;21;09
Alex
Raise $30 million and I was just sitting there watching this happen.

00;26;21;22 – 00;26;22;06
Alex
And the thing.

00;26;22;06 – 00;26;41;28
Alex
I was most excited about was, Hey, they’re proving that customers, you know, people want this, they want someone else to do their laundry for them, which isn’t new outside of New York and Chicago and L.A. But in some of these other cities, where laundry service isn’t as prevalent, they proving that, hey, some people want this. But operationally I thought, no way their model works, no where they make money doing what they’re doing.

00;26;43;19 – 00;26;47;03
Alex
Because of what I learned doing this in college, you know, on a small scale in college, I knew.

00;26;47;03 – 00;26;48;08
Alex
You can’t have.

00;26;48;08 – 00;26;50;05
Alex
1099 contractors sitting around.

00;26;50;16 – 00;26;51;05
Alex
Going to pick up.

00;26;51;05 – 00;27;07;25
Alex
Jordan’s laundry at 2 p.m. on a Wednesday. Like, you probably don’t need that. You probably don’t necessarily even want that. But it’s very expensive for the company to have drivers just sitting idle and waiting, and it was very inefficient. So I thought, I’ll hate myself if I hit 30, 40, 50 years old.

00;27;07;25 – 00;27;08;00
Alex
And.

00;27;08;20 – 00;27;12;08
Alex
Regret not going after this with what I learned in college and at least taken.

00;27;12;08 – 00;27;13;15
Alex
A stab at it.

00;27;15;15 – 00;27;30;05
Jordan
Yeah. OK, so you were just kind of observing, you know, what was going on with these companies and saying, I’ve learned a little something about this already, so maybe I’ll take a stab at it. Is that basically?

00;27;30;14 – 00;27;31;09
Alex
Yeah, like honestly, the.

00;27;31;09 – 00;27;32;21
Alex
Timing was perfect.

00;27;32;21 – 00;27;33;26
Alex
Just me seeing that.

00;27;33;26 – 00;27;34;22
Alex
Happening and.

00;27;34;22 – 00;27;36;19
Alex
Saying, Hey, I have some.

00;27;36;19 – 00;27;45;17
Alex
Experience here at the same time, kind of growing descent from me at the job that I was in, just not feeling fulfilled and not feeling like it was moving fast enough for.

00;27;45;21 – 00;27;46;05
Alex
I was trying.

00;27;46;05 – 00;27;56;28
Alex
To learn as much as I possibly could, and I felt like that was to some degree at the job I was in. And so I thought, Hey, you know, if I were to do this, what would the three differences be?

00;27;57;14 – 00;27;58;09
Alex
What would I do differently.

00;27;58;17 – 00;28;05;26
Alex
Than last year? What would I do differently than rents? What is what is the right approach? And I started really starting to obsess over that problem probably for.

00;28;06;12 – 00;28;06;29
Alex
A year.

00;28;06;29 – 00;28;08;09
Alex
Before I actually quit my job.

00;28;10;11 – 00;28;25;23
Alex
You know, working on ideas at night, really just thinking about the model, not really trying to get customers or anything more, just thinking about how could this work with your intensities? I’ve been one. What about 50? How do you how does this evolve over time? And the three themes I came up with were sort of Uber for laundry.

00;28;25;23 – 00;28;47;11
Alex
This has to be FedEx or UPS for laundry. So think statics scheduled routes instead of on demand. You know, point to point delivery, which is most of those on demand businesses. And the reason that made sense to me was laundry is not an acute impulse decision like ridesharing or food delivery. Like if you need a ride somewhere, you’re probably going to a meeting or to meet with friends.

00;28;47;11 – 00;28;50;22
Alex
You want to get there. Now, it’s not planned super far in advance.

00;28;51;05 – 00;28;51;26
Alex
Say that same.

00;28;51;27 – 00;29;05;12
Alex
Thing with food delivery as your pride is hungry right now and so on. That can deliver some things I don’t want to cook right now. Again, you want that food quick and you want it hot. Whereas laundry, how often you sit there your desk like Man, I wish someone would come take the shirt off my back and clean it right now it’s.

00;29;05;22 – 00;29;06;05
Alex
Probably.

00;29;06;05 – 00;29;07;19
Alex
Never right. Like maybe all the.

00;29;07;19 – 00;29;13;03
Jordan
Time for me right now just harms somebody else. Yeah.

00;29;14;23 – 00;29;15;24
Alex
Like maybe there’s.

00;29;15;24 – 00;29;30;14
Alex
Edge cases that are going to a wedding or something. That crap. The wedding is tomorrow. I didn’t get my suit dry cleaned or whatever. And for the most part, laundry is recurring and chronic. You do it every Sunday, you do it every night. Like there’s sure that everyone’s got their own routine, but there’s a routine that’s the difference.

00;29;31;03 – 00;29;31;29
Alex
And so the first.

00;29;31;29 – 00;29;32;28
Alex
Pillar for me.

00;29;32;28 – 00;29;34;04
Alex
Was static.

00;29;34;04 – 00;29;41;21
Alex
Predictable, scheduled routes. It’s going to be way cheaper on our end to pick it up and deliver it. Have one driver going to a neighborhood, pick up 30 orders versus.

00;29;42;14 – 00;29;42;23
Alex
You know.

00;29;43;01 – 00;29;46;02
Alex
30 trips back and forth, picking up all those those orders randomly.

00;29;46;17 – 00;29;47;01
Alex
And so that.

00;29;47;01 – 00;30;04;03
Alex
Was the first big driver. The second was instead of targeting New York, Chicago, L.A., you know, the top three or four cities in the country I thought was go, go target the majority of the population and where they are, meet them where they are. And that was in your secondary and tertiary cities, which don’t have to be small.

00;30;04;03 – 00;30;13;09
Alex
This isn’t, you know, Redwing, Minnesota, where I grew up. This is your Charlotte, North Carolina. You’re Austin, Texas, you’re San Antonio, you’re Raleigh, North Carolina. You’re Nashville, Tennessee.

00;30;15;18 – 00;30;16;10
Alex
And then go.

00;30;16;10 – 00;30;19;22
Alex
To the New York, then go to Chicago. Since you’ve really proved this out in markets.

00;30;19;22 – 00;30;22;08
Alex
That maybe look like.

00;30;22;08 – 00;30;34;23
Alex
They work under your model in New York because there’s 10 million people there but probably aren’t going to work anywhere else because not anywhere else. That’s 10 million people. And so I just didn’t want to give a false positive. Hey, Washoe worked in New York or it looks like it’s working in New York.

00;30;35;13 – 00;30;38;01
Alex
But then it has no legs in Charlotte.

00;30;38;01 – 00;30;44;17
Alex
And so at that point, I figured what’s what’s the point? So I was the second team. The third and final theme was quality has to.

00;30;44;17 – 00;30;45;15
Alex
Be at.

00;30;45;22 – 00;31;00;15
Alex
The core of everything that we do. Laundry is I personally believe it’s a very personal thing. It’s the first thing big decision we all make every day is what am I going to wear? What do I look the best and where I feel the best and depending on what I have to do today. And so we wanted to really protect quality.

00;31;00;15 – 00;31;17;14
Alex
And there was always this idea of how do we get to vertically integrating where we we process everything ourselves upfront. We don’t have the money to do that. Our thought was, how do we get to that pretty quickly, knowing that that’s going to drive and dictate most of the quality is how all clothes are being clean, what chemicals are being used, a process is being followed, all of that.

00;31;18;10 – 00;31;19;29
Alex
So that was a kind of.

00;31;20;06 – 00;31;21;02
Alex
Theme from.

00;31;21;02 – 00;31;27;05
Alex
The beginning of how do we have more and more ownership over the cleaning process.

00;31;28;20 – 00;31;50;03
Jordan
Yeah, I like those. I think those three kind of distinctives and you know, obviously the well, I shouldn’t say obviously, but the the static, you know, predictable planned out routes, you know, do save you a lot of money. And they can help you batch, you know, the pick ups and the deliveries because you’re going in certain areas at certain times.

00;31;50;03 – 00;32;13;10
Jordan
And you can kind of structure that in a way that provides you efficiencies where, you know, on demand, you know, maybe can’t do that as much because if somebody over here needs their laundry picked up and somebody over here needs their laundry picked up or now you’re going all over the place or you got multiple people going in different places, so in there, pick it up one order at a time as opposed to maybe multiple orders at a time, too.

00;32;13;10 – 00;32;43;22
Jordan
So I like that. I like the I like that I really like the targeting the secondary and tertiary markets because like you said, they’re obviously there’s, you know, bigger cities that are more densely populated that, you know, you can you can find some proof of concept but you don’t know if the concept is going to work widespread. So I like that and kind of I mean, I feel like one of the themes already is like flipping things you know, the other way.

00;32;43;22 – 00;32;44;12
Jordan
The other side of.

00;32;44;15 – 00;32;45;22
Alex
Us is the opposite.

00;32;45;22 – 00;32;47;02
Alex
Of everything the other two.

00;32;47;02 – 00;32;48;04
Alex
Are doing. Yeah.

00;32;48;16 – 00;33;07;02
Jordan
Yeah, it is. Yeah. And then obviously you know, quality being the core. You know, we talked about that a lot here on the on the podcast and I like I like the thought process behind, hey, you know, first you know, one of the first things we do every morning is figure out what we want to wear, how we want to present ourselves, how we want to look.

00;33;07;13 – 00;33;29;11
Jordan
And keeping that in mind, you know, and I can’t remember, man, apologies to whoever was the guest who said this on the podcast, but, you know, it was whoever it was was talking about how, you know, when when people give us their calls and you said it’s a very personal thing. Right. But also, there’s just a lot of monetary value wrapped up in clothes, like clothes are not cheap.

00;33;29;17 – 00;33;55;11
Jordan
Right. So people are giving you you know, sometimes a thousand plus dollars worth of their belongings to take care of. And so quality is huge because not only is there a monetary value, but there’s also an image value. And there’s I mean, there’s a whole lot of value that goes along with it. So I love that. So what did you decide to like how did you how did you get into it then?

00;33;55;11 – 00;34;01;14
Jordan
OK, you’re like, OK, I’m basically going to do what they did, except for the opposite, you know? What did that look like when you got started?

00;34;01;29 – 00;34;04;03
Alex
So at first, you know, I had actually had one.

00;34;05;14 – 00;34;08;19
Alex
Small failed attempt at trying to scale the college business. First I.

00;34;08;19 – 00;34;10;05
Alex
Tried and this is.

00;34;10;05 – 00;34;14;20
Alex
I a good advice for if there’s any like entrepreneurs lesson or people staying on starting their own thing is that.

00;34;15;08 – 00;34;16;00
Alex
I always.

00;34;16;00 – 00;34;23;24
Alex
Knew I liked working with other people and I just knew how hard a startup was going to be. And so I always wanted to work with a co-founder, you know, find someone.

00;34;23;24 – 00;34;25;14
Alex
To to do this with.

00;34;25;27 – 00;34;32;10
Alex
And so when I was at E y, I met another consultant. I thought, hey, let’s go try to scale us to two or three other schools. Versus at that point, it was just very this is.

00;34;32;10 – 00;34;33;11
Alex
Pre, you know.

00;34;33;11 – 00;34;34;09
Alex
To you and everything I just.

00;34;34;09 – 00;34;36;14
Alex
Shared. And one school.

00;34;36;14 – 00;34;47;24
Alex
Said no to us, not other that other guy just like gave up. So they said, no, people don’t want to, you know, I’m not. And at that point in time and we realized you don’t just find a co-founder, a business partner because it’s convenient or they’re close to you because it.

00;34;47;24 – 00;34;49;09
Alex
Was to two of the.

00;34;49;09 – 00;34;52;28
Alex
Same people at the same skill set. It was like finance consulting type people.

00;34;53;09 – 00;34;54;00
Alex
And it wasn’t.

00;34;54;00 – 00;35;12;13
Alex
Me being intentional. And and I really reflected on that a lot. So I was I thought it about, you know, to you in those three pillars, I also thought about how do I do this with someone else that has a skill set that complements mine? You know, I’m finance operations. I needed to be like a really gross marketing intensive business I need someone with that kind of skill set and background.

00;35;12;28 – 00;35;38;05
Alex
And as I started doing that, who I knew in my network, one of my best friends from growing up came to mine not because he was my best friend, but because he was at startups in Minneapolis doing sales and marketing, very scrappy, growth minded individual, but also understood start ups. He saw the company that he was at go from ten employees to 150 employees and all the revenue that came with that and challenges that came with that and everything that came with that.

00;35;38;23 – 00;35;42;26
Alex
And so I at first was just kind of picking his brain, riffing on the idea with him.

00;35;43;09 – 00;35;44;29
Alex
And, you know, one.

00;35;44;29 – 00;35;55;06
Alex
Conversation a month turned into one a week turned into one a night. And also next thing you know, like we’re founding a company together and he didn’t even realize it. I was like, hey, are you like you were just like helping me at first. Now it’s.

00;35;55;06 – 00;36;00;13
Alex
Like, this is a lot of time and commitment like, let’s do this.

00;36;00;18 – 00;36;15;24
Alex
Let’s do it properly. That’s good. No LLC stood up and, you know, ownership percentages and let’s quit our jobs and we just that really escalated. And so we both quit our jobs in 20, 15 and then launched to you in January of 2016.

00;36;16;20 – 00;36;17;16
Alex
And the idea.

00;36;17;16 – 00;36;21;14
Alex
Was those three pillars that I mentioned, you basically being the opposite of what you were doing.

00;36;22;01 – 00;36;22;18
Alex
And.

00;36;22;18 – 00;36;30;08
Alex
We thought it’d be millennials, busy professionals is our core customer. We thought it’d be, you know, bankers consulting lawyers, everyone going uptown.

00;36;30;08 – 00;36;30;29
Alex
With, you.

00;36;30;29 – 00;36;32;08
Alex
Know, making more money than they have time.

00;36;33;00 – 00;36;34;12
Alex
And so we, when.

00;36;34;12 – 00;36;46;05
Alex
We first started, we were driving Uber from 6 a.m. to 8 a.m. just not eating to our savings too much. And we also got our first customers that way. We made promo cards that because everyone always would ask, why are you guys driving Uber?

00;36;46;14 – 00;36;46;28
Alex
You know, you.

00;36;46;28 – 00;36;48;24
Alex
Look like you’re like a 2324 year.

00;36;48;24 – 00;36;50;28
Alex
Old. What are you like, what are you doing.

00;36;51;06 – 00;37;02;24
Alex
At 6 a.m. during the Uber thing? Oh, it was on this laundry dry cleaning thing. We’d love for you. Check it out. So we get a lot of our first customers that way, and then we’d work ten to 12 hours in the day and we would drive over again.

00;37;02;24 – 00;37;03;04
Alex
To.

00;37;03;13 – 00;37;22;26
Alex
The end of the night. And those first ten months is something I would describe as the most fun I never want to have again. Really, really taught us a ton. I mean, instead of it being the banker and consultant, we very quickly realized it’s the dual income family with kids, predominantly women, making the purchasing decision for the house.

00;37;23;22 – 00;37;34;27
Alex
Women ages 36 to 45 to kids lasting as parents they want to do when they get home from work is more work. So they’re using the grocery delivery, they’re using something to cut their grass. They have someone come clean the house.

00;37;35;06 – 00;37;36;17
Alex
Like they are purely.

00;37;36;17 – 00;37;43;05
Alex
An outsourced lifestyle. You know, there’s two sources of income coming in and they just want to get their time back to spend with each other, their family, their friends.

00;37;43;25 – 00;37;45;27
Alex
And that just took off.

00;37;45;27 – 00;37;51;07
Alex
We bootstrapped the I think 60, 65,000 monthly revenue within five or six.

00;37;51;07 – 00;37;52;10
Alex
Months of.

00;37;52;10 – 00;38;05;02
Alex
Dana. And I just like doing kind of growth hacky marketing pretty cheap free stuff and that that mom that that family customer base really just took off. They started sharing them on Facebook groups.

00;38;05;02 – 00;38;05;10
Alex
And.

00;38;05;28 – 00;38;19;28
Alex
With their neighbors and at that point we realized, hey, we got something here. Let’s go raise some outside capital to get help to do this faster because our ambition was always how do we build a nationally recognized brand in the category yeah.

00;38;19;28 – 00;38;31;22
Jordan
OK. So I mean, you have you’re building a laundry at this point. You don’t have like a location or anything. How how are you doing it? What’s the tell me about the logistics of this actually.

00;38;31;22 – 00;38;33;05
Alex
So we’re, we’re 24 at the.

00;38;33;05 – 00;38;33;16
Alex
Time.

00;38;33;17 – 00;38;33;24
Alex
Have.

00;38;34;16 – 00;38;35;19
Alex
No bank is going to lend us.

00;38;35;19 – 00;38;38;04
Alex
Money. We had no money to buy.

00;38;38;10 – 00;38;53;05
Alex
A laundromat or so. You know, at that point we thought, let’s just do what we were doing in college. Let’s find a dry cleaning vendor to partner with us. Let’s find a laundromat vendor to partner with and you know, they’ll be happy to the process of buying. We say we’ll handle customer acquisition, the logistics, the customer support, everything else.

00;38;53;25 – 00;39;11;04
Alex
And so we found Laundromat. So we’re willing to do it. We found a dry cleaner and very quickly realized the dry cleaning industry as well as wholesalers doing a majority of the cleaning for the drop stores that you and I would go to as consumers. So we go right to those wholesalers that have the plants, the equipment, the team of 15, 20 plus employees, and we would outsource the dry cleaning.

00;39;11;04 – 00;39;12;15
Alex
To those wholesalers.

00;39;13;01 – 00;39;22;10
Alex
On the laundry side, there wasn’t an equivalent know wholesale provider for Cintas and also that do big hospital linens and uniforms and hotel stuff.

00;39;22;23 – 00;39;23;09
Alex
But they.

00;39;23;09 – 00;39;29;25
Alex
Can’t keep Jordan’s clothes up from Alex’s and Jordan might want Island Breeze scented detergent and I want hypoallergenic.

00;39;29;25 – 00;39;30;17
Alex
And Dos.

00;39;30;27 – 00;39;32;11
Jordan
Island scented for sure.

00;39;33;10 – 00;39;35;14
Alex
And so we had to go to.

00;39;36;02 – 00;39;37;01
Alex
These my mom and pop.

00;39;37;08 – 00;39;38;21
Alex
Laundromats and.

00;39;38;21 – 00;39;39;15
Alex
We went to one and we.

00;39;39;15 – 00;39;40;18
Alex
Said we’re.

00;39;40;18 – 00;39;49;24
Alex
Going to start bringing you guys a couple of thousand pounds a day is what we believe. And they laughed. They just laughed at us. It’s a couple thousand pounds a day. Who are you? What are you.

00;39;49;24 – 00;39;50;10
Alex
Kidding?

00;39;51;12 – 00;40;02;18
Alex
Let alone £1,000 a week. Like, if you could bring us a couple thousand a month, we’d be happy. And like, we don’t see you doing that, but just trust us. Let’s negotiate price tiers based on volume.

00;40;03;05 – 00;40;03;19
Alex
And so.

00;40;03;19 – 00;40;04;17
Alex
Looking back and I think they.

00;40;04;17 – 00;40;07;12
Alex
Maybe, you know, put them.

00;40;07;12 – 00;40;14;09
Alex
In a bad negotiating position, I agree, because I didn’t think we’re going to do it, but they’re like, yeah, if you get to a thousand a day, we’ll do it for $0.60 a pound or something incredibly.

00;40;14;09 – 00;40;17;01
Alex
Cheap. And so then I liked it that was, All.

00;40;17;01 – 00;40;28;13
Alex
Right, here’s the goal. Let’s get down to $0.60 as quickly as possible and just start flooding them with laundry. And so that mom group got a hold of it. Those families got a hold of it. We were bringing them two or £3,000 a day.

00;40;28;24 – 00;40;29;23
Alex
They were overwhelmed.

00;40;31;21 – 00;40;32;23
Alex
And at that point.

00;40;33;17 – 00;40;33;29
Alex
You know.

00;40;33;29 – 00;40;42;25
Alex
We lost them. We raised the outside capital. We learned a very pivotal thing for our whole story. At that point in the 400 K that we raised was originally to go launch. Raleigh is our second.

00;40;42;25 – 00;40;43;06
Alex
City.

00;40;44;08 – 00;40;52;22
Alex
And a week after we raised that money, Washoe completely shut its doors down and deemed a massive failure after raising $20 million.

00;40;53;13 – 00;40;54;02
Alex
And so then I.

00;40;54;02 – 00;40;54;17
Alex
Was looking at each.

00;40;54;17 – 00;40;54;27
Alex
Other like.

00;40;55;11 – 00;41;10;02
Alex
What are we about to do? The same thing? Are we going to even though the three things that we decided are going to define our approach or the opposite of what they were doing, are we missing anything else or is this just an unsolvable problem? If they couldn’t figure it out, the 20 million, how are we going to figure out with 400 K?

00;41;10;21 – 00;41;13;14
Alex
And so we were we’ve always been.

00;41;14;04 – 00;41;30;21
Alex
I think, smart enough to know what we don’t know and ask questions of people that are smarter than we are, know have a better experience than we’ve had in certain things. And so we reached out to the founders of Washoe we reached out to their lead investors came and partners out of San Francisco that I think invested 12 or 13 million into the deal.

00;41;32;04 – 00;41;32;19
Alex
And the.

00;41;32;19 – 00;41;33;19
Alex
Thing that was really amazing.

00;41;33;19 – 00;41;37;10
Alex
Just like kind of, I don’t know.

00;41;38;00 – 00;41;49;22
Alex
Selflessness of certain folks. I mean both Washoe founders and Kane and his partners at this firm were willing to spend a couple of hours a day in know just been like, Hey, here’s what we did that worked well, here’s what we did that didn’t work well, avoid this.

00;41;50;02 – 00;41;53;05
Alex
Don’t do this, do that. And, you know, dozens.

00;41;53;05 – 00;41;57;21
Alex
Of things learned massive, valuable lessons. But the two things that really stuck out to us were.

00;41;58;06 – 00;41;59;08
Alex
The.

00;41;59;08 – 00;42;07;05
Alex
Logistics model that we were operating on. That point to point delivery just doesn’t work. That -20% plus gross margins are nowhere near.

00;42;07;10 – 00;42;07;19
Alex
Getting.

00;42;07;19 – 00;42;17;15
Alex
Out of that, you know, getting on the right side of zero. And whereas we had, you know, just around 30% gross at the time, and for eight months and didn’t feel like we were fully at scale and that there was probably room to get even more over time.

00;42;18;23 – 00;42;19;03
Alex
But the.

00;42;19;03 – 00;42;21;01
Alex
Thing that caused us to not launch Raleigh.

00;42;21;01 – 00;42;24;12
Alex
Was the the quality.

00;42;24;20 – 00;42;27;08
Alex
Quality control on the laundry side of the house.

00;42;27;08 – 00;42;28;08
Alex
To what we were doing.

00;42;28;09 – 00;42;29;06
Alex
At the coin laundromat.

00;42;29;26 – 00;42;31;07
Alex
And you.

00;42;31;07 – 00;42;36;18
Alex
Know, probably makes sense to a lot of Laundromat owners listening is that, you know, laundromats typically aren’t designed or built.

00;42;36;18 – 00;42;37;00
Alex
For.

00;42;37;09 – 00;42;41;01
Alex
Massive volume production. It’s designed as a self-service coin laundromat.

00;42;42;02 – 00;42;44;05
Alex
Or laundromat and the.

00;42;44;05 – 00;42;47;22
Alex
Pain that we were feeling at that one store I mentioned where we were overwhelming them with volume.

00;42;47;22 – 00;42;49;18
Alex
They you know, they had they were.

00;42;49;18 – 00;42;54;05
Alex
One of the few attended stores in all of Charlotte. That one maybe two part time employees.

00;42;54;19 – 00;42;55;02
Alex
You know that.

00;42;55;02 – 00;43;10;15
Alex
We’re doing some of this volume we started then they started adding at the second or third, fourth or fifth or sixth as we were bringing them more volume. But if you keep in mind before us, they were running a pretty straightforward self-service business with maybe one employee five to 10 hours of their time a week in many instances, because they were mature laundromat.

00;43;10;15 – 00;43;11;18
Alex
They weren’t just getting started.

00;43;12;05 – 00;43;13;09
Alex
And we.

00;43;13;09 – 00;43;20;27
Alex
Like Wash. Yeah. And this is the main thing we learned from last year, flipped that model on its head for them. They were now, you know, needing to be there 30, 40 hours a week, hire.

00;43;21;05 – 00;43;21;15
Alex
Ten.

00;43;21;15 – 00;43;22;12
Alex
Plus people instead.

00;43;22;12 – 00;43;22;28
Alex
Of two.

00;43;23;22 – 00;43;26;26
Alex
Layering technology of their business, which there wasn’t a ton of.

00;43;26;28 – 00;43;27;07
Alex
You know.

00;43;27;16 – 00;43;36;08
Alex
Even five years ago, there wasn’t a lot of technology even two years ago. There’s not a lot of technology in the laundromat industry. And so now you’re asking these kind of legacy owners for the most part.

00;43;36;21 – 00;43;36;25
Alex
To.

00;43;36;25 – 00;43;58;25
Alex
Do three things they’re not comfortable with. It’s managing a lot of people. It’s using a ton of technology and it’s being a hands on operator versus a passive operator, like a really hands on operator. And Washoe learned the hard way. They raised all that money. They scaled the six cities Boston, DC, New York, Chicago, L.A., San Francisco had six or seven Laundromat owners in each city.

00;43;58;25 – 00;44;27;16
Alex
So 40 laundromats that they’re working with all your typical kind of 24,000 square feet or maybe even smaller locations, all trying to keep up with all this volume that the Washoe marketing machine that they’re just burning cash is spending that $20 million to grow. It’s bringing all this demand into these stores that are just overwhelmed. And all of them started losing dozens of orders a day, mixing Jordan’s clothes with mine because again, they hadn’t built a process of that scale or a lot of them had built that type of process.

00;44;27;16 – 00;44;27;24
Alex
At that.

00;44;28;06 – 00;44;28;15
Alex
Point.

00;44;29;00 – 00;44;49;28
Alex
We couldn’t keep up with the volume and so Washoe was losing one, one out of every five orders a day, not making money on it. They just had to shut down. And I going to share that because we were feeling some of those growth pains just in Charlotte with one laundromat. And instead of launching Raleigh as our second city, we all kind of put our heads together up to those conversations and said, Look, we either keep doing what we’re.

00;44;49;28 – 00;44;51;05
Alex
Doing and.

00;44;51;05 – 00;45;01;21
Alex
Increase the risk of us doing the same thing Washoe did and just kind of relying on a supply chain that might not be built to handle tens of thousands of pounds of laundry a month in each.

00;45;01;21 – 00;45;04;06
Alex
Market. What do we.

00;45;04;06 – 00;45;22;20
Alex
Do? How do we build this process ourself? Going back to that pillar I mentioned at the beginning is how do we really take quality back in so that we can guarantee a consistent experience for our customers? And what we noticed is laundromats generate, you know, 50 to 60% of their revenue on the weekends, Monday through Friday, all that equipment is just they’re dead underutilized for the most part.

00;45;23;06 – 00;45;45;00
Alex
And so we went back to the laundromat owner that we were working with and said, Why don’t we rent out? You’re off our capacity. You’re, you know, you’re ecstatic because you have this whole revenue stream you didn’t have with the same amount of hours that you’re used to putting in each week. You can go back to that. So you’re happy we’re happy because we now have full control over the cleaning process without the CapEx of buying washers and dryers in a building and.

00;45;45;10 – 00;45;45;27
Alex
All of that.

00;45;46;16 – 00;46;14;00
Alex
And most importantly, our customers going to get just a much better experience consistently. And so we did that for about ten months. Talk about luck and right timing and serendipity. One of one of my fraternity brothers or friends that I met in college, his family had been in laundry and dry cleaning for 105 years. He was working in Raleigh hated his job, saw what we were doing, happened to reach out right around the time we’re talking to Washoe.

00;46;14;00 – 00;46;14;29
Alex
And I was just saying like, Look.

00;46;15;09 – 00;46;15;20
Alex
I see what.

00;46;15;20 – 00;46;28;16
Alex
You guys have been doing the last seven months. Like, I never thought I’d be wanting to get back in the laundry. I told my dad I wasn’t going to take over the family business like I was the last generation kind of thing. And he saw we were doing. I think I could be helpful here, and I like startups.

00;46;28;16 – 00;46;35;06
Alex
I want to be a part of something bigger. And the reason I mentioned him is there is back Miller. His background.

00;46;35;20 – 00;46;37;05
Alex
Is very.

00;46;37;05 – 00;46;39;20
Alex
Interesting in that not only does families run laundromats and dry.

00;46;39;28 – 00;46;40;15
Alex
Cleaners.

00;46;40;26 – 00;47;01;12
Alex
They did massive volume, individualized production for all these camp kids in Asheville. So hundreds of kids clothes had to keep separate. And so what they did is how much larger capacity washers were there, like orders, you know, let’s say also all the island breeze customers could get mesh bagged into separate separate mesh bags and put into a massive industrial washer.

00;47;01;22 – 00;47;18;23
Alex
But then they have a wall of dryer that would split out the orders back into the individual orders. And so he’d seen this kind of high volume custom cleaning before. And so he came in and help us build the same thing, but leveraging other people’s clothing. Laundromats did that for ten months, cut costs 15 20% quality was through the roof.

00;47;19;05 – 00;47;24;26
Alex
We hadn’t seen anyone else in the industry doing that approach in Washoe was purely Uber for laundry.

00;47;24;26 – 00;47;25;17
Alex
Rinse was.

00;47;26;03 – 00;47;28;23
Alex
Basically more of the same cleanly in New York, same.

00;47;28;23 – 00;47;32;10
Alex
Thing we hadn’t heard.

00;47;32;10 – 00;47;39;10
Alex
Of another model. Try to tackle the laundry industry by controlling the quality that way, but leveraging.

00;47;39;15 – 00;47;39;27
Alex
That.

00;47;40;01 – 00;47;50;08
Alex
That assets basically. And so we’re all high fiving. This is it. This is going to be the model and eventually had some other walls that we had to break.

00;47;50;09 – 00;47;54;25
Alex
Breakthrough but I’ll stop there if you hear any kind of questions.

00;47;55;02 – 00;48;23;04
Jordan
Yeah, no, it’s just a fascinating kind of story saga almost where you know, just I’m feeling the feeling the highs, feeling the lows as you’re talking about like, oh yeah, man, I see where that, you know, as you’re talking, I’m like, oh, they’re going to run into this problem. Oh, yeah. They ran into the problem like, you know, like you can see, you know, being on the back end of things and now seeing how more people have tried different things since you guys have, you know, started and known a little bit of your story.

00;48;23;04 – 00;48;46;08
Jordan
Just know and like, oh, man, you know, it’s an issue. And I mean, I think there’s you know, there’s there’s companies out there right now who are trying to do, you know, similar type things where people are doing laundry in their neighborhoods, at their homes. And, you know, I think they’re going to have a lot of the same issues, probably even more so actually, in my view.

00;48;46;08 – 00;49;10;06
Jordan
I’ve yet to be seen, but or determined, I guess. But I think they’re they’re going to run into issue. So it’s just it’s interesting. It’s fascinating to kind of hear the the saga of everything that you went to in iterations and, you know, how you guys evolved along the way. What was I mean, did you guys set off set out to do business for yourselves?

00;49;10;06 – 00;49;22;02
Jordan
Or do you already have your your sights set higher to say, hey, we’re going to either scale us out to multiple locations or franchises or or like that. What what was your initial ambition?

00;49;22;16 – 00;49;24;20
Alex
Yeah, that’s another piece of advice I’d like to get.

00;49;24;20 – 00;49;41;09
Alex
Anyone starting their own thing is like have that honest conversation with yourself. If it’s just if it’s you on your own, but if it’s you and another partner, have that conversation with yourself and them at some point to be like, Hey, Jordan, is this something we want to do for the next 30 years? Lifestyle business you know, kicking off cash for both of us?

00;49;41;21 – 00;49;43;02
Alex
Or is this like, Hey.

00;49;43;02 – 00;49;48;23
Alex
Jordan, do you want to be the laundry guy forever? Or do you want to try to get in and make something really big.

00;49;48;27 – 00;49;49;26
Alex
Own less of a.

00;49;50;02 – 00;49;51;17
Alex
Hopefully a much bigger pie.

00;49;51;28 – 00;49;53;03
Alex
And then sell it to.

00;49;53;29 – 00;49;56;25
Alex
You know, strategic partner or private equity group?

00;49;57;13 – 00;49;58;06
Alex
And so then I.

00;49;58;06 – 00;50;03;04
Alex
Got into it, you know, I think being coming from success, him coming from the startup world, his company that he was.

00;50;03;04 – 00;50;04;02
Alex
At had.

00;50;04;02 – 00;50;13;13
Alex
Just been bought by NBC Sports for 400 and some million dollars. And so I think he sees Nike’s sports engine. What’s the name of it? They’re building websites basically for like high school sports.

00;50;13;14 – 00;50;18;22
Jordan
Use it for my kids little league to keep track of all the games and practices got the athletes sound.

00;50;19;04 – 00;50;26;22
Alex
He was at sports engine fairly early not now like he wasn’t a founder or anything but he was part of the sales marketing team, sports engine.

00;50;28;07 – 00;50;28;14
Alex
And so.

00;50;28;14 – 00;50;49;29
Alex
He just seen that happen. And I had known enough about startups at that point that I think we’ve had that conversation with each other and determined we want to build a national brand in laundry. And if that takes 15 years, that’s fine. If it takes 20 years, that’s fine. And then five, that’s fine. Our definition of national was that it was in 30 or 40 of the NFL cities that has been and continues to be our ambition.

00;50;49;29 – 00;50;50;09
Alex
And at that.

00;50;50;09 – 00;50;51;13
Alex
Point we’ve.

00;50;51;13 – 00;50;56;00
Alex
Agreed that you’ve created, you know, optionality. You know, we had 30 or 40 cities and we’re both.

00;50;56;15 – 00;50;57;00
Alex
The tank.

00;50;57;00 – 00;51;05;06
Alex
Is still full and we’re both as passionate and energetic about the space and what we’re doing as we are right now, then we’ll keep going. But the important.

00;51;05;06 – 00;51;05;25
Alex
Thing to.

00;51;05;25 – 00;51;12;28
Alex
Him and I was to have the option to do that, that was the focus really was not necessarily a timeframe or a number or revenue goal.

00;51;12;28 – 00;51;13;28
Alex
Or it was.

00;51;14;18 – 00;51;21;14
Alex
Want to solve a really hard problem that hasn’t been solved before in our in our eyes. And we’re open to how long it.

00;51;21;14 – 00;51;21;29
Alex
Takes.

00;51;22;11 – 00;51;33;10
Alex
Depending on our, you know, our passion and energy in the industry. Because if that’s not there, it’s not fair to our team, it’s not fair to our investors, it’s not fair to us. Some of those are a long winded answer that.

00;51;33;22 – 00;51;41;23
Jordan
Yeah, no, I mean, just that’s fascinating. And I mean, I’m not sure that there are 40 NFL cities. I don’t know if there they’re like 32 or 33 teams.

00;51;41;26 – 00;51;42;25
Alex
So so we started out the.

00;51;42;25 – 00;51;48;15
Alex
30 as the 30 NFL cities you want to it’s like the 40 or 50 major cities in the country. Let’s start with the NFL cities.

00;51;49;29 – 00;52;02;23
Jordan
Now just give me our time OK so at this point in the saga you guys are you guys are running the business right like you’re running the operations and all that stuff. It’s your guys’s company. Is that right?

00;52;03;13 – 00;52;05;20
Alex
Yep. So once he raised the capital, I mean.

00;52;05;20 – 00;52;08;14
Alex
Usually when you raise around the capital, you going to give up anywhere from five.

00;52;08;14 – 00;52;08;22
Alex
To.

00;52;09;04 – 00;52;13;00
Alex
15% of the company every time you raise money is a rule of thumb.

00;52;13;16 – 00;52;13;26
Alex
And so.

00;52;14;02 – 00;52;18;26
Alex
His and his company and we know that as we take money and we’re actually giving some equity and ownership out.

00;52;20;23 – 00;52;21;16
Alex
You know, I think.

00;52;21;16 – 00;52;24;28
Alex
Where things really started to accelerate was after we took the process in house.

00;52;25;14 – 00;52;27;05
Alex
We saw one.

00;52;27;05 – 00;52;33;12
Alex
How much of an opportunity there is to do something big. But then to how expensive it’s going to be to build the technology required to do this out of.

00;52;33;12 – 00;52;35;12
Alex
Scale and really, you know.

00;52;35;23 – 00;52;50;04
Alex
Protect that quality to the degree that we want to really building tools for every aspect of the business, the drivers to be set up for success, the person managing the vehicle, the fleets and the vehicles, we saw the success, individuals folding, individuals sorting, individuals washing, drawing you know, all the every.

00;52;50;05 – 00;52;51;12
Alex
Stuff needed.

00;52;51;12 – 00;52;52;09
Alex
Some sort of.

00;52;52;18 – 00;52;52;24
Alex
Your.

00;52;52;24 – 00;53;09;13
Alex
Guide, right? This is all done on paper and pencil. It would be possible, but be much harder and slower, I think, to do and so we knew we needed to make an investment in technology into growth and grabbing market share and knew that that was going to take, you know, unless we wanted this take 40 or 50 years.

00;53;10;00 – 00;53;10;18
Alex
We knew that.

00;53;10;18 – 00;53;36;09
Alex
Raising outside capital would allow us to get there faster. So then we went and raised two and a half million dollars around the capital, got accepted into the Techstars accelerator. So it’s like going to get your MBA that one of the top five schools, they’re going to Harvard, we’re going to Stanford. They accept less than half a percent of the companies that apply Dropbox went through on Airbnb, went through on a lot of these major brands that we all know went through one of these top two or three accelerators.

00;53;36;21 – 00;53;58;22
Alex
And we were fortunate enough to get accepted we use that to launch Atlanta as our second city in January of 18. And at that point we started to run into those other roadblocks and challenges that I mentioned. And that was we had three laundromats in Charlotte at that point because we outgrew the first one very quickly. Just because there’s laundromats are not designed for this much volume coming in every day.

00;53;59;01 – 00;54;10;04
Alex
And so we very quickly to three, they’re kind of spread out all over the city. Different owners, different personalities, different equipment, some as hip, some as dexterous, some as Electrolux, some is 20 years old.

00;54;10;04 – 00;54;12;23
Alex
One store had some new equipment.

00;54;13;19 – 00;54;17;26
Alex
Some one was 1500 square feet, one was 4000 square feet. There’s all this.

00;54;17;26 – 00;54;18;18
Alex
Variability.

00;54;19;28 – 00;54;27;09
Alex
You had some goofy stuff happen to. I’ve shared this anecdote before, but, you know, one owner understood, hey, you’re bringing me another 15 to 20 grand a month in revenue.

00;54;27;09 – 00;54;29;24
Alex
I didn’t have another owner was like, you know.

00;54;30;03 – 00;54;38;12
Alex
Kind of harping us, Alex, you know, your team is using my bathroom too much nerves flying through toilet paper. I need to start charging you $40 a month for toilet paper.

00;54;38;26 – 00;54;41;22
Alex
I’m like, Steve, a brand new 15,000.

00;54;41;22 – 00;54;42;19
Alex
Dollars in revenue.

00;54;42;19 – 00;54;50;21
Alex
You didn’t have to buy that at Costco. Get more toilet paper wise bugging you and that just like it’s not that.

00;54;50;21 – 00;54;52;25
Alex
It was a huge challenge, but we just realized.

00;54;53;08 – 00;54;54;16
Alex
We’re kind of at the whim of.

00;54;54;16 – 00;54;57;09
Alex
The laundromat and dry cleaning partners that we find.

00;54;57;09 – 00;54;58;08
Alex
And the.

00;54;58;08 – 00;55;14;12
Alex
Laundromat part seems so sensitive because it’s we’re asking people to do even. It’s also our own team coming in. It’s just still so different to what they’re used to as the dry cleaning wholesaler. Again, it’s like yeah, bring me the volume. I want to be I’m an operator. Bring me thousands of more pieces. That’s my dream. I want more volume in here.

00;55;14;12 – 00;55;30;00
Alex
And that’s, that’s how I make money. Or as a laundromat owner, is like, this is an and this isn’t their main business is a laundromat business at its core. And that’s why they got into it. And now they can have some pick up in delivery volume from customers that might not ever step foot in their laundromat. It’s not competitive.

00;55;30;00 – 00;55;34;03
Alex
It’s not replacing what they used to do. It’s more work, you know, for them to think about.

00;55;34;03 – 00;55;36;13
Alex
And so we just kept.

00;55;36;13 – 00;55;52;19
Alex
Seeing that theme and thought and we were hearing about rents at that point and cleanly kind of running into some of these challenges at a larger scale than we were at. And there was just more and more evidence we have to vertically integrate. We have to design stores for this kind of hybrid use. We have to make sure that the right size.

00;55;52;19 – 00;55;54;09
Alex
Layout still.

00;55;54;09 – 00;55;58;07
Alex
Don’t use the money we raise to build the store because it’s, you know, we’re giving up equity to.

00;55;58;07 – 00;55;58;14
Alex
To.

00;55;58;28 – 00;56;19;18
Alex
You know, to get this money. And we felt like technology and growth had more of a return on it than one single store would have. And so still not bankable because we’re burning through money. There’s growing spending on marketing and growing and launching Atlanta. So we’re still going to stuck in this crossroads. And that’s when we have our stroke of luck and right timing Electrolux they’re an $18 million appliance company.

00;56;19;27 – 00;56;24;23
Alex
They do a lot more than just washers and dryers. They’re more well known for kitchen appliances.

00;56;24;23 – 00;56;25;18
Alex
And big.

00;56;25;21 – 00;56;27;17
Alex
Commercial kitchen appliances, vacuums, et.

00;56;27;17 – 00;56;29;18
Alex
Cetera. But their North.

00;56;29;18 – 00;56;44;02
Alex
American headquarters happens to be here in Charlotte, where we are and where we started there. Head of laundry Tom Wash. Brooks sits here and we are connected to Tom. I think you’ve seen a couple of Charlotte business journal journal articles about us. And, you know, we all just start talking.

00;56;44;02 – 00;56;44;13
Alex
About.

00;56;45;05 – 00;56;51;27
Alex
You know, what we’re doing. And, you know, they like the approach of having our own team leveraging these underutilized assets and.

00;56;52;19 – 00;56;52;29
Alex
You know.

00;56;53;10 – 00;56;54;22
Alex
Kept encouraging us to build our own.

00;56;54;22 – 00;56;56;13
Alex
Store and.

00;56;56;19 – 00;57;00;23
Alex
Explained why we couldn’t. And that’s where things got pretty interesting. Electrolux and Laundry.

00;57;00;23 – 00;57;01;06
Alex
Likes.

00;57;01;19 – 00;57;04;20
Alex
We’re both like, Hey, well, we can help with that. We can finance you 100% of the.

00;57;04;20 – 00;57;06;13
Alex
Equipment we can give you, you know.

00;57;06;13 – 00;57;19;09
Alex
Some, you know, good pricing and we want to, you know, like basically want to test and see how this works out. Or if you guys build a store and run all of your pick up and delivery volume into it, what does that look like on a large scale? And if you guys designed and built it the way that you’re saying you want to.

00;57;19;09 – 00;57;35;22
Alex
So we ended up buying an old McDonald’s in Charlotte is 6300 square feet. And the idea that was that 4700 square feet would be customer facing the other 2000 basically in the back would be for office and processing know people doing all that additional.

00;57;36;16 – 00;57;36;25
Alex
Pickup and.

00;57;36;25 – 00;57;37;14
Alex
Delivery volume.

00;57;38;04 – 00;57;40;12
Alex
And we had no idea.

00;57;40;12 – 00;57;49;00
Alex
What to expect on the laundromat side. And then keep in mind the first three or four years we were purely pickup and delivery marketplace type approach to now owning this physical.

00;57;49;00 – 00;57;51;25
Alex
Land and building and completely.

00;57;51;27 – 00;57;55;22
Alex
A different customer base coming in. It’s typically you know lower income demographic and.

00;57;56;04 – 00;57;56;10
Alex
These.

00;57;56;10 – 00;57;58;12
Alex
Non-Major markets that are using laundromats.

00;58;00;03 – 00;58;01;28
Alex
And we treated the same way we did two years.

00;58;02;11 – 00;58;06;20
Alex
Customer at the forefront beautiful design all these amenities. Well let’s.

00;58;06;20 – 00;58;07;13
Alex
Say, you.

00;58;07;13 – 00;58;13;12
Alex
Know surveying customers that use laundromats to see what things do you want or need out of a laundromat. Really put that same level of thought into to and I.

00;58;13;13 – 00;58;15;05
Alex
Just we had no idea.

00;58;15;05 – 00;58;21;10
Alex
Once we build this four people show up there’s a laundromat right across the street. People may be in their habits and want to use that person.

00;58;22;00 – 00;58;22;28
Alex
Pretty risky and.

00;58;22;28 – 00;58;23;22
Alex
A scary time.

00;58;24;08 – 00;58;25;22
Alex
And have just blown.

00;58;25;22 – 00;58;50;11
Alex
All of us our way. The walk in revenue grew faster than we thought we we eclipsed 40 grand in monthly walk in revenue within four and a half months. Of starting the business the cash flow on its own covered the loan to you know laundry and Electrolux covered the note on the land cover you know all the expenses for not just a walk in customer but also the pick up and delivery volume we’re doing to cover all those variable costs and a cash flow on top of it’s all.

00;58;50;28 – 00;58;51;28
Alex
This is way better than we thought.

00;58;51;28 – 00;58;54;22
Alex
It would be we were hoping the walking would even break even that would’ve been.

00;58;54;22 – 00;58;55;05
Alex
Fine.

00;58;57;08 – 00;59;01;18
Alex
And so you we’re all really excited. This is the model, right? We have to build more of these. There are not cheap.

00;59;02;09 – 00;59;02;24
Alex
Million to a.

00;59;02;24 – 00;59;04;20
Alex
Million and a half if you’re going to call de novo.

00;59;04;20 – 00;59;05;08
Alex
New and.

00;59;07;04 – 00;59;14;19
Alex
So at another crossroads again, how do we rebuild more of these faster? I’m going to pause right there just to see if there’s any new kind of questions or comments as.

00;59;14;19 – 00;59;14;26
Alex
We.

00;59;15;27 – 00;59;16;25
Alex
Are going through the story.

00;59;17;11 – 00;59;45;06
Jordan
Yeah. No, I mean, I’m I’m just taking it in, dude. I’m just it’s it’s so fascinating to me, you know, as somebody who you know, I’m a I’m a laundromat aficionado, of course, but I’m also just sort of a business and startup aficionado. And so here in kind of the experience there and you know, and I want to encourage anybody who’s listening to this right now, you know, who, you know, is maybe just more into the Laundromat thing and all that.

00;59;45;15 – 01;00;27;07
Jordan
Like we’ve been thinking of this and in your context, right? There’s a lot of things that apply to whatever context, context you’re in, whether that’s you just own a mom and pop laundromat in your small city or you’re trying to build a pickup delivery business or whatever, you know, be applying some of these principles and, you know, what I’m hearing a lot of is a lot of iterations, a lot of evolution, a lot of, you know, figuring out how to take the next step a lot of, you know, reaching out to other people for, you know, input and advice and, you know, connecting and finding ways to partner in ways that benefit both parties.

01;00;27;07 – 01;00;44;18
Jordan
And, you know, I hear a lot of all of those things that I think benefit everybody. So I just want to point that out as you know, as you keep telling your story and and also just kind of tease like, hey, you know, I’m going to ask Alex about, you know, some of this the franchising questions here soon as soon as we get there.

01;00;44;18 – 01;00;49;10
Jordan
So that’s what you’re hanging on for. Hang on just a little bit before we’re getting there. So keep going.

01;00;49;10 – 01;00;54;16
Alex
I’m almost to the yeah, I’m almost to the franchising part. You know, so at that point when we.

01;00;54;16 – 01;00;57;10
Alex
Thought, hey, we have to build more of these, but how we’re going to do that, they’re expensive.

01;00;58;26 – 01;01;00;24
Alex
We had been approached.

01;01;00;24 – 01;01;07;17
Alex
To the franchise a few times already at that point, but we’d always told, look, we want to get to three or four cities and then we’ll we’ll think about it.

01;01;07;26 – 01;01;08;20
Alex
Entertaining it again.

01;01;09;03 – 01;01;14;19
Alex
And so we’re very much in the mindset of this first one open. We’re going to still do this corporately. 100% corporate.

01;01;14;19 – 01;01;14;28
Alex
Owned.

01;01;16;01 – 01;01;17;17
Alex
Want to find ways to, you know.

01;01;17;18 – 01;01;17;28
Alex
Either.

01;01;18;10 – 01;01;19;08
Alex
Raise bank debt.

01;01;19;08 – 01;01;20;28
Alex
Or private equity.

01;01;20;28 – 01;01;27;14
Alex
Debt or have to figure out another way to raise the money we need to build to build these stores. Or maybe Electrolux alone will actually help finance those.

01;01;28;28 – 01;01;29;19
Alex
And so.

01;01;30;08 – 01;01;42;26
Alex
You know, the success of the first one, we realized we need to go do this in Atlanta. We were in Atlanta at that point, but during the old model where we were hiring our own team to go into other people’s laundromats. So we kind of had two things going on. You know, one way or another, people stores one or in our own in Charlotte.

01;01;43;19 – 01;01;44;25
Alex
And so at that point.

01;01;45;09 – 01;02;03;26
Alex
We raised $6 million from investors, I think because of how well the first started knowing that we were gearing up to start scaling it much faster at that point. This was in the fall of 2019 launched Raleigh in January of 2020 and then as we all year we all know the world kind of flipped upside down with COVID.

01;02;04;10 – 01;02;05;01
Alex
And.

01;02;05;13 – 01;02;08;16
Alex
We had another big kind of inflection point in our story.

01;02;08;17 – 01;02;10;22
Alex
You know talking about the.

01;02;10;22 – 01;02;22;28
Alex
Highs and the lows. We had just come off of raising $6 million. I never even imagined what that would look like having responsibility over, you know, as an entrepreneur this is like a first in many ways and the level of responsibility.

01;02;22;28 – 01;02;24;19
Alex
Of people believing in you that much.

01;02;25;12 – 01;02;34;10
Alex
But still a really good feeling, you know, high all around the team’s excited. This money means we have more capabilities. We can add more resources, invest in other things and.

01;02;34;10 – 01;02;38;13
Alex
Projects and so there’s this huge high.

01;02;38;18 – 01;02;40;07
Alex
We launch really huge high.

01;02;40;16 – 01;02;40;28
Alex
And then our.

01;02;40;28 – 01;02;44;17
Alex
Board calls a meeting the first week in February, late January.

01;02;45;00 – 01;02;47;24
Alex
And you know, to this day is one.

01;02;47;24 – 01;02;52;28
Alex
Of the most tremendous displays of foresight that I’ve ever experienced, though like.

01;02;53;13 – 01;02;53;23
Alex
We’re all.

01;02;53;23 – 01;03;08;19
Alex
Naive. I don’t know why our society and other companies aren’t are responding more appropriately, but this is going to get only worse before it gets better. And this is at a time where there’s only two or three cases in Washington State. There’s like zero elsewhere in the country at this point. And they say, look, look at Europe, look at Asia.

01;03;08;28 – 01;03;23;03
Alex
There are hospitals are overwhelmed. All their businesses are like shut down and they’re doing stay at home orders. It’s not a matter of where if you know, it’s a matter of when this is going to happen. So just start acting like it’s here already. So what would you do? Like you probably shut Raleigh down. You just lost it.

01;03;23;03 – 01;03;37;01
Alex
It’s wasting, you know, it’s burning money. It’s not going be profitable for a year. So just just give up on Raleigh for now until we know more about what’s happening in the world. Atlanta will keep open to see because we’re under contract to build a store there but even then, they’re like, it might just be too late to start.

01;03;37;01 – 01;03;51;23
Alex
That building project is expensive and time consuming, and everyone’s going to stop working and want to be backwards all of a sudden, if things do go that direction, and so they just called everything. Those businesses are going to shut down. Hospitals are overwhelmed. Everything’s going to stop, and you guys going to be sitting on this pile of cash.

01;03;51;23 – 01;04;12;07
Alex
And so focus on that. Focus on getting this team to the point where it’s the best, you know, the best members on the team. You’ve got that money and you can now have two months to really focus on what parts of our business were working, what parts were not, what parts would you double down on, et cetera. And sure enough, everything they said in late January happened almost exactly how they called it.

01;04;12;07 – 01;04;39;06
Alex
And it just blew my mind. And I think the importance of surrounding yourself with smart people, good people and that experience. And so we listened to them. We took those two months. And the theme that we came up with, the themes that we were noticing, we looked at, we build software exclusively for laundromats and dry cleaners. Do we use our pickup and delivery software in our fleet to deliver other things that was too crowded with Amazon and the million other pickup and delivery companies?

01;04;40;17 – 01;05;05;02
Alex
And the themes we kept coming back to is our laundromat grew 22% throughout the first six or so months of COVID, when most their retail businesses were down 20 to 30%. Restaurants, fitness concepts retail shopping, all of it was down. Laundry was deemed essential in all states. I think people were flocking to our city. There are others shut down or they weren’t taking safety precautions to the level that we were as far as social distancing.

01;05;05;02 – 01;05;19;22
Alex
Hey, wait in your car, outside of our outdoor seating, while your clothes are in the washer dryer, you’re giving people masks. It’s like really leaning into what our customer was telling. They wanted to feel comfortable. So we started doing all those things, social distancing before it was cool.

01;05;21;03 – 01;05;21;09
Alex
Again.

01;05;21;09 – 01;05;40;27
Alex
Just from customers telling us, I would feel safer if you did X and we would do X nine out of ten times. And you know, so we saw that theme. We need to build more of these stores faster. How do we do that without raising 50 to $100 million? Which seems like an impossible task in and of itself. And the second thing was we’re trying to do too much.

01;05;40;27 – 01;05;52;24
Alex
We have a pickup and delivery fleet of 20 vehicles and 25 drivers. We’ve got operations in three cities or had operations in three cities. We’re running a retail laundromat about to build more of them.

01;05;53;05 – 01;05;53;14
Alex
And we have.

01;05;53;14 – 01;05;59;27
Alex
A team of like a small army of people processing the amount of volume we’re doing in Charlotte. I mean we had 50 part time employees because we were.

01;05;59;27 – 01;06;00;10
Alex
Doing.

01;06;01;01 – 01;06;04;24
Alex
130 hundred and £40,000 a month at that point. It was just an insane amount of.

01;06;04;24 – 01;06;09;08
Alex
Volume and so when we saw.

01;06;09;08 – 01;06;12;00
Alex
Those two teams we thought, Hey, maybe we can solve both at the same time and.

01;06;12;13 – 01;06;13;02
Alex
Could we.

01;06;13;02 – 01;06;14;11
Alex
Explore that franchising.

01;06;14;19 – 01;06;15;03
Alex
You know.

01;06;15;13 – 01;06;25;14
Alex
Opportunity that people been asking us about sooner because one that allows us to build a lot more of these retail laundromats faster. We could provide value to them through.

01;06;25;29 – 01;06;26;08
Alex
Everything.

01;06;26;08 – 01;06;28;00
Alex
That we’ve learned over the store.

01;06;28;06 – 01;06;28;18
Alex
The.

01;06;28;18 – 01;06;32;29
Alex
Preferential pricing, helping with the data driven site selection approach.

01;06;33;12 – 01;06;34;00
Alex
You know, kind of all.

01;06;34;00 – 01;06;35;10
Alex
The stuff that a distributor would.

01;06;35;10 – 01;06;36;22
Alex
Typically you know, help with.

01;06;37;21 – 01;06;47;07
Alex
A laundromat. So I’m getting into the laundry industry and then the two value adds on top of it were all the technology we’ve built to make running a laundromat easier. Processing almost pick up and delivery volume easier.

01;06;48;10 – 01;06;50;14
Alex
And then the volume itself.

01;06;50;22 – 01;06;57;15
Alex
Could we go acquire that volume? We’ll take care of all of that. We’ll take care of the pickup and delivery, we’ll take care of the customer care and.

01;06;57;15 – 01;06;58;01
Alex
Support.

01;06;58;18 – 01;07;06;00
Alex
The franchisee. We’ll have this additional revenue stream that could generate, you know, three to 500,000 in revenue per location.

01;07;07;03 – 01;07;07;22
Alex
All they need to do.

01;07;07;22 – 01;07;15;02
Alex
Is they need a washer dryer fold. And so their operation isn’t dislodged too, too much. Then the typical laundromat that goes over the counter Wall Street.

01;07;15;02 – 01;07;16;07
Alex
Fold they don’t.

01;07;16;07 – 01;07;24;25
Alex
Have to worry about vehicles and drivers and acquiring two different customer based customer support and all that. So we started putting that thesis together.

01;07;25;13 – 01;07;26;00
Alex
And.

01;07;26;16 – 01;07;32;25
Alex
The power of the network really exhibited itself. Again, here we sent one email out to all of our investors, and within a week we’re talking to the Chick-Fil-A.

01;07;32;25 – 01;07;33;19
Alex
Family, the.

01;07;34;07 – 01;07;54;28
Alex
Founders of sports Eclipse, the guy that founded Anytime Fitness, like all these amazing franchise brands, and they’re giving us the dos and do nots in the category. Don’t set up royalties like this. Make sure that you’re providing value in these three ways. Make sure there’s this massive crash course in franchising. And so launched Laundry Lab is the franchise.

01;07;54;28 – 01;07;56;12
Alex
Brand in.

01;07;56;12 – 01;07;58;03
Alex
February of 2020.

01;07;58;03 – 01;07;58;12
Alex
One.

01;07;59;11 – 01;08;05;07
Alex
And our goal last year sell sell 17 license. So let’s see if this is a concept that people even want to get into.

01;08;05;16 – 01;08;05;22
Alex
It’s.

01;08;05;22 – 01;08;08;15
Alex
A high investment point just given the amount of equipment and machinery in.

01;08;08;21 – 01;08;09;29
Alex
The category.

01;08;10;21 – 01;08;29;28
Alex
Let’s see if people want it and now we’re about a year into starting to sell it and we’ve sold 47 licenses now we’ve won more than doubled what our initial goal was. It turns out people really are receptive to the category. 80% of those franchisees want the two you pick up in delivery volume. So a lot of them are coming in.

01;08;29;29 – 01;08;31;04
Alex
Thinking they’re.

01;08;31;04 – 01;08;34;10
Alex
Going to do three to five of these, not just one off or.

01;08;34;23 – 01;08;34;27
Alex
Two.

01;08;35;03 – 01;08;37;20
Alex
Ones and twos, any type of deal they want to.

01;08;38;05 – 01;08;38;21
Alex
And they’re coming.

01;08;38;21 – 01;08;42;15
Alex
In with a pretty hefty balance sheet or groups are coming in together to buy, you know, three to five.

01;08;42;15 – 01;08;43;01
Alex
Plus.

01;08;43;18 – 01;08;50;05
Alex
To really build out a core operation that will handle a ton of pickup in delivery volume at each disparate location.

01;08;51;10 – 01;08;52;23
Alex
So that’s the full story of how we got.

01;08;52;23 – 01;08;57;19
Alex
Into franchising, how I got into the industry, the pickup and delivery component, the retail component.

01;08;57;19 – 01;08;58;19
Alex
And, you know, the.

01;08;58;19 – 01;09;03;10
Alex
Story is not over yet. I’m sure there’ll be some more ups and downs, but that’s the chapter on right now.

01;09;03;27 – 01;09;43;13
Jordan
Yeah, what a wild story, man. So, so cool to hear from college class to where you’re at now with 47 franchise licenses and grow. And I’m sure, you know, I get asked about franchises all the time and so, you know, I’m going to pass some of those questions on to you, the expert here in a second. Real quick, one question that I’ve had since way back in the story is how how are we I mean you’re you’re bringing in you were bring in at one point you know these laundromats before you had your own stuff and all that two to £3,000 a day.

01;09;43;21 – 01;10;01;07
Jordan
I mean, I think there’s probably going to be a lot of laundromat owners listening to this being like, how, how how did you do that? I like to be that. How how did you do that? So how are you getting the volume that you were getting of of laundry? So as far.

01;10;01;07 – 01;10;02;17
Alex
As the acquisition on the to you.

01;10;02;17 – 01;10;04;06
Alex
Side, I mean, I think having.

01;10;04;18 – 01;10;20;29
Alex
A service offering where we could go pick up laundry and dry cleaning. So was a one stop shop. You know, we all have Amazon for this, Instacart for that. I think they’re becomes like subscription or service fatigue. And so I think anything to make why Amazon people like so much is you can go there for thousands of different things versus.

01;10;21;26 – 01;10;23;23
Alex
You know even Walmart.

01;10;23;23 – 01;10;28;15
Alex
Or something that has stores a ton of SKUs. It’s less so and so it feels like well if they don’t have.

01;10;28;15 – 01;10;31;19
Alex
That you know target that I need to go to this.

01;10;31;19 – 01;10;43;16
Alex
This category. You know so this is again this idea of a one stop shop really help with cross-selling people that were you came in on laundry then we converted the laundry and dry cleaner came in on dry cleaning converted so leveraging our existing customer base.

01;10;44;00 – 01;10;44;26
Alex
And the rest was just a.

01;10;44;26 – 01;10;55;08
Alex
Ton of word of mouth and leveraging those family, you know, those really those kind of mom influencers and ambassadors to post on next door and Facebook groups and.

01;10;55;24 – 01;10;55;29
Alex
The.

01;10;56;00 – 01;11;02;22
Alex
Moms of South Charlotte and those those various kind of groups just like we have in the laundry industry. I mean, with the.

01;11;03;11 – 01;11;03;27
Alex
Laundromat.

01;11;03;27 – 01;11;19;03
Alex
Owners group and the was three or four of them that come to mind right now that, you know, a lot of us go to for tips and advice the same thing is happening for parents. And, you know, this is again, a family service that families need. And so where are those families and how do you meet them where they are?

01;11;19;22 – 01;11;36;01
Alex
So a lot of our acquisition was word of mouth in those groups, our vans and our branding you can’t miss. It’s hot, hot, bright, hot pink. Our vans are all wrapped. So when you’re in, you know, you’re working from home or you’re up for a walk and you see a bright pink van driving by that says laundry pick up and delivery, it’s hard to miss.

01;11;36;01 – 01;11;52;02
Alex
And then you see your neighbors have pink and blue bags on their front steps. You start thinking what do they know? Something I don’t know. Should I be doing that? And they start thinking about how much time they’re spending on laundry, and it becomes a pretty quick, easy decision for them to say, Yeah, I outsource the lawn cutting, I outsource grocery pick up.

01;11;52;02 – 01;11;53;24
Alex
Why am I not outsourcing this?

01;11;55;13 – 01;12;20;07
Jordan
Yeah, I love that. Well, and I mean, I don’t know, way back I don’t know, probably in the early like twenties or something of episodes I was talking, I don’t even remember who maybe was Matthew Simmons or I forget who we’re talking about, dude. I think we underutilized influencer marketing and laundromats because there’s a lot of local influencers and that’s basically what you did.

01;12;20;07 – 01;12;42;28
Jordan
I mean, it wouldn’t probably fall under traditional influencer marketing where you go find, you know, some person with a really in-person audience, but that’s what it is, right? It’s like finding people who are influential in the community that and the demographic that you’re, you know, that you’re trying to serve and you know, get them to endorse you and, and promote you and, and spread it.

01;12;42;28 – 01;13;04;09
Jordan
And people trust that. Right? And so, I mean, I think that’s genius. Whether you did it on purpose, or not, I don’t know. But I mean, I think it’s genius to do that because it’s so powerful and we should be thinking more and more, you know, just as Laundromat owners, how how do you utilize influencer marketing in our in our marketing plans?

01;13;04;19 – 01;13;05;11
Jordan
So I like that.

01;13;05;28 – 01;13;09;22
Alex
Yeah. And the second thing, too, is like, we tried to we obsess over how we find.

01;13;09;22 – 01;13;16;23
Alex
One too many relationships. Like can we get a partnership with an apartment building that will send an email to the 250 people that.

01;13;16;23 – 01;13;17;25
Alex
Live here and.

01;13;17;25 – 01;13;19;19
Alex
That was really effective or like going.

01;13;19;19 – 01;13;22;22
Alex
To we.

01;13;22;22 – 01;13;30;06
Alex
Did. We tried stuff with hospitals. I think at one point, even like people that works, we thought like, hey, if you just had a surgery or something, you probably don’t want to go home and do laundry. You need.

01;13;30;06 – 01;13;30;16
Alex
Help.

01;13;31;12 – 01;13;35;18
Alex
Doing that. So we were trying to get like hospital groups to do this as like gifts or care packages.

01;13;35;18 – 01;13;36;05
Alex
For.

01;13;36;23 – 01;13;48;13
Alex
Their family members. Asked how they could help or another one was like registries you know, for people having babies is like if you’re not a kid and you’re probably tired and you got your hands full now and you want to be doing laundry. So could this be.

01;13;48;13 – 01;13;48;27
Alex
Like a.

01;13;49;11 – 01;13;50;05
Alex
Registry gift.

01;13;50;05 – 01;13;50;24
Alex
For.

01;13;51;14 – 01;13;54;00
Alex
The friends of a family that just had a child.

01;13;54;17 – 01;13;55;02
Alex
And they’re going.

01;13;55;03 – 01;14;02;00
Alex
To these like things where you could do one or two efforts but reach dozens of people? We were constantly trying to find where do those exist in the world.

01;14;02;28 – 01;14;21;26
Jordan
Yeah, and just to throw a couple I love that. I mean, that’s huge. And just throw a couple more out that I have heard or just come to mind right now is, you know, property managers. You know, I know a lot of people who are who are able to there’s some unique challenges about serving Airbnb and stuff like that.

01;14;21;26 – 01;14;48;19
Jordan
But if you’re able to, you know, figure that out, working with property managers who are managing short term rentals is another good one. You know, different associations, too, you know, that that you can kind of reach out to and advertise with that that serve, you know, particularly like commercial clients or customers who, you know, you might be able to service, you know, their laundry.

01;14;48;19 – 01;15;20;07
Jordan
So looking for the one to many relationships are huge and there’s a whole lot of different ways. I like the apartment, you know, complex and and that not only is a one to many, but it also adds a lot of efficiency you’re right. If you got to go, you know if you can figure out how to pick up everybody’s laundry on Tuesday and bring it all back on Thursday and pick up a new batch on Thursday, when you drop off the other and bring it back on Tuesday or whatever, like huge efficiencies in that you can even offer, you know, perks or discounts or whatever to people for doing stuff like that.

01;15;20;07 – 01;15;46;27
Jordan
So there’s a lot of benefits to linking to those one. Too many love that. That’s an awesome OK, so let’s talk let’s talk franchising here. What does it look like? Walk me through the process. First of all, let’s say I come to you, Alex, dude, I’m a baller and I’m looking to, you know, getting in this business here, you know, what does it look like for me to become a franchisee?

01;15;48;04 – 01;15;53;21
Jordan
Well, first of all, before we get into that, what are the franchising option offerings that you guys offer?

01;15;53;21 – 01;15;57;20
Alex
What yeah, so the main approach and after all those.

01;15;57;20 – 01;16;01;16
Alex
Conversations we had with, you know, the other massive franchise or brands out.

01;16;01;16 – 01;16;01;26
Alex
There.

01;16;02;20 – 01;16;22;22
Alex
You know, there are some approaches where people will sell like a whole state like Jordan could buy the rights to their Colorado. And now you’re basically reselling our licenses to other people and you’re making some percentage on that. But we’ve we got a lot of advice that can dilute the quality of the candidates you’re bringing in. It gives, it gives basically creates a layer between us and our franchisee.

01;16;22;23 – 01;16;24;22
Alex
And then I’ve always been very intimate with.

01;16;25;08 – 01;16;25;17
Alex
You know.

01;16;25;17 – 01;16;30;04
Alex
The cleaning process who are working with us, being pretty methodical and thoughtful about who we partner with.

01;16;30;20 – 01;16;31;05
Alex
And.

01;16;31;05 – 01;16;50;27
Alex
We didn’t like. And we got a lot of advice to avoid that. So we didn’t we don’t sell out, you know, whole states or whole cities. But what you can do is you could come in and say, hey, based on my net worth, my liquidity, you know, et cetera, making sure that you’re qualified and this isn’t going to be you kind of going out in front of your skis or getting yourself under water because we need we need our franchisees to be successful.

01;16;50;27 – 01;16;51;29
Alex
We’re completely aligned.

01;16;53;13 – 01;16;53;15
Alex
Yeah.

01;16;53;18 – 01;17;15;27
Alex
So depending on that that person or that family or that group’s background, you could come in and say, hey, I want a two pack. They call them packs. And franchisees say, I want to passing on two locations. I want three or five or ten. And you’ll basically say, I want them in Charlotte or whatever market you’re in. And I guess before you make that decision, you know, you’re probably exploring other franchise concepts that might work for you.

01;17;15;27 – 01;17;23;27
Alex
And that’s either because you found it on your own and you’re Googling and doing your own research, or a franchise broker reached out to you and said, Hey, Jordan, based on your background, I think.

01;17;24;17 – 01;17;24;19
Alex
You.

01;17;24;19 – 01;17;30;06
Alex
Might be interested in a gym franchise or whatever. And they start to kind of do that process with you almost like a business broker or.

01;17;30;06 – 01;17;30;13
Alex
A.

01;17;31;08 – 01;17;32;04
Jordan
Gym franchise.

01;17;33;05 – 01;17;34;12
Alex
They saw your profile picture.

01;17;34;12 – 01;17;36;17
Alex
And thought, This is a joke.

01;17;36;20 – 01;17;42;20
Jordan
Yeah, this is all my physique. When I was swimming in the Speedo and they’re like, This guy’s got to own a gym right now.

01;17;42;20 – 01;17;45;25
Alex
Like a whole series in theory. That’s right.

01;17;47;23 – 01;17;49;11
Jordan
All right. So there you go.

01;17;49;13 – 01;17;50;15
Alex
And so they’ll.

01;17;50;16 – 01;17;53;28
Alex
Reach out and they’ll help you figure out, you know, what is the right concept for you.

01;17;54;13 – 01;17;55;03
Alex
And.

01;17;55;16 – 01;17;58;28
Alex
You know, based on that, worth your interest your lifestyle, all that.

01;17;59;06 – 01;17;59;21
Alex
And so let’s say.

01;17;59;21 – 01;18;03;07
Alex
You find your way to Lawndale out at that point, whether it was through a broker or.

01;18;03;07 – 01;18;04;09
Alex
Through just your.

01;18;04;09 – 01;18;07;22
Alex
Google searching or hearing us on a podcast or a Facebook ad or.

01;18;07;22 – 01;18;08;29
Alex
Whatever way you heard about it.

01;18;09;13 – 01;18;19;11
Alex
You’re then going to do a business overview call with one of the owners, one of the founders, and they’re gonna walk you through like, hey, here’s a launch. A lab is all about here’s how we’re different. Here’s the value that we provide you, the support we.

01;18;19;11 – 01;18;23;11
Alex
Provide to you. Here’s the candidate that we typically look for.

01;18;23;14 – 01;18;41;01
Alex
In a partner. If you’re still interested in qualified, at that point, you’ll do a unit economics call, and that’s where you just kind of tear the model apart. You know, how much revenue does one of these do? What’s the cost to get into it? What’s the margin profile look like? Labor profile utilities run every line of the detail.

01;18;42;03 – 01;18;59;13
Alex
You do a couple of other calls about, you know, what the commitment is over the next ten years. Kind of what you’re committing to. And then the last step is to go to what’s called the Discovery Day. And this is pretty common again for regardless of the franchise brand is what franchising the process looks like. So Discovery Day, you typically fly to the headquarters of the brand.

01;18;59;13 – 01;19;04;07
Alex
You see a couple of stores in person. You meet other franchisees that are.

01;19;04;07 – 01;19;07;01
Alex
There you meet the team.

01;19;07;08 – 01;19;14;01
Alex
It’s really just kind of day and a half final date before you decide you’re going to get married or not. And at that.

01;19;14;01 – 01;19;16;02
Alex
Point, you know, it goes both ways.

01;19;16;02 – 01;19;22;09
Alex
We’re interviewing candidates just as much as candidate candidates are interviewing us. We want to make sure that this is something we want to work with for ten years because again, this is a ten year.

01;19;22;17 – 01;19;22;25
Alex
You know.

01;19;22;28 – 01;19;24;21
Alex
In many cases, ten years plus commitment.

01;19;26;00 – 01;19;26;10
Alex
And so.

01;19;26;10 – 01;19;27;29
Alex
It’s kind of a two way interview.

01;19;28;16 – 01;19;28;25
Alex
And let’s.

01;19;28;25 – 01;19;30;21
Alex
Say at that point, you say, you know, I want to go into launch.

01;19;30;21 – 01;19;31;00
Alex
Lab.

01;19;31;10 – 01;19;54;01
Alex
At that point, it’s you’re paying upfront for the rights to territory that you’re buying. So it’s 49,000 for the first license. That’ll be the let’s say let’s pick on Dallas Texas I there’s 20 that could fit there. You might say I want five of them so you’ll pay 49 for the first license, 39 for the second time for the third, 25 for the fourth, 19 for the fifth and anybody on the fifth this fall at.

01;19;54;01 – 01;19;55;19
Alex
90 and the reason.

01;19;55;19 – 01;20;00;11
Alex
I guess franchising works that way is to so that the company can sell out territories and know who’s going to own each.

01;20;00;11 – 01;20;00;27
Alex
Place.

01;20;01;04 – 01;20;06;01
Alex
And then you start building, it’s basically you, no one else can touch those five out of the 20 that you picked in Dallas.

01;20;06;01 – 01;20;09;11
Alex
At that point anywhere in the ground.

01;20;09;16 – 01;20;27;22
Jordan
Real quick, I just want to point out this is April that we’re recording this of 20, 22. So if you’re listening to this years down the line, those numbers may have changed. But I just want to point that out as a caveat. This is for right now and I mean, we didn’t talk about that. I’m assuming some point down the line that may or may not change.

01;20;27;23 – 01;20;36;10
Jordan
I just want to point that out. Yeah, you’re listening to this. Those numbers may or may not be accurate, but if they’re if they’re not accurate, is there a is there a place you can point them?

01;20;37;10 – 01;20;39;10
Alex
Yeah. So a lot of people, when they start to get into.

01;20;39;11 – 01;20;41;18
Alex
Franchise and you look at what’s called an FDA.

01;20;41;18 – 01;20;41;20
Alex
It.

01;20;41;20 – 01;20;45;19
Alex
Stands for franchise disclosure document. Every franchise.

01;20;45;19 – 01;20;46;27
Alex
Business legally has.

01;20;46;27 – 01;20;47;29
Alex
To do this in all states.

01;20;48;12 – 01;20;49;10
Alex
Some, you.

01;20;49;10 – 01;20;51;13
Alex
Know, take it a step further in their registration states.

01;20;51;13 – 01;20;51;24
Alex
Where.

01;20;52;09 – 01;20;56;29
Alex
You know, there’s very formal audits and other requirements that are met.

01;20;56;29 – 01;20;58;23
Alex
But for the core.

01;20;58;23 – 01;21;04;20
Alex
Document that anyone uses directly that shows startup costs, everything is audited by third parties, et cetera.

01;21;05;19 – 01;21;06;13
Alex
So, yeah, basically.

01;21;06;13 – 01;21;12;23
Alex
When you’re looking at the opportunity, look at the then current FTD because that will change once a year. It’s required to change every year and to reflect.

01;21;13;08 – 01;21;14;20
Alex
You know, those those fees.

01;21;14;20 – 01;21;15;14
Alex
Or the cost.

01;21;15;14 – 01;21;15;22
Alex
Of.

01;21;16;01 – 01;21;17;28
Alex
You know, materials going up or.

01;21;18;13 – 01;21;19;06
Alex
You know, 15.

01;21;19;06 – 01;21;31;03
Alex
More stores open this year. We want the results that they’ve experienced to be showcased. So you get to see every store pretty transparently how they’re doing. And if I’m a bottom quartile star, this is my risk. And if I’m a top quartile, this is what I could make.

01;21;31;03 – 01;21;31;07
Alex
A.

01;21;32;19 – 01;21;33;27
Jordan
How does somebody get a hold of that?

01;21;34;24 – 01;21;38;01
Alex
So it’s all franciscos, it’s all public, but I’ll I’ll.

01;21;38;01 – 01;21;52;24
Alex
Share a version with you that you can attach to the notes on the podcast. But otherwise you could go to our website at Lounge Alive, USA dot com, and you’ll get kind of put into that process. Or you can meet with my co-founder Dan that after he gets sent out.

01;21;54;01 – 01;21;56;23
Alex
If you Google, if you ever want to know any.

01;21;56;23 – 01;21;59;01
Alex
Franchise concept, a trick that we’ve learned is.

01;21;59;26 – 01;22;00;20
Alex
Go Google.

01;22;00;20 – 01;22;04;17
Alex
A registration state like California or Minnesota and then just say the brand after us.

01;22;04;17 – 01;22;07;18
Alex
Like laundry lab feed.

01;22;07;27 – 01;22;21;23
Alex
Minnesota. And it could be Orange Theory after the Minnesota. And the reason I say Minnesota is because it’s a registration state. And so they’re all there are lots of links to download all these different companies that it is typically when you search using that format.

01;22;22;09 – 01;22;37;23
Jordan
Awesome. Yeah. Thank you. And then I’ll put that in the show notes or if you’re on YouTube, there’s a link to that down below. All right. Sorry, I didn’t mean to interrupt you just want to point out that, you know, these things live for a long time on the Internet and, you know, so go ahead. Keep going.

01;22;37;25 – 01;22;38;27
Alex
I appreciate that’s that.

01;22;38;28 – 01;22;40;21
Alex
There’s that that’s the first element. Is that upfront.

01;22;40;21 – 01;22;41;05
Alex
Fee.

01;22;41;27 – 01;23;02;21
Alex
That varies depending on how many locations you want to buy or, you know, reserve upfront. And then from that point, you know, we get to work hand in hand working with you on finding the right side. We’re working with a private equity group in Atlanta called El Five, the largest large three fitness center in the country. Investors in Restore, which is like a big new kind of cryotherapy concept.

01;23;03;05 – 01;23;03;15
Alex
Big Blue.

01;23;03;15 – 01;23;05;11
Alex
Some school, a bunch of other franchise brands.

01;23;05;25 – 01;23;06;23
Alex
And what they’ve.

01;23;06;23 – 01;23;31;18
Alex
Helped us with is MAP. Basically, every territory in the major markets we want to go to and how many laundromats they believe could still be in that market successfully considering your competition, population growth, where the kind of gentrification is happening, in which direction it’s happening. And we use tons of data points and tons of data to map these sites to see just how many there can be in each city.

01;23;31;29 – 01;23;33;06
Alex
So you’ll pick those sites.

01;23;34;03 – 01;23;55;28
Alex
You’ll reserve them in that given market. We’ll hope you find a site within that territory in that market. Help you with construction and equipment, mix, layout, story design, branding, grand opening marketing, where that marketing dollars for those marketing dollars should go, getting your team staffed up, trained. I mean, literally everything you can imagine from the day to day operations to grand.

01;23;55;28 – 01;23;56;18
Alex
Opening to.

01;23;57;17 – 01;24;04;11
Alex
The right financing and how you should think about financing your equipment versus your improvements versus going to every kind of angle and scenario you can think.

01;24;04;11 – 01;24;04;17
Alex
Of.

01;24;05;22 – 01;24;07;22
Alex
And then once you’re open, the technology.

01;24;07;22 – 01;24;10;01
Alex
That we’ve built to help.

01;24;10;15 – 01;24;12;01
Alex
Make managing your store easier.

01;24;12;01 – 01;24;12;20
Alex
To.

01;24;13;03 – 01;24;29;03
Alex
Processing over the counter wash or fold to pick up a delivery washer fold in the main value add again, is that pickup in delivery volume that we can bring you. And that’s that that’s not an additional fee or anything. It’s we’re going to pay our franchisees what they would charge for over the counter wash drive fold.

01;24;29;15 – 01;24;29;21
Alex
Because.

01;24;29;21 – 01;24;30;13
Alex
We want them to.

01;24;30;13 – 01;24;30;25
Alex
Be.

01;24;32;01 – 01;24;49;27
Alex
Profitable. We want them to be as excited about the volume coming in the back door in a pink van as they are what the volume coming through the front door and branded laundry bag that sounds dropping off over the counter to really show that we’re aligned to the fullest extent. We’re not asking for some massive 30% discount because we’re bringing new volume.

01;24;51;13 – 01;25;04;13
Alex
There’s a royalty on that pick up and delivery volume we bring in. But again, we’re in a charge we’re going to pay you at a rate that you would charge a walking customer so that it’s exciting and kind of margin for you to want to keep doing that. The quality that we need you to do that.

01;25;05;27 – 01;25;29;25
Jordan
Yeah, that’s awesome. OK, so I mean, can we can we just talk plainly here? I mean, because here’s the thing. It’s like I get I’m sure you do too. I get people who are all about the franchise model. I get people who are critical of the franchise model. And I’ve got criticisms of some aspects of some franchise models and stuff, too.

01;25;29;25 – 01;25;31;18
Jordan
So I mean, can I ask you about some of those?

01;25;31;25 – 01;25;34;16
Alex
Yeah, let’s do. Yeah, I’m transparent. I’m an open book.

01;25;34;23 – 01;25;55;19
Jordan
Yeah. I love it. I love it. I love it. OK, so I mean, one of the big questions I get is can a distributor help me do a lot of the things that you just described? You know, that your franchise model will do. Do I need to go the franchise route or can a distributor do you know what you just said at the same quality?

01;25;56;05 – 01;25;56;15
Alex
Yes.

01;25;56;15 – 01;26;02;12
Alex
I think there’s there’s, I guess, a nuanced answer that depends on the person asking the question. Right. If you’re coming.

01;26;02;12 – 01;26;06;02
Alex
In with the idea of how I want one store.

01;26;07;18 – 01;26;12;19
Alex
And I’ve done a ton of research already, I grew up in family businesses.

01;26;14;01 – 01;26;14;06
Alex
And.

01;26;14;12 – 01;26;22;12
Alex
You know, I’m comfortable with labor and site selection and all these kind of other elements. As long as there’s some support through a distributor, I think this is a one off one off store.

01;26;22;12 – 01;26;23;22
Alex
I would say going.

01;26;23;22 – 01;26;29;06
Alex
The distributor route is probably the better route over time if the person they’re coming.

01;26;29;06 – 01;26;29;23
Alex
In is.

01;26;30;19 – 01;26;49;13
Alex
Hey, you know, I’ve I’ve built up this massive investment portfolio. I want a semi absentee business understanding. I have to be in the business for the first year to get it ramped up. And I’m willing to make that commitment or, or hire a team to help do that. But this is a diversification plan it’s a real estate play where they want to buy the land and then you have a laundromat on top of it.

01;26;49;21 – 01;27;05;25
Alex
We’re getting a lot of people interested in franchising for that reason because they don’t want to spend the time learning the laundromat industry up front. You know, I guess for like until they made the decision, they know that they’re going to learn it over that first year of running it and that we can help accelerate that speed to which they feel comfortable running their own store.

01;27;05;25 – 01;27;08;17
Alex
Then it might be all the trial and error that they did on their own.

01;27;08;17 – 01;27;09;21
Alex
We we talked about that.

01;27;09;21 – 01;27;13;09
Alex
Theme throughout this podcast of all this iteration and trial and error.

01;27;13;23 – 01;27;14;05
Alex
Know we get.

01;27;14;05 – 01;27;34;07
Alex
To do it. Those franchise owners did in those four or 5 hours of phone calls we get to do each of our franchisees avoid years of mistakes and learning. Hopefully in the course of, you know, a couple of weeks of training, we’re going to put them through and then constantly being a resource for them as questions come up. So that’s one person and the other is the kind of sophisticated investor that’s looking at this in a very big way.

01;27;34;07 – 01;27;49;05
Alex
They want to be the next Williford brothers. They want to be like the clean laundry is out of the northeast where they own, you know, three to five to start and then do another ten to 15 and really have 15 to 20 laundromats and a whole system. And so that that.

01;27;49;06 – 01;27;49;25
Alex
System.

01;27;50;22 – 01;28;07;12
Alex
Thinker is another persona. And then the last one is anyone that wants to pick up on delivery volume, they’re realizing that that revenue that we bring far surpasses the royalty that they’re going to pay us over the course of ten years is three to five X in the pickup in delivery volume that they’re going to be getting from us.

01;28;07;12 – 01;28;10;20
Alex
And also the preferential pricing that we’re getting and whatnot.

01;28;11;01 – 01;28;12;02
Alex
Makes up for.

01;28;13;19 – 01;28;25;20
Alex
The franchise royalties. And so long winded answer, but I think it depends on the persona and the intention of the person coming in, what are their motivations or their goals. And I think there’s a lot of people that their goals align exactly with what we’re offering those others that.

01;28;25;26 – 01;28;26;20
Alex
The goals don’t.

01;28;27;04 – 01;28;34;19
Alex
And so depending on which category you fall into, a distributor can be a great option. I mean, we work closely with all the distributors for our franchisees.

01;28;35;25 – 01;28;36;04
Alex
And.

01;28;36;07 – 01;28;47;15
Alex
Kind of are both there holding their hand and agree and might disagree on certain things as it comes to that point as well. The last thing I’ll say is, you know, distributors as much knowledge as they have.

01;28;48;03 – 01;28;48;14
Alex
You know.

01;28;48;14 – 01;29;07;28
Alex
They’re incentivized in a big way to sell equipment. Right. And so they’re trying to move equipment. Whereas if you think about our incentives, we can’t be done once the equipment’s installed, we we have to make sure that Jordan stores are successful. This we understand the investment that you’re putting into this. And if Jordan’s launch lab fails, he’s not going to open a second one that he bought or his third one.

01;29;07;28 – 01;29;11;20
Alex
And he’s also going to tell the next ten people that ask them, hey, what was your experience like with landlords?

01;29;11;29 – 01;29;12;17
Alex
Hey, these guys.

01;29;12;17 – 01;29;17;01
Alex
Said they’re going to do X, Y, and Z with an investment tank. And it was a work. I never would have done it.

01;29;17;01 – 01;29;18;14
Alex
And I would you know.

01;29;18;26 – 01;29;29;00
Alex
It’s going to create a terrible brand experience and reputation for us. So again, our incentives and motivations are more aligned with the end laundromat owner than I think your typical.

01;29;29;00 – 01;29;30;03
Alex
Distributors as well.

01;29;30;26 – 01;29;56;15
Jordan
Yeah, and I see that aligned interest piece. I mean, that’s kind of been one of the themes that’s come up, you know, throughout. Also and I just had a really great question. I really should have written it down was like rails like so good man. OK, oh yeah. OK, well, let me I want to make sure I’m understanding this correctly and a probably not so just correct me and set the record straight here.

01;29;56;15 – 01;30;22;19
Jordan
So if I come to you and I want to do you know, I want to franchise. So, you know, I go through the whole process, discovery day, all that stuff and like, yes, I’m in a buy one to ten, whatever and what am I getting at my buying a self-serve laundromat. And then you guys own the pickup in delivery, but you’re running it through my self-serve laundromat and and paying as if it’s a drop off laundry.

01;30;22;19 – 01;30;24;23
Jordan
Is that is that the models that basically how it works?

01;30;25;02 – 01;30;26;03
Alex
That’s the gist of it.

01;30;26;03 – 01;30;31;17
Alex
So you’re basically buying into the free launch lab the franchise like a McDonald’s franchisee would bind a McDonald’s.

01;30;31;17 – 01;30;33;15
Alex
So you’re getting all right. You’ll help with.

01;30;33;15 – 01;30;41;12
Alex
Site selection, machine mix discounts on equipment, staffing, training, ongoing maintenance programs and support.

01;30;41;12 – 01;30;41;24
Alex
There.

01;30;42;18 – 01;30;47;25
Alex
The right to those territories in the market that you’re you’re getting. But then on an ongoing basis on the to you side, the.

01;30;47;25 – 01;30;50;12
Alex
Value is think of to you is.

01;30;50;12 – 01;30;54;27
Alex
What DoorDash or Postmates does to any restaurant. Right. The restaurant doesn’t have to go.

01;30;55;06 – 01;30;56;13
Alex
Buy a bunch of vehicles.

01;30;56;23 – 01;31;04;28
Alex
The restaurant does have to maintain and manage a bunch of vehicles or drivers, even the restaurant when that customer complains now my food was wrong or it.

01;31;05;25 – 01;31;08;00
Alex
Didn’t show up or it was called DoorDash.

01;31;08;00 – 01;31;10;12
Alex
Is taking those calls and routing and solving.

01;31;10;13 – 01;31;10;21
Alex
You know.

01;31;10;24 – 01;31;22;29
Alex
Their customers issues not the restaurant having a man, you know a bunch of phones and solve all that stuff. And then lastly, that restaurant enough to build all that technology to do it. So think of what to you or what DoorDash and Postmates is to a restaurant.

01;31;23;06 – 01;31;24;08
Alex
Is what to you.

01;31;24;08 – 01;31;35;17
Alex
Is to launch a lot of franchisees. The franchisee runs a retail laundromat, which we all know can be a really good business in and of itself. Just a laundromat can be highly cash flow, positive.

01;31;35;25 – 01;31;36;13
Alex
Machine.

01;31;37;27 – 01;31;57;11
Alex
But then you bolt on this this whole other revenue stream to basically double and not to double your revenue from a customer base. I would never step foot in a laundromat that’s being logistically handled by someone that you trust and or close with on the two side. Those customers are being acquired without marketing dollars that you even have to think about as a franchisee.

01;31;57;22 – 01;32;16;26
Alex
And when those customers have issues, again, that support team is the cost is covered by this other company, not you for you as the franchisee. You’re just going to clean it, clean the street and fold it just like you would if someone walked in with a bag of laundry off the street and said, Hey, Jordan, I want to drop this off at number one, clean laundry and.

01;32;17;14 – 01;32;19;19
Alex
I want you to clean it.

01;32;20;20 – 01;32;22;18
Alex
Same idea. We’re just bringing a lot more volume.

01;32;23;05 – 01;32;46;06
Jordan
Yeah, what’s what I like about that, which is kind of interesting. So, like, I’ve had I’ve had critique criticisms of I mean, I’ve criticized Laundromat franchises before and I and I do I still have, you know, criticism of certain models of Laundromat franchise. And, you know, my one of my main criticisms is like, hey, what do you what do you actually get?

01;32;46;06 – 01;33;06;16
Jordan
And nobody’s going to, you know, ex laundromat because they’ve heard of X Laundromat in their city and they’re traveling or they moved or whatever. And it’s the same thing they know they’re going to get. It’s not McDonald’s. Right. And and I still think that criticism holds up for now. I don’t know that it always hold up, but for now, I think it holds up.

01;33;06;26 – 01;33;35;00
Jordan
However, what I what I’m intrigued by in your model is that is that extra I mean, and I’ve said this a lot on the podcast in the past is when you add pickup in delivery number one, it could be super lucrative for you. So if you want to go that route, go that route, however, you’re utilizing assets that you already have to start a new business, basically it’s related, it’s tangentially related, but it’s a logistics business.

01;33;35;00 – 01;33;58;05
Jordan
You’re now, you know, managing drivers. You’ve got vehicles you’ve got to manage and you’re, you know, it’s it’s a it’s a different business that you’re utilizing the same assets which can make it super powerful if you want to go that route. But it is adding a whole new level of of business onto your complexity. Yeah, complexity. Thank you for being.

01;33;58;06 – 01;33;58;17
Jordan
Well, that.

01;33;58;17 – 01;34;01;02
Alex
Was the thought, too. Like when we were when we were looking.

01;34;01;02 – 01;34;02;23
Alex
At what we were doing is like we’re running a retail.

01;34;02;23 – 01;34;03;12
Alex
Laundromat.

01;34;03;27 – 01;34;06;16
Alex
Coin laundromat, and then we’re processing our own volume there, which like.

01;34;06;23 – 01;34;07;02
Alex
That.

01;34;07;02 – 01;34;17;15
Alex
On itself is, is challenging. But then you throw in a whole fleet of vehicles and that’s why we wanted to split the two out as if we franchise the whole concept, you know, basically said, Hey, Jordan, we’ll get you stood up. And I’m trying to think.

01;34;17;15 – 01;34;17;21
Alex
Of.

01;34;18;25 – 01;34;27;26
Alex
If there’s anyone else out there like this, it’d be like merging wave max with happiness or a wave max with it’d be like those two combined and then try to package it up to you.

01;34;28;06 – 01;34;28;25
Alex
Felt way.

01;34;28;25 – 01;34;33;23
Alex
Too complicated because now you’re trying to manage hundreds of thousands of dollars worth of equipment.

01;34;34;00 – 01;34;34;14
Alex
On the.

01;34;34;23 – 01;34;36;07
Alex
Laundromat side, but they’re also having.

01;34;36;21 – 01;34;37;11
Alex
You know, 20.

01;34;37;11 – 01;34;41;09
Alex
Thousand dollar vehicles. You maybe, you know, five of those drivers, it’s.

01;34;41;09 – 01;34;42;22
Alex
Just too much here.

01;34;43;01 – 01;34;45;05
Jordan
Where are you getting $20,000 vehicles?

01;34;45;20 – 01;34;47;25
Alex
Oh good. Yeah. Now, yeah, right now.

01;34;48;28 – 01;34;52;23
Jordan
If you can even find them, it’s crazy. All right, guys. So that whole.

01;34;52;23 – 01;34;53;24
Alex
Other, that whole.

01;34;53;24 – 01;34;58;07
Alex
Category, you’re not running a whole other business. Our thought was how do we keep this as simple as possible and really just keep.

01;34;58;07 – 01;34;59;21
Alex
Like just like we do with the dry.

01;34;59;21 – 01;35;02;24
Alex
Cleaners. They’re really good operators. They understand throughput.

01;35;02;24 – 01;35;03;00
Alex
And.

01;35;03;10 – 01;35;15;27
Alex
And moving in quality controls, and they’re really good at that. And so our thought was, can we create basically a supply chain that thinks like the dry cleaner of today does in the laundry industry, where traditionally or predominantly.

01;35;16;09 – 01;35;16;16
Alex
It’s a.

01;35;16;16 – 01;35;30;01
Alex
Lot of legacy family owned businesses that are used to doing things the way that they’ve always done them for the past few decades. And so trying to bring a level of operational rigor in because the model that we’re needing from our partners.

01;35;30;13 – 01;35;31;02
Alex
Is that of.

01;35;31;02 – 01;35;36;00
Alex
The dry cleaning wholesaler, not of your, you know, your typical mom and pop coin laundry.

01;35;36;00 – 01;35;37;21
Alex
They’re just like you said, it’s two.

01;35;37;21 – 01;35;41;04
Alex
Completely different businesses you just happen to be using the same asset base.

01;35;42;16 – 01;36;06;20
Jordan
Yeah. So and I like that. I mean, I think that there is value in that in the same way or actually probably even in a better way than you were bringing value to those early laundromats when you’re bringing service because now you’re also supporting them on the the self-serve kind of wash dry fold side of things too, because they’re your franchisee and you need them to succeed and you’re providing that level of support.

01;36;06;20 – 01;36;41;06
Jordan
So I know I’m intrigued by that model. I think that that model makes a lot more sense to me than just a strictly self-serve franchise. Model, which, again, I, you know, to each their own. And I think, you know, that there is value in certain circumstances even for that. But I I’m more intrigued by what you’re doing and in the value that you’re creating for your franchisees by literally bringing them customers that they don’t have to go out and find themselves.

01;36;41;10 – 01;37;05;12
Jordan
They just have to process laundry. Super simple. OK, so that’s your that’s your sort of franchise model. I like that. Thank you for clarifying that for me because, you know, I wanted to make sure I was clear and everybody else is clear on what exactly you’re getting with that franchise model. Where are you guys at now? I mean, like, what locations are you are you guys represented in?

01;37;06;08 – 01;37;07;08
Alex
Yeah. So we’ve got.

01;37;07;08 – 01;37;08;27
Alex
Two corporate stores in Charlotte.

01;37;09;11 – 01;37;16;27
Alex
And then we’re opening stores in this year. It’ll be Tampa, Atlanta, Charlotte.

01;37;17;06 – 01;37;18;00
Alex
Charleston.

01;37;18;15 – 01;37;19;11
Alex
Phenix.

01;37;20;01 – 01;37;22;29
Alex
Denver, San Antonio, Austin.

01;37;23;23 – 01;37;24;16
Alex
Dallas.

01;37;27;04 – 01;37;32;11
Alex
Miami, Tampa, Burlington, Vermont.

01;37;32;25 – 01;37;36;22
Alex
Detroit, Raleigh.

01;37;39;27 – 01;37;40;20
Alex
And Philly.

01;37;42;29 – 01;37;52;21
Jordan
That’s a lot of places I’ve got to I’ve got to take some issue with you right now, though, because I do not hear any West Coast representation in.

01;37;53;01 – 01;37;55;01
Alex
LA, so we purposely avoided.

01;37;55;01 – 01;37;55;21
Alex
California.

01;37;55;23 – 01;37;56;17
Jordan
Oh, my.

01;37;58;18 – 01;38;00;15
Alex
And New York just because the.

01;38;00;25 – 01;38;04;09
Alex
The and not from a laundry perspective, maybe a little bit of laundry perspective to.

01;38;04;09 – 01;38;05;27
Alex
But the franchise.

01;38;06;07 – 01;38;10;22
Alex
Regulations and kind of just hurdles is so much more stringent in California, in New.

01;38;10;22 – 01;38;11;25
Alex
York and so.

01;38;11;25 – 01;38;19;19
Alex
Similar our approach of let’s go after the secondary tertiary cities first kind of feel that way about California in New York because there’s so much more country and.

01;38;20;00 – 01;38;20;14
Alex
Cities.

01;38;20;14 – 01;38;23;09
Alex
To go into. Let’s focus on on those first and then.

01;38;23;09 – 01;38;25;17
Alex
We’ll all eventually be there.

01;38;26;08 – 01;38;56;07
Jordan
Yeah well we we both New York and California and we like to make things difficult on our business owners around here. So don’t make it easy. And there’s a whole lot of fingers in your pockets when you’re over here. So yeah, so I don’t blame you there, but I mean I like again, I like the going after the secondary tertiary markets kind of the, the forgotten low hanging fruit actually where I think a lot of people see the low hanging fruit being in these super populated, dense locations.

01;38;56;07 – 01;39;01;11
Jordan
But there’s a lot of other obstacles and competition gets steeper when you’re in.

01;39;01;13 – 01;39;03;18
Alex
Everything’s more expensive and more.

01;39;03;24 – 01;39;24;00
Jordan
Yeah, absolutely. And we were just talking before we hit the record button about how much like fast food workers in Stouffer are being offered jobs for right now. So it’s. Yeah, absolutely. OK, so you guys are all over the place. I love that. Do you guys have any big goals for 22? What is it, 20, 22.

01;39;24;25 – 01;39;29;22
Alex
Yeah. So we really want to get these first our goals of 12 of those.

01;39;29;22 – 01;39;33;16
Alex
Stores this year or two of them are opening next two months in.

01;39;33;16 – 01;39;33;28
Alex
June.

01;39;35;15 – 01;39;40;04
Alex
So we’re continuing to build out the team around supporting our.

01;39;40;04 – 01;39;42;05
Alex
Franchisees then scaling.

01;39;42;05 – 01;39;43;15
Alex
To U behind. So we have a.

01;39;43;15 – 01;39;44;22
Alex
Still a decent.

01;39;44;22 – 01;40;07;09
Alex
Level of complexity in our business to support the franchisees the way that we want to to provide that five star experience for them but also the to new customer base that’s coming behind acquiring that selling of vehicles. So we are actually gearing up to raise another ten to $15 million capital round to hire those those resources can do to make those investments.

01;40;07;09 – 01;40;08;11
Alex
To really.

01;40;08;11 – 01;40;12;29
Alex
Deliver on the commitment we’re making to our franchisees and customers beyond.

01;40;14;02 – 01;40;24;24
Jordan
Awesome awesome. What’s a real quick what’s the lead time on if I come to you today slept on my 49 grand that’s my what’s my lead time looking like.

01;40;25;06 – 01;40;27;25
Alex
Yeah so it varies.

01;40;27;25 – 01;40;49;22
Alex
Depending on the market right now but 12 months is what we’re shooting for and that’s everything from site selection to our offering. Our allies are at least negotiations design and construction permitting with the local municipalities grand opening or pre marketing leading up to grand opening. What we’re finding the biggest hurdle is right now is.

01;40;49;22 – 01;40;50;08
Alex
Is.

01;40;50;08 – 01;40;53;17
Alex
Site selection. This is all very picky about.

01;40;53;29 – 01;40;54;04
Alex
You.

01;40;54;04 – 01;40;58;22
Alex
Know once you put all this equipment in your location, you can’t move it. And so we’re probably more rigorous.

01;40;58;22 – 01;40;59;07
Alex
Than we.

01;41;00;06 – 01;41;11;08
Alex
Will need to be over time as we get more and more data to support kind of our thoughts on what makes up a good laundromat location. You know, a ton of data has already been poured into it, but I think until.

01;41;12;10 – 01;41;12;26
Alex
You have.

01;41;12;26 – 01;41;20;27
Alex
The scale of like a laundry capital, those are got 80 plus laundromats. It’s it’s hard to get really good data anonymous because it’s so fragmented.

01;41;21;23 – 01;41;57;29
Jordan
Yeah. Yeah I’ve been harping on that for a while, but I think there’s more and more data coming coming our way. So awesome. OK, so I want to pinpoint right now if somebody is like, man, I might be interested in franchising or even just buying their first laundromat. But franchising in particular, do you have this is the segments called Pro Tips, by the way, do you have any advice for maybe that newbie who’s looking to get into the business, maybe through the franchise model, what what they should be doing first or what they should be doing now?

01;41;58;27 – 01;42;00;09
Alex
Yes, I’m going to cut.

01;42;00;10 – 01;42;14;26
Alex
You two answers. One, from the franchise perspective, you’re just interested in franchising in general, whether it’s a laundromat or a gym concept. I think using the brokers is it’s helpful. It doesn’t cost you anything. Those brokers make money. If you buy licenses from the franchisor.

01;42;15;10 – 01;42;15;29
Alex
You have to pay that.

01;42;15;29 – 01;42;27;06
Alex
Fee that 49 K any way. Whether you came through a broker or not, the brand is just going out to then turn around and cut a check to that broker. So for you as an individual, it’s free exploration. You got a resource that’s going to listen to you.

01;42;27;19 – 01;42;29;13
Alex
The thing to look out for, you know.

01;42;29;15 – 01;42;49;00
Alex
In that category is that brokers are typically going to push brands that are in their network. So there might be a hundred concepts out there, but they might only show you 20. And so just being aware of that as you get into franchising, as do some of your own research on the side, as far as brands that you like that a broker might not be exposing to you or showing you, but they’re a great resource to help.

01;42;49;10 – 01;42;49;13
Alex
You.

01;42;49;18 – 01;43;06;16
Alex
Hold your hand through that kind of franchise discovery process. And if it’s laundry, you know, in particular the tip to get into the space is the same thing that you have to do a ton of research, go into stores, go to the top rated stores in your market, go into the lowest rated stores in your market and see the differences and how they’re run and treated.

01;43;07;01 – 01;43;18;04
Alex
But then I’d say go through a discovery day with a Laundromat franchise, go through our Discovery Day, go through way that Discovery Day, especially if you if you qualify, if you go all the way through.

01;43;18;14 – 01;43;20;02
Alex
You’re going to get a ton.

01;43;20;02 – 01;43;30;09
Alex
Of time spent by the brand educating you on the space, the economic model of of the business. And then you’re going to get a mostly all expenses.

01;43;30;20 – 01;43;31;03
Alex
Paid.

01;43;31;03 – 01;44;00;23
Alex
Trip into the home market of that brand because they want you to come in person. And so to me, it’s a good way to want to do a ton of research. But also you might find that you like the franchise model and you want to do it. And if you don’t, you at least learn that while you were there and learned about laundromats in a very kind of classroom type setting, very structured, lots of different point of views and topics covered everything from site selection to machine mix to marketing to grand opening to technology.

01;44;00;23 – 01;44;02;03
Alex
I mean, you’re going to get a crash course.

01;44;02;03 – 01;44;02;11
Alex
On.

01;44;02;27 – 01;44;04;17
Alex
All those things. And again, it’s in a.

01;44;05;26 – 01;44;06;02
Alex
Pretty.

01;44;06;02 – 01;44;10;03
Alex
Unique setting outside of just perusing online or in forums.

01;44;10;03 – 01;44;11;07
Alex
And whatnot.

01;44;12;06 – 01;44;37;19
Jordan
Yeah, awesome protests. Love that. Hey, I mean, franchise broker, I mean, like you mentioned though, you know, just I was mention, you know, keep in mind that brokers get paid when they sell you something. So I’m I’m a broker here in California. So I feel like I can say that about our time you know, they’re going to invest time with you, but, you know, just keep that in mind.

01;44;37;19 – 01;44;48;25
Jordan
So awesome. Awesome. Protests are another segment of the podcast called Recommended Resources. Do you have any resources you recommend to help people either grow personally or grow their businesses?

01;44;50;17 – 01;44;52;21
Alex
It’s a good question. Any resources.

01;44;55;08 – 01;44;58;08
Alex
One of the things that and this is just a reading, I guess I do, but like.

01;44;59;04 – 01;45;00;11
Alex
Subscribing to like term.

01;45;00;11 – 01;45;01;00
Alex
Sheet.

01;45;01;00 – 01;45;13;27
Alex
And the hustle and these kind of various email newsletters about business. Like it’s amazing how much you can learn from reading, you know, short snippets or stories on strategies that other categories are doing that.

01;45;14;08 – 01;45;15;09
Alex
Apply to you. I mean.

01;45;15;16 – 01;45;28;02
Alex
There’s one about how Subway was talking about the $5 footlong and although that campaign was crushing it for Subway as a brand, the franchisees were losing tons of money. And so although they were not selling sandwiches like that was a learning lesson that I got.

01;45;28;15 – 01;45;29;20
Alex
This was well before we were.

01;45;30;03 – 01;45;41;13
Alex
Thinking about franchising. I just remember the story because it was interesting in that newsletter, but now I can recall that article I read and use it for, Hey, let’s not, let’s not have our $5 footlong equivalent for our lounge allowed franchisees.

01;45;41;13 – 01;45;44;19
Alex
So are just these like very short, quick.

01;45;44;19 – 01;45;58;21
Alex
Digestible newsletters that are business strategy oriented. So I can term sheet was one of them and then the hustle is another one that I really like that has those kind of engaging interesting stories that helped me think strategically regardless of the category business.

01;46;00;14 – 01;46;38;09
Jordan
Yeah, I like that and I think I feel like we don’t get enough of that recommendation and recommend a resources segment, but like looking outside of our industry and looking for principles to apply, you know, and while maybe the $5 footlong may not apply to a single mom and pop laundromat owner, there’s other stories in other contexts where and I do this all the time, I pull in stuff all the time from other, you know, YouTubers or, you know, who are doing business different ways or blogs or newsletters or, you know, these kinds of things where you’re doing basically case studies and, and pulling in principles that you can apply in in the context of

01;46;38;09 – 01;46;41;02
Jordan
your business. So I love that great.

01;46;41;05 – 01;46;43;03
Alex
Well, I think something I’m sure like this gets.

01;46;43;03 – 01;47;01;21
Alex
Said a lot. But again, the network and the network and again, like my mom had always said to me and my brothers, grandma’s like, you don’t ask you don’t get. And I had a professor at work said something very similar. It was like reach out thoughtfully to people that you aspire to be or to learn from. And you’ll be surprised just how willing there are to spend their time with you.

01;47;02;09 – 01;47;03;21
Alex
And so go look at what.

01;47;03;21 – 01;47;14;10
Alex
You believe are the best laundromats in the country. You know, they’ve got, you know, 1005 star reviews. I bet if you thoughtfully reach out to that owner and say, hey, I’m a laundromat owner across the country.

01;47;15;03 – 01;47;18;13
Alex
You’re a huge fan of what you’re doing, would be I would love to buy you.

01;47;19;01 – 01;47;23;29
Alex
I’ll send you a Venmo for a coffee or I’d love to just pick your brain for 30 minutes over a video call and.

01;47;23;29 – 01;47;27;01
Alex
I guarantee you they’ll do it. And so I just.

01;47;27;05 – 01;47;45;01
Alex
Whatever it is ask out thoughtfully whether it’s in industry or out of industry. Again, there’s a lot to learn from those adjacent businesses. And maybe it’s a carwash operator in your market that’s just a powerhouse, great operator. Everyone loves that location. I’m sure a lot of what they’re doing can be applied to your single Laundromat store.

01;47;45;29 – 01;48;03;01
Jordan
Killer, killer advice. I love that and I love that the word thoughtfully, thoughtfully reach out. You know, I get unsolicited stuff all the time. You know, for me, I’m sure you do, too. And, you know, if you get the same kind of thing over and over and over and it really doesn’t provide any value, you’re less likely to respond to it.

01;48;03;24 – 01;48;32;24
Jordan
So be thoughtful in the way that you reach out to people. And especially, you know, the bigger they are, the more successful they are, the more thoughtful you should be. And yeah, so awesome. Awesome. Last question I have for you is if anybody’s interested in learning more about the franchise or maybe they just want to connect with you because you have a lot of great experience, you know, in this industry and they want to hear about how you grew your pickup delivery or they want to hear about how you killed it on your self-serve laundry that you guys opened or whatever the case may be.

01;48;32;24 – 01;48;41;26
Jordan
What’s the best way they can a learn about franchising through laundry lab and B connect with you if you have questions?

01;48;42;17 – 01;48;43;09
Alex
Yep. So anything.

01;48;43;09 – 01;48;49;05
Alex
On the franchise side, you can go to Laundry Lab USA dot com and that’s Landro.

01;48;49;10 – 01;48;50;23
Alex
Like laundromat only.

01;48;50;23 – 01;48;52;12
Alex
Lab instead of Mat USA.

01;48;52;12 – 01;48;54;20
Alex
Ecom. And then if people have.

01;48;54;20 – 01;49;06;29
Alex
Questions about anything honestly and I’ve we’ve only gotten to the point where we’ve gotten and we’re still going and continuing to learn is by reaching out thoughtlessly to other people. And so I’ve always been quick to return that favorite other people.

01;49;07;02 – 01;49;09;08
Alex
Who are whatever.

01;49;09;08 – 01;49;18;09
Alex
Stage you’re in. If you think that I have something of value to add to, I want to provide it, I want to add it. And so you can email me at Alex at laundry lab U.S.A..

01;49;19;03 – 01;49;19;20
Alex
Or.

01;49;19;20 – 01;49;25;13
Alex
Honestly, text call is fine as well. My cell phone 65176.

01;49;25;13 – 01;49;26;03
Alex
Four.

01;49;26;11 – 01;49;32;20
Alex
0342. Again happy to have you just give that time and help in any way that I can.

01;49;33;02 – 01;49;43;12
Jordan
Oh man. You are a glutton for punishment putting your phone number out there and I think you realize the millions of people listening to this right now, you’re going to get bombarded with texts.

01;49;45;02 – 01;49;45;15
Alex
And if I don’t.

01;49;45;24 – 01;49;50;09
Alex
If I respond the first time follow up because I again, it’s not because I don’t want to talk to you, because it’s because.

01;49;50;09 – 01;49;58;11
Jordan
There’s millions of people millions. This is awesome.

01;49;58;11 – 01;50;00;07
Alex
Our thing. Billions of people.

01;50;00;07 – 01;50;17;20
Jordan
1 million. Yeah. This is awesome, dude. I appreciate you coming on and sharing your story, which was super fascinating to me. I think a lot of people will be fascinated by that, but also coming in and talking, you know, just frankly about franchising and what that looks like and the pros and the cons and all that stuff. That’s awesome.

01;50;17;20 – 01;50;41;22
Jordan
And you know, to if you have questions about franchising or maybe you’ve heard, you know, critiques about franchising or you’re not sure about something, one of the things I love about Alex is that he is willing to field those questions even if they seem counter to, you know, what he’s trying to do. He’s, you know, a thoughtful guy and will be able to have those conversations.

01;50;41;22 – 01;50;44;09
Jordan
So, man, appreciate you thanks so much for coming on, dude.

01;50;44;26 – 01;50;45;22
Alex
Yeah, thanks for having me.

01;50;45;22 – 01;50;49;14
Alex
I really enjoyed the conversation and what you’re doing and not just for.

01;50;50;10 – 01;50;50;22
Alex
The last.

01;50;50;22 – 01;50;52;20
Alex
2 hours, but what you’ve been doing the last few years.

01;50;52;20 – 01;50;53;03
Alex
Building.

01;50;53;18 – 01;51;00;07
Alex
The Laundromat resource and what you’ve done. A huge, huge kudos to you as well. And thank you for you taking your time with me as well.

01;51;00;20 – 01;51;07;17
Jordan
Oh, absolutely. Appreciate that. A lot of fun for me, so it works out nicely. All right, man. Looking forward to connecting again.

01;51;08;03 – 01;51;08;26
Alex
Yep. Yeah.

01;51;10;00 – 01;51;35;07
Jordan
All right. What a super cool episode with Alex. Man. Huge. Thank you to Alex both for being on the podcast and also for doing this webinar that’s coming up. Make sure you join us again. That is May 26 that’s a Thursday. You can sign up at lot of my resource dot com slash events there for that and get pumped about it because it’s good bring your questions and he’ll he’ll be there to answer them for you.

01;51;35;08 – 01;51;59;12
Jordan
All right so very cool. My one big takeaway every week I want you to take something away from the episode put it into action members the action that gets us to success. So pick an action maybe go shared on the forums a lot about resources dot com slash forums get that accountability go in there but also my one takeaway I’d like to share that with you is a couple of different things.

01;51;59;12 – 01;52;19;24
Jordan
Number one, I kind of like just perspective on the franchise model versus relying on distributors. I thought there are some good points in there. That’s not really an action item for me, but I thought it was a good perspective to have the other one that I loved was when you were sharing about how to grow your pickup and delivery business.

01;52;19;24 – 01;52;55;22
Jordan
His point number five was finding one to many relationships, right? One to many relationships. You gave examples of, you know, trying to, you know, talk to apartments, different associate homeowners associations, registries, property managers looking for, you know, when you make a sale, you don’t just, you know, you don’t just make one sale. You make many sales. Right. And if you can get, you know, pick a delivery from one apartment complex, you know, from a property manager, whatever, maybe you can get like five or six or ten or 15 or 20 orders at one go.

01;52;55;22 – 01;53;15;20
Jordan
And I loved that. So I’m going to apply that both to my laundromat businesses. And also all the other things that I’m working on because I love that concept, the one to many relationships. All right. What is your big takeaway that you’re going to take action on I want to hear about it. Go to the forums and share it over there or, you know, shoot me an email.

01;53;15;20 – 01;53;32;14
Jordan
I’d love to hear your takeaway. Put in the subject line. Big takeaway and, you know, put into action this week. All right. That’s what’s going to take you to success. And that’s what we’re all about, finding financial freedom through laundromat ownership. Let’s do it this week and we’ll see you next week. Piece.