Sometimes, you can have everything going for you in a business. The right solution. Adoring customers. Perfect timing – but you end up making the wrong decision on your team and everything can fall apart in an instant.
Our next guest shares his cautionary tale…
Please introduce yourself to our readers…
My name is Avi Klinger.
I am the president and CEO of HOMECORE inc.
You once started your own business – what was it?
My previous entity was a website named Home Improvement Expo. Started in 2006, the company was developed to offer contractors with the most closeable leads in the industry.
Contractors have always had a problem with finding internet leads because all lead-gen companies would not only sell leads to one particular contractor but also to 7 or more other contractors. This didn’t allow for healthy competition at all, and yet this was the business model. This caused a new problem; the contractors who did close these leads were forced to underbid projects, resulting in homeowners getting a bad experience from contractors working for no profit (and sometimes at a deficit). Homeowners found themselves with jobs of terrible quality materials, awful workmanship, or jobs left unfinished.
By examining the pain points of the current process, we were able to offer a better experience for both the end user and the supplier.
Our site had a different model; we provided exclusive leads to the contractors, which was unconventional. We recommended only one contractor to the homeowner, and our business model made us even more profitable than the companies that sold the leads many times over. We sold zip codes; for every zip code a contractor bought from us, he became the exclusive supplier. This resulted in a higher rate of close for the contractors, and it prevented the homeowners from being bombarded with tons of phone calls.
What made you decide to go out on your own vs work for someone else?
Not everyone can do it, but to me it is the only way.
I took the initiative. I already had hands on experience with that site, so I knew the business. Also, I have always had a hard time working for someone else if when I could work for myself.
Did you take any outside funding?
Yes. Overall I raised 1.6 million dollars.
Did you have any partners?
Yes, I had one partner.
What was your vision/goal for the company?
To give the most closable lead possible. Yes we succeeded and we have testimonials to prove it.
What was your company culture like? Did it ever change?
We were really like a family; everyone was helping each other. It was also a very open culture, meaning everyone knew how much money everyone else was making. This motivated the people on the bottom of the scale. There were daily cash bonuses, extravagant dinners. In sales, you need to keep your team motivated, stimulated, and excited. All employees were 1099 commission based; they all made good money.
Why are you not with that business anymore?
Every family has a black sheep. One of our foreign investors ended up defrauding us.
Would you do it again?
Yes, and I have!
What are you doing now?
I’m changing the way business is conducted in the residential home improvement arena. We are a disruptive force that prevents contractors from taking advantage of homeowners.
What advice would you give to someone thinking of starting their own business?
Only do it if you are 10000000% passionate about your concept. At the same time, the concept has to make sense. Preferably it should offer a new service or product that is needed or an existing service or product that you have made better. That passion will drive you through the rough waters. To stay afloat your passion and determination will act as a life vest.
What is your favorite song?
Metallica – Fade to black
Thank you for sharing, Avi! You can find him on Facebook here.