Brett Burkhart Talks of Product Development, Due Diligence, and the Art of Questioning
"Going forward we want to keep Slash/Web doing what we are really good at, but I would also like to continue building product. From a personal standpoint I really enjoy building something that serves the end user. It's a throwback to my time in architecture," Brett Burkhart, CEO of Slash/Web studios, observed of his dual role in leading both a service firm and a software as a service firm.
Multiple roles would seem to be a career paradigm for this ISU liberal arts graduate who was the featured guest at the October Business Innovation Zone Startup Stories session. Mike Colwell, Director of Entrepreneurial Initiatives for the Greater Des Moines Partnership, led Burkhart through a recitation of the winding path that led this one time Architecture student to a leadership position in dual entities, one of which serves the HVAC industry.
"With the abundance of free time studying architecture provided me," he said with tongue firmly in cheek, "I found a number of additional interests that I wanted to pursue, such as videography, photography, 3-D animation and web design, and along the way, found some projects that would allow me to utilize them."
The Art of the Question
Working in a series of architecture firms, Burkhart cultivated yet another skill that would serve him well going forward; asking insightful questions and listening to the answers. "We were designing high-end residential, so you started with a clean sheet and asked a lot of questions," he explained. The idea was to craft a product that was tailored to the precise needs and lifestyle of the future residents. This ability to ask the right questions and listen to the answers would become a cornerstone of all future successes.
By the 2008 downturn in housing demand, Burkhart and an associate were working for what had become an Architecture/Web Design studio and opted to break away, creating Slash/Web Studio. Opportunities had become plentiful in the field and the move proved to be a wise one. Little did they know it was, in some ways, just another step in the path.
"As we continued to grow our web design business, we transitioned to much larger projects and moved much more towards development rather than design," he reflected on what was more of an evolution than a pivot. As a result, Burkhart and company found themselves meeting an increasing number of contacts with product development needs and ideas. Insightful questioning allowed them to separate the wheat from the chaff, often declining projects when they felt the client could be better served by existing products, or that the idea put forward as a solution was less than well formed.
With their foray into product development on a small scale to serve the needs of specific clients, the next logical step on the path was towards product development on a large scale to serve the needs of a specific industry. For this step, the insightful questioning became the due diligence of an investor. "We look at it from an investor viewpoint, we are investing development time that could otherwise be generating billable hours," he argued, further noting that you have to ask all the same questions an investor would ask before committing resources. As a company whose expertise is in development, due diligence requires that you have knowledge of the industry the product will serve as well as access to the market and credibility within that industry.
All of those issues came together when Slash/Web met an experienced consultant in the HVAC industry who saw a growing, almost unanimous, problem among small to mid-sized HVAC firms; the exodus of knowledgeable sales people. The consultant was commanding a successful salary filling the vacuum and utilizing an enormous excel spreadsheet to model pricing and generate bids, but as Burkhart observed, "he was not scalable."
"In essence, that spreadsheet was our MVP. From there we knew the direction we needed to go," he recalled. 14 months later was born ThermoGRID, the HVAC Profitability Platform. This software as a service, which Burkhart spun off as an independent business, allows the user to do on-site estimating and bid submission utilizing industry design standards and current vendor pricing. This levels the playing field, for the smaller shops, and dramatically reduces the need for the sales people to have decades of experience at pricing.
"Our research showed us that 70 percent of heating and cooling companies fail in the first year, not from a lack of clients, but because they price poorly and have the wrong skill sets," Burkhart elucidated, harkening images of Michael Gerber's E-Myth where talented tradesman start their own business and fail for a lack of business process knowledge, in this case often setting prices at a level that gave them a net negative for a bottom line.
Now in the hands of 30 initial users, and headed into the intense season for heating and cooling contractors, Burkhart expects to make adjustments based upon user feedback before moving into an aggressive sales cycle next year.
Asked about the future, Burkhart took a measured look at the path thus far traveled. "We'll continue to look at opportunities from an investor standpoint," he conjectured, "Do we meet all the criteria for a good investment? If so, I want to really understand how we can build something that can truly serve them." Whether designing a home, a website, or a software solution, Burkhart will be asking questions with the end-user's needs as his guiding principal.