Kevin Wagstaff: Relentlessly Stay In Front of Your Customers

[00:00:00] Hello and welcome to my biggest lesson, the show that brings you the key learnings for

[00:00:06] the most influential founders, executives, and investors in the Colorado Tech community.

[00:00:10] My name is Adam Burrows, and I'm Chris Erickson.

[00:00:14] Together we are the co-founders of Range Ventures.

[00:00:17] An early stage venture for a based in Denver.

[00:00:20] You can find out more about what we're up to at range.vc.

[00:00:26] Our guest this week is Kevin Wagstaff.

[00:00:28] Kevin is the co-founder and president of Spectora, the leading software for home inspectors.

[00:00:34] Kevin is brother Bootschrepp Spectora from nothing to over 8,000 current customers in

[00:00:39] the platform and a recent successful exit to private equity.

[00:00:42] Kevin has a fascinating background that merges tech, entrepreneurship, and real estate.

[00:00:56] Kevin, thanks so much for joining us.

[00:01:05] Of course, thanks for having me, man.

[00:01:07] I'm pumped.

[00:01:08] Yeah, would love to start out just hearing a little bit about your background, how you

[00:01:13] came to go found Spectora and what you're doing with it today?

[00:01:16] Yeah, absolutely.

[00:01:17] So I took a windy path like many.

[00:01:20] I was a finance major in college thought I wanted to be an investment banker, got into

[00:01:24] finance, found my way into tech at HomeAdvisor where we met.

[00:01:30] Which is really cool.

[00:01:31] And we were approached really with the idea of the home inspection software space because

[00:01:35] my brother, he's my co-founder as well, we knew we wanted to do something in SaaS but

[00:01:40] the idea found us because our friend's dad was a home inspector and he said his software

[00:01:45] was left in the past.

[00:01:47] There was no real dominant SaaS player into 2016 in vertical software for home inspectors.

[00:01:54] So for anyone that's bought a home knows it's very kind of forgotten about part of the

[00:01:58] home buying process.

[00:02:00] So he brought the idea to us and we looked at it and we said, huh, this is an approachable

[00:02:05] vertical niche that needs technology.

[00:02:09] No one's really focused on it because it was too small for the huge players to really

[00:02:12] dive into it.

[00:02:14] And so we thought it was a good approachable vertical to go into.

[00:02:19] What were people using it in time?

[00:02:20] What were the inspectors have any software at all?

[00:02:23] Believe it or not, some were still using pen and paper like literally writing on a yellow

[00:02:27] carbon copy handed to you when you're buying a home.

[00:02:31] Others were using a lot of downloadable software so the days of hey, here's a DVD download

[00:02:36] this onto your computer runs locally.

[00:02:40] And so that was a majority of the industry was still using downloadable pretty antiquated

[00:02:44] software that was maybe built 20 years ago, not a ton of updates since.

[00:02:48] Wow, it's incredible.

[00:02:50] But think back way back in 2016, right?

[00:02:53] Yeah, exactly.

[00:02:54] 2016, we thought SAS 8th the whole world by then.

[00:02:56] So we are like, really, what are we missing?

[00:02:58] We kept asking ourselves, what are we missing about this, like the slice?

[00:03:03] And we learned why it was hard and all that but that's some of our lessons.

[00:03:06] But in hindsight, an amazing opportunity to modernize an industry that's kind of marginalizing

[00:03:11] forgotten about.

[00:03:12] Yeah, absolutely.

[00:03:13] That's fantastic.

[00:03:14] And how did you really break it?

[00:03:16] I mean, you and I know from working at Home Advisor, it's incredibly hard to get all these

[00:03:20] little small businesses to do anything.

[00:03:23] How did you get so many home inspectors to change what they're doing and come to you,

[00:03:27] Spectora?

[00:03:28] Many things but to notably pick out a few.

[00:03:31] So I was also a Reelter for years while I was also working on the SEO team at Home

[00:03:36] Advisor.

[00:03:37] So I was learning firsthand what home inspectors were doing via being a Reelter.

[00:03:41] So I was side by side with a lot of home inspectors.

[00:03:43] I saw the end product that was lacking.

[00:03:47] So I had a number of contacts to reach out to, to say, hey, can you talk to me about your

[00:03:51] software?

[00:03:52] What are your pain points?

[00:03:54] And it was a very hands-on kind of approach, Mike and I took where I begged inspectors to

[00:04:00] get coffee with me.

[00:04:01] I bought them $5 star bucks on their way to an inspection just to sit down with me and

[00:04:05] show me what they were using.

[00:04:07] So I just sat there watching them click around, asked them what they didn't like about

[00:04:10] it.

[00:04:11] And it was just from day one, the deep product questions of solving pain points one by

[00:04:16] one.

[00:04:18] And sometimes it took months to get one guy to even try it because a lot of them are 50

[00:04:23] plus don't like change like most humans.

[00:04:26] So it took a relentless, like kind of we showed up, we committed to showing up every single

[00:04:31] day for two years to solve one guy's problem and hoping we would get 10 that would turn

[00:04:38] into 100, turning the 1000.

[00:04:40] So staying in front of them and just asking relentlessly, what could be done better?

[00:04:45] What are you solving for?

[00:04:47] Ken, what was the work with your brother?

[00:04:51] I mean, did you ever have any trepidation going into it?

[00:04:53] People say don't work with your family members.

[00:04:55] Don't work with your significant other.

[00:04:57] Don't work with your best friends, but it's worked for you.

[00:05:00] It has worked.

[00:05:01] Everyone says that and we've heard that hundreds of times and we have not had that experience.

[00:05:05] But I think we have enough complimentary skill sets to where our lanes were very known

[00:05:11] like our swim lanes going in.

[00:05:14] And we really got along.

[00:05:16] I mean, we've always gotten along for the most part.

[00:05:19] Yeah, we thought when we were young but I think not having that checking our egos at

[00:05:24] the door was something we talked about early of saying, like if there's a tiebreaker,

[00:05:28] we're going to look at the data, we're going to talk to customers.

[00:05:31] We don't think we know better than each other on any given matter unless it's informed

[00:05:35] by experience or data.

[00:05:36] And so we've had our time where you could tell, we dig in a little but at the end of

[00:05:39] the day, we were both just so focused on what the end goal was which was to build a good

[00:05:45] size company, have a good exit, a good outcome for ourselves and that anything that's not

[00:05:51] in service of that is our ego talking.

[00:05:53] And so it helps his background as in counseling psychology also.

[00:05:57] So he was a therapist for a few years.

[00:05:59] So there's that.

[00:06:00] So we talk about our feelings which is very healthy, especially sometimes it's male co-founders,

[00:06:06] investors whoever you are sometimes it comes out in other ways if you're not talking

[00:06:09] about it.

[00:06:10] So we have a good community dynamic like that.

[00:06:14] That's great.

[00:06:15] And one of the cool things about your story is you guys never raised money right?

[00:06:18] You bootstrap it all the way until recently when you raised growth equity around and

[00:06:22] recap the company.

[00:06:24] What was that like where you always in agreement you didn't want to do?

[00:06:27] Did you try to raise money?

[00:06:28] I'd love to hear about that thought process.

[00:06:30] Yeah, great, great perspective.

[00:06:32] Great question.

[00:06:33] So we read a lot about the venture world before we even started the company together.

[00:06:38] We were very I guess well read in terms of the paths to companies.

[00:06:41] We followed all the big companies that went through rounds and growth and understood

[00:06:45] that that was one path when we decided on vertical niche SaaS.

[00:06:48] We thought we could we liked it because we could start with $2,000 each to buy the domain

[00:06:53] name, start building an MVP and do it very lightweight.

[00:06:57] So I believe we liked the idea given the industry.

[00:07:01] Now if we were going after something with a huge tam, maybe we would have thought differently

[00:07:04] and said we got to raise money, we liked that we could get some traction just two guys

[00:07:08] in a basement, create content, cranking out code.

[00:07:12] So we knew that was the path initially.

[00:07:14] We didn't know how big the vision could get.

[00:07:18] We had a hunch that this could lead into home ownership and a bigger tam.

[00:07:23] But at that point we would have the recurring revenue from SaaS to fund it.

[00:07:27] And so we almost thought we could be our own investor for many years and we really

[00:07:31] liked being in control of our destiny in that way.

[00:07:33] But niche SaaS again allows you to get traction, reinvest your profits.

[00:07:38] But I mean we were raised by frugal parents, you know, military dad put water in the orange

[00:07:43] juice to make more of that kind of thing.

[00:07:44] And so we never spent money, we didn't have, we often didn't spend enough for growth

[00:07:50] early on.

[00:07:51] So I think that there's a flip side to it but we're glad, you know, we went seven years

[00:07:55] without taking a dollar because I think it is a value of cruise to use an owner.

[00:08:00] Now, it's really inspirational.

[00:08:01] I love when I hear that and obviously is we meet with so many founders there's a time

[00:08:05] and a place in a situation for venture capital, right?

[00:08:08] And then in most cases, it's not the right situation.

[00:08:11] I think what you and your brother did in being really upfront and honest with yourself

[00:08:16] is what are we looking to achieve, particularly in the face of tech media that glamorizes

[00:08:20] all the big phone raises, right?

[00:08:22] We did feel like we were missing something.

[00:08:24] There was a firm, oh, many years of you read headlines, you read companies like service

[00:08:28] tighten or something that are just growing like crazy and there was definite fomo of feeling

[00:08:33] like, man, are we taking like the slow and steady wins the race approach too much?

[00:08:37] Like should we have raised to accelerate growth?

[00:08:39] So there's always two sides to it, man.

[00:08:41] Absolutely.

[00:08:42] What's it been like building the company in Colorado?

[00:08:45] We love Colorado.

[00:08:46] We were mostly raised here.

[00:08:49] Just the environment and the Denver startup scene in particular has been really cool to see

[00:08:54] Denver startup week grow here, to see some flagship companies really grow here.

[00:08:59] The kind of people that Colorado attracts very work life balance, very nature involved

[00:09:05] in nature don't live to work.

[00:09:08] And I think that's good in some senses than other senses you want to create that urgency

[00:09:12] and you want to find those people that really want to carve out their path.

[00:09:15] And so just the active lifestyle, man, it just breeds good people, good workers.

[00:09:20] It's bringing in a lot of talent from across the country.

[00:09:22] We know post COVID.

[00:09:23] You and I have seen the boom here, but a lovely place to build and grow and would do it

[00:09:28] again because I think it's one of those under the radar startup cities.

[00:09:32] I think in some ways it doesn't, it still doesn't get talked about in the breath of

[00:09:35] an ostentomy.

[00:09:36] I mean, whereas it quietly has its place, I think.

[00:09:39] Absolutely.

[00:09:40] And I think it's because like you said, we're all, we're heads down doing our thing and

[00:09:45] not hosting Southwest, you know, so you know, they could build parties in Miami.

[00:09:52] We're just doing it and building great companies here.

[00:09:54] Kind of blue collar in a way here.

[00:09:56] Yeah.

[00:09:57] I got to follow up on one point you made though which is something that we do get asked

[00:10:00] about, hey, can you really build successful companies in Colorado when people just want

[00:10:04] to go take off on Friday and go skiing and your reference work life balance being important

[00:10:08] for finding, you know, it's important to find those people who are willing to kind of

[00:10:11] do what it takes to build a successful company.

[00:10:14] You clearly found those people to do what you guys did.

[00:10:17] How'd you do it?

[00:10:18] Well, we took chances on people early on, second, third, fourth, fifth employees and we tried

[00:10:23] to make it clear that hey, this is not an 80 hour a week sleep under your desk kind

[00:10:28] of vibe and culture but it's also not do your 30 to 40 hours and check out and don't

[00:10:33] care if we get results.

[00:10:34] And so being very clear that we have a hill to climb in a vision, we're trying to get

[00:10:40] to and it's going to take above and beyond effort and time and energy but differentiating

[00:10:45] it from Silicon Valley culture of the toxic kind of like burn yourself out all in favor

[00:10:51] of say the founders or some outcome.

[00:10:53] So we tried to find those young hungry people that said, hey, well, we'll teach you everything

[00:10:58] about our industry and how we want to do things.

[00:11:00] That worked out, a lot of those people were hungry to put in the effort and the time

[00:11:04] and relentlessly show up for customers day in and day out.

[00:11:07] And I think people do work for founders when they see you doing it as a founder and Mike

[00:11:12] and I, you know, for years showed up every day and did put in those 60, 70 hour weeks

[00:11:18] and answered customers at any minute of the day.

[00:11:20] It's kind of contagious and you start saying like okay, I can believe in this vision.

[00:11:25] And then when we told people like hey, if you're starting to feel burnt out, yeah, go

[00:11:27] hit the mounts.

[00:11:29] But like let's talk about it and decide when we're shifting gears.

[00:11:33] And so like I think mindfulness around shifting gears was big.

[00:11:36] And then you've been head down, build this thing for a long time but any companies in the

[00:11:40] local tech scene that have you excited?

[00:11:43] Yeah, so I'm in an entrepreneur group in Denver that has been wonderful for connecting

[00:11:48] with other entrepreneurs.

[00:11:49] One of them, Poppins payroll.

[00:11:51] He's in one of my groups and doing cool things in the payment space which isn't, you know,

[00:11:57] everyone's cup of tea, but lots of cool things are happening in the payment space.

[00:12:00] And there's a number of other companies in there that are escaping people.

[00:12:04] We meet every two weeks and we just talk through founder problems and what's going

[00:12:08] on.

[00:12:09] But I have found through these entrepreneur networks.

[00:12:11] There's dozens and dozens and dozens of companies that are quietly building monsters

[00:12:17] and I think it's a special thing.

[00:12:19] Absolutely.

[00:12:20] Cool.

[00:12:21] Well, let us segue Kevin to the meat of our conversation today which is your biggest

[00:12:25] lesson.

[00:12:26] Obviously, a lot of ups and downs and ultimately great outcome with Spectora.

[00:12:30] If you had distilled it down, what's the one biggest lesson you've learned?

[00:12:34] It would be relentlessly staying in front of your customers and there's a couple different

[00:12:40] flavors of that and that sounds obvious right?

[00:12:42] But I think as builders, creators, investors, whatever class and tech we are, there's the

[00:12:47] tendency to want to have the answers or provide the solution or know as opposed to continually

[00:12:54] just asking people and doing the hard work of distilling that information on the product

[00:12:59] side.

[00:13:00] So to me, on the product side, it's never assuming we know the tech answer for non-tech

[00:13:06] people because most people in this world are non-tech people.

[00:13:10] They experience technologies like anyone else and so one huge lesson on the product side

[00:13:14] was taking time to ask do focus groups, do mastermind groups.

[00:13:20] We have a Facebook group literally dedicated to just product feedback that we lived in for

[00:13:24] years and just said, hey, does this make sense for a workflow here?

[00:13:28] Okay.

[00:13:29] What do you do after you click that button?

[00:13:30] Hey, when you're at the house and you're ready to wrap up with the agent, what does your

[00:13:33] workflow look like?

[00:13:36] And then on the content side was kind of my world where I think I've written probably 500

[00:13:42] articles and created 300 YouTube videos over the last seven years.

[00:13:46] And I just put my hard hat on it, did that every day even before we launched to keep my

[00:13:51] face and my voice in front of our industry?

[00:13:54] And it didn't seem like it was going anywhere for years.

[00:13:58] I just kept creating content, kept finding, just like you're doing here, creating content.

[00:14:03] It's a beautiful thing.

[00:14:04] But it kept us in front of our customers and they heard our voice and then they got asked

[00:14:08] questions about the product.

[00:14:11] And I think that built a certain kind of loyalty in our space that has propelled us

[00:14:15] and it doesn't work until it does and then it kind of snowball.

[00:14:20] So now everyone says, oh, how do you crack out so much content?

[00:14:23] It's like, well, in eight years.

[00:14:25] That's how?

[00:14:26] Do you think it's the accessibility?

[00:14:29] They felt like you were real people and not just some corporate entity.

[00:14:33] Is that was that the key?

[00:14:34] Yeah, that's a great point.

[00:14:35] I think they, when they talk to founders or early employees consistently, when they have

[00:14:40] your phone number, when they can shoot you a text, when they, when you answer the email

[00:14:43] same day, and then they hear and see your voice, they see, you know, I'm where hoodies

[00:14:49] I show up to work and I hit record, doesn't matter what I'm wearing or how I'm feeling.

[00:14:53] I think that helps show people that you're showing up and you give a shit.

[00:14:56] And I think when you show up and care for an extended period of time, it's just like

[00:15:00] any relationship that builds trust and let some know that like, I'm actually rooting

[00:15:04] for you.

[00:15:05] I don't want to be your customer.

[00:15:06] I'm like rooting for you.

[00:15:07] And we've, that kind of loyalty we've had employees come in and say, this is weird.

[00:15:13] Like they're like cheering for you and defending you.

[00:15:17] Yeah, that's amazing.

[00:15:18] I mean, we saw this at Home Advisor Kevin where I always went in with the idea that your

[00:15:22] customers had to love you and be to be in it.

[00:15:24] Home Advisor you and I know like great business.

[00:15:27] Generally speaking, the customers didn't, didn't love the product.

[00:15:30] Right.

[00:15:31] So it was an interesting learning for all of us that you could build a great company where

[00:15:34] the customer kind of didn't love your product but reluctantly felt like they had to use

[00:15:37] it.

[00:15:38] Right.

[00:15:39] Yeah, they needed it right?

[00:15:40] And it seems like you, you want a different, different way.

[00:15:43] Just love to hear your, you're thinking about that given you're learning at Home Advisor.

[00:15:47] Right.

[00:15:48] It's a love, hey, relationship and it's hard and it's hard fought loyalty and trust

[00:15:53] that was built because for years it was not that.

[00:15:55] It was skepticism.

[00:15:57] It was you're charging too much.

[00:15:59] You know, like hate this hate that and there's still some of that.

[00:16:02] You know, it's like there's a, there's a couple percent of crazy in any industry, right?

[00:16:06] I think continually solving a pain point, making their life better, keeping that human

[00:16:12] connection.

[00:16:13] And so, I think we're going to do our best to be mindful of that and keep those humanizing

[00:16:18] connections and we're intentional about some of the content we create to put our people

[00:16:39] front and center to show that like, hey, we're showing up to work just like you guys are

[00:16:44] every day.

[00:16:45] And I think continually champion being a champion for the industry.

[00:16:50] And so I think we're going into an era where we're going to be creating products and even

[00:16:54] sharing some of that revenue with our home inspectors.

[00:16:56] So let them know that like this is not all about us gobbling up every single penny and

[00:17:00] cent.

[00:17:01] We are going to do better as we do better.

[00:17:03] And I think that, and we wouldn't mean it really say it.

[00:17:05] So I think that's helping a lot.

[00:17:07] How do you balance being in front of customers, making them realize you care about them?

[00:17:13] Being accessible with inevitably, you can't solve everybody's problem.

[00:17:17] You can't create every product feature that every inspector is going to want.

[00:17:20] You're going to have angry inspectors and angry customer.

[00:17:23] It's never one of them are how great a product you have.

[00:17:25] How do you walk that line?

[00:17:27] Prioritization and getting them to prioritize because I think that's the hardest thing

[00:17:31] because whenever we would do product surveys and we do mastermind groups and I'd run

[00:17:35] them, all their features must have game changers.

[00:17:39] Have to have it right?

[00:17:40] And you're just like they can't be true.

[00:17:43] And it just takes hours and hours and hours of conversations to say okay if you couldn't

[00:17:48] if you could only have one of these two features which one would you pick and asking them

[00:17:54] pushing them to quantify to say how many minutes would that save you?

[00:17:59] Oh only two a day.

[00:18:00] Okay well what about this other feature?

[00:18:02] Like what are we talking here like 30 minutes an hour?

[00:18:04] How much headache would that save your wife or your admin person?

[00:18:08] And so it's like drilling down into the product's questions and layers deeper to really discover

[00:18:14] true priorities.

[00:18:15] It's freaking hard because there's so much noise now.

[00:18:19] You know you have thousands and thousands of feature requests in the backlog.

[00:18:23] Yeah, you inevitably turn a few people off that say I'm going to go somewhere else to get

[00:18:28] that personalized attention and I think we've lost maybe 10 or so customers lifetime.

[00:18:34] To an upstart that maybe would give them that personalized attention.

[00:18:38] And that's just the nature of the beast but the rest I think we do show them our product

[00:18:43] roadmap and say this is what we're dealing with on a given month.

[00:18:48] And it's not their job to wear to like have awareness of everything we're dealing with

[00:18:52] but it helps them understand why something's not getting built when we say hey look I get

[00:18:58] why that's important to you.

[00:19:00] But that only benefits a small subset of our users and we have to kind of prioritize

[00:19:04] based on impact.

[00:19:05] So really it's the true it's getting in front of your customers and it's being open and

[00:19:09] transparent with them.

[00:19:12] Open and transparent and at times not letting yourself get what we call feature blackmailed

[00:19:16] because a lot of them will say I'm going to go somewhere else if you don't build this

[00:19:19] feature for me and we used to laugh about that phrase feature blackmail because it's like

[00:19:23] we did it at times and there's times we have you know and we have features and a little

[00:19:28] bit of like bloat at times because you just build custom stuff when you start becoming

[00:19:33] custom to everybody you start losing your appeal to the masses and to new customers.

[00:19:37] And so it's kind of there's no secret there's no what you know secret way to do it.

[00:19:42] You said it's sometimes it's founder intuition and gut of okay I don't get the sense this

[00:19:47] is going to impact or help the broad user base.

[00:19:50] So I got to say no on this one and that doesn't feel good to hear but here's why.

[00:19:54] I think it's absolutely right Kevin you tell you guys built a culture of caring of trust

[00:20:01] with your customers of you know for your for your folks on your team making sure that

[00:20:05] they're putting the customer first it's obvious.

[00:20:07] The downside of that and it sounds like you're you manage as well is you're going to get

[00:20:12] customers especially those in the front line especially those employees in the front

[00:20:14] line deal with customers were like hey I thought our value was that we care deeply about

[00:20:18] customers I've got this customer here who's going to quit right because we're not

[00:20:21] here and he said we're ruining we're ruining his life so it's not just managing externally

[00:20:27] how do you manage that internally keep that that culture tight.

[00:20:30] It's really hard to I think manage that the art part of empathy and service and giving

[00:20:38] your people context as opposed to can't do it not a priority then they feel shut then

[00:20:44] customers feel shut down.

[00:20:46] And so at the stage we're at 65 employees now like inter department communication becomes

[00:20:53] a thing and I know hyper scale companies will probably laugh and say that's cute you

[00:20:57] know wait till you get to hundreds and thousands but I think it does get to a point where people

[00:21:02] are not getting maybe communicated to internally like they used to they don't just hear you

[00:21:07] don't just roll around and tell someone hey this feature is watching here's a nuance

[00:21:10] of it let me show it to you.

[00:21:12] It's now in a remote world all it got in a lot harder so to me it's the process of how

[00:21:17] we communicate is now a focus.

[00:21:21] How do product releases get put out are we doing video over just an article because no

[00:21:25] one reads and how in that video needs to be like two minutes so they can watch it real

[00:21:29] quick understand and then communicate.

[00:21:31] So it's all these little communication points that I didn't appreciate when we were at 10

[00:21:38] or 20 people and now I'm like organizational communication is a thing for a reason and

[00:21:44] I get it now because if you're frontline people don't have the empathy or the context

[00:21:50] they communicate it poorly customer gets pissed doesn't understand is a risk churn risk

[00:21:55] so we're still figuring it out it has not been the most fun part of this phase.

[00:21:59] Well, it sounds like you can overall navigate with the laws possible and done a great job

[00:22:04] so great story and congrats on all that you built with spectora we're kind of listeners

[00:22:09] follow along with what y'all are up to.

[00:22:11] We have a podcast spectora spotlight it's an industry podcast but I'm also on LinkedIn

[00:22:16] Instagram Facebook all the usual places under Kevin Wagstaff and I share a little bit

[00:22:20] of company journey stuff.

[00:22:22] Thanks so much Kevin really appreciate your time and lesson.