Sound BITES: E48 - Daniel Myers | Flair.co

Speaker A: Today's episode is brought to you by our company, nanochomp Marketing Strategy and Analytics. We help product and marketing teams solve problems and experience growth using data and approachable AI. Visit nanochomp.com to learn more.

Speaker B: Hey everyone. Welcome to another episode of Sound Bites. This is the podcast where we talk about all things business, innovation, technology, entrepreneurship and strategy. And today we have Daniel Myers. Daniel is the co founder and CEO of uh, Flair, and it's a company that specializes in smart, uh, climate control solutions for homes and businesses. Dan has a background in computer engineering and music from Northwestern University, so can't wait to dive into that. And Dan and his team are working on interesting systems that are at the intersection of comfort control, savings and optimization, all with an evolving IoT platform. So, Dan, welcome to the program. Thanks for having. Thanks for hopping on.

Speaker C: Excited to be here.

Speaker B: Awesome. Yeah, so are we. So I guess where we like to start all of these episodes is really like, what got you to where you are today? Tell us a little bit about your background.

Speaker C: Yeah, um, I mean, I think to some extent I'm maybe the sort of classic tinkerer. Was, uh, it maybe the real starting point? Um, I mean I was playing with uh, like transistor level logic back in like fifth grade for like just nerding out at home, um, as fifth graders do. Yeah, yeah. I mean I.

Speaker B: Classic greater activity.

Speaker C: Yeah. I just would love to build things, you know, and of course take them apart. I feel like tinkerers all start as destructive, uh, elements and then move into creative ones. Um, so just, I mean, built mini bikes, go karts. We built this giant solar powered car. I drove across the country, country in high school, all sorts of stuff like that. And I think, um, you know, that's just sort of the zeitgeist that I've had forever and uh, still have that. So. Yeah.

Speaker B: How did you get exposed to that kind of stuff? Like what got you, you know, pulling stuff apart and taking it back together. Was there someone who inspired you or that, that you modeled that after?

Speaker C: Totally. I had. Both of my grandfathers were engineers, so it's 100% their fault. Um, and, uh, you know, basically one of them was a structural engineer. One was, um, more kind of automotive. Um, and so we were always tinkering with something. Um, and just generally, you know, uh, we're very kind of math focused and things like that. Ironically though, I will say I had one. The grandfather who was really into automotive was always explaining to me how air conditioners worked, which, like, in hindsight I think is so funny, because I'm like, why is he telling me this? Right? And then in hindsight, maybe that just like inherently put a bug in me. Um, and, uh, I mean, I even, I remember even in high school, so I grew up in South Florida. You know, you also never stop thinking about air conditioning when you, when you live in that environment. Um, I even wrote a paper on the development of South Florida as it pertained to sort of the evolution of air conditioning, uh, back in, like, I think it was my junior year and finally found that like a year ago. Um, so it's something that thematically came up for a lot of different reasons. Um, and, uh, you know, once you get into the sort of energy world, you realize, oh, it actually kind of matters. Right?

Speaker B: So.

Speaker C: So, yeah, there's a lot of things that converged.

Speaker A: It's pretty interesting. Like that one, that theme kind of sprinkles its way through. And as we've done this podcast man, quite a few times now, I think we're like maybe 50 episodes deep. These little butterfly effect moments that impact people so much further on. And it's like, what would things look like if your grandfather didn't talk to you about how H Vac worked? Or if you grew up in Wyoming, like, how would that have changed the path that you took? Which is kind of fascinating. And through all of that, a lot of that traditional H vac space, you're looking at like fluid dynamics, thermodynamics, but you didn't go a mechanical engineering route, you went computer engineering. So let's talk about that for a minute. What made you decide to go down the computer engineering path?

Speaker C: Um, yeah, it's a good question. I actually started as an electrical engineering, um, you know, uh, inbound. And um, I had done so much, so I mentioned that solar powered car thing, right? So I went to this like, it's an environmental sciences magnet high school. Um, and, um, so as a, it was a senior project, but I spent like two years working on it, raised $50,000, built this thing in my garage. It's like 20 foot long solar powered car. At the time BP, which was beyond petroleum. I think they're back to petroleum now. But when they were beyond petroleum, um, donated the panels, we got Toyota to donate a giant trailer, we got all these different like people to come together. And um, even an ultralight airplane manufacturer, um, to donate a bunch of like aluminum and gusset plates, all this cool stuff. Um, and, um, I, I remember the year, the summer between junior and senior year, I sat down with autodesk Inventor. And the. The. This was Broward County Schools in Florida. Florida. So, like, Fort Lauderdale area donated, um, like a CAD machine back when you needed a CAD machine for cad, I guess.

Speaker A: Yeah, true. I had, like, a Sun workstation to be able to make that kind of thing work.

Speaker C: I mean, it wasn't that intense, but it, you know, it was like, now you can do it on your MacBook Pro, you don't worry about it. But back then you wanted, like, a beefy machine with a good video card and all that.

Speaker A: Right.

Speaker C: Um, and so they donated that. And I just sat down over the summer and just learned how to, like, build 3D models, uh, soup to nuts and model the whole car. Right. And so at some point, while thermodynamics, fluid mechanics, like all sorts of statics and things in the mechanical realm were not the place I focused, I did feel like, yeah, I know how to build physical things. I'm not worried about getting a degree in that. What I want to know is, how does the chip inside my computer work? Because I don't know how that works. Right. Um, and I want to be able to get from, okay, electrons are getting routed around this way to this JavaScript library is going to do this thing in my browser and everything in between. So I kind of took the view of, like, I wanted breadth, not depth, which in some ways, I think at the time in the EECS department was not what they wanted for their students. Like, they were more like, we want you to be the best computer engineer that intel could hire. Right. Uh, and I was kind of like,

Speaker A: EE department would split you and say you're gonna be induction machinery or electronics, but you're not doing both. Right. Like, they pushed you into one path or the other. And if you were in the computer engineering space, you were doing embedded, like, yeah, that was how they drew those lines in the sand versus, uh, a da Vinci style, um, entrepreneurial engineer.

Speaker C: And I thoroughly enjoyed the, you know, the class I took where I designed a processor. Like, that was awesome. I never wanted a career in designing processors. Right. Like, so from my standpoint, um, I ended up in computer engineering because I think curiosity led me to the middle of the stack, where computer science. Because I got a master's in computer science, like, uh, pretty much in parallel with the computer engineering degree. Computer engineering just sat between EE and cs. And so it was a great place to kind of launch off in either direction whenever you felt like it.

Speaker A: It's funny, like, I think we've talked about this. I end up, I have a Degree in doubly in computer science. So I, I did the other bathtub fit.

Speaker C: Right. Same concept, Right? Right.

Speaker A: Like, how do I get wider to be able to take these things I built, turn it into a control system that's executable in this new world that's going all software based versus mechanical based. So really interesting. So you have that path there. You have these butterfly effects. These little things in your world came together, kind of directed you down a path. You built a Sunseeker car. I was on the Sunseeker team too. I was really composite material, which is kind of fun. Um, and then what? So there's a little bit between. And then you started a company. So what happened just before you built your own business?

Speaker C: So, uh, I went to school at Northwestern. Um, the reason I really ended up there was they have a phenomenal music program. Uh, and so I play the French horn. Got into the horn studio. The professor there, she's just like world renowned. I think she retired last year. So, uh, you know. But, um, awesome. Was excited to get in. I was like, yeah, they have good, you know, academics and engineering and whatnot, so that'll be great. But I was, I was there for music for sure. Um, and, uh, and then after that, was living in Chicago, you know, just, you know, half an hour on the, um, train away, uh, from Evanston, and was, um, working at a startup building giant web crawlers for, like, online pricing data and loved it. I mean, they basically said, here's a credit card. Don't spend all our money on aws, but also go build everything. Right? And it was, it was great. It was an awesome experience for a year and a half. And I was living in this apartment in, um, Ukrainian village there, and I could not for the life of me figure out how to keep two rooms comfortable at once. And, uh, it was like that dumb of an experience where I was like, all right, whether it's like legos, a Raspberry PI, an Arduino, or like some combination of those. Right. I could probably like, figure out how to do this, um, you know, by just monkeying with what vents are sending air, where, when. Yeah, um, started there. And then the Harold Washington Library in Chicago got this grant for 3D printers. So I was like, okay, well, let me just go cad something up, design it, uh, and put it in my apartment. And like, it didn't really work. Like, it was like, you know, horrible initial design, everything else. But it got me thinking about it a lot. And I was like, all right, if I was going to do this right here's how I would do it. Talked with people, kind of thought back to my days living in Florida. It was like, this problem is really widespread. Like everybody who's lived in an American home with a central system has gone into a room that's too hot or too cold. And the end result is just a lot of energy wasted. And it's like, well, somebody's gonna be dumb enough to fix this. Like, I, I'm down to take that bet. Um, and so that's kind of how we got into it. And that was what sparked the interest in, in kind of um, maybe H Vac proper as a thing to play in.

Speaker B: I'm super. I want to talk more about a flare, but I'm also just thinking about your past. You talked about this two year project in school where he built his car and like you had to get all these donations and stuff from Toyota and all these other companies. To me, that just reminded me of, you know, what it takes to build a startup where you're asking, did you like, do you notice any parallels there? Did any of what you did during that project, even on a small scale, kind of help inform, you know, raising funds or, you know, thinking about how to start your business?

Speaker A: Yeah, realize at the time, yeah, I

Speaker C: didn't realize at all at the time. I, I, oh, it's funny, I think South Florida, uh, it's probably different now. At the time was not a startup centric place in my perception. Right. Um, that was like a thing that happened out on the West Coast, I guess, and I didn't know anything about it. And even in the first few years of school I wasn't getting any messaging that like the startup world was an option. Right. Like, I just didn't have that in my, in my head. And um, but at the end of the day, I started, I feel like I started reading Slashdot, then uh, I started reading Hacker News. And then I started seeing this whole ecosystem that existed. I was like, oh, these are my people. I found the world where they're just, they go out and they build stuff and they don't ask for permission and they don't have to report like 10 layers up into a bureaucracy. They just go build it and uh, deliver it and it's, you know, and there are people who will fund it and like, you can, you know, do this. It was sort of eye opening some, sometime in the middle of my, uh, undergraduate career. And um, and then it occurred to me, I was like, oh yeah, I did actually just get on the phone and ask People for money or did just get on the phone and ask people for stuff and, uh, and then did just go build stuff without anybody sort of saying, you can, you can't. You know, this is the perfect way. This is the right way. It was more just try and fit it together and figure it out. Right, yeah. Um, and so I think inadvertently, uh, I had like, Startup Light, uh, as an experience, um, and it was a, I think, a good starting point for. Yeah, okay. I could see how you could just call up somebody and say, okay, I don't have everything figured out, but I can put together, you know, a plan and, and build stuff. And, you know, I've got. I don't have a prior business that I've executed on, but I've done a lot of cool things in life that I can point to that maybe give you some confidence. So write me a tiny little check and I'll go, you know, work, work, uh, on it from there. Right. So I think it was definitely something that helped.

Speaker A: Yeah. When you did it, you mentioned, like, you're in the Midwest. I'm from Detroit originally, so I can commiserate. And you look and you say, okay, Boston. Like, you're biotech. You're. You're going to be in the Boston ecosystem. If I'm not near Harvard or mit, I'm just not going to get touched. And then it's like, okay, well, if I'm not going to Stanford or I'm not in the Bay Area, I'm not going to get touched. And, um, you know, being an engineer in Detroit, my first role out of school, like, what I thought I was going to do versus what I was really ending up doing was sorting bolts by their hexavalent chromium content. Like, that was miserable. And that kind of pushes you out of that space into. Into entrepreneurship. But, yeah, I think your background uniquely positioned you. Like all of your upbringing, kind of all those things came together that uniquely positioned you to break out of potentially sorting hexavalent chromium as a career and instead doing something interesting, solving your own problem. And the problem you even bring up, even when you, when you found or, uh, created it, it was more difficult to solve than even the building blocks today, like things like Raspberry PIs were just coming out. Now you can go get an ESP32 chip, a raspberry PI chip, and you've got these frameworks, and you can kind of duct tape a solution together to make it work. You can, you had to design 3D print, uh, build a lot of the Stuff just completely from scratch to try and solve that problem and then iterate off of it. Right. So what does that iterative process look like or iterative process? You said your first piece just wasn't that great. So what was your next step? How did you improve on it and how did you get uh, it to go?

Speaker C: Uh, well, the smartest thing I ever did was I called my co founder, well, eventual co founder, um, because he's smarter than me by, you know, leaps and bounds. And so the, the end result, right, was like, okay, well this sort of heinous idea I have, like somebody needs to come in and like, you know, basically tell me all the stupid things I did and you know, come up with better ideas. And uh, and so that person, his name's Kenny. Um, it's, it's funny along the lines of maybe just dumb luck, which I'll definitely take that, you know. Know, um, I think I was his first friend in the US M after he came here from Singapore, uh, to study in school. And uh, and we were just friends from pretty much freshman year to now. Right. Um, and um, you know, so I had just sort of called him and at the time he was at Microsoft, uh, you know, building software. And it's funny, he was, he was doing the, what is it, Chrome Vanadium, sorting himself at Microsoft effectively, right? Like he was like, yeah, we're building this stuff. He was on the Skype team, you know, and like, you know, I think Skype shut down literally a month ago, right? Uh, finally. Um, but he was like, yeah, I have this deal with my dad, uh, who was, does like electronics distribution in Singapore that if I don't find anything interesting I gotta go take over the family business. But if I find something interesting, you know, I don't have to. And he's like 100% I'm interested in this startup concept because I don't want to go take over. Which is kind of, kind of funny. So uh, we waited, I think for him to get his annual bonus. And um, and then we basically just kind of worked up a plan to move to the Bay Area and figure out how to get into some accelerators, right? Because we were like, okay, we can do around on some of this stuff, but we don't know anything about building things at scale like manufacturing. Like it's, you know, example would be you build a solar powered car. It's completely one off. There's no notion of unit economics, there's no notion of industrial processes. It's very like bespoke and it's fun and it's definitely engineering, but it's not commercial. Right? Yeah.

Speaker A: Uh, how do you do it twice? Like you can do almost anything one time. Yeah.

Speaker C: So there was an element of, uh, okay, we can see that there's a design path. We could kind of feel it out. We didn't like. And we could build some prototypes that could get us closer. And we did a little bit of that. But I think the real big move that we made was we said we got to go find money and we got to go figure out production. And that was when we quit our jobs incorporated, you know, uh, finally, I think we used some service called Clerky back in the day. Maybe it's still around, I don't know. Um, and, uh, and set up shop in San Francisco with very limited money, very limited personal Runway. Um, but a whole lot of ambition and determination in terms of, like, somebody out there is going to fund us. And, you know, we got laughed out of meetings, but eventually we found people who would believe in us.

Speaker B: So what was it like, um, starting your business with a friend, you know, during that time? And then how has that kind of evolved over time? Or how has that relationship evolved over time? And you know, are there pros and cons to. To starting a business with maybe someone who starts off as a friend and is now also a co founder?

Speaker C: Um, I certainly wouldn't ever say that my sort of one experience so far generalizes, but in my case it's been, I mean, incredibly fortuitous. Um, there's been times when both of us have said, what are we doing? Right M. I think that's like a thing that happens when you. I mean, you know, there was a period, I want to say, like three or four years in, where we basically were running out of cash. Uh, we was uncertain if we could get funding. Um, you know, and I remember, uh, you know, there's more to this one too, right? There's. There's a third friend involved here, which is my wife, um, who was on. Who also built that solar powered car with me in high school.

Speaker B: Oh, cool. Wow.

Speaker C: So, um, you know, like, I think having friends and people who, you know, have personal investments with you, uh, and that makes all the difference, I think. You know, once in a while I see these like, message boards. People are saying I'm looking for a co founder. And like, I can't even fathom that world, um, of like going in cold and it might work great and like, there could be some real serendipitous wins there. But, uh, so I Wouldn't dismiss it outright, but I can't really imagine it yet because I was just so lucky to have people around who, like, were like, yeah, you can kind of tank our personal finances and take a bet, like, go for it. Right. Or, uh, you know, yeah, I'm willing to take this chance. And, like, you know, I know that you're not fly by night. I know that you're a hard worker. I know that you're a smart guy. Like, those kinds of things give you more confidence to take bets and risks.

Speaker A: That's a good answer. And I think, like, when you. When you look today, there's so many. There's so many videos and pictures and images of, like, the Instagram versus reality entrepreneurship result versus what's actually happening. And when you're not on a private jet and you're sitting back with your co founder, like, yeah, those. What. What are we. What are we doing? Like, how do we move forward? Is, do we just got to pull the ripcord on this thing? Like, how do we make this thing work? And I think a lot of people think there's more sunny days than rainy, um, ones. And I don't know if that's exactly true. I think a lot of times you're. You're scared, you're nervous, you're problem solving. You're working with clients and you're problem solving with them. You have things going well and things that are going poorly, and having somebody that you know, that you can balance things off of is, I think, extremely helpful versus adding another layer of stress to it. But it's. I think it's a challenge. Right. Like, I think that relationship, over time will change, but it's, um, tough emotionally.

Speaker C: I feel like it's as important as anything. I mean, like, my, Like Kenny, as an example, as a technical co founder. Right. Both of us being technical with him being the cto. I mean, what a freaking rock star. Like, he is so amazing at, uh, supply chain, at ee, at, um, you know, the engineering. Like, he. He, uh. Another advantage that, you know, like, we've had here is, like, he has language skills. So when we went to China to build a supply chain, like, critical piece. Right. So, um, very lucky. But honestly, the most important thing that I think Kenny, uh, brought to the whole business over the long term was just, like, somebody to emotionally be in it with.

Speaker B: Yeah.

Speaker C: You know, like, who could see the books, who could see everything. Right. Because, you know, even the early hires, like, you know, you kind of want to shield people from what's going on a Little bit. You need them to execute, not be distracted. Uh, your co founder is the person who like 100% is on the roller coaster with you. Right. Um, and so that's just, that was just such an important part of this story.

Speaker A: Yeah, I think that's, yeah, really great insight and I think a lot of people don't think about that. Back to I need a founder or like getting on Reddit and finding a founder. And there's this, there was this trend of like distributed companies or like DAPPS for a while where things were like tokenized for solutions. And I think that can work for some tasks. But to your point, for the actual organization, for building, uh, your principles, your culture and somebody that's going to be like handcuffed to you in an emotional support system to keep moving forward and bounce ideas off of and be a puzzle piece that isn't the exact same skill set that you have that can look at a problem from a different perspective, I think is super important. Yeah, that's a great answer. So as you're growing and as you're, you're working together and building things, what was the next thing that surprised you? What were the, what was the next milestone you hit that we thought, okay, this might be okay?

Speaker C: Um, you know, I think part of it was certainly funders. Um, you know, I mean, to some extent, while we hadn't built commercial things like hardware products, we had built enough things, whether it was software or one off things that, you know, we just sort of tinkered on at one point in life, um, that we were confident we could build something.

Speaker A: Right.

Speaker C: Like, I don't think we felt like we couldn't do it. We felt that getting the economics might be hard. Uh, you know, that makes sense. Might be hard. We felt that, you know, getting, attracting customers could be hard. Like there, you know, building the business, there were certain parts of it, but building the product, we felt like we could do it. Um, the. And so building the business, right. Like, well, what are the other pieces besides the product? Well, a big part is you got to have the funding and you need customers. Right. I even felt like we could get customers because if I could sell the dream of building a solar powered car as a high schooler, I could sell the dream of fixing your house's heating and cooling. Right. Um, so that, that to some extent, like, felt like, yeah, we could figure it out. It may not be perfect, it may not be like, you know, a unicorn in a year, um, but like, there's gonna be people out there who want to Buy this. Um, and if we make a good enough product, like, you know, and, and kind of communicate it, well, that'll happen. The, uh, the hard one was like, are there people who want to fund this? Right. Like, it's like, you know, hardware was definitely not popular. Um, you know, uh, H vac to a bunch of people who like MBAs running venture shops in San Francisco. Like, you don't even have air conditioning in San Francisco. Um, like, trying to convince them that it mattered was, like, incredibly stupid. Um, and then, um, you know, climate tech was not a thing, uh, when we started. Right. So in some ways, I think we were a few years early. Um, and then the other thing that actually was, was very real at the time. We had two SmartNet competitors that launched pretty much like, publicly and loudly right around the time we quit our jobs. So we were, like, afraid we were going to be. This also ran before we even got started.

Speaker A: Um, I guess the benefit of that is, is it validates the problem enough that there are other people trying to fish in that pond, right. So that you don't look as crazy.

Speaker C: There was some of that for sure, but there was a lot of. Well, these guys just raised, like, real money. You guys have like, 25 grand in your bank account. Like, what are you gonna do? Right. Uh, and. And, um, the end result was that, um, one of the companies which was on Shark Tank and one of them which was a spin out from mit, both of them essentially failed on their product executions.

Speaker B: Hm.

Speaker C: Um, and then when that happened, they had so much money already in that they essentially blew up their cap tables. And as a result, we're not fundable, um, and we're not in a position to, like, you know, build their way out through sales. Um, and so, ironically, we were forced to take the, like, fight for scraps path. And what that forced was like, okay, we didn't have money, but we did have some time. Right? I mean, we had time on the Ramen plan, but it was time nonetheless to get details. Right. Right. And that was a place where, if it was product details, things like that, we could, we could get.

Speaker B: Right?

Speaker C: Because we were very. We were the. Of the three sort of people trying to figure it out, we were the most, um, scrappy and technical and. And that was an advantage that we didn't feel at the time, but in hindsight, 100% was real. Um, we didn't have the problem of too much money, that was for sure. Um, and, uh, so anyways, I think, like, we met a couple funders, um, out in the Bay Area who just like what we were doing and liked us. Uh, one, the first one actually rejected us a couple times. Then I think we were just so annoying that they were just like, you

Speaker A: know, what to go away.

Speaker C: And another, we met while in China, Um, still, um, work with him, uh, you know, relatively closely, and then just kind of kept going from there. Right. Uh, but. But that was, um. I think it was important to be in the right place to fundraise. It's probably different now, but back then, like, it was still a handshake type of thing. Um, and, um. And you had to be plugged into some venture ecosystem. So we had done this accelerator who was focused on hardware that helped us figure out China. And there was some angels floating around that ecosystem who eventually kind of we connected with.

Speaker B: Uh, I listened to a number of pitch podcasts where they actually record pitches to VCs, and there have been quite a few people who have pitched hardware products. And it's always like, this big to do. It's like, well, this is hardware. This isn't sexy enough. And so do you think as you're fundraising, that mentality has changed, or is it still, like, very much dominated by software?

Speaker C: And, uh, that's a tough question. And the reason I say that is, like, I'm trying to figure out what 145% tariff means for that question, you know, as of the last few weeks. But, yeah, what. What I can say is, um, it's really changed over time. Um, I think certain aspects of hardware are definitely out of the venture playbook now. Right. Like, I don't think this product right now could be started in the current moment. Uh, in some ways. Uh, I mean, there might be a way, but, like, it's, you know, like, IOT was so much less mature when we started. Right. Like, nobody knew what it was going to shape up, who the winners were going to be, what the connection technologies and platforms were going to kind of come out as. Um, that's. That's different now. Um, but in the broader hardware sense. I mean, you have a lot of deep tech investors now, but they're looking for, how do I translate, you know, some PhDs research into a commercial entity. That's m. Like sort of where we live. I mean, there is some academic research on what we've done and we're kind of commercializing it, but we didn't go about it from lab to, uh, you know, P and L. We went from just where we think this real problem. Yeah, right. Um, I would say this, though. I think Software has become a very confusing place because of AI. Right. I mean one, at one point you built a SaaS business. It literally just you know, didn't need to be complicated. It just had to have good customer acquisition cost, retention rates, low churn and good unit economics and a couple of different basic parameters. And AI could have said yeah, I should invest or not in this business. Uh, it was pattern matching. And I um, think now as some of the difficulty of building software has eroded long term, you know, can these little apps that used to get funding and grow into something and then get acquired, like the build or buy piece feels very fuzzy and ironically hardware is still a place where AI is like not that good at ah, like you know, building a supply chain. Right. Like uh, it's just a really hard thing to do. So I, I, that's a little bit forward looking instead of just you know, what are we at exactly right now. But I do think there's an element there of like um, hardware may become a little bit more attractive because there's more moats. M uh, long term.

Speaker A: Yeah, the differentiation. And then when you think about a platform, people will hear platform and think of software and services. But if you have a platform that's based on hardware, software, services integration and data now you have a real serious place where you can build a mode around each one of those individually. In your solution we can touched on it, but we haven't even doveen into it really. But your solution really approaches how do we take comfort in a space and high level it and let you jump in and say it better but by closing opening vents in the house to redirect airflow. Like I grew up in a home in the Midwest that had a one thermostat on the main floor and it was a two floor house. Right. And all the bedrooms are upstairs. So in the summertime it was a zillion degrees upstairs and freezing downstairs. Your solution solves that. But the office I'm in right now faces south. It's 12 degrees hotter than the bedroom that's facing on the north wall on the same H Vac system. And your solution fixes that. So it helps optimization space utilization and it helps rebalance airflow in a space where you actually need it versus having these super hot pockets. Cold pockets. Terrible comfort in uh, terrible economics for how you're uh, optimizing your H Vac.

Speaker B: Yeah.

Speaker C: And in the framework of like, you know, what's hot in VC land and, and like, you know, how do you build things that are durable commercially? Like um, I Mean, there's been moments where like when I look at our products, like we're a hardware company, but we're also software wrapped in plastic. Right. So m. Uh, if somebody cloned just the hardware, right. They probably wouldn't be able to realize much value because all of the logic and smarts and everything is distilled into software and firmware and it's like distributed in different places. And if somebody just tried to AI the software, like you couldn't really manifest it. Right. Uh, you don't have a solution.

Speaker A: You've got a little piece.

Speaker C: You got a piece. So I do think that while is rightfully so something that investors are weary of, um, when it comes to like hard connected hardware and sort of platform plays. The flip side is, um, if you want to build durable positionality and products, right, like, it may just be that there's a lot of different pieces that have to come together and that complexity and simplifying it into something you ship, uh, is the value creation. Right. Um, so I definitely think, you know, having a lot of like, kind of truly full stack, you know, hardware, firmware, software, electrical engineering, uh, all of that, um, solved in a solution is real complexity and challenge, but is also long term the reason that like we're still around and building, we haven't been fully commodified, you know, by clone ware.

Speaker A: Makes sense. And your channel relationships too, because I think people that are. You probably learned this right away. The channel for the trades, um, is pretty robust. But there are, there are traditional moats that are on that space that create challenges and nuance for new competitors, new people to come into the space.

Speaker C: Yeah. I mean, to that point. And maybe I'll like just sort of illuminate our products a little bit in that, in that conversation, which is that like, you know, we build a variety of H vac controls, right. Some of it is zoning, right. With our smart vents. And you can direct air to different rooms and kind of reapportion energy, uh, more appropriately inside of a building. Some of it is controls for other types of equipment. Some of it is work across different types of equipment. Working across different types of equipment, um, in one home to support things like the energy transition. And um, the sort of interesting thing there is that like with time your moat definitely evolves beyond technical and commercial execution that you sell to consumers and into, okay, now I've got, you know, in my Rolodex, in my little book of contacts, like, okay, the top five OEMs who are sending me emails, making sure their latest thing is compatible or, you know, want to launch a product together or. And eventually, you know, you move. You sort of transcend purely product execution and you move into commercial, you know, success, which I'm hesitant to get too far into that term. But, like, I would just say, um, you know, you get to a point where you're a part of the industry. Um, and when that happens, the moat is very real. And it's not just technology. Yeah.

Speaker B: You know, as you're talking, I'm thinking about what you build, and I'm sure you've seen some interesting use cases. Are there. Have there been any use cases that have, like, surprised you or any customer demand where you're like, what? I didn't even think about that.

Speaker C: Oh, my gosh. So many. Uh, I'll give. I'll give you a couple of the fun ones. One thing I will point out is, again, in the serendipitous nature of building things and meeting people and kind of moving through life, right. Um. When we went to China, being from the US where everything was sort of central H Vac, I remember the first thing we did, we landed in Hong Kong. And I'm looking at these tall buildings and, uh, and on the side of them is just condenser after condenser after condenser. It was just unreal. And I'm, like, trying to figure out, what am I even looking at? Right? And Kenny, my co founder, who grew up in Singapore, is like, yeah, that's how the rest of the world does it. Right. Um, and it was just, of course. Right. But for me, as sort of a, you know, relatively untraveled American, I was pretty clueless. Um, so one of the opportunities that we discovered. Right. Was that there's a lot more variety in how buildings are controlled and managed and, uh, whatnot. Um, from an H Vac standpoint. And it took going overseas to see that. And what that did for us, which I think our competitors to some extent missed out on, was it forced us to build a platform. Right. Rather than a product. And when we did that, we set ourselves up for some good things. Um, it had downsides. We had people at different times saying, don't build a platform, focus on one thing and ship it. You know, the nest of the world. They built one little dial and, you know, they sold for billions. And I'm like, there's some truth to that, but that was a moment in time, and whether that was ever replicable, who knows? Um, and so I would just say, like, I think one of the surprises was just, uh, I went overseas and did not expect to, uh, build a platform company. Right. As a response to that, and we did. Uh, one of the more funny ones that's really short is, um, we had somebody contact us, um, who had a natural cave in their basement. And, uh, so this didn't generalize at all, but the thing that I loved about it was, you know, they were excited about the smart vent because they could leverage the natural cooling that came from this natural cave. So we just absolutely wanted to run with, you know, so simple a caveman can do it, um, begging for it. But it was one of those ones where it was, like, commercially completely irrelevant, but comedically gold. Right? Yeah. So that was kind of a funny one. Um, you know, outside of the more relevant, important, uh, you know, product side

Speaker A: thing, it is pretty interesting. That's like, you know, the case study in using geothermal to optimize your house. Right.

Speaker C: Natural geothermal. That's right.

Speaker A: That's really cool. So really exciting. In what direction are you focusing on now? So you have a platform now, so you're sustaining a platform. You have mobile apps, you've got software, you're. You're integrating, you know, data. Well, you are basically a data company that has all this products that you want to get really technical about it, but you're continuing to optimize products. So what's the next step? What is the use case you're focusing on now? And what does that look like?

Speaker C: Yeah, I mean, I think so when we. I don't want to say bootstrapped, because it wasn't like pure bootstrapping. Right. I mean, we still had some angel money and stuff like that, but when we first went to market, we largely went to market as a DIY retrofit. Okay. So it's very much consumer. Um, the H Vac industry, though, is very much driven by contractors. Right. Like that. There's 500,000 in the US we need that to be our go to market long term. Um, that is the big opportunity. And there's 85 million homes in North America that have central ducting. And I think it's something like 5% have zoning. Right. And so I think if you kind of look at that, and then another big picture way of looking at it is I think RMI, the Rocky Mountain Institute, is estimating like a 3x demand in electricity by 2050. Right. Uh, in the US and I think that was put out prior to AI really coming into its moment.

Speaker A: Yeah.

Speaker C: So who knows, right? Maybe AI solves itself, but, like, maybe not. Um, and just Compute becomes a mainstay of major electrical demand. And, uh, so big picture is figuring out ways to keep buildings comfortable with, without just blowing up. Energy demand, um, is still the big picture vision, but how we get into buildings is changing a lot. And so what we're trying to figure out is, you know, okay, the H vac industry, like, is historically kind of tech averse. If I'm speaking about the residential element of it. I think commercial is maybe a bit different, um, a little bit tech averse, but changing as contractors generationally turn over and things like that. And it was historically based on you buy this big box for 20 grand every 10 years and, uh, you know, you just, you're on auto for, you know, repeat for that, um, with a little bit of service in the middle when something, you know, goes bump in the night on the equipment. Um, so we're trying to bring a different angle to this industry and get contractors to really pay attention to it. And it's challenging, right, because the consumer interest in our product is, oh, I can be more comfortable and save money, but the contractor doesn't benefit directly from that. Right. They make money selling you their time and equipment. And so I think that as a focus for us is big. The flip side of that is contractors also have superpowers. Right. They know how buildings work really well. They know how to take something like our product, merge it with the other products they sell and have phenomenal outcomes that a consumer really can't do. So I think just like solving that puzzle is a very big thing for us and part of our answer is doing it with partners because it's also a high touch industry, um, dealing with that segment of the market. You know, when we stood up our website, we bought some Facebook ads, we bought, you know, we set up a Shopify store, we found a 3PL, we shipped it in from our supplier and, uh, shipped it out. Right. Simple. Um, contractors are a totally different beast. They go through this far more complicated channel and, um, you know, it's multi. Tiered. There's distributors, there's master distributors, there's, um, there's all these pieces. And then, um, you know, to kind of add to that, um, the equipment landscape has changed a lot. Right. When we first started going like heat pumps were an afterthought for everybody. And now it's like, that is the whole world of home electrification in some ways. Right?

Speaker A: Sure.

Speaker C: Um, we have to build into their world to be successful with them. And that takes like a pretty deliberate thing where we have to get into their headspace. And think about how do we fit into their business? And not ask us to. Not ask them to just be, you know, our minions and sell our thing, because that's what we want. They're not going to do that. Uh, so that's a real challenge, but it's also an exciting one because if you figure it out, there's a really big prize.

Speaker A: You're trying to be disruptive and you have a disruptive technology, but kicking in the door and being like, this is the solution doesn't get you what you need. You need to influence with your ears, really, and then see what's happening, hear what's happening, and move from there. It's tough, man. That's a challenging space you're navigating, and it's really exciting to see you do it.

Speaker C: Yeah, yeah. Good partners. Yeah. That's a big one.

Speaker B: I was going to say, speaking of ears, you mentioned this very briefly in your, uh, sort of path to getting where you are, but music played a big part in your life. Where does that. Where is that now in your life? And does that help you or make you look at your business differently in any way?

Speaker C: Um, yeah. I mean, it's interesting, right? So obviously it directed me to Chicago, right? So that was, like, one very clear thing I could point to. Um, but, um, I think the thing that music did, another inadvertent one in terms of startup training, if you will. Um, when I was. So I was a dual degree when I went in, which meant that, uh, I would have one class on the south end of campus. An hour later, I was on the north end of campus. One was, like, figuring out the structure of how some, like, Bach chord progression worked, right? And then the next minute you're, like, trying to figure out how you dope silicone to get what you want on a transistor. And I think when you think about startups, right, it's very parallel to that where, like, you know, prior to talking with you guys, like, I'm sitting there scratching my head on, okay, how do I respond to these crazy tariffs? But also, um, I need to finish this document that, like, describes how this nuanced technical thing works. Um, you know, and then I need to email a board member and give them, like, an answer on something. And, you know, being a little bit scatterbrained but productive in the process was an important thing to learn how to do. Um, I think that that was also an important one. And then today, um, I'm actually, um, I just had a second kid about eight months ago, so I Took some time off. But I do play in the Danbury Symphony Orchestra, which is um, sort of, ah, I guess they call it advocational. So it's people who in theory could maybe make some money playing, but you know, in practice are doing it for fun. Um, and uh, it's, it's great stress relief. Uh, you know, I think it's just like you kind of get out of the. Is global trade going to be on fire today? And you're like, okay, I better make sure I'm in tune with the guy next to me. Right. And grounds you a little bit on just. Yeah, we still just want to have fun being a human and being with other humans and that kind of thing. So I love it in that sense. It's just a way to get out of your own head and just sort of be somewhere else.

Speaker B: That's great.

Speaker A: High focus, intentional meditative. Right. It puts you in a completely different space where you can't be thinking about those other things. Um, so yeah, this has been really exciting, really interesting to hear where you're coming from, where you've grown, some of the problems you're solving, the challenges you're facing. So looking back at it, you know, you come up in Florida, you used music as a way to get to Chicago or helped focus your way to Chicago. Let's pretend you can go sit down with the 18 year old, 25 year old version of yourself, pick one and you have dinner with that person. What does that conversation look like? And what advice do you give that version of you for the path you're on now?

Speaker C: Yeah, I, um, it's funny, um, at my bar mitzvah when I was 13, my dad, uh, got up and read uh, the Robert Frost poem, um, which is just um, like take the path less traveled. And uh, you know, I didn't think that much of it at the time. Like, he probably barely remembers that he did that. Right. Um, but in hindsight, like, I think it was great, right? Like it was just like, yeah, just go do the thing you want to do and don't worry about what some, um, curriculum at a university says you should be doing. Right? Don't worry. What if you want to build a platform and somebody tells you, build a product, build the platform. Like, I think there's a certain degree of like, um, you get into the headspace of this is what I'm supposed to do. And admittedly I feel very privileged to be able to go take some risks like that doesn't. That's. It's not a position everybody's in and I can totally respect that.

Speaker B: Yeah.

Speaker C: But if you find yourself in a position where you can take some risk, take, can take some ch. Uh, you know, take some, take on some challenges, um, that are things you really think would be fun to do, uh, and that you know, could be good for your just career and life. Just do it and don't be too afraid, uh, you know, to do something that nobody else did.

Speaker A: I think that's probably great advice. Right. And people get tied up into the day to day and they focus on, oh, this is what I'm supposed to be doing at this stage in the world right now. And they abandoned the things they could be doing. Um, really related story to what you said and I'll keep it pretty tight. Um, one time I was driving with my, my brother, um, my sister and a few people and my brother was in the passenger seat, I was in the back and we came to an intersection and it's a part of a downtown area where there are, it's ah, a five way intersection. And basically where we wanted to go was in front of where we were. But the road doesn't go there. You got to take one of the other roads around and there was a lot of stress in the car. Do I go left or go right? Do I take this angle? My brother just like cut through the noise and goes. You can literally go any way except the way you came and you're gonna get where you're going. And I was like, it was like a moment with the universe and it's like something almost a throwaway statement to stop an argument. But like I was like, man, as a philosophical point of life, like as long as you're not going backwards, you're going to be okay. I think about that a lot.

Speaker C: Yeah. Those, those moments, uh, at the time you don't realize how impactful they are. And then retrospectively you're like, man, these like define life, right?

Speaker A: Yeah, yeah, it's like 15 years ago and I still, I'll never forget that moment.

Speaker C: Yep.

Speaker A: So one last question and then we

Speaker B: uh, the last question we like to ask just selfishly is to you know, get a list of what you're listening to, maybe what you're reading, music, podcasts, books, what, what's in your ears right now?

Speaker C: Um, when you have time, I know

Speaker B: you have an eight month old, so maybe there's nothing. Maybe it's cartoons or something.

Speaker C: Yeah, I was going to say so actually. So I have an eight month old. I also have a three and a half year old. Uh, right now my primary reading is children's books, which is lovely, actually. Like, not a complain. Um, but, um, you know, I, I, it's kind of funny how all consuming, uh, that, um, you know, I, um, things that I watch, listen to, um, range. You know, there is this whole world of startup, um, you know, podcasts and things like that, and I do listen to some of those occasionally. Right. Like, um, I, I kind of enjoy hearing other people's stories and learning their mistakes and making them and realizing I made their mistake and that kind of thing. Um, one of the ones, though, that I geek out on a lot is, um, I'm still, like, I am still obsessed with nerdy, smart home, uh, like, things that are out. Like, I, uh, we're remodeling a bathroom in our house at some point when we find a contractor and, you know, kind of commit to the whole thing process. And I was just last night watching, like, I watched probably 10 YouTube videos on this smart, um, mixer, I guess, or smart shower controller thing. And, and it was like, my wife was just like, man, I knew there was a way to get you interested in this bathroom. Right? But, uh, and you know, prior to that, I think I was geeking out at like, okay, like, look at all these pool cool robots that like, emerged in the last few years. Like, this is crazy. Like, uh, you know, I, I have a, um, a lawn robot right, for my yard. Like, I'm, I'm really into, like, techie stuff still. And even if I don't have it or buy it, I love to just stay on top of what's happening. And, um, you know, and I still occasionally pull up hacker news and, you know, peruse that and that kind of thing. So, you know, some habits just die hard, you know, like, sort of once a techie, maybe always a techie.

Speaker A: It's hard to get away from that. Like, you move from the robot space to.

Speaker C: You know what?

Speaker A: Wouldn't it be cool to have a Roomba with blades on it?

Speaker C: Yeah. Yep.

Speaker A: Yeah. What could possibly go wrong?

Speaker C: Um, I'm anxiously awaiting for somebody to ship a good robot lawnmower that also deals with leaves. Right? And I'm like, 2025. The year is 2025 the year.

Speaker B: You know, fingers crossed.

Speaker C: So I, you know, still techie at heart.

Speaker A: That's awesome. And I think that's gonna, you know, the future of the company depends on that. So that's definitely, uh, a good trait to have. But, Dan, thank you so much for joining us today. Really appreciate the insight. Great conversation. Love hearing what you're working on, how you're problem solving, and thank, um, you so much for sharing.

Speaker C: Yeah, my. My pleasure. Absolutely.