Funding Feeding Frenzy – Part 4
VERBATIM by Loop Lonagan – Investor and man about town,
as told to John Jonelis
Loop Lonagan here at FFF and we’re in for a treat. Mitch Schneider is pitching his new company, Kauzu. I like companies that do well by doin’ good fer people. And this one’s all about local jobs that keep people off the streets.
Say you got a business in an urban setting and need to hire an employee. You want somebody local. Hey, everbody wants local. McDonalds, Wal-Mart, Pace, Cook County—they want local people too. Local’s always better. Local employees stay longer and save the business alotta money.
Just by way of example, I’ll explain this from the point o’ view of a small guy—a shop or restaurant or somethin’.
Da Old-Fashioned Way
You wanna put out feelers. But how you gonna do that? Monster? Whoa—they’re expensive and you get buried by applications from all over the place. So what else can you try? How about Craigs List? Usta be pretty good—my own daughter got a job thru them about five years back. But they’re still not as local as we’re talkin’. Then there’s the classifieds, but that’s expensive and in a city of millions, that’s not really local either. You can post a help-wanted sign in yer restaurant window, but then you gotta interview anybody comes in off the street, like my pal Big Bubba. Can’t picture him workin’ tables unless yer runnin’ a racket and need an enforcer or somethin’.
So those are all old-fashioned methods. If you decide to use one o’ those yer gonna get tons o’ applications to wade thru. Lots ‘n’ lotsa paper. Most o’ those’ll be the wrong people for the job. Ever try ‘n figure out which is best by lookin’ at paperwork? Good luck to you! Far as I’m concerned you might as well throw darts.
Then after you pick a buncha people you think look good, you gotta interview ‘em. All of ‘em. There’s laws. Are you a professional in the use of modern interview techniques? Probably not. So yer wastin’ alota time and money. And it’s all happenin’ when yer short on help. I don’t know about you, but I don’t like it. What if we could dump the resume and the application too?
Da New Way
Now, when I’m picking a stock, I use modern filtering and modern analytics. Why not apply that technology to jobs? So where do you go to get that?
Along comes Kauzu. Here’s what they do:
- A business posts a digital help-wanted sign on Kauzu’s website for next to nothing. Kauzu uses filters and analytics and automatically matches the right people with the right jobs. And you get to set the filters yerself. No need to study hundreds of resumes or interview scores o’ people.
- Job-seekers fill out profiles on the Kauzu site for free. One and done. They see the close-by jobs that fit them right on their cell phones.
- The result? Businesses save time and money. You only interview pre-screened local candidates that are more likely to stick. Job seekers get a hyper-local job search with fully mobile functionality. The resume is a thing of the past.
“But,” you say, “What about people that don’t have smartphones.” And that’s true for about 70% of the unemployed. But hey—you don’t need no smartphone. Text works just as good. Just input yer location ‘n’ it shows you the nearby jobs.
If you got one o’ them newfangled smartphones or tablets, it gets even better. Geo-location shows you the jobs right on a map. Of course you can always go to the public library and use their computer fer free.
Pretty slick. I like it a lot. So do chambers of commerce and city colleges that are pushing Kauzu. The timing couldn’t be better. Check out this video. And there’s lots more on their site.
This Mitch Schneider guy is super smart. I had lunch with him not too long back at One North. When we got done four hours had blown by. I guess I like talkin’ to intelligent people and I’m impressed with Mitch. I think this guy’s got the know-how, the drive and the creativity to make any startup sit up and bark.
They’re asking $500K for a 30% equity stake and expect to break even in month 17 with a 10X multiple in five years. Translation—they’re investable. So far they’re bootstrapping, but along with Paul Cusimano, they already built a nice team, a great website, and they got a big advisory board that includes—get this—Glenn Gottfried. So they got the management, the tools, the channels. Now they’re raising the money.
So how did the judges respond to a terrific offering like this? Yer not gonna believe it. They didn’t get it at all. Mitch got four o’ the dreaded GO FUND YOURSELF signs and one STILL FISHING. Not a single FUNDABLE. Strange—real strange. Why didn’t the judges get it? The audience sure did—no question. People watching the Q&A got so frustrated, they kept calling out answers to the judge’s questions. That’s against the FFF rules but hey, it was kinda like a revolt. And these judges are guys I respect, so I ain’t got it figured out.
So afterwards I ask Mitch about it and he seems strangely unconcerned about it all. Turns out he’s using a different pitch every time he presents. He videotapes every one o’ them and runs comparisons. What a terrific strategy. Like I said, this guy’s smart. So he found a pitch that connects with an audience but not judges. He won’t repeat that one, but it might be good advertising fodder.
So I go downstairs fer some lunch and ask Glenn Gottfried how come the audience understands it but the judges don’t. He’s got alota good ideas fer fixing it but no real answer to why it happened. Guess we’ll wait fer the video analysis. I’m still scratching my head, but it is what it is. If any o’ you guys can offer a suggestion, feel free to leave a comment.
Funding Feeding Frenzy
Chicago Venture Magazine is a publication of Nathaniel Press www.ChicagoVentureMagazine.com Comments and re-posts in full or in part are welcomed and encouraged if accompanied by attribution and a web link . This is not investment advice. We do not guarantee accuracy. It’s not our fault if you lose money.
.Copyright © 2013 John Jonelis – All Rights Reserved