the journey is coming to an end.

TLDR:

• We’re sunsetting Revonate because we can’t make enough money to satisfy our personal expenses.
• Next I’m seeking a sales leadership role in construction/ sales technology or selling a technical solution to the enterprise.

Waking up nauseous every day because we’re always on the verge of death sucks

Since we’ve only raised a modest amount of capital ($430k) and pivoted a few times we were in the unfortunate position of having 2–3 months of runway constantly being pushed out because of modest sales success. This is an unfortunate reality for most contractors already. They run low margin businesses and usually have unexpected project expenses without leveraging much process or technology.

But after over 2 years of personally struggling with this, I’m still not used to it and frankly don’t want to get used to it since Revonate is supposed to be my primary source of income.

This reality forced us all to fight in the trenches daily; doing whatever we could to keep our business and our newest Miami contractors’ business afloat. To us this meant buying leads on Houzz and jumping on his inbound/ referrals that he worked hard to network for. In short, we’re always working in the business and not on the business.

Q2 was our most important quarter close ever but still wasn’t enough.

We’ve reaffirmed opportunities are best from referrals and need strict qualification from all other channels. We leaned into Houzz but virtually all of our business and the largest deals came from inbound referrals. If we didn’t close 7-figures in construction projects we’d run out of money by August. That’s unbelievable pressure to perform.

We got 2 of these referrals that turned into 7 figure condo recertifications deals that we actually closed for $3.4M+. This was a momentous team effort across Revonate and our GC partner. It gave us runway until the end of the year, even if we don’t close another dollar. But would it be repeatable?

What we know and don’t know; simply put repeatable revenue.

What we know

• GC’s want more qualified customers, especially commercial or high end residential customers. Projects like home additions, new builds or commercial restorations i.e. hotels, offices, condominiums. The best GC’s don’t want to touch anything less than $50k and only at a high margin.
• Most GC’s will happily pay us 5% to help them source and close deals. That’s a business model that can scale once we figure out the demand generation system. If we do $2M on average with each GC, then each brand would be worth $100k to Revonate in ARR (annual repeatable revenue).
• GC’s usually need help getting bonded, approved by lenders and organizing all of the appropriate documents for 7+ figure commercial deals. This is an obvious software opportunity for Revonate in the future. We’d likely dive deeper into exploring this more now as a PLG hack if we had the cash on hand and bandwidth to experiment.

What we don’t know

• We needed to become experts at local advertising; online and offline so that we can increase our lead quality. We’re specifically interested in commercial restorations and larger residential projects like home additions.
• In order to achieve this we believe that we need to tap into potential distribution channels like online demand generation and getting referrals from architecture, engineering, lenders or large construction firms. Construction is like most industries and if we can get the elite, well connected people to jump on board the rest of the herd will follow.
• We haven’t built a marketing automation system that can be localized for different brands across the country. We’re confident we can learn to do this and execute, although not with the current resources, bandwidth and runway.
• Given a sales cycle would easily be 90 days and building a pipeline of these projects would need to be a focused marketing initiative it’s something that wouldn’t be achieveable before we run out of money at the end of the year.

My biggest challenge is balancing emotions and expectations, especially when there are (bad) surprises and increasing responsibilities.

Family stress. I have a stubborn, elderly mother living by herself after my father’s passing in February, I’m newly married (<2 years) and we have an 8 month baby boy which wrapped together takes an immense emotional and mental toll.

Unexpected medical and home expenses rack up debt. Apparently I required a gum surgery so I won’t be a 33 year old wearing dentures. Most insurance considers a procedure like this cosmetic so it’s largely paid out of pocket. Ironically, I also needed to pay to repair an underground gas leak and redo damaged flooring because the contractors that I used originally to renovate my house were so terrible they inspired me to start Revonate in the first place.

Life is hard and full of (bad) surprises. It’s especially tumultuous when you’re running a fledgling startup, recently married, a homeowner of a 50+ year old property, and became a new father all within the last ~2 years.

I’ve been growing a startup, not building one and growth hurts

Most people talk about building startups but in my experience it feels a lot more like I’ve been growing one. If you’ve every seen something grow you see how uncomfortable it is; like an infant teething or a difficult pregnancy.

Personal growth is grueling. Growing a family and a company pushes you to your limits and there are severe growing pains whenever something grows quickly. I remember how little I could sleep the summer in between 6th and 7th grade when I grew over 6 inches because my legs felt like they were getting pulled open every night.

Business growth, too slow or fast, is grueling. I’ve been at fast growing and slow growing companies, most businesses’ experience both, especially before clear product market fit. Both modes of growth push you to your limits but slow growth wears me down the most. It’s hard to keep searching for a light at the end of the tunnel when your financial security is at risk.

Our decision to sunset Revonate

We have carefully considered our options for moving forward with Revonate, and while we have explored multiple paths, we have ultimately decided to sunset the business over the next couple of months.

1. We have considered fundraising, but we have been advised that we need to be generating $500k-$1M+ in ARR for this to be successful. We would likely end 2023 closer to $250k in ARR as a best case scenario.
2. We considered investing heavily in marketing to increase pipeline in Miami and Las Vegas, but given the sales cycles of approximately 90 days, we do not have the runway to execute this plan effectively.

Our third option, and the one we have decided to pursue, is to shut down Revonate as gracefully as possible. Ideally, we would like to do this through an “acquihire” with a company that has a similar vision.

What’s next? Embrace the journey, not the destination and move onto my next role.

We’re seeking a soft landing for Revonate to take our relationships, insights and perhaps help another company with a similar vision benefit the perception, productivity and income of tradespeople.

Personally, I’m seeking opportunities for sales leadership roles at early stage companies in construction or sales technology. I may also take a break from people management and refine my sales skills as an individual contributor. Ideally by selling an innovative technical solution to the enterprise.

As usual I’ll optimize for who I’ll spend my time with- the team I’ll be working closest with and the customer profile I’ll be selling to.

I fell off the horse. Now it’s time to get back on.