Bob Habian, AIA of Tect joins the podcast to talk about what we’re actively doing at Tect in our early stage of the business, challenges that we’re addressing head-on in the building industry, how we’re approaching the re-alignment between building product side and design professionals, managing expectations in regards to the timeline involved in overcoming some of these challenges, typical venture funding versus crowdfunding, solving problems from within versus from the outside of our industry, and more.
Latest TRXL AEC/tech Newsletter
- Bob was previously a guest on TRXL 036: ‘The Answers Are There’, with Cormac Phalen and Bob Habian
- Peopleverse podcast 021: Todd Miller
- Tect’s website
- Join the movement at tect.com/join
- Check out Tect on Wefunder
- Connect with Bob on LinkedIn
- Tect’s booth (#4201) at the 2023 AIA Conference on Architecture
Watch this episode on YouTube
TRXL 116: ‘Teaching Old Tricks to New Dogs’, with Bob Habian
Evan Troxel: [00:00:00] Welcome to the TRXL podcast. I'm Evan TRXL. This podcast tracks the evolution of architecture and technology, and perhaps even more specifically the people behind all of it who are pushing or pulling the building industry along. And the work I'm doing at Tect fits pretty neatly into that spectrum. And if you've ever wondered, what does Evan do at Tect this conversation will bring a lot of that to light.
But, The good news is I'm not going to interview myself, so don't worry. Luckily for me, the perfect guest was available and that is Tect's co-founder and CEO Bob Habian. Bob was on the podcast back in episode 36 and you can find a link to that one in the show notes. Today he returns for round two.
Bob is an entrepreneur and an architect. His career path includes chapters of conventional and unconventional work with extensive experience in traditional architectural practice, building, product, [00:01:00] manufacturing, and technology development. Like many other guests that come onto this podcast, Bob is intensely driven to help make the profession more sustainable for the long haul.
His particular passion and commitment lies in cleaning up the way architects and manufacturers do business together for their long-term mutual success. In this episode, we discuss what we're actively doing at tech in the early stage of our business challenges that we're addressing head on in the building industry.
How we're approaching the realignment between the building product side and design professionals, managing expectations in regards to the timeline involved in overcoming some of these challenges, typical venture funding versus crowdfunding, solving problems from within versus from the outside of our industry, and more.
So without further ado, I hope you enjoy my conversation with Bob Habian
[00:02:00] Welcome back, Bob.
Bob Habian: Thank you Evan. Good to see you again.
Evan Troxel: don't get enough of each other.
Bob Habian: That's how I feel.
Evan Troxel: Yeah, Well, I'm doing a, a bit of a, this is in the moment. I'm, I'm doing some business related podcasts.
I had mutual friend Robert Yuen on and he was talking about kind business of architecture. obviously, you a lot of interesting things, but talking about economic uncertainty, this, I think, falls into that category, which is startups, funding, things of that nature. And so maybe let's start off and we'll catch people up with a, a bit of a summary on what is Tect and why it exists. I want you to tell people why Tect exists.
Bob Habian: Well, I, it may have something to do with me perhaps, but in my early architecture career, I was so frustrated by how difficult it was to find information from manufacturers. That was meaningful, right? And so like most of us, what I ended [00:03:00] up doing was just winging it most of the time. And so I then subsequently had a lot of exposure to manufacturing and I saw what was going on on the other side.
And I understood very simply that manufacturers make things. They sell them to contractors and owners and projects, distributors and retailers. They can't sell 'em to design professionals, and they don't know how to interact very well with us. So the average manufacturer is strong in all areas, but early project support for design professionals, that's their Achilles heel.
So over time, I just recognized whether it was working for myself, I ultimately owned a manufacturing company, or subsequently when I had a business on Wall Street with hundreds of manufacturers as clients, and then more recently working inside of a, Billion dollar family enterprise, manufacturing of building materials.
And for eight years I was just [00:04:00] reaching out to my peers talking about the products that we manufactured. And so I had that real rep experience as well. And what Tect is, is a summary of best practices over the past 30 years. So I'd argue we're not as much a startup as we are, a very distilled summary of what not to do and how to do it better, you know, and or what's not working, rather in, in the industry and what, how we can do something about that.
So, specifically what was needing to be put in place or what was lacking was the ability for design professionals to find the help they need when we need it, The alternative is that the supply side's just banging on our doors, trying to get to us and be in the right place at the right time. It's always ill timed.
It's a distraction. It's not helpful. . And then more importantly, if they're trying to sell to us, then it's just a non-starter for both sides and it's a big waste of time and resources.
Evan Troxel: Mm-hmm.
Bob Habian: flipping the script to give a new tool set to design professionals to be able to find supply professionals [00:05:00] when needed product experts with information, it didn't exist.
So at Tect that had to be built. That's what we built. There's a lot more we could talk about, but that's the essence was, was a missing tool now in place.
Evan Troxel: Yeah, it's a tool. And it's also the idea of the Tect platform being a place where people can go to find other people a what we call a people first for connecting architects and engineers with building industry product experts. Because this is where I think it's interesting, right?
Where we're zigging instead of zagging, which is we're overloaded with data and information. And so maybe you can talk a little bit about kind of the spectrum of data to information, to knowledge, to wisdom. Because tagline that we've got on the website is wisdom on demand, right? And so maybe go into that side of things, because this is not an area of focus for so many startups and companies out there who are trying to solve [00:06:00] this problem. They're just trying to solve it from a different angle than we are.
Bob Habian: Yep. Yeah. The problem is that there's just so much information that we have to navigate in the building industry to put buildings together.
Evan Troxel: Mm-hmm.
Bob Habian: you think about one product, one singular product in the world, and reflect on how much information is related to that from supply chain and sourcing to pricing, to availability to options.
You know, a recent Peopleverse podcast, Todd Miller, one manufacturer makes 8,000 SKUs product skews, right? That's just one manufacturer on one product type, but on any given product, there's so much information that when you really think about all of the products that we're supposed to have command of to do the projects that we work on, the amount of data is unmanageable.
So in terms of venturing and startups and how to fix problems like data overload, it makes sense that you would take a data structure strategy and say, let's [00:07:00] wrangle this data into more manageable data.
most of our peers that are out venturing and really solving some of these problems, They're focused on how to make better sense of the data, how to analyze that data, how to allow design professionals to have more control over, mining that data.
Things that Google don't really do for us or others. so the refined platforms that are managing data are of significant value to all of us. But as an architect, if I see a table comparing five different materials with 12 different criteria, I may not know what to do with that material. Like how do I put that into the assembly?
Like I get the product specific data and the attributes of that component, but I have other questions, and those questions are solved by actual people that have experience that can answer just random questions that may or may not be on those tool sets or websites or other things. [00:08:00] But as the architect, I, I've got a lot at stake to make the right decisions.
Around all of those products, how they all integrate and what the net effect is through construction and post occupancy and for decades to come in terms of liability, right? So the stakes are so high, and yet the tools that we have access to today are structuring data, which in its best form might be structured knowledge perhaps.
But in terms of wisdom, like what do you really want to do? To me that's a combination of experience, knowledge, and people with just dialogue like you and I today. some things are objective that we decide on. Some things are subjective, and so many of our decisions are a blend of that. So, at Tect we just, as you've said, a people first approach simply just puts a person in front of the risk of the process.
If I have a question about a product, if I talk with that expert, I'd consider them that product concierge almost. at that point, it's like, Hey, I've met an expert [00:09:00] that can help me. What do you think I should do? Or how can you help me navigate all this data, compare these specs, review these details, et cetera.
I can handle all the data around a product category if I have a concierge on my team or if I have a concierge on the phone, kind of that phone of friend, idea. So people first is not the norm, Because working with people, that's, that's a little more messy than just structuring data and using things like AI and ML to just optimize to the best of computational capabilities.
But in the practice of architecture and in the building industry itself, this is a relationship business at the end of the day. We all know that. so we have invested fully in trusting that people first, like people before, projects or people before transactions, relationships matter. All of these themes that you'll see when you, when you look at what we're up to, are simply putting the people before the data.
Evan Troxel: When you say that, we all know that something that comes to mind is teaching new dogs old [00:10:00] tricks actually. Because I think that emerging professionals and graduates who are just getting into the profession, often coming at this from a data first
because that's how they grew up.
They grew up digital natives. They grew up searching online, learning how play the game of keywords and finding the data that they're looking for, hopefully. But because of that overload you know, the noise that does exist out there, and what you're saying is, is that, People who have been doing this for a very long time who are experts in all of these different pieces of the puzzle that make up any project in the building industry are the ones who know the fastest way to get from here to there. not a Google search, it's not a LinkedIn search, it's not product directory search, because we might not even be asking the right questions upfront. We might not even know the right questions to ask, and so therefore, you know, we could [00:11:00] go on a four hour Google search where we end up shopping for shoes, or we could phone a friend and in 20 minutes get a lay of the land. helps us make decisions faster. Because ultimately that's the goal, right? Is to document decisions along this path of getting from idea of a project to the built thing in the very end. That is a decision making process that gets documented all along the way. What is We don't have a problem structuring our data once we have made the decision. But the making the decision part is the hard part, and I think that's where most people are. The deer in headlights like, oh my, I'm just overwhelmed with all of the choices. And so what do I do when I'm overwhelmed? I go with the thing I've always done.
I just go back to the products that I've always used. And as, as a designer, we're constantly looking for new, better ways to do things. And the building industry that creates products, the product side of the industry doing innovative stuff, but how do we find it? How do we know that? [00:12:00] How do we keep up with the code changes? How do we build in this area versus that area? What's different in our assembly from Southern California to northeast New York, there's a huge range there. And so taking all of these things into consideration, it's like goes back to the thing that this building industry already has.
We don't need to learn a new tool. don't need to buy a new gizmo that helps us do this thing. the people already exist, the experts, the wisdom. It's already there. We just need to connect. We need to tap into that like neo in the matrix, right? Download into my brain, Kung fu tell me about rain screens.
and somebody who knows what they're doing can convey that, you know, of the land information and get us set on the right path so quickly. me, that's really the difference of what we're talking about when we're talking about data is important, information is important, but wisdom helps us get to there faster.
So it's, it's like a, timeline. Wisdom before [00:13:00] data and information helps us get in the right path sooner.
Bob Habian: Yeah. You know, I, as you're talking, I'm thinking about two rooms. Pick which one you want to be in as an architect or design professional in one room. Mountains of data, sample libraries. Fair amount of dust on some of those samples, by the way.
Um, project files and folders, just reams, right? I, I've walked into some firms that have done some large hospital projects and just the specs right, are massive.
Evan Troxel: Yep,
Bob Habian: They, they, they're multiples of the old Sweet's or, or probably multiples of Encyclopedia Britannica back in the day. So would you like to hang out in that room or would you like to go into the other room where discovery, design and wisdom lives?
because we're losing touch with design. I mean, your line of old tricks for new dogs, that's awesome.
[00:14:00] Why are we teaching the next generation how we used to do it back in the day, much of which is good, but so much of which is inefficient. And, we hand them these tools that are like, look, it's all solved with a piece of software. It's easy to design a building in three hours. Go, okay, but that doesn't end well.
Let's just say that. Um, that might get you the job, but it's not gonna do the job. but the idea of returning back to a place like that room where wisdom lives and design and discovery, I don't want to do it the way I've always done it. You know, I was offered a position doing what's called format work, for gas stations. And I took a look at the work and I took a look at the team and I mean, this is rinse and repeat for the rest of your career. I didn't show up at this. The next day, the, the, a buddy of mine was the principal. He says around the office, they just get a laugh out of going, what about Bob?
Where's Bob ? Because Bob is not down with rinse and repeat. Do the [00:15:00] same thing again and again, and again and again. I just need to discover new ways. And I know that every architect in their heart wants to explore and innovate and bring new things to the table. Design itself is a craft, right? It's not a formula, it's a craft that's diverse among all of us.
It's got so much richness and potential simply put in a, in a project cycle. , there's never enough funding for design work, right? So recently this idea of, of raising money to finance design, that's a great idea. because design is precious and we've been losing touch with it for the last many decades, it's time to put a full stop to that.
Reconsider what the heck we're doing. Which room do we want to end up in most of the time? And just, if we use an 80 20 rule, let's spend 80% of our time in the design wisdom, you know, [00:16:00] closet or room. Then the data overload. room i'd, I'd make that data over room more of a closet. And the other one more of a design studio with big windows and fresh air and dramatic music and capes galore.
You know, the essence of being an architect.
Evan Troxel: so this idea of the Tect platform, connecting professionals to what we call product experts. I think one of the things that have to keep coming back to here is like, okay, there might be other people on the other side of the phone, but who, how are they gonna treat us differently than what we're used to already? think that's, part of it. And then the other part of it is, as a design professional, I need to have enough people available on the other side of that phone to find what I'm looking for and have a great experience because think we've all dealt with tools where that initial hurdle is so high, we never, it's like, you're the gas station job, we just don't go back
Bob Habian: Mm-hmm.
Evan Troxel: So this is all part of it. I mean, part of it [00:17:00] is, finding what you're looking for, but then what is that experience actually like for people? And so don't want to go too far down the road of Tect Academy, but part of this is about change and setting expectations for when a design professional on our schedule reaches out to them to get what we need right when we need it, but also that the treatment coming back from them is not what we're used to. that typically happens right now.
Bob Habian: Yeah. You know, I would put all of that in the category of choices. We're all real people and we all have choices that we can make every day. earlier in my career as an architect, I was feeling overwhelmed that I didn't have much say in the outcome. Right?
Evan Troxel: Hmm.
Bob Habian: And that's frankly not true. We're relegating our decision making to.
suggestions and standards by others, but that's not who holds the license. We hold the license. It's our call. [00:18:00] And so making the choice, as I was saying earlier, of which room you want to practice in, that's the design professional choice to make on the supply side, right? You've got manufacturers galore.
Some are small, regional, sharp, innovative, some are sharp and innovative and global, Some have thousands of people on their team. Others are a small third, fourth, fifth generation family business. That supply side is also made of people they have a choice to make. Do they wanna pursue projects as opportunities trying to sell their products into those projects?
Is that the choice they wanna make or do they want to nurture long-term relationships with decision-making design professionals? You have to make a choice because if you're chasing projects, then. , you know, when's this thing going to bid? What's the competitive price where I could push someone else's product out?
It's all of this transactional nuance that's less important than the bigger picture, which is, is this serving my client [00:19:00] best? Does this meet all of the criteria that I had with my client early on? And are we at least 80% delivering what we had hoped for,
Evan Troxel: Hmm.
Bob Habian: opposed to the opposite of that? And I haven't started a project yet as an architect, where I didn't preface the future for my client to say, look, this is gonna be a bumpy road, right?
Because we know it doesn't always end well, and we're prepared for the worst, and we, we hope for something better than the worst. So if both sides make a choice, then this can radically change projects immediately, right? So if I choose to reach out to experts on the supply side and trust them again because, , I just have to, right now their culture is sales pressure, sales
Evan Troxel: Mm-hmm.
Bob Habian: promises, calling me back way too late or whatever.
but if I can trust them and make that call, to your point, who's gonna be on the other side?
don't want somebody that's choosing to chase my projects with their products. I want somebody that's choosing to nurture relationships, help me [00:20:00] understand the fundamentals of their products, what should I do with it?
the, what are the frequent mistakes made around their products? That's not a transaction on a one-time phone call, that's a relationship over time. So specifically at Tect we're only interested in those that are choosing on the design side to make the right call with trust to the supply side.
And we're choosing those clients on the supply side, those manufacturers that are making the choice to invest in relationships. If you're not a manufacturer that wants to. Choose relationships and people over transactions and projects, then we're not that interested in having you on our platform.
There's plenty of room for you in all of the other avenues from trade shows and publications and search engines and other things to go do that last thing the industry needs is another one of those.
So, to your point about relationships and, and the nuance of what's happening on that other side of supply, there's some fantastic companies.
What I'm finding is that so many of them want the relationship. They just happen [00:21:00] to be chasing the project because they don't have options to find the people to begin the relationships with. So lemme just draw a hard line there. Both sides want the same thing,
Evan Troxel: Yeah.
Bob Habian: not doing it.
And, what has been missing is the platform on which you could find each other in the right vein with the right expectations.
Simply, consistently and without any risk,
uh, that that's at the center of our work.
Evan Troxel: is, is key, right? Because the, that I think is what people are not used to. They go online looking for a product or a manufacturer or a rep or information, and you get met with all different kinds of blocks. You could hit a gate on a website that asks for your information so that you can even talk to somebody, okay, red flag, I'm gonna go somewhere
Uh, I mean, those kinds of things. And so kind of setting ground rules that drive consistency among the user's experience, the design professional's [00:22:00] experience when they choose to engage on their timing is, is a big deal. And I think that to me is. Again, this is one of those shifts that a lot of product manufacturers are coming around to. They keep hearing it. They hear it from the AIA. The AIA has done these reports over many years and saying, asking for people's private information just to talk to you, because they don't even know if your product will fit or not, and if they can't talk to you about it, they go somewhere else. And so this is a missing piece of infrastructure in the building industry, which is how to connect to people with a baseline set of expectations on no sales no gated entry, no registration. As design professionals, we don't have time to deal with that. We cannot get on somebody's email list and cold call list because there's not enough time in the day. We have. Thousands of things to do. it really is kind of that missing piece of [00:23:00] infrastructure that Tect has identified and is creating that so that we have the right half to get to decisions that matter that make the biggest difference on our projects as early as possible.
Bob Habian: Yeah, you mentioned the Tect academy. So the first step was to identify the missing infrastructure for making connections,
Evan Troxel: Mm-hmm.
Bob Habian: that we call the tech platform, the behavioral component. and I, I hate to use the word behavioral, but let's just say the engagement, uh, model that we're used to that needs some, some altering, I'll use that.
Okay. That I'm happy with that term. we recognize that there has to be some teaching, some sharing going on. I'd ask architects, how much do you know about what it takes for manufacturers to bring raw materials to finished goods, and how to distribute it and work with contractors and, work with change orders and other things.
How much do you know about manufacturing? Most of us are too [00:24:00] busy in our own profession to know, well, the same goes for them. So again, everyone's well intended, but manufacturers don't know what they don't know. So we found that the platform itself was not enough. So we had to expand our, our business a bit.
And tech academy is an online. Series of modules that break down what it is manufacturers should know about design professionals. What do we like, what do we not like? You know, what would we like to see more of or less of? And why? You know, how do project delivery models work If it's design build or CM at risk or other things?
Manufacturers have very little notion of what that even means
Evan Troxel: Mm-hmm.
Bob Habian: it impacts how they interact with us on early stage price inquiries when we're trying to set budgets that are realistic and are all in, including labor and other things that typically don't see on a manufacturer's website. Um, [00:25:00] you know, we've covered it enough, this idea of serving design professionals instead of selling to us.
But if we just look at statistics and we've talked to thousands of our peers, How many reps do you know that you trust so well? You, you would refer to a friend and we're seeing that number as far south of 10 people.
Evan Troxel: Mm-hmm.
Bob Habian: How many reps should you know on your projects? Literally hundreds. We should know.
Hundreds. We know barely any, that we trust enough to do good work together over time. So if there are a thousand architects that have two of their favorite reps out of the thousands that are out there, but a thousand architects, each of whom know, two, just by sharing those leads with each other, a little peer-to-peer support, we could all know a few thousand potentially.
Like, that's just a, a value proposition [00:26:00] of exchanging current information. So one of the reasons I didn't, I don't like the word behavioral change, is that it's just a shift. It's like a, it's almost a. Invisible shift that just needs to be made. We just need to realign what we're doing. We don't need to change everything, right?
We just need to realign how we're doing it. We're we're, we're all in business with the cart before the horse or the, whatever analogy you want to use, just stop turned around and let's do better now. That's what we're seeing. And you know, I'm charmed every day when I talk to clients this morning included, where I'm setting up a, a, a launch to a training to a team of about 15 reps at a company.
And one of them already completed the academy and he's so excited. He's like, I was, he was done a few months ago and he says, I'm so ready to move to the next steps. But his team is still needing to get on board. But his excitement, having [00:27:00] gone through the academy, knowing now what he didn't know before, information he can use every day.
Evan Troxel: Mm-hmm.
Bob Habian: um, we're talking about real change, not like software subscriptions and annual, maybe we delivered something. This is stuff that we're all gonna realize benefit immediately. We just needed somebody to worry enough about it and invest enough in it to, to make a change possible for all of us. So,
Evan Troxel: I like that
It does make sense, especially when you think about the different customer types that building manufacturers have, and they can't treat everyone the same. Right? So realignment and a readjustment of how to treat certain audiences that they have, or maybe they don't have yet.
Maybe they're not going serving, design professionals the early stages of design. Maybe they're solely focused on contractors and substitutions at the end of the project, and so, It just, I mean, it really points out, like you said, what are the nuances, when you [00:28:00] approach a design professional that you need to be aware of so that you can serve them best and, and differently than you would serve a different customer type. And so we've taken that on, the design professional's behalf by creating this academy so that they get that information and can use it to their advantage, which is then transferred to you as a design professional. You get to use it to your advantage because they treat you how you need them to treat you when it comes to getting the, the right information or direction that you need when you approach
Bob Habian: Let me point out also, the Tech Academy is not a sales tool. This isn't sales training for product reps, how to sell more. Okay? This is saying very bluntly, stop selling. If you want to create more sales on projects working with design professionals, then stop selling to design professionals and you'll realize more sales long term through their projects.
So stop selling, [00:29:00] start serving. Um, so the, the academy itself is long overdue. , the curriculum was informed by actual practitioners that you haven't interviewed. Aggregated their feedback, did a fantastic job of structuring that, uh, wisdom and experience and, and request from the profession. What I also love about the academy is that we're able to tell manufacturers things that architects want them to know, but that architects weren't willing to tell them to their face.
would've been a bit embarrassing to say, could you just stop calling me once a quarter because I don't even want to hear from you that frequently because there are a thousand reps doing the same thing and it's not helpful. It's not you, it's just that it's not helpful.
we all know that, uh, we've heard great stories about lunch and learn scenarios in all of their various forms.
some really important and meaningful lunch and learns, and some that are just [00:30:00] comical, and it's more about the food or the color of the person's tie or some other thing that comes as a net result of that in interchange. And, this is a, colorful bag of tricks that things could go in a hundred directions.
But, you know, we just want to bring a little clarity, bring things back to connecting and making progress here. And, uh, the truth of what we really want to tell them just needs to be told. And I think you, Evan and others in the academy, did a really good job of representing design professionals.
Not only well but thoroughly.
Evan Troxel: Mm-hmm.
Bob Habian: you dig into some of the very small aspects of, of interchange between supply and demand, and you just address 'em straight up. . so I'm I'm really proud of the work that we're doing in the academy. I'm excited about the outcome that transformed sales reps that are becoming product category experts, uh, are expressing to us.
Um, you know, one [00:31:00] of our graduates, and we call 'em tagged, right? They're, they're tech Academy graduates. They've been tagged and, uh, one of them in particular graduated, called me about a month later and said, you're not gonna believe it. I said, what? She says, my next month is full of meetings with design teams where I was invited to come in and talk to them about their projects.
That is not a normal, uh, day for or month for a sales rep, but that, I believe is what a month in the life of a product category expert looks like, because a product category expert. Needs to know more than just their products. They need to know about their competitor's products. They need to know how to help others integrate their components into assemblies.
They need to be brutally honest, like, Bob, we don't make that, and that might upset my sales manager, but we don't make it. Here's who does.
Evan Troxel: Mm-hmm.
Bob Habian: the honesty we need. And guess who I'm gonna call next time I have a project
Evan Troxel: it's [00:32:00] information. Yeah,
Bob Habian: But that's the trust that I just want, I want somebody that I know is honest, objective, professional, competent, and guess what?
That person that I talked to, they don't have to be the expert. They just need to be able to deliver the expertise from that supply side manufacturer to me. So if I ask a question they don't know, that's okay. Just give me the answer in less than 24 hours, please.
and so we're also just helping equip those individuals to recognize that they can't know it all themselves.
And so facilitating expertise from their team and their industry. Right. When you think about, say, uh, you know, flooring, there's a flooring industry. There are multiple flooring industries. The amount of expertise and case studies and research and data that's available through just one category, expert at one company is more than we would ever need.
we're activating in a very specific [00:33:00] or structured way. Right. We're structuring this in a few important ways. One, it's structured by product category. It's findable via keyword. It's filterable by geolocation of where your project is located. Is my project in the southeast with hurricane conditions or the northeast with other conditions of climate and code and labor practices and tradition and cost?
Is my project in a rural area or a a big metropolitan area? being able to search and find the experts in categories by keyword and location. This is not something we've ever had access to until now. And you know, it ended up that we, yeah, were issued a 20 claim patent on our software because these things had not been put together in the way that we have before.
so we're excited about bringing this to market and, appreciate sharing about it.
Evan Troxel: perfect segue. Let, [00:34:00] let's talk about that. because I don't want to set any false expectations that this is ready to go right now, because it isn't, and I think this is part of that shift, that alignment that we were talking about earlier, and, the, the scale at which we need to get to make this useful for people the first time that they use it. There's a lot of product categories out there. There's a lot of regions we're talking about where we're starting from. You have to have a certain scale for it to be useful right? And so I think now we're kind of shifting the conversation into the mechanics of. the startup, and I think we, I want to even get into the funding side of
that is a, that is a piece of this. do you build this thing be the most useful as soon as possible? Because you get that one chance to make a first impression. And so, like the idea the execution sound fantastic, but the, [00:35:00] the truth of the matter is like, you can't launch before it's ready.
And so speak to that part of it for a little bit because the AIA partnered with us early on, did a survey basically that was some of the findings that came out of that. Maybe we can use that as a jumping off point to talk about and, then funding.
Bob Habian: Yeah. You know, so you used the word startup. So I I easily interchange the word venture, right? So we're creating ventures, not buildings. Um, so entrepreneur, architects, like entree architect, mark LaPage, and his community. I, I'm definitely an, an entrepreneur, architect, more entrepreneur, frankly, than architect.
My entire career has been building businesses, learning from that feedback in the market, pivoting, improving businesses, understanding the cycles of the economics in the market, from the real estate cycles to other supply and demand cycles. You know, when there's a shortage of Portland cement in the world because China's consuming most of it.
These are the things that, that as a venture [00:36:00] minded architect who's mostly an entrepreneur, this is not my first rodeo. I've been doing this most of my career, and I think that informs our strategy, which is to recognize that just going to market with a product is not enough. Just getting people to subscribe, you know, to your platform is definitely not enough, um, because it's easy to join, but if there's no value, then it's very easy to leave.
And frankly, they never look back.
Evan Troxel: Yep.
Bob Habian: And so, as you said, Early on, we got a call from Washington DC right? The AIA National Office said, Hey, what are you guys up to? This looks interesting. This is potentially solving some issues that we've been studying for a long time
their research called The Architect's Journey to Specification since 2016.
But they just expressed this interest in what we're doing and how we might get there to potentially be a mainstream component long term in the building industry. And [00:37:00] we engaged in a call every other week for 18 months, and surprisingly, the majority of the conversations were about how to kind of pump the brakes, think this through much deeper and longer to say, look, fast is not the only criteria in this case.
sustainable and intentional, what we can deliver value. Matters most, right? For any of us, you see a new thing, it better deliver value. If it doesn't, why are you bothering me? So understanding how best to deliver value to both sides was the first part of the work. The platform's been built for quite some time.
We've beta tested, redesigned, optimized. It's not that we are still building a platform, it's ready for market. But as you indicated, AIA then funded a third party survey. What do their members think about the Tect platform? And we received a really detailed report about those findings. As the CEO of Tect I was very pleased.[00:38:00]
The majority of folks love the platform. They had two strong areas of pushback. One, the idea of the academy. Many architects said, are you sure you wanna nudge manufacturers to actually consider their behavioral change? Because maybe they don't want to do that. Are you asking too much of them, Bob And I don't think so.
And in fact, I'm. Glad that that's not the case. Actually. It's fair to assume as an architect that might be a hindrance, but the outcome is no, no, no. They really enjoy the the academy. That's good for all of us. The second thing was don't bring a product like this to market until there's enough density on the supply side of experts that when I search, I can find the help I need.
That's simple blocking and tackling. That's like saying, can you become Google tomorrow? No. Did Google start as the Google? We know. No. Did Facebook start? No. Facebook started at one university.
Evan Troxel: It's the 10 year long overnight
Bob Habian: right. [00:39:00] So Facebook started at one university. Then the Ivy League schools, they started picking steam when they hit the high schools.
But the Facebook you think of today, WA was a small community. Same with Slack, same with many others. But if you're patient and you really focus on the quality, of those early engagements and you really hone in on how can this scale? Because frankly, if it works well for one, it will work well for everyone, but we just need to put it through its paces.
And so at this point, we're really just focused on customer acquisition. The software works, the value proposition's there, what's called the product market fit is solidly there. We're signing multi-year contracts with manufacturers across categories across the country. And so now we just need to ask the demand side market to support us with some patients and, and, uh, enthusiasm because this is coming.
This isn't a thought, [00:40:00] this isn't a concept. This is coming to you. Um, but we're being responsible enough to bring you what you asked for, which was enough density on the supply side to be a meaningful tool. And we're doing all of that not to be able to charge you more. In fact, we charge you nothing. This is a free resource for design professionals.
Why would we do it that way? We're, we're design professionals. We're doing it the way we would want too. Sorry, Evan.
Evan Troxel: Well, when you talk about customer acquisition, I think it's important to point out exactly what you mean
Bob Habian: Yeah. So customer acquisition is simply the fact that our platform is free to design professionals and manufacturers pay a small fee to be on the platform. So our users are design professionals, our customers are manufacturers.
Evan Troxel: Mm-hmm.
Bob Habian: And so those manufacturers are signing multi-year contracts to take a position on the platform that represents their category of product, or in many cases, multiple categories of products that they make.
And our [00:41:00] goal is to populate the spectrum of product categories, but also have national coverage. So some product categories are national by nature, those products are shippable across the country. Carpet as an example, and flooring. Concrete products take concrete block doesn't ship across the country very competitively when there are adequate manufacturers across the country already.
So that one category may have a half a dozen or a dozen manufacturers required to cover a national demand. Um, and in other categories it's just a few. So our focus is to populate the supply side, not with any manufacturers, but with those manufacturers who choose relationships first, who sign multi-year contracts who enroll in the Tect academy to go ahead and really understand the needs of the demand side.
Like I don't know how it gets better than that in terms of a scope of work that we need to focus on. [00:42:00] And so we are deeply in that work. We are making fantastic project progress rather every day. , but we're in that work for a while. We're staying out of view. We aren't telling ya you should get excited about finding people tomorrow, but that said, let me say this.
We are celebrating those early adopters and I want you to celebrate them with us. These are manufacturers that are stepping up to meet us where we ask them to go.
And so we're gonna be participating in the AA conferences here in San Francisco, the conference on architecture. We got a significant booth at that event.
And we really are focused on celebrating those people that are stepping up early. And that's on both sides. We've been blessed to have a, a growing following of our peers on the design professional demand side and others, supporting what we're doing. And, uh, you mentioned the people verse, this is part of the community that we're building, right?
This is about people, [00:43:00] this is about community. And so, , you know, customer acquisition is more manufacturers on the platform to the benefit of all of this and, and this season of growth. there's a place for participating, um, so that we can deliver a really mature solution. That's just immediate benefit when you start your search to find those experts, you need,
Evan Troxel: So let's talk about how we get from to there and there being kind of this enough inertia to launch, because I think this is where rubber meets the road. You gotta figure out how to do this. And so I don't think it's any secret of this kind of VC winter. I don't know.
There's a lot of different ways that, that people are talking about the economic conditions that exist right now,
for small companies like ours who a big vision to deliver real change in the positive, meaningful way for the building industry, which is huge, which has its [00:44:00] own enormous set of challenges to overcome. We really feel like this can help. that. Right. Uh, and so how do we get from here to there, speaking as the CEO of Tect and, and and, and startups and that, and that whole world of the economic side of things.
Bob Habian: Yeah. The economics of venturing, right?
Evan Troxel: Mm-hmm.
Bob Habian: they're a bit different than professional practice. In professional practice, as we know, the fees we collect fund our firms, right? You don't go out and raise funds from investors, per se to start your practice. That's not how we do it
in the venture world. . That's perhaps the only way you do it.
you know, if you're fortunate enough to create a business that is a revenue first, no outside investment required business. That's the, the gold standard. That's the brass ring and that is attainable. [00:45:00] There are fantastic companies that started with a revenue first model. They were conservative in their spend, their model was able to get to market and move their value into the market early.
Okay? Others, as we know, many of the brands were familiar with in the news and the financial news, um, humongous global brands. They've yet to produce profit,
Evan Troxel: Mm-hmm.
Bob Habian: uh, let alone significant revenue. In many cases, they're just trading their IP and the hope of what they might one day do as a real business with real money involved.
So, Having been a multi venture entrepreneur, now we had to consider what is the right financial model for this. and similar to our discussions with AIA and others about slow and steady toward mainstream rather than fast and flippant, we had to build our financial plan for the long run, [00:46:00] and that required heavy investment internally.
Okay, so there's been multiple seven figures invested internally before any outside money was, was sought during that internal investment period. We've begun revenue, so we are selling our services. We are selling multi-year contracts right now, so we're, we're creating a balance of investment plus revenue.
We have real revenue and we're hopeful to be profitable. I just don't want to put too many forward projecting statements out right now because we are raising funds, but we're very hopeful about the direction and the pace of our sales and our path to profitability. However, unless that revenue is adequate to sustain the growth of the enterprise, the only option is continued investment, right?
So we have a choice that we're making. Again, choices [00:47:00] we can choose to go the way of the venture capital markets and strive to be one of those ventures. That quote is worthy enough to garner their attention, to put their money in what we believe is meaningful to our profession. Well, at our core, here's a question we keep asking.
Do we want somebody to solve our problems in this industry and those people are outside of our industry? Do we wanna wait for somebody outside to do it? Or can we do it ourselves and should we do it ourselves? And would the outcome be better if we did? Well, we believe in the latter. So instead of pursuing an outside market for funding, we're using a very democratized platform called Wefunder.
This is like crowdfunding specifically. It allows unaccredited investors. We could sidebar that topic if you want to explain what an accredited or unaccredited [00:48:00] investor is. But most of us are not accredited investors in the world, and so if we wanna buy stock in a company, we have to wait for that company to go public.
Evan Troxel: right.
Bob Habian: It's only the accredited investors and the big folks with money they can afford to lose. They get to invest in a lot of the startups. There's a friends and family round. There's a angel. Round of people that have a little more money to throw around. But accredited investors are typically the ones that get the lion's share of the upside in deals because they get to invest early and the rest of us just have to wait until let's, that value is long gone and now we're just splitting hairs when the stock goes public and we hope for the best up 2 cents this week down, down half a buck next week, whatever.
Evan Troxel: All
Bob Habian: So what we're doing now with Wefunder is inviting others like us to invest with us. Cause we've long invested already, but we're inviting others to now invest with us [00:49:00] as little as a hundred dollars in our campaign. And whether we have a thousand investors of our peers, or 2000 investors of our peers or more, that's the outcome we're seeking.
We would much prefer to be building this together inside the industry. Coming together to make this happen.
Evan Troxel: Mm-hmm.
Bob Habian: well on our way actually. So we're about, uh, we're almost approaching 20% of our fundraising goal, and we're just launching that campaign next week to the public. Um, so anyway, that's how we're going about it, is in a collective crowd crowdfunded way that the s e C and the IRS now allow with new regulations.
particularly as of about 2020, the laws and the tax code has changed to allow unaccredited investors to invest a portion of their net worth. So, whether you're invested in 401ks or other things, you can now redirect that money, make better choices of where you [00:50:00] choose to put your money, maybe in things that you know more about than a mutual fund or other things that you have no say, no familiarity with.
But, uh, It's exciting to, to be embarking on that effort. Um, we're getting some great votes of confidence from some key people early from our peer group, uh, that are leaning in with us, and we're just starting that effort to now open that lens and, and invite others to consider doing this together inside our industry.
Evan Troxel: I think a lot of people are familiar with, sites like Kickstarter, where you put down, uh, an amount early on in different tiers. You know, they make these different brackets that have different rewards systems to them. Kickstarter's all about
maybe, uh, I
Bob Habian: almost.
Evan Troxel: Yeah, pre-orders in the, on the product side of things. It could be a book, it could be a movie though. It could be like just helping make a bigger thing happen.
Um, but it usually is, [00:51:00] there's some kind of output from it. And this is investing in a company, and so if the company does better over time, you get a return on that investment.
Right? So that's the whole differentiation that I would think. This is, they're both right? But this is crowd invested versus funding products. And so just to kind of bridge the, gap of like, what is this thing? And what is exciting about it to me is that we can go to our peer group and our colleagues in the industry, but also outside of the industry to say, this is a huge problem and a huge opportunity that if we overcome this, I mean, the building industry is, it's in the US alone, it's a 1.6 trillion. Industry and we've identified through our advisor group and research that there is as much as 50 cents on the dollar on every project that is left on the table. It goes completely to waste. That means buildings cost [00:52:00] twice as much as they should to people who need to buy buildings to go through the process of procuring architecture. And so can we do something about that 50 cents on the dollar going to waste? I mean, if, if people knew that on the owner side, would they still want to do it? I have a hard time believing like this is, we say it in in air quotes like it is, it's the way it is, but it doesn't have to be that way. And there is a huge crisis in the built environment, shortage of housing and other things. so if we can make a dent that universe by getting people to have the ability to make better decisions that make a bigger difference. Earlier on a project that's huge, that can have an enormous impact, that can have an, an enormous impact on the environment, but it can also have an enormous impact on how you spend your time on a day-to-day basis as a design professional. Would you rather spend your time [00:53:00] fielding phone calls and emails and trying to find something in a four hour long Google search or would you rather just get the information straight away and do better things with your time? Because I don't know about you, but as an architect, like the most valuable thing I have is my time.
That's what I bill for. So if I can use it for better things and not work late and on the weekends trying to find these things, we really believe that we can make a huge difference here. So by. Extending this offer out to our peers in the industry on this podcast and in other ways through like Wefunder, which is opening it up to the general public. We really feel like we have an opportunity here to fix this from the inside. And like Bob said, not wait around for someone else to come along and fix it for us. We may not like what they come up with Right? And, and so we're asking people to vote with their dollars, right. And vote with their feet and join our community. because we really do believe that, and I think [00:54:00] it's come up many times in this conversation. this problem for the long run is very important. And we wouldn't be doing this for the short term gains of something that is going to take a very long time to actually fix. This is something that. Manufacturers getting on board with, we want relationships, relationships last a long time. Why? Because they're better for the business if they do. All of these things are long term goal oriented. And so, by investing now this vision, in these founders of this small business that you believe in, that can make a difference in your day-to-day, but also in the life of the profession in generations moving forward. I mean, to me, this is, this is a big story. This is a big idea, and it's something that's worth paying attention to. So I think that's really what we're inviting people to do. and so moving from talk to action is something that we talk about a lot. I mean, how many times have we sat [00:55:00] in meetings where people are like, oh, this would be a cool idea.
And then people look around. Uh, you're gonna do that, right? Not me. I mean, this really gives anyone the opportunity be a part of the solution. And it's a very easy lift. you don't have to learn a new piece of software to do this. You don't have to completely change your behavior to do this. This is easy. You can actually just say, yep, I believe in this and I'm gonna support group. And I actually wish more startups would go this route because think there's a lot of ideas that we're excited about. I mean, there's a lot of people that come on this podcast who have for something that is extremely exciting and people want a way to support the people who are making a difference in their profession and beyond. wish more would give the general public a k a us the ability to, to do that. So I, I think this is a very exciting opportunity.
Bob Habian: Yeah. And I would, you know, draw a distinction as well that this. [00:56:00] Service that we provide and the campaign that we're engaged in. This isn't about us, this isn't about Tect. What is Tect? Tect is a platform to enable the market, to enable both sides of demand and supply. And, you know, we've met some fantastic folks along the way that individually have decided to do something about problems in the marketplace.
You know, not even related to us, just out there fighting the fight in a, in a corner of the market that they decided was too important for them to ignore. And they just wanted to do something about it.
that's like most people on most projects, okay? Most people on most projects are doing their best to make things as good as they could possibly be.
And yet, how often are they celebrated? How often are they even recognized, you know, particularly at the big. Shovel events when we're taking pictures at the openings and stuff, and [00:57:00] it's just an awkward moment. You've talked about this before,
you know, but the doers that are doing the work are so frequently unappreciated, you know, unacknowledged.
And we recognize that the strength of our industry is in numbers and in talent and in the work we all do collectively. We are a powerful profession. We are a powerful industry that has direct impact, as we all know on the world.
Evan Troxel: It says it's, it's a cliche, right? But it, we actually do have the power to, to change the
Bob Habian: right.
Evan Troxel: built environment. Yeah. , it's, it's a
Bob Habian: And so rather than saying who wants to step up and wave a banner and claim their place and this leadership of change, no, no. Here's how it's more likely gonna happen. Quiet people, talented people doing rigorous work. With persistence and patience and sweat [00:58:00] that really are doing it out of a belief and a choice and what we're drawing together around us.
And we look around and we see it every day now are like-minded professionals and peers in this industry. And I'm seeing two distinct communities. One, those people that want to step up and absolutely do something about what needs to change. The other, maybe more importantly, are those that support those that stand up to make the change.
If you stand up to make a change on behalf of your peers and you look around and there are no peers following you and there are no peers that that are cheering you on, well then something's wrong with that picture. And it doesn't mean that the person doing the work is wrong, it just means they've not connected the dots.
Those things that are worthy of support get support. And so we're hearing great feedback from people that believe in the work that we're doing. But again, it's not work about Bob and [00:59:00] Evan. This is work in service to each of you and all of us. In my remaining days in this life, I hope to see a platform like this fully in play with the kinds of outcomes at maturity that matter.
Architects who currently are maybe even still in school, that come into the profession with a new tool set that come into the profession with a new mindset. I'm not gonna go search for products. I'm gonna nurture relationships with supply side experts. I'm gonna grow my design firm leveraging the wisdom and the knowledge and the power of supply side partners in the manufacturing side.
We're gonna stem bad decisions right up front. We're gonna set a better course for our project. The ripple effect is not gonna be negative on our projects. The ripple effect is gonna be positive. We're gonna have less change orders. better budgets, less field changes and such where our schedules maybe are gonna be met [01:00:00] or even exceeded for the better.
The waste is gonna be clawed back and put to good use, maybe even our profit margins, you know, and just restore order. But do it in a thoughtful, practical, very architect minded way. Because you know that we do this for our clients. We're responsible for trillions of dollars globally every year, and we do this responsibly for our clients.
How about we do it for ourselves? How about we do it for our profession? And I welcome the supporters of those that are willing to step up. And I will. I welcome those that are willing to step up and together we can do this. And together we are doing this. So I, I appreciate the opportunity to talk about this today, Evan.
I think it's, it's a meaningful. Moment in our journey together and, uh, you know, glad glad that we could share this.
Evan Troxel: [01:01:00] Yeah, I, that's a great way to, to wrap it up. And I, I, the last thing that I think we should mention, we brought it up earlier, is that we are gonna be at the AIA conference on architecture in June. is it? The, the seventh through the 10th or something like that? It's, we'll be on the expo hall floor, uh, on Thursday and Friday of that week in the Tect booth.
Do you know the tech booth number?
Bob Habian: 42 0 1, it's a
10 by 30 foot booth right in the middle of the, the whole enterprise. When you come down the escalators and go to your right at the Moscone Convention Center, you're gonna see the Swatch box sample library, and just half an aisle across the way is the Tect booth. and that's the centerpiece for just community.
So we're not gonna be showing products, we're not gonna be promoting data and, and. specs and cut sheets and all that. We're gonna be celebrating people. And if you're going to the show, we want you to come say hi.
we're gonna be interviewing some of our peers on all sides, [01:02:00] with an onsite podcast, but more importantly, we wanna make a connection that
can take beyond those two days together and, uh, build together. So we want to know what you care about, where your problems are with products, what your hope is for the industry, because this fabric is being woven by each of us together. right now this is, uh, this is a wonderful time to be in practice and I, I'll end with this. , regardless of what the signs might indicate, I believe we're entering the most important and most exciting period in the building industry.
And I'm excited about the enthusiasm that is shared by others like us that are doing something about it. And I welcome you to see that vision and to be a part of the best chapter in the building industry because that is a choice we make.
Evan Troxel: Yeah. we believe in the built environment and we believe in the power of architecture [01:03:00] and what it can
Bob Habian: Absolutely.
Evan Troxel: and our goal is to celebrate the people who make that happen. It's, it's not the projects per se, it's the people, it's the ideas, the creativity goes into that. How can we help facilitate that to happen even better? We wanna meet you. We want, so, so definitely come by the booth and say hello and hang out. Our biggest goal right now is to build this community who cares about the future of these professions that make up the building industry. there's not a better place to do that than the AIA conference.
Why? Because that is where the design and manufacturing community do come together the biggest setting possible, and it's where we can make the biggest difference, bridging the gap between those two. How many times do you bolt down an aisle, not making eye contact with those manufacturers because you don't want to get sucked into a sales scenario. We're there to change that one person, one handshake, one meeting at a time. I mean, As we build this community, we hope the network effect really does [01:04:00] happen and that we can change it bigger, faster, better. this is where it has to start and this is the place to do it. So if you're gonna be there, come by, say hi, booth 42 0 1 at Moscone Center, and uh, we're looking forward to meeting you
the website is tect.com and if you go to tect.com/join, you can get onto our communication list
so thanks so much for having this conversation today. It was an important one. I've been looking for a reason to have it, and, and so I'm, I'm happy that we did this.
Bob Habian: Likewise. And, you know, for the Wefunder campaign, we'll put a link on to that as well. but it's wefunder.com, wefunder.com/tech t e ct.one wefunder.com/tech one, and we invite you to take a look. If it's not for you, it might be for someone you know. And, uh, so between the upcoming show. Um, the [01:05:00] opportunity to work together with our dollars and our efforts, and then well beyond that, looking forward to engaging and serving you with our platform, serving your projects long term, building a sustainable piece of infrastructure that we all can rely and grow with.
Um, that's what's most exciting and so we look forward to that Together. Thank you again for listening and, uh, hope to see you soon.
Evan Troxel: Yep. All those links will be in the show notes and, uh, thanks everybody. Talk to you next time.