The First Customer - Startup and Franchising magic with Karim Kerachni

[00:00:27] Jay: Hi everyone. Welcome to The First Customer podcast. My name is Jay Aigner. Today I'm in lucky enough to be joined by Kareem Kerachni. I almost got it in the first take. Very good to see you, brother. Founder and CEO of Steamates, a franchisee, not franchisee. how do I say what you do for property guys?

This would be a great question to ask

[00:00:46] Karim: Yeah, that's the I'm the head of franchise development

for Massachusetts 

[00:00:49] Jay: development. Okay. So you are working on getting franchises for property guys. Got it. and you just told me that you recently got your first one. let's skip ahead or skip backwards and just figure out where did you come from originally? and did you have any entrepreneurship, you know, around you growing up that led to you being one later in life?

[00:01:10] Karim: Great question. Thank you, Jane. Thank you for having me, by the way. I'm very happy to be here. my background really quickly. I was born in Canada. I grew up in France. My parents are half French, half Algerian, have Algerian roots. and then I moved back to Canada about 10 years ago, out west. then I moved out east started my first business and now i'm actually traveling the world I'm, actually not even physically in massachusetts.

I've been working remotely for over a year and a half Traveling and running those businesses as i'm traveling. to answer your question because that's a great question. I don't get that often I don't actually so my grandpa I used to own a small convenience store. And so I grew up when I was in France.

Initially, I was, you know, there a lot. I'm talking when I was six, seven, eight years old. and, did that impact, you know, the rest of my life? I don't know, but it turns out that I started in science, you know, in my studies. engineering school wasn't for me. Moved to business school, try different things, you know, different, curriculum. And, I ended up with an MBA that I've never used. And so then I started my, you know, my first jobs were, from, you know, from the bottom I was in door to door sales and, you know, equivalent and really, you know, grew, learned and grew from, from there and kind of worked my way up, so did that have an, a subconscious impact on my career?

[00:02:31] Jay: Maybe, right. That's like, that's a, that's fair. you mentioned something there that I am curious about. How the hell are you productive when you're traveling and working? Right? Like I have, I try it and also, I mean, I have a ton of kids, so like, that's just like, I probably should just chalk it up to having five kids around while I'm trying to do stuff.

But, how do you stay focused and like, actually, do you have You know, kind of a routine when you're away and you're doing stuff like how the hell do you get stuff done?

[00:02:59] Karim: Yeah, absolutely. Well, you nailed it. Yeah. Having a good routine is super important. So, right now, I mean, as I said, I'm in Malaysia. I've been here for about seven months and it just so happened that it's 12 hours. ahead of, Massachusetts and,and Canada. so right now it is midnight actually as I'm talking to you. and, and wherever I go, I basically adapt, my work time, my play time, my sleep time. to, to that. And it usually works out really well. The fact that we're 12 hours ahead, you know, can be a little bit of,turn off. But I think it works even better. Because what happens is, I work mostly in the evening from, you know, 89 PM. Sorry, 78 PM until 1, 2 a. m. That's, you know, good work time. Mostly for, you know, Interactions, meetings and networking and podcasts and so on. during the day I take one, two, sometimes three hours for admin. Usually I go in a nice place, you know, coffee shop by the sea or whatever it might be in a good environment.

And that actually, what's. Get me, you know, get me really productive. And, because, you know, I feel like I, I don't know, I feel more energized when I'm in a nice environment. and in between that, in between those, you know, two, three hours during the day, four or five, sometimes six hours in the evening.

I have plenty of time to go explore, to do, you know, some sports. I do a lot of, volunteering, and so on and so forth. And, so you really just adapt. It takes a few days, sometimes a week to adapt to, you know, the new environment. That's also why I don't move too much, you know, from here. It is a good stepping stone.

I was in Laos and Thailand, you know, last week. so I do go explore the neighboring countries. I explore where I am. but I tried not to, I don't move from one place to another every week. and that allowed me to set up some good routines. It's extremely important.

[00:04:43] Jay: I think that's good. Yeah, no, that makes more sense than, what I originally thought, which was like, nonstop travel. I guess if you're setting up shop in multiple places for some amount of time, you can at least, like you said, get a routine together. I think that makes a lot of sense. Where did you get the bug to travel?

Do you think it's your parents being, you know, both sides of the Atlantic?

[00:05:02] Karim: Could be. Yeah, it could be the fact that I was born, you know, with three passports with three citizenships. I think again, subconsciously that had an impact when we, growing up in France, we, we didn't travel internationally, we traveled a lot within France because there is just so much to see. and so I guess I had that. You know, micro frustration of like, Hey, I want to, you know, visit, other countries. So as soon as, you know, I started to have to make some money, first, you know, in, in France, I started visiting a little bit, you know, Europe. I went to England and Ireland and Spain and so on. And then, I uprooted myself, went to Canada. and, and initially that was for, you know, six months to a year. And I ended up spending, you know, the past 10 years over there. so, so that's where I, Started getting a little bit of a little bit more of this travel bug. and after my, so one, one, as I mentioned, I did some door to door sales for a home security and smart home company named Vivint.

and so what happened is you work very hard for four or five months during the summer. You know, if you stick to it and if you're good at it, you make really good money. And so I, for three years in a row, work for four or five months. And then I went to spend all of that traveling the world for the rest, the rest of the year.

And

that's really what had an impact in two ways. Not only, you know, the fact that I wanted to make that part of my life to, to travel the world. Consistently, but for long periods of time, not for a week or two, but also made me realize, Hey, This is great, but this is not sustainable to make a bunch of money, travel, spend it all, come back broke And repeat. it's great when you're in your early twenties and mid twenties. but I wanted to do something more sustainable. That's where, you know, entrepreneurship is one way, not the only way you can be a freelance. You can, you know, do a bunch of things, but entrepreneurship was my way. and as soon as I started my first business, I quickly, I was focused on removing myself from the business, you know, creating systems and processes, delegating, automating, or eliminating, and, and in order for me to remove myself from the doing and working The business and working on the business, you can do that from anywhere. But the benefit in that is not only my freedom of space and time. it is, I think the only way or the best way for your business to grow when you're not your own limitation, your own bottleneck, and you have a team and you have systems in place, then those systems, you can expand, you can create, you know, new services. You can duplicate this model in other cities. That's what we did with the cleaning company. We literally copy pasted the brand, the way of doing things, the processes, how, you know, how to do each type of cleaning and how to recruit and how to, you know, the, do the marketing. We copied and paste that to, to another city, in this case, Ottawa. and it's been, you know, quite successful since, we're actually in process of,opening Toronto. Very soon in the next few months, same, you know, same thing, same brand, same systems, and it actually gets easier and easier, the more we do it. so, you know, I went on a kind of on a tangent,

[00:08:01] Jay: no, that's great 

[00:08:02] Karim: lots of benefits in,

[00:08:04] Jay: no, I love that. well, let's talk about it. What was the first business you started? yeah. 

[00:08:09] Karim: real business was The cleaning company when I was in, in, with the the home security system, company, I was a contractor, so yeah, I could hire my own,my own, reps representative and train them and manage them and so on. So it's kind of, you know, being an entrepreneur, but not really, cause it's not.

Your business, your brand, your way of doing things. so my first business was that cleaning company named teammates, S T E A M A T E S. It's a palindrome can read it both ways. in, so in Halifax, Nova Scotia, the reason I started it, not because I haven't had a specific passion for cleaning, but because there was a real need, a real demand. And I thought that was a great opportunity and it was and started from scratch with very little money. That's one of the cool thing in the service industry cleaning, you know landscaping a lot of there are lots of businesses that you can start with very little, initial investment but a lot of Sweat and blood and tears. and so in this case, I, bought a bunch of, you know, equipments and products, less than, you know, less than 2, 000, I think all included. And I started doing the cleaning, you know, myself to learn the job, to learn the processes. and, and to, you know, when you're doing it yourself as the business owner, you're going to,to provide, you know, the best service possible to your clients, because it's your first client, and, and you want to make sure to satisfy them and to get some referrals out of them

and to get some repeat business.

But at the same time, you know, half of the day is spent, you know, doing the cleanings, the other half of the day spent doing everything else. So whether it is the marketing, the accounting, the networking and so on and so forth. So the first. Few months, until you're able to delegate are really tough, but actually really fun.

I look very fondly, you know back at at this time because You're learning a lot and you're growing things the way you want. You're making mistakes are, you know, extremely valuable for the future. so you get a welcome those mistakes and those, those, you know, failures, mini failures along the way. and, yeah,that's how I started. And I owe everything to do that. Can you repeat your question? Cause I'm not sure if I, fully

[00:10:09] Jay: No, you did. No, it was what business did you start? and it was 

[00:10:12] Karim: So the cleaning company.

[00:10:13] Jay: No, I love that. what about property guys? what, how did you feel the need monetarily to go back and to work for somebody else? Did you, were you just excited, you know, interested in franchising? Like, well, how did you shift back into a nine to five ish, you know, quote unquote nine to five, after starting your own business?

[00:10:31] Karim: Yeah, so, actually to correct that. I started another business So

property guys is not my business, but actually I started a corporation and I and for the first time I had to find some investors because you know to I had to buy in property guys to be the the head of franchise development for massachusetts.

I basically acquired all franchise in the state and my job is to then Find and select the, the best fit for each of those territories. So to do, you know, all the marketing and advertising and sales for that state, and, and so starting another business obviously was easier, but finding some initial capital.

First time I did that, because as I said, the first business, that was from my own money and that was very little initial investment. We grew exclusively on profit in this case. No, I needed actually a large,investment. And so finding investors was a new. You know, a new challenge that I had to conquer, I found six investors with different, you know, different level of investment, all of them from my direct, direct circles, whether it is friends, some family, but mostly, friends or people from the community that I knew somehow.

And that, that I approached. So, that was super interesting to, to do things, you know, differently. And on top of that, bringing a model. So the property has modeled to a brand new market that I was not necessarily super familiar with, you know, Massachusetts. I never lived there. I've been there, but I never lived there.

So I had to do all the market research or there was a lot more, You know initial work, than the cleaning company. I went for it There was an opportunity. let's do it and let's figure things out in this case. No, there were there was a lot of you know financial projections and crushing the numbers and market research which state will I open? property guys,first, you know, Florida and Texas were already active, but beside that I had 48 states, you know, to choose from. And, so I selected Massachusetts for a bunch of reasons. I think that's where the model can be the most, will be the most successful. but that took a lot of work between. when I came across the opportunity, that was my accountant who, you know, brought up the idea and then I dug into it until finding, you know, figuring out, you know, the extent of that, that opportunity and talking to people at, at property guys and so on. then finding investors or incorporating the business, getting started that took a full year. actually, so there was a lot of work prior with, you know, no, no income. So you have to really believe in,in what you're doing. and, and then it took another, you know, almost another year to, to find the first customer, and basically figuring out.

[00:13:01] Jay: Okay. 

[00:13:14] Karim: your pitch because it's a lot of sales, not in the sense of.

Pushing the product to, or the service to someone, but really, I see myself as a guy, if I'm talking to someone who would be a good fit for that model, I have to obviously, you know, get some interest out of him, but, it's really guiding them through the process, in learning about it. Getting excited about it, doing their own research and financial projections and so on, and then taking them all the way to, you know, the agreements, reading it and signing it and then getting started.

That's really the extent of, of my work. So I know, at no point really, can you, or should, I'm sorry. At no point, I should, push something that it, to, franchise that to someone that is not a good fit for what we do, because myself, All the next franchisee and the company at large relies heavily on the success of each of the success of each franchisee. and so we got to make sure we find, excellent, you know, fit for each,for each franchise. so, so it's been a whole different adventure. But what I can say from there, what, you know, what I learned and what actually really gets me excited, you know, to this day is that I've done the whole starting a brand from scratch and starting a startup from scratch. and it's been great, but it's not easy. And that's why so many, you know, startups are not successful. so I see, now I see, the value of owning a franchise, is just, you know, so much higher, you know? Because you're buying in a strong brand in this case, 25 years experience, hundreds of franchisee went, or are in the system, went through the system or are currently active.

We'll have about 110 franchise. so you buy in, you know, systems and processes in place. You don't have to make all those mistakes, sometimes costly mistakes. Now you just have to follow the process. and, and also you buying,an economy of scale. A lot of things, you don't have to get, you don't have to get a graphic designer and a web designer and SEO person, and, you know, salespeople and so on, all of that is provided to you by the franchisor, and that's provided to each franchisee.

So that reduces the cost drastically. There is about five people that you don't even need to hire for your franchise, and you can just focus on. Business development, educating people in your territory,and bringing on, you know, more listings in your territory. So my point being, seeing how tough it is to start a business from scratch.

And the, that increased in my mind, you know, the value of becoming a franchise you, when you're an inspiring, aspiring entrepreneur.

[00:15:43] Jay: Yeah, no, that makes a lot of sense. and just so for people who don't know, what is the, what is, what does it mean to be a, you know, first of all, what is probably you guys do specifically? And what does it mean to be a franchisee for property guys? What are they doing? a 

[00:16:00] Karim: Yeah, absolutely. So, property of that come, let's start with that. so for the past 25 years, as I mentioned, they have been the alternative solution to the traditional real estate model, meaning, for someone wanting to buy or sell specifically selling, any kind of property, you know, your home, your condo, commercial property mentioned, you, instead of using the traditional model, which is, you know, To get an agent a real estate agent paying a five or six percent commission, which can be a lot getting a lawyer getting photographer stager appraiser and so on and so forth. all of that costs money And you kind of lose control in the process So with property guys, you can list your property For a one time flat fee that one time fee doesn't just include the service of an agent But actually All those professionals that I just mentioned and more are included in this package.

So one time flat fee, you get everything. You don't have to spend anything else, any more money. and that one time flat fee in the property get model is actually in the four, five, six grand range. and it doesn't matter if your property is worth A quarter million or 2 million. it's the same, you know, one thing. So, that allow people to keep the level of control. They want in the process of selling their property. Some people want to be more hands on and others, you know, what we completely hands off, but it allowed everyone. To save at least 15 grand and sometimes a quarter 50 or 60 grand in the process of selling their property So that's what property guys does it's an amazing model that brings so much value to each individual clients and it's really big in canada in some markets.

They have over 50 market share. So half of the properties for sale It's property guys. so now what is the value for a franchisee? Because that's, you know, that's really where my focus is Well, those franchisees often come from the real estate industry So say an agent a real estate agent that might be struggling in differentiating themselves, you know, every friend every agent Have the same value proposition.

They all do the same thing. You can use John, Mike, or Cindy. you're going to have your property sold. Hopefully. so, so they have trouble differentiating themselves. Very overcrowded industry. they don't usually make the. Income they expected to make when they got into the industry, only the top 5%, 10%, you know, make really good income beside that everyone else makes, you know, doesn't break six figures or, you know, barely,and work really hard for it.

so becoming a franchisee basically solves all those problems. Not only you get to, to stand out from the crowd and, offer something vastly different from everyone else. In, in your state, you're unique, sorry, you're exclusive. So you have a territory. So in, in my session said it's going to be Boston, Essex County, you know, Cape Cod, but we have,in each French, in each state, sorry, you have a dozens of territories and you own one where you exclusive.

So you're one out of one.

you don't have any competition internally, any leads, any client in your territory are yours. so, you know, imagine being the only killer Williams in Boston. You'd make a killing so it's the same thing and on top of that you you own a business and you're not just a contractor and that's very important You're not running from One, commission to the other for 40 years or whatever long you're an agent No, you own the business and you work on growing the business growing the brand locally And so all the value added to that business first off as we mentioned earlier, you actually can become hands off so you can make more income than as an agent You And be, you know, hands off, you know, not, I wouldn't call it passive income, but close to it, you know, you can have a team running the show eventually and so on. and, and eventually, you know, after 10 years, 20 years, you might want to sell your franchise for, you know, 10 or 15 times more. Then what you got it for initially, as an agent, you cannot sell your license. You can work for 40 years and pretty much have nothing to show for when you want to retire or when you want to move on to something else. so those are some of the reasons why,the franchise, the property as franchise board is so competitive,in term of, you know, for franchisee, it can be also a different new stream of income, say your mortgage broker, you know, the industry, you have passion for real estate, well, you want to have a new stream of income where You know,cross pollinate, you know, your clients or, you know, refunnel your clients from your franchise to your mortgage and vice versa, and really maximize the potential on both ends. So there are many reasons, for, for real estate professionals to,to choose to become.

[00:20:23] Jay: yeah, no, I love all those benefits, especially for somebody, that may be overwhelmed by completely starting their own business. At least it's a shortcut to a lot of those things. Um,What is next for Steamates? You mentioned Toronto. you know, how are you balancing, you know, growing that business, but also, you know, giving the amount of time you need to give to property guys?

[00:20:51] Karim: Yeah, that's a great question. So my focus is 90 percent property. Because for stillmates, I actually,already sold, 60 percent ownership, last year, a year ago for that reason, because I, you know, I started the property guys and I thought I could juggle the two. And I realized that I wasn't giving, property guys.

It's a real do, in terms of, you know, of my time and my efforts, it was taking It took a lot more than I initially, you know, expected for things to now take off. and so still meets how I do have a business partner who is there. he's also hands off where, you know, we're kind of overseeing the business. but it's good to have someone, you know, on the ground and he does meet with the teams there occasionally and so on. now we are, you know, looking at opening Toronto because we, funny enough, you know, when you start a business, you're looking for your first customer. It's that. You know, the title of your show, in this case for Toronto, it's the other way around.

We actually, are, signing on a new huge client for us who are nationwide. So we're signing them for Ottawa, but they're so happy with our service, that we are actually in discussion in, to,to provide service to them also in, in Toronto, where they have even more properties for us to take care of.

So it, it is. Basically, you know, that's an opportunity for us to open a branch to service them first. And as you know, we have our team there and so on, things are set up, then we're going to expand, you know, our offering just like we did in Halifax and in Ottawa. But it's interesting to do things, you know, the other way around, we're opening for that client, and then we're going to expense teammates Toronto, you know, in the month and years to come, hopefully, to become, you Probably not our number one branch because the potential in Toronto is it's huge

[00:22:35] Jay: Right. That makes sense. So, who was your first customer for Steamates? And you mentioned your first franchisee took a year. who was the first customer for both of us?

[00:22:46] Karim: For teammates actually i'm gonna give a shout out to him. His name is neil andrino He's a very successful realtor actually and multi business owner But he was a good friend of mine that I met through networking and we become we became friends this way. And he ended up being our first customer when I started teammates, I told him about it and he owned, owns a bunch of properties.

It was like, you know what, I actually have that property that I'm, I'm flipping and I, we need a good deep cleaning there. can you do it? And I know that, you know, I remember very clearly, that, it was, it was late. I went there, I asked, you know, a friend, to, to join. And, and we did it.

We spent, I don't know, like five hours up to, you know, to like midnight, after a whole day of work, but just, you know, so excited. I remember very clearly because, you know, I was so excited, our first customer and, you know, first money coming in, after that one, we got three more jobs out of him.

He referred us to some people, you know, in parallel, I did, you know, acquire some, some other clients,a restaurant bar, I forgot the name of it, but it's a pretty big name in, in, in Halifax, which, I think I got them through simply going there with my business card, meeting the owner, and, a few customers like this, big customers, just being bold and going there and,

you know, introducing yourself.

Hey, I want to talk to the owner. hi, my name is Kareem. I own a cleaning company here. I'm curious, you know, who does your cleaning here? and, often they are in the market or they are just not super happy with their current, cleaning company or it's their staff. You know, the bartenders and so on during the cleaning.

And, you gotta have an answer ready for each of those cases. If it's the staff, well, you know, it's not really their job. I understand that you might not be satisfied with that. The quality, you know what, give us a shot. I'd be happy to do 50 percent off, you know, for the first time. I know I'm going a lot into, into giving advice here, but,don't be shy in offering your service for free or 50 percent off or whatever, because that's a great opportunity for you.

To learn how to provide this service better, and that's a great opportunity for this client. If they're satisfied, they're going to keep you even when you want to say, you know, you want to charge them full

price, if you've done a good job. So, so a lot of people are scared of offering value for free offering service for free. I think that's one of the great way to,to get,your first customers. So, yeah, having that one great asset, which is Neil, and I thank him, you know, to this day. and, and in parallel, you know, going out there and, and meeting, you know, restaurant owners in my case and so on, and giving my business cards and don't be, not being shy to, to approach them, 50 percent off. All of that gave us, you know, a pretty large portfolio in the first in the first six months, really, we, we ended up, I ended up hiring after two months, and I ended up, you know, not having to do any cleaning myself after eight months. So in the first eight months,we grew really quickly, and, try to continue this way,from there on.

[00:25:39] Jay: I love it. All right, man. Final question for somebody who's a traveler. I'm going to modify this question a little bit because I'm curious. I typically ask if you could do anything on earth, and you knew you couldn't fail, what would it be? But I'm going to ask you, where is the place that you want to go the most?

[00:25:59] Karim: and when are you going to get there? I'm sure there are somewhere. That's a great question. I have so many, so I have two answers for that because one of the plays that is on top of my bucket list has been for a long time. I'm not that far, so I should go into New Zealand. I think it's on top of the bucket list of a lot of people for many reasons. I mean, it's a beautiful country.

I think it's a very well ran country. Very respectable in a lot of aspects and the Kiwis. So the, the locals are amongst the nicest people that I've ever met. You meet a lot of Kiwis traveling, and often when you can notice, you notice that they're from New Zealand just by their, you know, their kindness and approachability.so, shout out to everyone in New Zealand. I don't know if there are any in Europe, but yeah, so, but the one that actually I'm, I'm looking at more seriously right now. It's, South America, Columbia, Chile, Peru, Argentina. So those, you know, all those countries, it's kind of, it's fairly easy to move around from one country to the other when you're there, just like Europe, just like Southeast Asia.

so we are actually talking about it with, with my wife, on the way back, because eventually we're going to come back to Canada and Massachusetts, but on the way back, making a stop, for a few months in South America. Okay. It's very. Very likely

[00:27:18] Jay: All right. I love that. Well, send pictures if you make it to New Zealand or to South America. 

[00:27:24] Karim: will do 

[00:27:26] Jay: yeah, my, one of my friends is in New Zealand and he actually, he just won astrophotographer. Of the year down there. so shout out to my buddy, Amrit, who lives, down there in New Zealand. Great clear skies down there.

Cause they're kind of in the middle of nowhere. you know, being an Island and everything. So, Kareem, how do people find you, if they want to reach out and, how do they find more about property guys, franchises, and steam mates, as well?

[00:27:53] Karim: Absolutely. Thank you for asking. So, first to reach out to me. The easiest way is on linkedin So you have my name right here and i'm the only one on linkedin with that name So, you can send me a connection invite and very approachable Don't hesitate to come even if you just have some general questions about entrepreneurship, whatever it might be You feel free to reach out if you want to know more about the property guys franchise opportunity specifically for massachusetts, but We are also in Connecticut, florida, texas. So, feel free to reach out the best way to find resources Google property guys franchise massachusetts or property guys massachusetts and you'll find my website as well as property guys website everything regarding our franchise Opportunities and for teammates, We are looking at selling the whole business, the global, you know, corporation, with all its assets and all the potential.

So the Toronto branch coming up and other, you know, things that we have in the pipeline. So it's a great, you know, great place, a great time, I think for us to, to find a new owner that will be more hands on than us. The business deserves it. so if you're in Canada and you're looking for a good business opportunity, don't hesitate to reach out as well.

Same thing on LinkedIn. and we, we can talk.

[00:29:04] Jay: Beautiful. All right, brother. Well, thank you for your time today. have safe travels around the world. I'm very jealous of your You know, it's not quite digital nomad, but it's a very cool life So congrats on all the success continued success and we'll see you again soon. All right.

[00:29:19] Karim: Thank you so much, Jay. And congrats on the success of your, your podcast. I've been listening to a bunch of pieces leading to, to this conversation

and, really

enjoy it. 

[00:29:28] Jay: Thank you. very much. I appreciate you too kind. All right, be good brother. Talk soon. All right. Thank you

[00:29:32] Karim: Thank you. 

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