RALEIGH – Living in a home can be stressful, even as home values soar across the Triangle, and a local entrepreneur has set out to alleviate that stress for his company’s customers, every day of every year.
What types of stress? Faucets can leak. Toilets can clog. For seemingly no reason, your heat could go out in the midst of the coldest weekend of the year.
Need a new dishwasher or garage door opener? It might take months to resupply a similar quality component, given the supply chain backlog.
Not only do these surprises arise from time to time, addressing and resolving them comes with a significant cost: an investment of time, from someone living in the household.
That’s time that could be spent finishing that project at work, or paid time off that could be saved for a day when there’s a parent-teacher conference or a swim meet. That time you spend waiting for someone to arrive to repair your internet connection because a tree limb broke due to ice? What if it was yours again?
That’s the proof-of-concept that Matt Sheehan, cofounder and CEO of Exhale, sought to identify in the Triangle in the prior two years.
The company, which provides home maintenance services on primary residences to its customers, which Sheehan calls “members,” charges a monthly access fee. That fee can be thought of as a membership subscription.
The company also generates revenue under a service agreement, but that revenue is then allocated for annual or bi-annual regular and recurring maintenance projects specific to the member’s house, such as servicing an HVAC unit and furnace. The company can even provide services on-demand for its members, due to an internal team of service professionals and a growing number of vendor relationships with licensed, bonded tradespeople.
“This idea is ten years old,” said Sheehan. “I’ve been watching the industry for ten years,” he added. “I just didn’t understand why the primary homes aren’t taken care of, as it’s often where we spend the most time.”
18 months ago, he set out to demonstrate proof of concept, interviewing potential customer members, with the goal of gaining 15 members to hone the model. He and his team launched a pilot with 17 homes in February 2021.
36 hours and $200 later, but then fixed in four minutes
The vision of the company is fairly simple, said Sheehan. “Take the stress away from the homes we live in every day.”
Sheehan began his career working as a supply chain associate at Streamline.com, then earned three promotions in under four years. In the early 2000s, he worked as the sales director at Manhattan Associates, then earned an MBA at Penn State.
Sheehan accepted a role at Redbox, where he reported directly to the CEO. During his tenure at the company, he assisted in the execution of the firm leaping from $4 million in annual revenue to more than $2 billion in annual revenue.
While at Redbox, Sheehan said, he came home one night from a networking event to a surprise: a broken faucet.
Sheehan still remembers the feeling that came when his wife asked whether he’d noticed the faucet downstairs prior to coming upstairs.
“Despair,” said Sheehan.
After spending the better part of the next day vetting companies and finding one who could come and repair the faucet, Sheehan had to wait again, overnight.
The faucet did get fixed, Sheehan said. It took four minutes. And it cost $200, plus a day and a half of his time, energy, attention, and focus.
That’s time he’s not getting back.
“It turned out to be a little issue, but it was a big stressor,” said Sheehan.
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More convinced than ever
Today, most home services companies are transactional, said Sheehan.
But it doesn’t have to be that way, because it’s not what consumers actually need, he argues. “What they need is relational, they need someone that understands them, and understands their home.”
Sheehan left Redbox, joining Primo Water Company, based in Greensboro, as COO, later becoming president, then CEO. The company was sold in a $775 million deal with Cott Corporation in March 2020.
For years, Sheehan had tabled his home service delivery company concept. Meanwhile, the country had just pushed a pause button on commuting, thanks to the onset of the global SARS-CoV-2 pandemic. More people spent more time at home than they had previously, Sheehan included.
He launched Exhale in August 2020.
“I’m only doing this because I want to serve really great people, who value their time, because they have great gifts to give to the world,” said Sheehan in an interview last year as the company was finishing recruitment for its pilot program. “They’re frustrated because on Saturday mornings, or Thursday afternoons, they are waiting for someone to come and do something for them in their homes.”
The pilot launched in February 2021. By October, Sheehan told WRAL TechWire, the company had already exceeded all of its goals.
“I am more convinced than ever that folks need a home manager,” Sheehan said. He is a member of his own company, he told WRAL TechWire, recalling a recent anecdote where his assigned home manager handled a visit from a service professional while he continued his work day. “In this space, it’s a big problem, we don’t think that people are getting cared for the way they should.”
Dream big, start small, scale fast
Sheehan self-funded the company for its first year. That was an intentional choice he made, and he made other intentional choices during the first year as well.
Sheehan told WRAL TechWire that he likely could have recruited 100 members in the first year, but he elected not to do so, even though it meant the company wasn’t generating positive cash flow.
“At Redbox,” said Sheehan, “We had a saying, dream big, start small, scale fast.” What that maxim means, in practice, said Sheehan, is that when you sight your sights on something, you go hard after it by starting small.
“But when you find your answer, dump fuel on it,” Sheehan said. After the pilot concluded, and Sheehan had hired additional staff as needs grew, the company expanded to serve 25 members, according to Sheehan. By October, Sheehan knew the company was ready for some additional fuel, and he set out to raise capital.
$2 million and how it will be allocated
The company has raised $1.9 million in capital, and there’s more coming, said Sheehan. Of the 26 investors, all of whom were investors with whom Sheehan has held a prior relationship, 15 of them are CEOs, Sheehan said.
The investors are all people “who believe in me, and believe in this idea,” Sheehan said. They also believe in the opportunity in front of the company, as does Sheehan, who told WRAL TechWire that the current home services market in the United States is $350 billion annually.
“This is a big business, or it could be a big business, and while we’re still a startup and are still humble, this is a big, big opportunity,” said Sheehan. “As we think about this next year, we’re going to go from 25 members that we have now to approximately 75 members,” said Sheehan, with that expansion occurring in the Triangle.
The funds will be allocated to onboard about five to seven additional staff, including at least two home managers, and a general manager for the company, said Sheehan, who will start next week.
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“Update the consumer experience, and then layer a technology map on top of the consumer experience,” Sheehan told WRAL TechWire would all be priorities for the company to begin in the year ahead. “Which will be a 3-5 year build for us, but I’m pretty sure it would be a unique, and the only build for a home services concierge company.”
“This year is really about getting some people, adding a bunch of homes,” said Sheehan. “And proving unit economics.”
Though the company is generating revenue from its members, said Sheehan, it is not yet profitable.
“We have to figure out how to get profit out of the business earlier rather than later,” said Sheehan. Much of that is also intentional, said Sheehan, not a flaw in the business model. It’s because it’s more important for the company to build its membership slowly, while investing in long-term infrastructure simultaneously.
“When you’re thinking that this is often the largest asset that someone owns, we need to care for it deeply, which is not necessarily about speed, it’s about quality,” said Sheehan. “Efficiency matters, but speed can kill,” he added.
Sheehan told WRAL TechWire that the company has turned down members, because they weren’t a good fit for the service delivery model. And either Sheehan or his team spend a total time of seven hours analyzing each potential home to manage before the firm even issues a contract proposal for the property.
“We’re investing a lot to ensure those members are a good fit for us, and vice versa,” said Sheehan. “If you serve your members well, that is the core of a nucleus of a good business.”
The firm is also planning to add to its service delivery capacity, and will be seeking to develop additional relationship with companies or entrepreneurs with expertise in the trades. “We’re selecting great members, which are the exact type of people for whom anyone in the trades wants to have as clients,” said Sheehan. “And for members and our trades partners, there’s only one contact, the Exhale home manager.”
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New year, new general manager
Sheehan will be turning over the day-to-day operations of the company to a new executive who will lead the company’s Triangle efforts, as Sheehan and his cofounder, Sanay Patel, advance longer-term plans and projects.
Pete Durand (LinkedIn profile photo)
Peter Durand, the former chief revenue officer at Netsertive and the former CEO of RivalHealth, will join the company as its general manager, and will begin next week, Sheehan confirmed to WRAL TechWire.
“Pete will be responsible for the company reaching our objectives,” said Sheehan. “He loves this idea, believes it can be big, and he’ll have responsibility for the market.”
“Has a real appetite for building something special,” said Sheehan. “And the right temperament to really grow this business.”
