The First Customer - Shifting Tech Landscapes through Digital Drift with CEO and Founder Jim Keeney

[00:00:27] Jay: Hi everyone. Welcome to The First Customer podcast. My name is Jay Aigner. Today I am lucky enough to be joined by Jim Keeney. He is the founder and CEO of Dapt Tech. we met at the PACT Capital Conference, which is a fun conference to go to. Jim, how are you, buddy? Thanks for joining me.

[00:00:43] Jim: I'm doing great. How are you?

[00:00:45] Jay: Good. I heard you were on a hike this weekend, I think based off of our little pre show, which is a very cool thing.

You hike every weekend you said, or you try to?

[00:00:52] Jim: pretty close to. Yeah. so every weekend it's hiking unless it's biking. So those are my two things.

[00:00:58] Jay: Okay. All right. Very cool. where did you grow up and did that have any impact on you being an entrepreneur later in life?

[00:01:05] Jim: That's an interesting question. I don't think location had anything to do with it. so I grew up in, I actually live where I grew up, Crofton, Maryland. Now, I also like to point out that I was born in Brooklyn, New York. So I like to point out that I, kept the New York metabolism and added a Southern drawl, which makes a polite New Yorker.

So if such a thing

[00:01:27] Jay: I don't know if that's a real thing, but we can we'll leave that where it is.

[00:01:31] Jim: so yeah, no, I think being an entrepreneur is more about. kind of energy and metabolism and, you know, focus to details and things of that nature. Sensitivity. and, and I've always been someone who tries to build things. and so entrepreneurship is a manifestation of that. You're listening to what people are struggling with, and you're trying to fix problems and build things.

I have this story about when I was in kindergarten. Believe it or not. I was, playing with the blocks and I wanted to build a whole city. They had a tremendous number of blocks and I vaguely remember, organizing the other kids because the other kids wanted to build something else, organizing the other kids to help me build a city.

[00:02:17] Jay: Very young. Well, one thing you said metabolism, of an entrepreneur. What do you mean by that?

[00:02:23] Jim: Well, I think entrepreneurs, you know, it's not really bipolar, but there is that notion of just having that extra, enthusiasm about life and about things that you kind of jump into things feet first when others might hesitate and think about, you know, and kind of pull themselves back. I've always been.

You know, somewhat high strung, mainly around ideas, not, you know, and I think that's part of the entrepreneurial spirit. you're constantly questioning why and what and seeking to do something about it. and, and that, you know, before, before starting Dapt Tech, I actually ran a, software development, a custom software development company called Fitterweb Consulting.

and, that really was a function of, Constantly trying to figure out how to build things that other people couldn't. and it really manifests itself in DAPT as well. what we're doing is we're solving job cost accounting, which is being able to do profit and loss by activity. and what we discovered is that it's a complicated situation.

that people have kind of veered away from, but underneath it, the principles are always the same. And so we built out, we solved that complexity and that's what we do. And what we're doing there is we're helping small companies. track what's going on in their business using their normal process that comes through accounting to be able to analyze that profit and loss at the activity level.

[00:03:56] Jay: And it gives them an advantage that other companies don't have. Yeah. Explain that a little bit. when you say like, at the activity level, gimme just an example. Like who's a company that you would help?

[00:04:06] Jim: yeah, so, about 50 percent of our companies are in construction and trades. And the reason why I say trades is HVAC and plumbing and painters and things like that. so, the way to think about it is they send out a bunch of people to go do jobs. They track their time against the job. they also indicate other things about what they're doing, like what kind of work they're doing, et cetera, et cetera.

We take all that information and we package it and, kind of foster it through the payroll processing, process when it comes out the other end, it's dollars and you want to be able to take those dollars and link them back to the time that was tracked, because that defines what the work was that was done.

So then you put them together and you can create accounting entries that Give you specific insight into how much that person, how much it costs you to build that wall or, install that toilet, what have you. And to think about it, it affects the business both directions because now when you know what it actually costs to install a toilet, the next time you estimate a job, you can be more accurate.

And on a bigger, bigger level, we have, companies where they have more than one line of business. And so they're trying to make that decision. Hey. Is this line of business a better line to pursue? Should we put all our efforts in there or should we, you know, spread them out the way we do well, ultimately that's profitability.

So if you have the ability to analyze very quickly and easily. I started with this digital marketing campaign. It came through the work cost me this much. The revenue was this much. Hey, there's my profit level. Let me put more energy into that one because that marketing campaign was very successful to me.

Whereas these other two, the profit margins are less because we're arguing with the customers when we're trying to make the sale and the sale takes longer, et cetera, et cetera. So companies more and more are. finding that they're challenged to be doing that not on an annual basis, but on a week to week basis.

So a good example of that is, we have a company that does,power generators, you know, the kind you install in houses and they're in Texas. And as you remember, I guess it was three or four years ago, they had that cold spill in Texas. They had that cold spell in Texas. They did more business in three months than they typically do in an entire year installing generators, but their overtime costs were significantly higher.

So, you know, we were able to give them the information to adjust their pricing. On a rolling basis to make sure that three months worth of work where it was as profitable as an entire year's worth of work. So then it went into the rest of the year. They had that cushion and they could take some of that money and invest it back into the business and expand.

[00:06:50] Jay: That makes a lot of sense. So who was your first customer then?

[00:06:54] Jim: Our first customer was actually a. suppression company.

[00:06:58] Jay: Okay.

[00:06:59] Jim: And so they go into buildings and they install sprinkler systems and that sort of thing. it was an accountant that worked out on the West Coast. And so she was dealing with all the intricacies of Washington State and they wanted to do exactly what we do, which was, Analyze each of their jobs to see which were more profitable and what was a better line of business.

And of course they have two different sides to their business. One is the big commercial where they serve as a subcontractor to contractors. And then the other one were the odd jobs that they were picking up. So there was a lot to really think about and understand and compare in order to get to, make the right decisions about which line of business to pursue.

[00:07:39] Jay: And how did you get that customer?

[00:07:42] Jim: That's a great question. So, cause I've given it, you and I talked briefly at the

[00:07:46] Jay: yeah,

[00:07:47] Jim: met a lot of thought, especially because the intent of this podcast is to help other entrepreneurs. and the reason why I've given it a lot of thought is. You know, entrepreneurs, they don't always fit within the system and the business world works.

There's really two approaches to business, right? The first one is find an institution, a bunch of big corporations or accounting or what have you align yourself with the behaviors they expect and just ride. That's, but entrepreneurs don't think that way and they don't live that way. They don't, you know, they're like, Hey, wait a minute, I'm not going to join that.

I want to be my own free spirit. and so for most. Most entrepreneurs, there's two different ways to go after their customers. One is to build their own following of people who will ultimately buy their product. We went the other route, which was, the opportunity came to us from someone who worked at Intuit.

And Intuit of course runs QuickBooks and QuickBooks. it's now called QuickBooks Time. It used to be TSheets. And they came to a, came to me when I was head of Fitter Web and they said, Hey. We got this problem. We got all these customers who want custom reporting on their time cards, time sheets.

Can you help us? I said, sure, because I happen to be working with their, with their infrastructure as it was. So I built a platform to make it very easy for me to do custom reporting. Well, it turned out that what they really wanted was to be able to bridge the gap between time collection and payroll processing so that they could do job costing the way that I described.

so that very first customer had both pieces of it. Thank you. And so once I realized what was going on, I began to figure out both sides of it.

[00:09:33] Jay: I do want to, I hear that story quite a bit and I'm curious how from a business perspective you approach that because you had a custom software development shop or, you know, a dev shop that you're building products for somebody, somebody comes to you with a problem and says, Hey, I need you to solve this problem.

You go, okay, great. Oh, wait, this could also serve a bunch of other people that, you know, could use this product. What was the process of productizing this thing? And making it resellable and like, how did you have to have a conversation with them? Like, you know, this is going to be a bigger thing and you know, you guys can be a client of it.

Like, how did that work? Right,

[00:10:09] Jim: I was very fortunate that the person who, her name is Daniel Price, who works at, Intuit, who made the, you know, the first contact with me, she had always kind of seen it as that bigger, So I didn't have to, I didn't have to go beyond that. And actually what it facilitated, which is very unusual for a company in our position is, you know, we're now at 85 customers and growing, for the first two years of our existence, we had this almost passive lead funnel. Basically the leads would come from. AP that would go into it and then they'd come to us and we would connect everything for the job costing piece of it. So, so what the reason why I say that was very fortunate is there was a tremendous amount of complexity behind the scenes. And so. Because we were not having to focus on getting the next customer, we could focus on what the customers were telling us and what problems were and how to build out the infrastructure to be able to be powerful and flexible enough to do what we were doing on an industrial scale.

and so now we're at the point. we can ramp up the marketing. We can ramp up the sales because we've got that reproducible thing. and again, it was because for two years we didn't have to go out in search of our customers and we didn't have to kind of expand beyond that. Now I will say that right from the beginning, we understood it was a big problem.

it, you could tell by the way that people were talking about it. On top of that, It fits one of the things that I've seen as a great pattern, which is find a problem that's really not sexy, that nobody loves, but has a whole bunch of people whose livelihood is dependent upon it and go after that. because everybody has a new idea about the things that are, you know, kind of exciting and rich and all that kind of stuff.

And so, there, it's all about, can you raise enough capital to out compete now the other guys here? It's really about solving the problem. And again, as I said, I'm always about building things. It's really about can you solve the problem? And I've had accountants who have been in the business forever who said, Hey, you know, I've been at this for 25 years and nobody else has solved it.

And you have, now I personally think, cause I look at everything from the development standpoint and software and everything, I think it's straightforward.

[00:12:39] Jay: right.

[00:12:40] Jim: That's, you know, that's my little craziness,

[00:12:42] Jay: No, I look, I mean, I run a, a QA agency, so I don't think there's anything probably less sexy in software development than QA. So, I hear you about, but it's, you can't, Make quality software without it. So it's like you do need it. And if and I hear the same thing a lot of time from our customers, like, that's all you guys do is QA.

Like, that's it. And like, that's it. But we just do it really well. So it's an interesting kind of comment there that going after the unsexy thing. I like that. Hey, so you talked about ramping up marketing and sales, kind of be in the position where you've, you know, you were fortunate enough to have this lead funnel that was kind of just trickling in.

And I love the partnership kind of angle there where you just were kind of part of this ecosystem and just getting these leads filtered. And that's been a great, I've heard that a lot. so what, how are you putting together your marketing and sales? Strategy. If you're a tech guy, you're, you know, you're built this platform.

You get these partnerships that are going on already. Like you kind of had to start at square one of building this strategy to get an inbound or an outbound, whatever you're going to do, sales funnel for marketing sales. So what has your been your approach to do that?

[00:13:45] Jim: Yeah. So, So we,in a prior life, I actually. focused a lot on this. So, so I worked for two years at a digital agency called Navigation Arts in Washington, D. C. And then later on, when I was working, fit a web, I helped customers with some of this. and then for about four years, I ran the Baltimore social media meet up way back before social media was the thing it is today.

So, you know, we fall in We're very much a function of influencer marketing because the industry is, you know, so we're influencing the accounting industry, the back office, and it's very much about, you know, helping each other. It's a very tight community. and so for us, it's all about building authority in the subject matter, and then using that as our outreach to expand our brand.

we're also very fortunate because again, we have a partnership with Intuit. We have, we are now, qualified for the ADP marketplace. So we have a relationship with ADP. We're in the process of building a relationship with Paychex and several other pay, pay, payroll processing companies.

They, you know, so our marketing is, Hey, use us. And what's great about what we do is we close sales. So what happens is, you know, an AEP rep goes in and they get everybody excited about, you know, HRIS and payroll processing, all that kind of stuff. Then they start talking to the back office accounting staff and the accounting staff says, well, do you do, you know, certified payroll and do you do, you know, shift differential, you know, they've got a list of must haves at that point.

I've now got them to the point where they call us because we have all those answers. So it's really about building that authority and building that,building that, reputation. And that is going to be traditional content marketing, but with the email channel and LinkedIn being a heavy, you know, the heavy focus of that.

[00:15:46] Jay: If you didn't have that into it, an ADP partnership, which is fantastic, by the way, I think those are going to serve you really well. how would you recommend somebody establish a partnership with, you know, a well known company if they're just some, you know, small business and they don't have an in maybe like you had, how would you, you know, tell them or at least give them advice to maybe try to establish that partnership?

[00:16:11] Jim: Yeah. So, start with the problem. Don't lose track of That, right? So, the problem has people who need to solve it. So you go find them, find what communities they circulate in, and work your way through the ranks of those communities. They're gonna refer you to the source. It's just a matter of time.

They're gonna say, Hey, you know, you gotta meet this person,

[00:16:39] Jay: Now, when you say communities, what do you mean specifically? Are you talking, you know, reddit groups? Are you talking about business chambers? Are you talking about like what, when you say communities, what do you mean?

[00:16:48] Jim: Yeah, it's digital communities. So, so, you know, we're big in accounting. so it's for us, you know, the,obviously QuickBooks has a big convention,that's one place, but it's just finding thought leaders within the accounting community, making the relationship with those thought leaders and then partnering with them to expand your authority.

and again, you know, so. So I started, Danielle Price has been very good and supportive of us. She introduced us to the ADP. groups. We've worked our way up through the ADP channels, through, into it. We've now got a relationship with a company called out of the box. They're one of the largest aftermarket service providers for QuickBooks.

through our customers, we got introduced to paychecks. That's how we're working on building our, our integration with paychecks as well, etcetera, etcetera. So it's a, it's. But the key thing here is, you know, when I started out, nobody was talking about job costing the way I'm talking about job costing.

Nobody thought about it the way I'm thinking about it. So I would get on sales calls with ADP reps and I'd go through my little pattern. Where I say, you know, job cost accounting is dependent upon three pillars. The first one is accounting. The second one is time tracking. The third one is payroll processing.

in accounting, you set up your jobs and information synchronizes with time tracking. Your employees track their time against the job. That information then goes into payroll where you pay the individual, hours become dollars, the dollars need to be connected back to time tracking. Boom. That's how you get your accounting entries going back into job costing.

So I came up with that pattern on my own just by listening to what people were saying and interpreting what it meant. And then when you start echoing that back to people who have been in the know and in the community, they go, wow, that's much clearer. That's much more straightforward. They want to be with you and gives you the leverage to the next connection, to the next connection, to the next connection.

So the underlying instinct of the entrepreneur is what drove that. Understand the problem, understand the patterns of the problem, solve the problem, reflect that back to the world at large. It becomes, you know, a self reinforcing echo chamber that allows you to build and build. So, you know, sometimes I think you got to twist the question, ask the entrepreneur if they're struggling with that.

Well, who's listening to you and what are you saying that they, you know, that they are telling you concretely is what they want to hear. You know, it's a bit of an echo and response

[00:19:35] Jay: Yeah, no, I liked that a lot. and I think a lot in a lot of ways. Establishing partnerships is a different flavor of sales and marketing, right? I mean, you are selling your partnership to the, and I remember sitting at a lunch one time with this partnership guy and I wasn't getting any traction. I could just tell it just wasn't a great, like, you know, it's just one of those call, you're just at lunch and you're talking and it's just, it wasn't hitting, I couldn't figure out why.

And I left that meeting and I was thinking, What the hell, what happened there? And it was because the epiphany that, Oh, I wasn't providing a value to him. Like he didn't give a shit that I was trying to pitch my, you know, whatever I was saying about how great of a, you know, QA partner we could be for them, a services partner, I wasn't showing him that I was going to solve his problem, which for a lot of those service part, you know, in our industry, it's, You know, companies want to make a product they don't want, they want to make a QA product.

They don't want to support it. They don't want to be the implementation partner or the, you know, whatever. So we would solve that for a bunch of different companies, but we weren't doing that for them. So it's a great point about, kind of working with and building that partnership in a way that's beneficial for both sides and solving the problem first.

And then having that answer when you go to them and say, these are what we're, this is what we're going to give you as a partner. Right. Cause that's all. Anybody cares about the end of the day is what are you going to do for me? Right, even a partnership so very cool stuff. all right. I have one more question for you non business related If you could do anything in the world and you knew you wouldn't fail what would it be?

[00:21:01] Jim: so, this is like an avocation of mine. so if you think about blockchain and you think about what it enables trustless transaction tracking.

[00:21:12] Jay: If you think about building an economy based on that, there's a tremendous amount of stuff that people do on a regular basis that they don't get credit for.

[00:21:24] Jim: And the further down into the economic strata you go, so the least, you know, the least supported groups in society, the more their activities are not tracked or not trackable, not traceable. Okay. So if we could enable blockchain platform that made it very easy for people to constantly track all the, you know, I lent so and so my, my lawnmower for two hours and get credit for that.

Okay. All right. So that, that presents your foundation. You didn't expect a long answer like this,

Well, I didn't expect it to include job costing but i'm gonna let you continue does. It's not really. so then, So then, the difference between the, you know, the economies of the world that are doing really well and the rest of the economy is the ability to have a security aftermarket. And traditionally securities have always been against hard assets, like houses and things like that.

So the difference between the United States and other countries, if you trace it all the way back, has to do with the fact that we made it very easy. To securitize a house and we made it very easy to securitize a piece of land or a business or what have you so you get bonds that's a leverage effect and that leverage effect is a multiplier so the value of everything that you have is much greater when it's securitized which then gives you know the United States a huge advantage over other countries that trail behind in securitization because we have more liquid capital in order to reinvest and therefore create greater innovation.

Well.

[00:23:05] Jay: You know, we talk about the fact that classes that, you know, there are people within the United States who don't have access to that ecosystem. It's because they don't have anything that securitize them. However, the latest technology in FinTech is beginning to realize that you can securitize streams of.

[00:23:26] Jim: of payments, not the thing itself. Well, if you take that one step further and you're able to securitize actual, you know, actual,transactions that aren't, don't involve monetary exchanges. Okay. I babysat for you. I let you, now your economy is magnified tenfold and suddenly money is flowing both directions.

Okay. So the reason why all of that's important is because. Capitalism has a counterflow problem. There are many ways in which money can be aggregated. There are very few ways for it to be dispersed. The government, stock market, etc. Okay. so if you had a foundational kind of blockchain infrastructure that was tracking all economic activity, it could also be an investment vehicle that would be far more, equitable and far more,risk, de risk than every other market out there.

And suddenly now you have a way for aggregated capital to be invested all the way through the economy rather than to a certain level and not beyond.

[00:24:43] Jay: I thought you were going to say, hike every trail in the world, but instead you hit me with foundational blockchain economic, you know, change in the world. So you're right. I was not expecting that. I think it's a very cool answer. I'm sure it's, you know, I went part of it went over my head, but I think I got the concept of it.

but no, dude, Jim, you're fantastic, man. If you want to find out more about you or about Dapt, how do they do that?

[00:25:06] Jim: my email is jim. keeney at dapt. tech and that's dapt. tech, D A P T E C H. And our website is dapt. tech. Again, T E C H. Feel free to look us up. Feel free to email me directly. I'm always interested in talking to people about DAPT and about, job cost accounting of all the interesting things.

[00:25:28] Jay: Beautiful. I love it. I'm sure there will be people who take you up on that. Jim, you're fantastic brother. best of luck with the, have a happy holiday season. We'll talk to you again soon. All right.

[00:25:37] Jim: Jay, thanks for having me. I enjoyed it very much and look forward to talking to you

[00:25:41] Jay: Absolutely. Thanks, Jim. See you, man.

[00:25:43] Jim: All right. Happy holidays. 

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