Transcription

@0:00 - Gabriel Flores (The Shades of Entrepreneurship)

Hello everyone and welcome to the shades of entrepreneurship. This is your host mr.

florids today I'm here with mr. of Michael Hoffman Michael. How are we doing?

@0:21 - Michael Hoffmann

Gabriel fired up to be here.

@0:23 - Gabriel Flores (The Shades of Entrepreneurship)

I'm I'm stoked guys Another fellow local Oregonian. He's actually down there in Eugene, Oregon Where you currently number one Oregon ducks are sitting atop the college football rankings Don't be mad if you are not in the Pacific Northwest folks But we are very excited about our ducks here in Oregon.

@0:41 - Michael Hoffmann

Even if you're not a duck fan We are very excited about it, but enough about the ducks Michael go ahead and introduce yourself Who's Michael Hoffman tell us a little about yourself Yeah, so you know a little bit about me is I'm the classic entrepreneur got my hands and a lot of different things Originally grew up in the Midwest

went out to the Silicon Valley down in the bay to help sort of start up back in 2014 and then moved up here to Oregon right before COVID and the rest is history.

@1:14 - Gabriel Flores (The Shades of Entrepreneurship)

So what was that 2014 startup?

@1:17 - Michael Hoffmann

Tell me a little bit about that one. Yeah, it was a startup in sports actually, speaking at Oregon, but it was all around injury, analytics, injury prevention, prediction type software based.

were literally founded right across the street from Facebook. So there was a lot of that energy around there to build software and scale it.

And it was a fun experience being in the bay for so long, especially coming from rural Iowa.

@1:47 - Gabriel Flores (The Shades of Entrepreneurship)

So it's definitely out of my comfort zone. Yeah. So let's talk about good old Iowa, the Hawkeyes out there.

So tell me how how did you transition? kind of what, how did you get from, you know, rural Iowa to Silicon Valley?

@2:03 - Michael Hoffmann

Yeah, so my background growing up, you know, grew up in a town of like 500, classic farm, you know, some cows, showed 4-H FFA, that whole thing, and my dad ran his own vet clinic.

So, kind of got exposed to the whole, you know, entrepreneurial side of things, and you know, did the whole lemonade stand growing up, worked up the McDonalds franchise, that was the only gas station, and like a 20-minute radius, and also a fast food station.

So, you know, kind of did some signs early on that pointed me down this path, and then came across the founder of a company at a conference in Exercise Science, Strength, Conditioning, which is what I went to college to study.

And he's like, hey, you know, I think I was in polling number five. Do you want to move out to California and to the Bay, most expensive part of the world?

Palo Alto and like, yeah, why not? that was 2014. And it was just a whole different experience, being out there and then brought it up to Oregon.

@3:11 - Gabriel Flores (The Shades of Entrepreneurship)

Well, I love, you know, I got to tell you folks, I graduated, you know, I'm from Oregon, Mount Angel, Oregon, small German community.

I think I had about 30 people in my graduating class. Yeah, I think we're just a little bit bigger than you.

I think we're about that 2500, maybe about that time of population. But to your point, we didn't, we didn't have a street like, we actually had no big mom and pop shops there in Mount Angel steel.

Currently, there are no like large brands. It's all mom and pop individual entrepreneur businesses there. And very similar to you, traffic was essentially getting stuck behind livestock cross or trailer, you know.

So tell me about some of your experiences. How did you tell me about your experience? You mentioned being in Iowa, being on the farm, and then you kind of taking it and learning, taking that experience and taking to Silicon Valley.

Tell me about some of that. transition of the things that you learned there in the fields of Iowa. And how did that translate over to Silicon Valley?

@4:06 - Michael Hoffmann

Yeah, by the way, Mount Angel, you didn't even give your little October fest.

@4:10 - Gabriel Flores (The Shades of Entrepreneurship)

I know next year, folks, I'll be there October fest. Come on down, check out the boys, the beer house and I'll give them a shot out.

So if you're in the Mount Angel, go to the beer house, or if you're in a Silverton, check out the gown house.

@4:22 - Michael Hoffmann

There you go, boys. love it. That's awesome. Yeah. So back to, you know, Iowa, I think the thing that I learned is is work ethic there.

The cows, the pigs, not going to feed themselves, whether it's Christmas day or, you know, getting back into the office, you know, that's the beauty of farming, is it's got to get done.

And so you kind of, you learn work ethic and, you know, people the right way of the whole Midwest values is something I'm very passionate about and integrity.

So that was something I brought out to Silicon Valley. was, you know, I think, Very advantageous, having been grown up around those kind of values, you know, you didn't have to coach work ethic with me when I when I got out there.

@5:11 - Gabriel Flores (The Shades of Entrepreneurship)

Yeah, you know, one thing I recently did this past week, well, the episode will probably be airing a little bit later, but I was recently the host, the Oregon Entrepreneurship Network Awards, and one of the things I talked about, you know, their, their theme was tradition meets innovation.

And so I talked about work in the fields of Mount Angel. And I'll tell you folks, individuals that are within that Marion County region, there's a probably strong probability those individuals have worked on the field at some point in their life.

They probably have done some, some type of field work, either mowing the lawns or bailing hay or picking berries, pulling plants, know, moving pipe that they're all sorts of things.

Now, now tell us about your current venture, you mentioned, you kind of moved from Silicon Valley to the Portland.

@5:54 - Michael Hoffmann

So tell us a little bit more about what you're doing specifically, and then tell us about that transition up north.

Yeah, so we moved up here for my wife's job. We had met in the bay and she was actually at Stanford at the time.

She took a job at Oregon. So we moved up here and I went remote and got into some different things, invested in a short-term rental and over in Bend and did some different things, started a vending right out here in Eugene.

So yeah, just kind of that classic entrepreneur trying different things and see what sticks type of mindset.

@6:36 - Gabriel Flores (The Shades of Entrepreneurship)

So tell us about some of it because, know, you're Mr. Passive. So tell us about some of your passive incomes that we currently have.

@6:47 - Michael Hoffmann

Yes, I currently have a little bit of everything. You know, we got a short-term rental that is managed third-party down in Florida.

near Clearwater Beach, we got so we're doing a real estate development, which I was kind of like the silent.

You could say in Corvallis building multiple units on one plot of land, some more of a value add on some land.

And then, you know, we got vending routes in four different cities across the country and Bitcoin mining, e-commerce store, so all kinds of things where I really like to roll up my sleeves, get involved initially and then figure out how do we build the operations and automate and delegate to, you know, I want to remove myself from the business as quick as possible.

@7:46 - Gabriel Flores (The Shades of Entrepreneurship)

You know, it's interesting is you're kind of in a lot of different verticals, right? So let's talk a little bit about risk, because I think entrepreneurship and itself, it has its fair share of risks.

How do you kind of view risk when you're kind of, you know, looking at a new venture and then how do you determine what this is a venture I'm willing to take the risk on?

@8:12 - Michael Hoffmann

Yeah, that's a loaded question for me. You know, I think it's a little bit of, it's just like your portfolio, right?

You get your higher risk, higher reward type items, and then you get your lower risk, lower reward type items.

So, you know, if we use vending, for example, the thing that really intrigued me about that was I could get the cash flow per month, the equivalent of what I would be getting for my rentals, and I wouldn't have to put the down payment of like a house to get a machine, like I could and then use a cash flow to pay it off.

So, for me, it was a little bit lower risk, know, like this build, this development we're doing in Corralis is definitely more risk, but

Um, you know, the upside's a lot more. So I just kind of look at it as like having kind of a balanced portfolio.

@9:05 - Gabriel Flores (The Shades of Entrepreneurship)

Smart, smart, like, and that's, that's a good point too. Like I think some people when they think of investments, they tend to go kind of deep into a specific area, right?

it's real estate or maybe the stock market kind of tell me about your philosophy in regards to the diversification of your portfolio.

What, what are their specific industries you look at?

@9:26 - Michael Hoffmann

Or you just kind of look at them all and see what's available. Yeah, kind of like to look at them all and see what's available.

And then wherever we're having success, really try to double down.

@9:41 - Gabriel Flores (The Shades of Entrepreneurship)

Now, let's talk about that success, which, which were, which current passive venture have you gone through, uh, been the most successful.

And then which one has been the most difficult?

@9:53 - Michael Hoffmann

Oh, that's a good one. Um, probably the most successful is we did a, we bought a plot of land actually by Austin Stadium where we kind of little did a little zoning hack.

We did a house and an ADU on paper, but we fenced them off as in separate driveways is two houses.

So when you pulled up to the lot of land, you would have thought it was two lots because there was two houses side by side and fenced off and separately and all of that.

But on, on paper with the, the city and permits and stuff, it was a house in an ADU. Um, so we did that development.

That was really fun. Um, and I got an off the market offer for that. That actually was too good to, to pass up.

Uh, and so that's kind of what led me to this, the Corvallis thing is kind of similar concept. It was, uh, residential with one house on it, but the land is absolutely massive and we think we can build a eat on there.

So on the same law, So that's what we're striving to do, but I think what I didn't really work out was, you know, during COVID, I really got into like the e-commerce stores and doing the whole FBA, dropshipping, all of that, and realized real quick, know, that your store is only as good as what Amazon or Facebook or whatever Walmart online e-commerce thinks of it.

So it's kind of like, you know, when Trump was banned from Twitter, you know, if you get suspended from Amazon, good luck trying to keep that train of income going.

@11:37 - Gabriel Flores (The Shades of Entrepreneurship)

Yeah, that's very, very true, you know, kind of talk a little bit about love to know your experience with that specific area about the algorithms.

How did you, because it's very much like an algorithm game, right? Tell me about your experience with it.

@11:53 - Michael Hoffmann

Oh, it's a total algorithm game and the whole like nowadays, I don't I forget what they're, I always get them.

Confused, but like you got to get and Yeah, I think to me my experience was looking back on it a little probably too much risk You know You're really trying to play the guessing game and timing things.

I remember one time we hit the jackpot with some ice melt In our drop shipping store because there was a massive winter storm that went through the Midwest and the Northeast and it was total lock It was like trying to time the market with the right products and that that really got us Into the algorithm, but I wish I could say we were smart, but you know We didn't look at the weather and Realize this huge storm was coming through and Yeah, it's just to me it was a little too much risk Yeah, and like folks like we're not trying to like say don't go into the fulfillment section with Amazon by any means But we are probably saying like be mindful because I think the amount of work that actually goes into being You know working with the Amazon fulfillment center, even though they do have all the things located there You

@13:00 - Gabriel Flores (The Shades of Entrepreneurship)

You're still the marketer, right? And you're still the sales person. You still have to go build that brand awareness.

You got to create your sales funnel, marketing funnel, get people aware of your product and service. then you kind of start having to do the algorithm game, Cause as Michael mentioned, know, it's, it really is about what the consumers think, you know, I keep telling people, if you think you're a thought leader, put your thoughts out in the market and the market will tell you what they think, you know, that, that tends to go well or sometimes it doesn't.

@13:27 - Michael Hoffmann

You're spot on. Yeah. That was very well said, 100%.

@13:32 - Gabriel Flores (The Shades of Entrepreneurship)

So what would you say now? You kind of talked about the, you know, easy stuff in this. Now let's talk about what you're currently doing.

I would love to kind of talk about the attention. Did you bring the company up from the Bay Area to Portland?

@13:45 - Michael Hoffmann

Are you still working in that startup as well? No. So I transitioned out about a year and a half ago or maybe it was two years ago.

Actually, it was two years ago, November. So I transitioned out. That was the classic, like he transitioned out. ask you to stay on as a consultant.

So I stayed on as a consultant until actually last month, just, you know, part time, couple hours of month type of thing.

But I went all in on really kind of flipping this whole archaic bending industry on its head with what I call luxury unattended retail.

So you think about going through the airport and there's the Hudson Book store that literally got no employees. And you can even at the motor center, I remember going to a game last year and I went and got a bottle of water and, you know, fast food sandwich.

And I didn't talk to anyone. You just put your phone on there, the gates open, and you grab your items and you walk out and the cameras track you.

So we do a ton of AI camera based micro markets that we help people with unintended retail solutions. I help people across the country and build their quote on quote.

routes wherever they live.

@15:02 - Gabriel Flores (The Shades of Entrepreneurship)

Wow and I was kind of funny you mentioned I was just in the Seattle airport the other day. would throw a Hudson and sure enough there's a there's the register and I nobody to talk to but I just don't scan my thing and keep going.

It's it's very convenient but and then you mentioned Motor Center too. Yeah they even have it for the beers and it's very interesting to have a gate right there and once you pay the gates will open up and let you out.

That's such a really unique concept. were some of the challenges did you guys face in that specific vertical you know with the AI kind of making sure or some of the things that you kind of had to make sure it kind of got down and one of the things you're like wow that was really cool we learned that.

@15:40 - Michael Hoffmann

Yeah so anytime you're dealing with humans and tech there's always going to be human air so for us a lot of it was like when you install these things you got to build out what's called planing grams so okay if this is a shelf what's in the top right of the shelf is it toothpaste is it a hot dog is it a bag of chips

Minnesota. And so you build out your planogram, so the AI cameras whenever, you know, comes through that gate to grab something off that shelf.

It's tracking it through there and charging appropriately. then the other side of it too is we do a lot of stuff in college towns and, you know, those gates aren't going to prevent the two of AM drunk college kid from jumping over and grabbing something.

So we do a lot of, like, AI coolers where the doors actually walked in, then you have to put your credit card or debit card or Apple Pay on the door, then it unlocks, and then you can grab everything.

you know, it kind of prevents the staff that people might think about with some of these types of solutions.

@16:43 - Gabriel Flores (The Shades of Entrepreneurship)

You know, that's one thing you just mentioned that is very interesting with the planning concept, right? really making sure that AI knows where, I'm assuming like the size and the shape of the products that are on the, does that also kind of track?

And then like, how does it track? And how does it kind of dictate the like making sure the prices remain the same and things of that nature?

@17:05 - Michael Hoffmann

Yeah, so uses a lot of them will use like computer vision tracking and your spot on when you Basically, it knows like okay, this shelf is two feet wide and this Box of popcorn is six inches.

So now we have 18 inches left of space to You know these two inch snickers five inch hot dog, whatever.

So yeah, it will Know basically what you grab it also tracks if you put something back and grab something else So that computation It's it's crazy with AI and I imagine this is probably also helping like operations and logistics because like hey now i'm How much quantity I have left in my backstocks and it's kind of wow Yeah, it's making a lot easier Yes, we have over 50 locations and just from my phone and I mean I can immediately go in and I'll see you okay

And like, what's the revenue of a location to what's the inventory of a location three, like, what's running low, you know, like all those things are being tracked and consolidated.

@18:11 - Gabriel Flores (The Shades of Entrepreneurship)

What are what would you say are some of the unique insights that you have learned by tracking the information?

Like, for example, like, what is the most purchased item or or things like that? what insights have you learned?

@18:23 - Michael Hoffmann

Yeah, so for me, it's this, I went kind of down this path inadvertently because I was trying to I was going through the airport one time and I actually missed a flight because of a delay in Denver at 11 p.m.

there was nothing open and there was no Hudson open, there was no Chick-fil-A open, there was nothing open. So I went to the vending machine, I paid five bucks for a bottle of water.

I knew that water was like 60 cents at Costco and some guy was making whatever 400% off of me and he was clearly at home sleeping and I'm.

one busting my  for my day job. So long story short, that's kind of what got me into it, but it was really with my background with human performance and health.

I've been on this mission to kind of get after the now as I guess people call it the make America healthy again, but really trying to get after this obesity issue.

so initially when I started out, you know, with my first machines, it was Diet Coke and Snickers, but we're really meeting people in the middle and trying to kind of get past that mentality.

And we're doing I mean, in these machines, can do whatever you want, hard-boiled eggs, you can do, you know, fresh protein packets, you can do sandwiches, salads.

So it's not just, okay, it's an M&M, it's an diet Coke that comes down with any motor that we're used to.

@19:56 - Gabriel Flores (The Shades of Entrepreneurship)

Yeah, you know, you mentioned that like the obesity and the Maybe he's a good former gas verda. Go folks, check it out, the shades of B dot com.

Saw me thinking and talks about their kind of four way into that area, too, especially with all the new medications that are coming out, the weight loss drugs, it seems to be kind of front and center again, the Americans health, right, trying to tame a lot of that.

Now, you kind of mentioned a couple of months ago, you kind of ended your consulting with the team. So what does Michael's kind of future look like?

@20:32 - Michael Hoffmann

are you getting into now? Yeah, I want to do more of these AI focused, unintended retail, know, if you are following anything in the economy, Walgreens is closing down 1,200 stores.

Yes, it's closing down a ton dollar tree, et cetera. now is, there's no better time. People are going to pay for and people are going to, they don't want to spend 30.

dollars on a door to ask sure. So, you know, I'm doubling down on how do we make things more convenient?

Do we put these AI micromarts and like employee break rooms and teachers lounges? You know, because at the end of the day, it's just such a modern approach to what old school vending was.

@21:21 - Gabriel Flores (The Shades of Entrepreneurship)

Yeah, I agree. Like, you know, lot of people don't know this, but most of these stores, restaurants, know, they kind of look at their location on how much revenue do they make on a per square foot basis?

You know, so when you're going out there and if you're not selling, if you have a, let's say, Walgreens is probably like, what, 36?

know almost like 4,500 square feet roughly. That's not counting the back storage. probably talking about straight retail space. And if you do that, and you're not selling, you know, lot of items, but yet you still have 20 employees working, you know, 8-hour shifts every day, that the operational cost will tend to eat into.

that profitability pretty quickly. And again, it's based off of that revenue per square foot. Now, I'm not saying folks should go and relieve their frontline employees and just gonna go automation, go straight to AI.

But what I am saying is when you start to scale your business, think about the long overall needs of it as well.

do you really need the location to be big enough to also store all of your back store items, right?

Or can you have that out of the outside location that's specifically drawing cold storage, know? So just kind of think about those things because if you're able to kind of create a more efficient, small, compact location, Michael's trying to hope to create, I also see the value and the revenue of probability in that kind of venture.

@22:44 - Michael Hoffmann

Yeah, well, and with kind of, you would be able to understand this, but you think like these medical offices where they have the coffee shop on a lobby that right now is open to 10 or 11 a.m.

because they can't find enough employees to keep it open. been all day and so these nurses these you know you got oncology on the first floor x-rays on the second floor whatever on or you know on the third floor and like all these people are like what do we do or do we go and we don't want to we don't have time to leave and we don't want pay $30 to door dash something here so I have like a vision someday where you got your micro market or whatever downstairs and it's kind of like Instacart to get it there or Instacart alerts you and then you get the little robot that drives around and takes it up to wherever your office is and drops it off or in goes back down to the the micromarts now just like the last mile like uber that is actually yeah we'll talk more about that offline because now you got me really how you got my ears broken up because again you know I work in the healthcare industry folks been in been in it for almost you know over two decades now and one of the things that's very interesting one healthcare never sleeps we're open 24-7 you know if it's a hospital outpatient clinic

@24:00 - Gabriel Flores (The Shades of Entrepreneurship)

or they have their hours of operations, but we get patients in throughout all hours of the night. one of the things that's sometimes difficult with hospitals is specifically with patients.

When they come in and our grills are already closed. It's like, oh, I'm sorry you came in at night.

grill just closed at 8.30. It doesn't open up again until five in the morning. know, so that's a huge window where our patients and their guests, right?

Because I'm Latino. if we're coming to an hospital, I'm bringing the whole family or I ever come in like 30 deep.

And so it's like, I want to make sure those people feel cared for and about as well. So yeah, I do believe there is a big need for it, especially when you look at it on that perspective, right?

Again, we're not trying to replace employees, but we are trying to provide an additional service that helps keep the employees that are continuously working on those off hours supported, right?

@24:53 - Michael Hoffmann

Absolutely. And think about hospitals and they're so big and like the ER is down this wing and you take a left and a right and like...

@25:00 - Gabriel Flores (The Shades of Entrepreneurship)

Those family members that are there with you, not going to know how to even get to the cafeteria I don't want as a cafeteria even open and so like you can do like these what I would call like pop-ups and different parts of the wings We have we do a ton of these on the medical Offices that are next to the hospital because all those nurses and docs don't want to walk over to the hospital and wait in line at the grill At for their their lunch because now they're not going to be back in time for their appointment after lunch So it's just a at the end of the day it comes back to convenience Yeah, and I'm also thinking of the the docs in the OR like you know Yeah, you have to scrub out and scrub back in and you have a patient on the table the case is going and you You really can't really leave that floor sometimes You know in that that unit and so being close to that location Captures in the third floor, you know, Michael you're talking about large if anybody's seen the Oregon Health Science University campus in Portland I mean, we have a dang train that connects our building because we're so huge, you know, so it's a big place So so Michael

I mean, about, you know, you talk about Mr. Passip and you're trying to continue to build it. How are you building this brand, the AI specific brand?

@26:06 - Michael Hoffmann

You know, how, how do you build new clients? How do you kind of bring them into your funnel? Yeah, so there's a couple of things we do have like an in-house cold call center.

So I, I used to outsource lot of our lead gen and kind of off market leads through cold call centers and just didn't get, it wasn't cost effective.

I brought it in house. We do a lot of lead gen through just conversations. A great thing now with this kind of unattended retail space is, is it's such a new concept and all they know is like the Coke machine.

Like, oh, yeah, I can just go down to the Coke machine and enter in the codes. And I got five different drinks selections.

We're now it's like, okay, well, you get this whole market. Do you want sandwiches? Do you want cokes? Like, do you want in the hospitals case, we could do like night quilt, day quilt, time level.

Like at the end of the day, cameras, you just set it, the planner. into whatever's in this thing. So, for me, it's more just kind of elevating what people currently have as a solution and just trying to coach people out in our community across the country on how to position and do the same thing we're doing here in Oregon.

@27:20 - Gabriel Flores (The Shades of Entrepreneurship)

Yeah, I love it. Now, what would you say? What are some items that maybe could not like, I'm not trying to envision.

trying to think of what items maybe couldn't go in there, because as you mentioned, you know, you can have a door with a lock, right?

Open it up. items wouldn't you put in there?

@27:35 - Michael Hoffmann

I mean, you just put everything in you can put anything. mean, we can we do everything from toilet paper to paper towels to, you know, people here venting and I think, oh, it's just like snacks and maybe some fresh food and but like in our apartment complexes again, a lot of these places, they don't want them to work.

walk over to the the CVS at two in the morning to get, I don't know, condoms or, you know, if it's a hotel phone charger or a laptop charger.

So you can really do anything and you're starting to see this even in airports like when you walk through the Seattle airport.

Now there's like Lego machines and just like these random, which isn't a bad idea because I have two kids.

I would probably pay 70 bucks for a Lego set to keep them occupied on a six hour flight across the country.

That's a great ROI. So yeah, yeah, I think it's kind of the world's your oyster when it comes to those type of things.

It's more what's the environment? Like I come back to like, okay, energy and care. If they don't want to go over to get to the wall range, like why don't just put all the over the counter stuff in the machine next to the snacks and drinks?

@28:47 - Gabriel Flores (The Shades of Entrepreneurship)

Yeah, I'm starting to think like the benefit of it from like so many different avenues because again, you know, very much like, you know, entrepreneurship folks, you're going to have to provide a different message for each target audience and you have

know what those needs are, right? So like Michael was mentioning, if you're in the urgent care ED, you know, having those over the counter medications available so those individuals don't have to go to the pharmacy.

Or if you're in OR, we're having some food and beverages, things that are very easy to you know, consume very quickly, give you a boost of protein, boost of energy, maybe some electrolytes, right?

the hotel, you know, their phone charger.

@29:25 - Michael Hoffmann

Yeah, well, and Gabriel, this is this is at the end of the day, it's understanding your customer and understanding and like that.

All three of those examples are perfect examples. Like I think of hotels, hotels already have a grab-and-go where hotels have friction is you go to grab those items.

What do you have to do? You have to go wait in line behind someone checking in and you're like, I just have this bottle of water.

Why am I waiting 20 minutes to say, hey, can you throw that on room five or four? Like, let's just throw a kiosk in the grab-and-go so you can just go swipe your barcode and pay it with your room.

in charge and you're on your way.

@30:02 - Gabriel Flores (The Shades of Entrepreneurship)

It's all we're using friction. It's so it's funny. I was thinking I was mentioning right before we got on the air, was down in Medford, Oregon.

about three and a half hours south of here, folks. I was at the Hilton and that same thing happened.

It's like 11 o'clock at night, got done from a dinner, worked dinner and I was grabbing a bottle of water and some M&M.

I'm like, I'm down here for 20 minutes for a bottle of water and M&M's. Just put it on 219.

I'm going to go back to bed. just want some water and a quick sugar rush. So let's talk about now the implementation.

So maybe there's one of your clients listening that's interested in having this implemented in their hospital or their building or maybe with their organization.

What is the cost of implementation and then what can I generally expect when that ROI will kick in?

@30:46 - Michael Hoffmann

Yeah, so if we're talking and let's say someone on the call here is like, hey, YMCA, I go work out every morning.

It would be perfect to put something in the lobby at the Y. if you're going there, first your position yourself at the

and then an amenity and then why I'm saying like hey yeah bring up put a micro market in the lobby here so when you talk cost the great thing about this is it's very similar to the automobile industry and that they're gonna all these manufacturers gonna say all right Gabriel do you want to finance it or do you want to pay for it up front so if you pay for it up front you're probably looking at let's say eight to ten grand if you finance it you're looking at let's say 180 bucks a month over 60 months so let's just go down the path of we're gonna finance it so that location would probably do around our average locations do around 1500 to 2500 bucks a month in revenue so that location you're probably going by there twice a week probably takes a half hour to stock it let's say an hour or a drive time and all of that another hour or a week of getting your product and and so you're in it three hours a week and so

Um, you know, of that, let's say two grand for a simple math, uh, your profits are probably around 50 to 55%.

If you're doing it yourself, if you're like me, where it's like, okay, I learned it. Now I want to hire a stock urn operator at 20 or 25 bucks an hour to go through all of that.

Um, you know, your margins might be down to 40% after, uh, of all ends. So that's a typical way to do it.

I personally finance all my machines and then I try to pay them off in the per share with cash flow smart smart.

@32:31 - Gabriel Flores (The Shades of Entrepreneurship)

And now is there so for example, the healthcare industry might be little bit more unique, right, where they're also trying to create their own revenue.

Is there also models where you actually sell off the AI software and then, you know, I guess it's very similar, right?

They, they, they will now become the fulfilling, right?

@32:50 - Michael Hoffmann

They become the supplier of the food and the, they have their own employees, right? Yeah, they could. mean, absolutely.

I think what you're, what you're starting to see in the market right now is. employees are a headache for these people and so it's they'd rather outsource it a great example is probably that Hilton and Medford that market you the the grab-and-go at the Hilton probably had a lot of empty items like right now kind of the hot button and hotels is like how do we be outsourced things like we want to cut staff at the local level like why do we need 20 staff if we can get 10 and centralize the call center for check-in check out questions etc so actually lot of these locations are trying to outsource a lot of these these operations so it's kind of a perfect strong yeah because I imagine you know the initial cost I think it says 8 to 10k right or something similar to that or maybe little worth of that depending on the size right but I imagine the cost of an employee plus benefits that's basically what maybe a couple months of the year getting return

@34:00 - Gabriel Flores (The Shades of Entrepreneurship)

investment back pretty quickly.

@34:02 - Michael Hoffmann

Yeah, in fact, I was talking, so I have a friend that runs a crossfit gym here in Eugene, and he's like, Hey, can you just come by and give me some feedback?

So he has these, he, you know, post workout at this crossfit, Jimmy has a refrigerator with a bunch of energy drinks, shake, water, and then he has supplements up on the wall.

And it's a total honor system. So people come and go, you know, they write down if they grab the water, lot of people forget.

And he really was doing the math. He's like, okay, if I put in one smart machine, that's, let's say, I think they're like $5,500.

If I put in one smart machine, that's $160 financing payment over 60 months or sorry, $130. Anyway, he's like, that's, that's five hours of I put an employee at the front desk monitoring this cooler that people are literally grabbing their water.

He's like, that's five hours a month of he's basically viewing this AI cooler as is

@35:00 - Gabriel Flores (The Shades of Entrepreneurship)

front desk reception for this product.

@35:03 - Michael Hoffmann

I'm like, that's a brilliant business case.

@35:05 - Gabriel Flores (The Shades of Entrepreneurship)

Yeah, no, I agree. I agree. And again, I'm thinking about the healthcare world. The, the mound of, I would say energy spent working night shift is is astronomical.

I think people understand I work night shift for a couple of years in the ED as well. And it's a lot it wears your body quite a bit.

And especially if you're, you know, in the food and industry, you know, some of those workers aren't getting paid the best.

Now, granted, know, our union for Oregon Health Science, you originally did a very good job about helping those employees make sure they get some shift for a differential pay for those shifts.

But still, you know, the wear and tear on your body, no amount of money, I don't think would ever compensate for sometimes the wear and tear in your body that those shifts take.

And so thinking about from a health perspective of an employee as well, having those options, it could also be a benefit for that overall health of their employee.

@36:00 - Michael Hoffmann

100% absolutely.

@36:03 - Gabriel Flores (The Shades of Entrepreneurship)

Now, what advice, you know, you've been doing this or do a few different entrepreneurial adventures, what advice would you have for an aspiring entrepreneur that's listening?

@36:14 - Michael Hoffmann

Um, you just got to start, you know, there's no perfect time. There's no perfect book that's going to lay it out for you.

You just got to kind of roll up your sleeves and jump in. that's why I was, I was actually joking before this, this zoom, like I'm, I'm not a good operations guy, like I'm a visionary, but like operations is where I struggle.

Like if we talk, like the EOS mindset, I'm not an integrator, but you know, Fridays are always super stressful for me because it's like, you got to do payroll, you got to close out, you know, the books, you got to do all the like back end stuff that I am just terrible at, but like that's part of entrepreneurship.

also don't have a boss. and do what I want when I want and you know there's that side of it and for me it's all about freedom like time is the number one currency and yeah it's I want to be president dad like that's what drives me every day is with two young girls so I think for me just gotta start with entrepreneurship and be curious and be persistent because it's not easy yeah I I completely agree it's not easy it's a long a lot of long hours and I would say my my enrichment from the whole process right my enjoyment is similar to yours they'd be able to remove myself from this desk at around five o'clock at night go upstairs sit down with my wife and two little girls I have four-year-old and a one-year-old and eat dinner no TV no music and there's chat with kids and every day I'm asking my four-year-old hey how was school today what projects to do did you guys eat inside or outside you know just having those conversations building that rapport with them because this is everything

@38:00 - Gabriel Flores (The Shades of Entrepreneurship)

we do is for them, right? I always look at my goal, right, is to help build generational wealth and establish it.

So if you go check out LatinoFounder.com, you'll learn about the nonprofit. really, my all the money I'm trying to make is so my kids can have a better life moving forward.

You know, my parents made sure we felt rich. You know, they did a lot of things that made us felt rich.

I remember one year at Christmas, we all had bites, you know, I was like, oh my God, it's crazy.

I was telling one of the former guests, I was like, I never actually jumped on a plane until I was 17 years old.

That was the first time I ever took a flight ever in my entire life, you know. And so and now my kid is like one years old and we're flying over to Missouri to see the in-laws.

And so it's like the very drastically difference. But at the same time, the building the generational wealth is really important in trying to establish that entrepreneurship created passive incomes.

That's one way to do it. You know, sometimes it's not for everybody, a lot of hard work won't lie.

I'm with Michael. not an operations guy. and the visionary, I'll create a strategic plan for you. I'll create a roadmap for you to help you get point A to point B, and I'll help you create tactics and define those tactics with KPIs.

But once it gets to the operational efficiency and integration, I love to hand that off to somebody else. I was going to help me get there.

@39:20 - Michael Hoffmann

Yeah, no, absolutely. That's very well said.

@39:24 - Gabriel Flores (The Shades of Entrepreneurship)

So Michael, now folks that might be interested in maybe learning about you. Maybe they want to connect with you.

Maybe they want to purchase this product.

@39:29 - Michael Hoffmann

How do they connect you online? Where do they find you at? Yeah, so definitely I'm an open book on social media.

You can go to, I think my handle on X now, but Mr. know, Instagram, same thing, YouTube, et cetera.

You can find me on there. I'm very passionate about what I'm I'm set with entrepreneurship is very similar to like Mark Cuban and like, I don't believe in patents and.

keeping all my secrets. I share all my knowledge for folks openly and just want to be a resource because the more you can impact other people like you're doing with a lot of your stuff, you know, a huge believer in that.

So yeah, definitely, feel free to reach out on Twitter, Instagram or whatever social media channel you guys prefer.

@40:24 - Gabriel Flores (The Shades of Entrepreneurship)

Perfect. Again, folks, I'm very much the same way. Check out theshadesab.com. There's a lot of blog posts. In fact, we'll have a blog post about this conversation with Michael kind of pulling out some tips and some insights from the conversation.

We'll also have a transcription of this conversation on theshadesab.com. So please make sure you just subscribe to that because I am also a firm believer in sharing best practices.

My goal is to help you avoid the landmines. I always tell folks if don't be afraid of sharing your idea because if if somebody wanted to do that idea, they'd be doing it already.

It's not easy. It's not easy to get successful. It's not easy to find success. Everybody talks about, you know, one hit.

wonders. Well, nobody talks about the hours and songs and albums that were released before that one song, you know, and so there's a lot of work that goes into it.

As I mentioned, I'm not trying to discourage anybody, but it's not for everyone, you know, so it's okay to share those ideas and share those ideas and people within the market and the vertical you're interested in going into, you know, they might have some insights of landmines to avoid or our partners to identify collaborators to think about.

You know, there's there's people out there that are willing to be a mentor to you to help you along your entrepreneurial journey.

You just kind of have to ask. Like Michael said, you kind of have to do it. You kind of have to put one forward and jump out there.

It's scary. Sometimes it's you kind of jump out there, but it's fun. There's there's nothing more fun than entrepreneurship.

@41:48 - Michael Hoffmann

Absolutely. Yeah, it's like riding a bike.

@41:49 - Gabriel Flores (The Shades of Entrepreneurship)

You just kind of get going. Yeah, you're going to fall a few times.

@41:53 - Michael Hoffmann

Yeah, you're going to fall.

@41:54 - Gabriel Flores (The Shades of Entrepreneurship)

But once you're able to hit that pop will, it's pretty cool because that's actually a great. analogy of entrepreneurship where it's like, there's going to be times we're going to have the pedal, and we're going to have the pedal really hard.

And there's other times you're coasting downhill, you know, hundred percent. And it's always different. It's always different. Now, Michael, is there anything that you want to say to audience before we leave?

@42:16 - Michael Hoffmann

No, I think the number one thing that I come back to is don't be afraid to be professionally persistent.

Like I think humans, you know, if we look at it from a sales lens, like you and I have done before humans buy from humans, they don't just buy the best product a lot of times.

a lot of times, like, I mean, I think back to where I bought my car, where I got my iPhone, where I got this or that is like the sales rep that was the most persistent, like, you know, so don't be afraid to be persistent.

Don't be afraid to, it just drives me nuts when people are like, oh, I need a network and I'm waiting for them to email me back or like email again, provide value.

Like people, I want to help people. That's what I work human.

@43:00 - Gabriel Flores (The Shades of Entrepreneurship)

so persistence to me is always a game changer yes and you know what Michael I absolutely love what you said provide value folks if you're going to ask if you're coming with a request make sure it's of value so again my call to action for you guys to subscribe to the shades of entrepreneurship newsletter by visiting in the shades of e and I hope you find value from these conversations again these are individuals who have lived experience they have the successes the failures the trials and tribulations of entrepreneurship and they're providing their insights and expertise for free and then I'm summarizing it for you in a blog post and then we have a transcription so if you're can't hear very well you can read it I'm trying to provide every every option available for you to succeed in this in this ecosystem right of entrepreneurship because it there's a lot to do I love that absolutely well Michael thank you again so much for joining the show for those folks that are listening please subscribe to the shades of e by visiting the shades of e.com you can find us on youtube uh

Apple, Spotify, then all other you podcast serving stations. You can also find us on Instagram linked in Facebook and TikTok at the Shades of E.

Thank you and have a great night.