Social media is great, but human beings also love to socialize in person. Paint Nite is thriving by tapping into the desire human beings have to ‘hang out’ and do creative things.
Sramana Mitra: Let’s start with telling our audience a little bit about your personal background. Where were you born and raised? What kind of background?
Dan Hermann: I am now 43 years old. I was born in Boston and grew up in Newton, Massachusetts. I attended the University of Wisconsin. I started my first business at the age of 21. That business is a pick-up and delivery laundry service, which I still own today. We’re in six different states. I learned a great deal about operational businesses in that business.
I later attended Babson College for my MBA, which I did in the evening program. I completed that in 2005. My new company, Paint Nite, was started in March of 2012. I like to say that I did many mistakes in my first business, but I was fortunate enough not to make the same mistakes in the second one. We’ve grown by leaps and bounds. It has been a tremendous amount of fun and excitement along the way.
Sramana Mitra: Since you said you had so many mistakes in your first business, tell us a little bit about what your first business was. What were the top mistakes that you made in building that company?
Dan Hermann: That was a labor-intensive business. It’s also a very tight margin business. We held that business very closely. We worked very hard and I think we did far too much ourselves versus paying people outside the company to bring different aspects of the business into the company. In other words, splitting out the revenues.
Because it’s such a tight margin business, it’s a little more difficult to do that as well. Honestly, one of the things that I should have done with that business was to go out of business. Early on, it was a very difficult thing to grow and get out of that scrambling stage where you’re working 100 hours a week. I was still young and stubborn and didn’t want to give up. I stuck with that company for a long time. The amount of money that we were able to not only generate as a business but also take out of the company didn’t match how much effort we had to put in.
Sramana Mitra: With the business that you started next, what was the opportunity that you went after and how did you determine that that’s the business that you wanted to build?
Dan Hermann: A good friend of mine, Sean McGrail, is in sales. He’s also from Boston. I was friends with him for a number of years before we started Paint Nite. Sean was always somebody that I had thought would make a great business partner. He had some skills that were very complementary to my own. I was much more on the operations side of the business, and he was a natural sales person.
I had already been in the business that didn’t have a lot of sales within its organization. I was aware of how expensive sales were and how important they were. I always thought that he would make a great partner for me. We also were pretty good friends.