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1Mby1M Deal Radar 2012: Nerds On Call, Redding California

Posted on Monday, Jun 18th 2012

Individual consumers and independent contractors, probably more than any others, need affordable computer repairs and services. Fortunately, companies like Redding, California–based Nerds On Call, many can satisfy that need. Founded in March 2004, Nerds On Call offers on-site computer and laptop repair services to consumers and businesses. Nerds On Call provides troubleshooting for PCs and Macs, home and office networks, printers, iPods and other MP3 players, handheld devices, and cell phones, home theaters and game systems, and virtually every other form of digital equipment. 

In 2009, 2010, and 2011 Nerds On Call landed on Inc. magazine’s list of 5000 fastest growing private companies. With 15 locations across California, Oregon, Washington, and Arizona, Nerds On Call serves more than 40,000 satisfied customers per year.

Co-founder and CEO Andrea Eldridge oversees a staff of schedulers and technicians as well as corporate finances and has been instrumental in the development of marketing campaigns that have introduced Nerds On Call to communities around the western states mentioned above.

Prior to establishing Nerds On Call, Eldridge served as president of Internet Billing Services, Inc., which provided website management and online bill-pay processing for web-based clients. Her responsibilities included coordinating online technical support for website users and on-site computer repair and networking services for enterprise clients. Prior to that she was a senior real estate administrator for Merrill Lynch Trust Company, where she oversaw properties held in trust.

Eldridge earned a bachelor’s degree in international relations and French from the University of California, Davis.

Co-founder Ryan Eldridge is the senior vice president of Nerds On Call, overseeing customer relations, marketing, and software development for managing customer data and inventory. Prior to establishing Nerds On Call with his wife, Andrea, he served as CEO of Internet Billing Services, Inc., where he coordinated online technical support for website users and on-site computer repair and networking services for enterprise clients. Prior to that, he served as CEO of Imperial Direct Marketing where he formed a staff of phone sales and support technicians, while developing the necessary infrastructure to manage the enterprise. He got his start in retail as general manager of J. Stephens.

Andrea Eldridge came up with the idea for Nerds On Call when her mother called her one day, frustrated and discouraged. Her mother’s computer wasn’t working, and she wanted to know if Eldridge’s husband, Ryan, could please come over and either fix it or kill it. A virus had been wreaking havoc on the machine. After Ryan had fixed her problem, she turned to him and said, “Someone ought to start a company that sends people to your home to do this sort of thing. Kind of like a plumber for computers.”

That was the inspirational moment that brought Nerds On Call to the world. Andrea believed that if her mother needed this service, there must be other moms out there in need of a computer house call. Shortly thereafter, the first Nerds advertisements hit the local papers. Cautiously optimistic, yet trying to remain practical, Eldridge put her cell phone number on the first flyer so she would always available.

She did not image how well received the service would be. Word of the business quickly spread and within only a few weeks, the Eldridges began looking for qualified, friendly people to bring on board as Nerds On Call employees. Within months, the service moved out of the Eldridge’s home and into its current Redding office location. Over the years, the company expanded beyond California’s borders and started providing services for individuals and businesses in Washington state, Oregon, and Arizona.

Best Buy acquired Geek Squad in 2003, signaling the emergence of a new computer repair industry.  Geek Squad took computer repair from the back room of a small electronics store and put it center stage in every Best Buy store in the nation.  However, the roll-out was slow and not without a few growing pains.

In early 2004, when Nerds On Call was founded, computer repair companies were still mostly mom-and-pop shops serving customers within small geographic areas. The small shops varied in quality and service, and many modeled themselves after a dying service industry for televisions and other household electronics like sewing machines and vacuums.

When Nerds On Call opened its doors, the technicians were working out of the Eldridges’ home.  Nerds offered exclusive onsite service, which meant customers didn’t have to worry about dismantling their machines for service or worry about tackling a mess of wires when they attempted to set them back up again.  Nerds would work on the machines with the customers sitting beside them, asking questions, taking notes, and discussing new ways to use their computers. Sometimes, repairs could take hours to complete.

The Eldridges believe that Nerds On Call penetrated the market because as Best Buy was tackling a national roll-out with the Geek Squad, it couldn’t see Nerds On Call’s massive expansion right under its nose. With its competition being a fragmented service industry run by small town repair shops and one major retailer worried more about the margins on inventory, the Eldridges think that Nerds On Call just has to be available to service competitors’ unhappy customers in order acquire new ones.

Nerds On Call sets itself apart from competitors, particularly Best Buy’s Geek Squad, by providing consistent service, competitive pricing and warranty work. Although the company serves individuals and businesses, the target market is women over 30, whom the founders say usually act as the decision makers in families when it comes to repairs.

Currently, the company serves 400 customers per week, with 260 of these as returning customers. The company charges a flat rate $160 a service and earns, on average, $64,000 a week. Nerds On Call offers customers a recurring billing program that the founders refer to as the “online service plan,” which costs $25 a month. The company boasts 3,900 subscribers to the online service plan, with approximately 60 new members signing up each week.

The company’s annual revenue is between $4 million and $5 million annually. Research shows that 309 million U.S. homes have at least one computer. On average, customers require some type of computer repair 1.5 times each year. At $160 per service call, the total market could be $7.4 billion each year.

A completely bootstrapped company, Nerds On Call started with a $60,000 investment from the founders’ savings account. Profitable within 30 days of opening, the company has never taken any investment money and carries no debt.

As the company continues to maintain steady growth, the founders say that they are not seeking investors but are open to new ideas. Nerds On Call plans to expand by providing online service and repair. Because it is becoming more inconvenient for customers to wait for appointments, the founders realize that the wave of the future for Nerds On Call is remote services and having a presence in retail stores in high-traffic locations where people go to handle various chores and repairs in their homes.

The founders have no definitive exit strategy, choosing instead to focus on growth and creating an enduring business.

 

Recommended Reading:

The 1M/1M Deal Radar 2010: Craig Technologies, Cape Canaveral, Florida
The 1M/1M Deal Radar 2011: Artisan Infrastructure, Austin, Texas

 

This segment is a part in the series : 1Mby1M Deal Radar 2012

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To learn more about the Nerds On Call story, visit http://www.callnerds.com/the-nerds-on-call-story/

Shawna Bell Monday, June 18, 2012 at 10:17 AM PT