79: Growing a Startup from $0 to $6 million per year with Mickael Roger
What does it take to build a growing and scaling startup?
Determination, motivation and a great support network around you! Today’s episode of The Essential Shift Podcast is sure to inspire you to continue on your business journey.
Mickael Roger is the Co-Founder and Co-CEO of PropHero and today he shares with us how he went from a 0 to $6 million startup in two years. PropHero has recently been awarded the "Startup of the Year Award" and is changing the way we buy investment property.
Mickael shares his experience working with Essential Shift, his expertise and his story.
Fun fact: I was also his first property buyer with PropHero! Enjoy this podcast and be prepared to take many notes.
If you LOVED the episode, make sure you share this on your Instagram stories and tag me @essential.shift.
KEY EPISODE TAKEAWAYS
Behind the scenes of building a Startup from scratch
How to grow and scale a Startup
How mentoring and coaching can help build your vision
More on multiple income streams and investments (with property)
SHOW RESOURCES
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Bless it be.
With love, Laetitia!
ABOUT THE GUEST
Mickael Roger is co-founder and co-CEO of PropHero, a data-driven digital platform for property investment. PropHero helps you find, buy and manage the best investment properties.
Before founding PropHero, Mickael was an Associate Partner at McKinsey & Company, where he was leading the Data & Artificial Intelligence practice, serving clients in the Telco/Media/Tech, Private Equity and Financial Services industries. In 2017, he launched a new AI-powered commodity price forecasting capability for McKinsey, serving some of the largest commodity producers and traders to predict prices using artificial intelligence and develop advanced trading strategies.
Prior to joining McKinsey, Mickael worked as a Senior Consultant at Roland Berger Strategy Consultants in Paris and North Africa, where he focused on both strategic and restructuring topics, while developing M&A and financial advisory activities. Mickael Roger began his career as an M&A investment banker for UBS in London in 2011.
Mickael Roger holds a Master's Degree in Engineering from Telecom ParisTech and an MSc in International Finance from HEC Paris.
PODCAST TRANSCRIPT
Laetitia Andrac 0:14
Hello, Mickael, I'm so excited to welcome you on the essential shift podcast.
Mickael Roger 0:19
Thanks for having me, Laetitia.
Laetitia Andrac 0:21
I can't wait for everyone to be inspired by your success story. Because we often hear entrepreneurs who are struggling in business, they're not growing the business and for you, it's more like total opposites. Well, expansion quickly. But before we get into all the detail of the success that you're having today, all of that can you take us back to the origin story of your business? Why did you start it prop hero?
Mickael Roger 0:48
Yeah, so look, I think for as far as I can remember, I've always wanted to launch my own company. For a multitude of reasons I haven't up until I was 32. And then what happens? So at the time, I was a consultant at McKinsey, and I was one of the leaders of their data and AI practice. And well just like many employees, right, I had a little bit of savings but no time and I wanted to invest my savings, shares ETFs gold and real estate, buy ETF shares gold is super easy. You have apps easy right? Reset is more complex right there is like big process. It's lots of money, many stakeholders so because I didn't have time I hired a buyer's agent to help me. Yeah. And what I realized is that I gave this person a $35,000 house. Still, I spent like dozens of hours shaping what she was telling me. Everything was based on gut feeling everything was in person or by email or by phone calls, like massive waste of time and money. And I thought, well, not the best experience, not the best investment but a great business opportunity. So that's kind of like how I decided to leave my job at McKinsey and launch prop hero, which is basically replacing buyer's agents. So there are two values for Prop hero. If you want to invest in property, we'll do everything for you end to end from defining your strategy, finding the deals, negotiating prices, finding the property manager managing the property, Debra blah, blah, blah. And because we use data and AI and a network of partners that local real estate experts, we outperform the market between two and three times so that's how we we got to the idea of launching procure.
Laetitia Andrac 2:36
Yes. And I will always remember when you came into your hands and I apartments and in our living room and you showed us the pitch deck and with you and we're like okay, we're ready. We're gonna be the first one trying this we could seize your opportunity and we were stuck in not knowing enough to invest in the property market in Australia. And we were the one who diversified our assets everywhere. That in property because we didn't have everything we needed. So we validated your problem straightaway, and we were the first client on board but what was the vision you had for Prop hero? I think it's important also to go back to the vision you had because then when we're going to share, you know, the journey and where you're at now. I think again, you've outperformed the vision that we've defined together for Prop hero, but can you share with us a bit the vision you had at the time?
Mickael Roger 3:33
So I think that the the vision was really about well, how can we reinvent this industry to make it as simple and transparent and profitable as investing in in chairs, right as long as like the vision and so I've kind of like simplified the view in my in my previous answer. But so the vision in more conceptually is to become your digital property wealth partner for life. Right? That's what we want to be. Meaning that you know, like this industry, real estate is really much about transactions, that 0% of our clients want to buy just one property right what you want is actually to be financially free, or remove financial stress for the rest of your life. And so that's why we've built property around the platform as your property wealth partner for life. Data is just a means to get higher returns in order to get to get better results. The platform is just a mean to make your life so easy, you know so for example, like in the platform now you have like automatic recommendations on how to refinance your property if you're paying too much in interest rates or to find a better property manager if yours is not great or to find a better insurance if yours is too expensive on a good enough. And also to tell you how it is you're like look, your property increased by 200k Last year, did you know that you can use this equity to buy the next one. We really want to take the lifetime pain of building property wealth out like away from you and do everything for you for the rest of your life. So it's kind of like a like a digital coach to build your property portfolio and that's kind of like what has been the vision from day one. And of course, at the beginning, we were pretty far from this right. And as you could tell when you were our first sales, we didn't have all of this but it's a it's a journey to get there.
Laetitia Andrac 5:22
Exactly. So take us back to the journey. You know, how did it all start? And what was the MVP because I know some people are listening to this and they're like, oh my gosh, so it sounds like seven app and serves this many clients and this and this and this and that but we were your first client and it's not the experience we had yet it was a great experience. So can you describe a bit the journey moving from we have a vision, this is what we wanted to create and you know, back in Yeah 100% With that, but we need to start somewhere. So can you take us back to the first few months of prep hero.
Mickael Roger 5:59
Definitely. And so I would say that the before launching from zero I try launching another business and I spent three months including all my holidays, working days and nights to build a product. After three months, I realized no one wanted it or no one wanted to pay for it. You know, like everyone was saying yeah, it's a good idea. Why not? Why not? But no one wanted to pay for it.
Laetitia Andrac 6:21
Just want to say I was not your mentor at that time.
Mickael Roger 6:24
Exactly. Exactly. And so we're learning from this. From this not failure this experience right before launching prop hero. I did one thing. I tested the ad with people who could potentially pay for it. Right? And I did that with like dozens of people. And what made me feel that there was something is that 80% of people's I talked to what they told me Hey Michael, tell me tell me when it's live. I want to get Yeah, then me when it's like I want it and I'm ready to pay for it. And I guess even the pricing with them. And so what happened is that so I did see the ID with all the concepts with people who would actually pay for it. Then what I did I spent like a full week in my room building the first data model to prove that indeed we could outperform the markets. And then when we were alive one day, I went to the beach with my son to go and enjoy the Bondi kids swimming pool. And then I met French lady that I never had never met before. Somehow I told her about my ID and said, okay, yes, I wanted Can we start tomorrow? And that was you that is Yeah. And overnight, I had to build the website because I only had the data models. I had to build the website. I had to be like so many things. I spend my entire weekend working like literally like 48 hours to be ready for you for the next Monday. And that's how we started right. Super small was that shitty platform like absolutely terrible. But with data that flopped, right? So like the core value, which was Hey with us, you're going to outperform this was like the core backbone of the value proposition. And this world, all the rest. There was no app, there was no nothing. It was like awful. But then yeah, it was like a way to start and again, that's how we started.
Laetitia Andrac 8:15
Yeah, and it was the backbone of procura was there because we had data to make our informed decision with your hand but we also had the human factor. You were there. And you were helping us coaching us which now exists in your platform. We're talking about where you are at now. But we had, you know, the core values, the core essence the core value proposition of property right was already there. And I'm so grateful that we got to experience that with you and and now see where you're at and, and then what an honor when you're like, Okay, so can you mentor me for the next day? Like? I love the idea because the mission that you have, is so powerful, like, how might we build wealth through property, when we don't come from this background and just knowledge so you're kind of breaking a cycle, which I'm very passionate about. So who that was? Sorry, go ahead. You wanted to add something?
Mickael Roger 9:11
Yeah, definitely. And I think like, I think like one of the things that I before like deciding which company to launch I really wanted to launch a company that could do some good around No, like, I already I realized with my first trial of a competitor you had like zero interest for let's say, like a b2b SaaS platform right and nothing wrong with it, but me, I had to feel that our clients would be genuinely happy and thankful for what we were doing. And no, it was that moment in my life. And yeah, well, so glad to hear what you're saying. That is Yeah. And so that we can work on feedback. So today,
Laetitia Andrac 9:45
you know, we are like, in love with your product with your offering with your team and everything. And yeah, so I cannot vouch more for your services. But who surrounded you when you started because you say we met at the beach? I remember this story like it was it's insane bringing it back to them and and then who surrounded you when you started? Like were you starting by yourself? Did you When was your first hire? I know the whole story but take everyone on the journey because it's so powerful to show them the first step you did because it's actually what I recommend everyone to do. We first we start the ad we get someone who's ready to pay and then we scale. Everything else.
Mickael Roger 10:30
So I'm digging to the origin. I remember I left my job on a Thursday afternoon. took three days, three and a half days off without thinking about anything. And then Monday morning, dropped my son at daycare at 7am and at 705 I was alone in my apartment on my couch thinking Oh, what am I going to do? Looking back? I thought to myself look, one year from now you will laugh at this moment but I must say it was very scary, very scary. And I think for anyone listening this podcast if you're in that phase when you're alone, well, like be conscious that is probably the hardest period so just hold on, because you're going to go through it. It's just the honestly the hardest bits. So after having secured the first clients what I did in parallel is that I went on the hunt for a co founder. Yeah, very, very much like to have a personal choice. This being said, I cannot stress how easier it is to have a co founder. It's so hard to launch a business. Having someone to cheer you up when you're down having someone to laugh with having someone to celebrate successes with or to complain to or or anything like it's so important. I tried a few people and I think just like with a marriage, right, it takes a few, a few trials to find to find the right person. And I was very lucky to find Pablo at some point and I think that people who surrounded me, friends who were like here to have lunch with me when I was alone at home. I also went to the Sydney startup hub level one it's free you can get the free desk and you can meet people and really helps you when you're alone. Launching a business. Finding my co founder Pablo again like don't worry if you don't find the right person at the beginning. Just Just keep looking at startup events like talk to as many people as you can. And then also like what we had we had like friendly first clients right? And I would say forgetful first clients, we were very transparent saying hey guys, we're giving you a discount. We will give our life for you. We will do everything. But be mindful that this was the early days and I think I've been being honest and transparent with your clients on like a look we don't have everything ready yet but we will give everything to make your experience and your and the outcome amazing. Works really well and as a fact most of our first clients became very good friends and coaches. Right. So I would say yeah, like yeah surround yourself with like friendly, forgetful and, and positive people, friends, family coaches.
Laetitia Andrac 13:27
And that's so good because lots of entrepreneur and whether is it just starting out or if you're using their business, they feel very isolated and you don't have to do it alone. And if the pathway of getting a co founder is not your way of going like I don't have a co founder in my business, but everyone that works in my team. They are you know, elevated they have decision making I delegate to them. So in your instant with Tableau it was you know, a beautiful match and witnessing when you came together I will always remember a session I facilitated between the two of you You are like the best marriage we could get for Prop hero in terms of your personality, your strengths, your complementarity, and this is what we want to find in a co founder. We don't want to find someone who is exactly like you otherwise don't challenge you and all of that. So what is the best advice you've received? Since starting prop hero and you know, maybe it's an advice you received about the co founder. Maybe it's something else but what's the best advice you've received?
Mickael Roger 14:31
I think the best advice actually came from Pablo, my co founder and Pablo keeps repeating there are only two things that kill startups, co founder relationships and cash. And you should relentlessly work on both and what we do with Pablo on co founder relationship every week on Monday. We have what we call our honest chats. And the idea we have zero ego right and we will tell like not every week but like every two or three weeks. Hey Tableau Hey Michael. You did this and honestly this is bad right? Okay, we have to change this right. And here is how I felt and curious like why? And because we have no ego. Whenever one says this to the other, they always say okay, yes. You're right. Okay, you're right. Okay. So let's send this and very early on we had these early chats and as a fact I think like Pablo is, I don't know like is the part where the yin and the yang it's like the perfect balance between him and myself. I mean, I will say that we have on paper, the same background like engineers and business, but we have opposite ways of working. I'm much more around like strategic thinking, planning, organizing things. And Tableau brings chaos that makes things happen. Right. And I remember one day, one month we were right in the middle of a race. And on the 28th day of the month, we had reached 5% of the monthly targets right in the middle of the race, and three days, that low overlap, see the target. You went from five to 130% in just three days, right? No strategic thinking could make this happen. But he made it happen, right. I think the complementarity in personalities is really what's working really well for us. And obviously the time that we have like yeah, he's he's not a tech guy or he's not like it doesn't matter, right like you want a co founder that has a complementary, complementary personality. And as such, we will enjoy spending time with you like so tomorrow evening and flying to Madrid to have a PIAA with Tableau and also to work right but but yeah, it's kind of like yeah, you want to be excited to spend the next few years with the person?
Laetitia Andrac 16:46
Yes. Yes. And cashflow also is queen or king. Because without cashflow, indeed, you're you're not able to pay for the next development of the platform or the next thing or the teams that you have around you and so on. Can you tell us where you are at now because, you know, since we saw each other two weeks ago, I'm sure you're gonna tell me that you grew again beyond possible, but anything you can share with us around how many clients you've served. So you've been two years in business now? Yeah. under two years.
Mickael Roger 17:21
Yeah. So a little bit under two years, where we are now. We helped over 800 investors globally. We currently making about $6 million, our annualized revenue. We launched just after a few months, we started in Australia, then we launched Europe and Europe is going like like crazy. And potentially opening a new continent relatively soon. So yeah, like going really, really well. Also, I would say that in today's so for those people listening to this podcast are a little bit more advanced. We're actually focusing now quite a lot on profitability, like edit profitability, because well as we will launch theory a probably like at the end of the year or like early next year, like profitability is a real topic right and proving that you actually have a business that doesn't need VC is important promises. Yeah, so in today's world, so yeah, working on that but but again, I mean, it's like very healthy economic, so so I'm not worried at all.
Laetitia Andrac 18:26
Ya know, very, I'll see economic and how many employees do you have now?
Mickael Roger 18:31
47 including contractors
Laetitia Andrac 18:33
Yeah, perfect. It's just to give everyone you know, kind of a snapshot of what is prepare on our it's, you know, it's it's been a ride. You've grown beautifully and it was such an honor to be there from the beginning of your journey and then seeing you again, you know, a few weeks ago and launching the app and all that like it's incredible. Honestly, I have no word to express the trust you put in me to help you at the beginning of the journey and witnessing where you are now I am in complete out. So you've raised funding, it's your decision to share the number of nodes I know it's in the price and so on but if you want to share how much you've raised in your past funding, and advice you'd give to anyone who is looking to raise fund because I have a few startup while listening to this podcast, who raise way more than you did, but I also have startups who are looking at raising but they're afraid of raising so if you don't mind sharing your advice on that.
Mickael Roger 19:30
Yeah. So so for us we raised through two rounds precede of 1.6 mil and, and a seed round of eight mil so about $10 million in total. I think that capital raise is of course harder now that it was two years ago. Still, if you're in the precede of seed stage, they see like lots of money, right? So like, I will tell you, if you're writing a series, there'll be CEREC it's harder today. Definitely like yeah, much, much harder right now.
Laetitia Andrac 20:02
Yeah, with everything that happened in the US and like honestly
Mickael Roger 20:06
but yeah, like I presidency the whole day. See like lots of money, right? And because like your seed money will last you about two years. Actually, you should get back to like Syria time, like around the right time when hopefully the market will be back up. So I feel like I don't think it's a bad time to launch your business now. I think that's for capital. Right? So I've got like a few, a few pieces of advice, right? So one, cold emails do not work. So you have to leverage your network. concretely what I did is that I went on Google, I went on like Facebook groups, LinkedIn groups, whatever give the list of all the VCs in the world and all the business angels in Australia. I had like a big Excel, who is the contact there and on LinkedIn, who do I know who knows someone there? And as someone like even if it's at level two, there's always someone right? Always. And so get an intro get a warm intro from someone. So for me, I conducted over 200 PCs, right, and it's a numbers game. And so in the end, for the second round, we had like 14 who said yes, so 14 out of 200 Right. So it's a numbers game and then we only selected two. That's like the first thing is don't go with cold emails, get warm intros, and like, do the work to like get this freaking long list and and just like, for me, it was like a full time job. I spent days contacting people on LinkedIn emails, etc. I spent days with that. Second thing is, so if you're precede I've already tried to go with Angel investors. It's so much easier, so much faster, right? And there's lots of money there. So if you're like only looking towards a few 100k, like Angel investors right now is I think much much easier and faster, and you can do a safe note. So so it's really fast and really time efficient. Big, big advice I have is listen and act on every question you are you're asked when you present to a VC, and intimidate let me tell you what I mean by that. A question asked by a VC means that your pitch was not clear enough. Period. If they ask a question, it's mean it was not clear period. And I remember when we did launch the seed, a few VCs say no, and the end irrational was the same. And for me, it was stupid. But if it wasn't right, like it wasn't clear enough. I changed one word in one title in one slide one word, right. Like it's nothing like just one word, and I made sure to emphasize this word when I was presenting the slide during the next VCs after this change. 100% of the VCs they presented to say they wanted to invest in our seed round, right? And so same business, right, same business, nothing changed. Just the way of presenting it was different with just one word. So listen to the questions. And every question means that you have to refine your pitch. It's a living thing. So improve it every time you have a goal. And you will see after something like because most VCs think kind of like the in the same way if you preempt these sources of worries, you will make it work. Yeah.
Laetitia Andrac 23:25
And this is what I love about what you send me here is like it's applicable to raising funds, but it's applicable to any aspects of running a business. If you are a business like me who is not looking to raise any funds like not interested in your funding. Thank you so much beautiful VC who approached me but basically I am happy with where I'm at controlling 100% of my business and growing in the way I'm growing and all that. But those advice are applicable to everyone listening to this podcast. First of all, it's about being exhaustive doing the research putting in the work, which you did for the VCR example but you did for every aspect of your business, Miguel, and I think we share the same DNA coming from strategic consulting. We've been raised this way so I do the research first. And then the second aspect which is listening and listening listening to your customer. Same apply you know, you listen to the VCs a question you trick to word is the same thing when you listen to your customer and someone is saying I'm not buying because of this you change one word and then boom everyone wants to buy so those advice are beautiful because it's applicable to everything. You want.
Mickael Roger 24:30
Something you are like spot on. It is actually last week. I was in the plane I went I went from Australia to to Europe. So I had like lots of time in the plane. I downloaded the sales goals and also when we do like a sales goal we know we sometimes record them like for training I downloaded on my laptop like doesn't have Salesforce or like hours and hours and hours of Salesforce what I notice is that all clients are all leads always ask the same questions, right? So same principle, right okay, I walk pitch deck, but our sales pitch presentation was not clear enough. So we improved it. And we preempted these questions like hey, like, for example. Like, does your pricing this and this and that. If people ask it means that it's not clear and that they're worried right? So we improved every single bit of the sales pitch. And I'm already seeing now that our leads to sales conversions, our conversion rate on leads coming to us is already getting improved. So yeah, listening to feedback from leads from clients, even from employees, just like helps you like get better and better and better.
Laetitia Andrac 25:38
I love that is the cycle of positive improvement which we used to use in Lean. So it's it's really important, but I love how you're dedicated Mickael you had this thing you know, it's what I would always say it's like as a CEO that successful is breathing and living and so passionate about their business and you've said it at the beginning you were passionate about this ID so anyone listening to this if you don't want to talk about it at breakfast with the person who's getting you your coffee, it means you may need to tweak your ideas. And as you know, I have created three businesses before this one, and I was not passionate about them. That's why they were not successful. This one I can talk over breakfast to someone and say, Can I help you fucking grow your business without you burning out? Like can I help you bring strategy so that you grow so thank you so much for sharing all of that before I let you go. I would love for you to share quickly some learnings that you have had in those less than two years experience running a very successful business running an incredible team and serving your client like next level we've we said we've been your first client but we are looking to sign again to invest in Europe and in Australia and will disclose at the end a special offer we have for everyone listening to this podcasting would be in the show notes but I back you so much but not just because of the business but also because of the learning and because of who you are as a human. But what are the key learnings you'd like to share with your audience in your journey? Yeah,
Mickael Roger 27:08
so I think a few so first of all, is that so I mentioned before, don't start building anything before testing it and not testing it with your friends only but with people willing to pay for it. I think that's the main learning from my previous attempts of launching a business, too is when you start building, be ashamed of your entity, right? And I can tell you our first platform, I was ashamed, I was ashamed to send the link to my clients. I was ashamed but it's good. It's the right way to go. Three Zero, leverage your network to find clients to get feedback to get funding everything. And maybe my last my last learning I think is probably the the most important is get help. Launching and growing your business is freaking hot. Right? We are very lucky. We're very fortunate is doing really well for us. Still, it's freaking hard and every day is a battle. And it's not only about work, right? I mean, while you know your business you may have I don't know you may become sick, you may get divorced, you may have to leave the country. You may have to I mean things happen in life, right? It's freaking hard. And when you're a founder, it's even harder. So honestly like, I'm very sincere in Excel right? So we are friends and you are my coach. I cannot say enough how much you have helped me go through all this right? I don't know how many times you know, like I'm like, with everyone. I'm unbreakable and massive or thunderstorm with you. I think I spend more time praying than actually anything else. But it's so useful, right? So get help from someone that you respect, admire and who can understand you and help you grow, grow and go through through everything. I think that yeah, it's a it's a it's an amazing journey. It's also a tough one for me like very sincerely, Earl, it is just beyond you as a coach, I think you as a human being. You have helped me go through all of this and yeah, like, Yeah, amazing relationship with you.
Laetitia Andrac 29:18
Oh, thank you, Mickael. I appreciate your words. And I take it's in my heart. Thank you for that. So now can we share with everyone? How can they work with you? Because we shared your founder story we shared your success. We shared so many tips with everyone listening to this so you know it's a robust business backed by a wonderful coach and low so now get in it is time to invest in your wealth. So what is prop hero and how can they work with you?
Mickael Roger 29:47
So prop hero is here to help you invest in property and build property wealth. When you join prop hero. You get assigned property coach, licensed property coach and you get access to our app. The coach will define your investment strategy. And we'll start sending you through the app properties each week that completely that are aligned with your strategy and that have been selected by our data models and network of local experts. On the app you can see everything you can wish for when you're an investor all the data, all the due diligence, all the analysis that makes you understand why it's an amazing deal. Once you select a property, your coach will do everything for you negotiating the price finding a property manager if you don't have one to convert, finding a convenience store Owner Broker doing the inspections doing like everything end to end and then after the property is yours. We can also like manage the property. So I've set you have nothing to do. And then through the app, you can actually see track how your portfolio is growing over time and what cash flows. You're getting from your portfolio and get recommendations on how to continue to build wealth. Hey, now is the time to buy the next one. Hey, here's an opportunity that matches your strategy. So you are already your partner for life. And our fees are super simple and transparent. $11,000 1000 When you join and 10,000 When you buy the property, that's about like between two and three times less than any buyer's agents for like 10 times the results. And if you mentioned Laetita or essential shift you get to $1.5 thousand discounts. When you join property or buy so 11 of like $11,000 We pay 11 minus 1.5. So kind of like a pretty massive discounts only for essential shift for us.