Reichen Kuhl is an entrepreneur who seems to have a knack for turning challenges into big wins. He has already raised tens of millions of dollars to solve a problem facing millions of US households, that was born out of him being told “no.”
On the Dealmakers Podcast, Reichen Kuhl shared his journey into entrepreneurship, including participating in the Amazing Race. We talked about how getting denied for an apartment changed everything, proving your business idea, and finding a B2B angle for your product.
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Kuhl was born in Cincinnati, Ohio to a nurse and policeman. Though when his parents divorced when he was just five years old he ended up moving to a trailer park outside of Boston, Massachusetts.
He says that living in a trailer park wasn’t very popular at his school. On the bright side, that gave him a lot of time to focus on his studies and do well on his grades.
The one thing he knew is that he wanted to get out of that situation. He dreamed of owning a real home. To this day he is still driven to keep succeeding by never wanting to go back.
Applying himself to his studies got him into the US Air Force Academy with a congressional nomination from his senators.
His progression through the ranks of the Air Force helped him realize his dream of owning a real home. Though after nine years he found the military just wasn’t a personal fit for him.
The Amazing Race
Next Reichen found himself teaching high school physics and working as a flight instructor. However, one night at a bar in LA changed everything for him once again.
He was approached by someone casting for the TV show The Amazing Race. He and his partner went on the show, raced around the world, and won the $1M prize.
It definitely meant never having to worry about living in a trailer again. It also gave him a new career for a while. He appeared on The Drew Cary Show and Frazier. He has been in soap operas and hosted TV shows for the next nine years.
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Testing & Proving Your Business Idea
Reichen landed another TV show in New York. However, trying to move there brought a new challenge, and gave birth to his own startup venture.
Despite having been a TV personality and winning $1M on The Amazing Race, he couldn’t even rent a $3,000 a month apartment in NY.
They turned him away because his tax returns didn’t show he made 80x the monthly rent. They told him the building next door demanded he proves that he was making 120x the monthly rent.
That seemed crazy. Not to mention the fact that $3,000 doesn’t get you much on the NY real estate market, and if you are making a quarter or half million dollars a year, you probably want more than a $3,000 a month apartment.
This frustrated him so much that he decided to do something about it. His first move was to go back to school and study law. At the same time, he wanted to build a business around it.
Reichen started out thinking he would be happy if this side hustle brought him in an extra $15,000 while in law school. He believed that there were good renters out there who shouldn’t have to make 80x more than the rent to be able to get somewhere to live.
So he threw up a little website and called it LeaseLock. His pitch was that he offered to cosign on other people’s apartment applications and leases, providing his credit, if they would pay him.
He received hundreds of applications. Many from foreigners who may have good jobs or job prospects, but no US credit history.
Reichen Came Up With The Idea of LeaseLock
They would pay him 10% of the total lease amount upfront for his help. He picked 12 of them to start with. That meant cosigning for $400k worth of leases in just a week.
After the year was up he found no one defaulted on their leases, and the full $40,000 was his to keep.
So, he decided to double it to 25 people. Again, no one defaulted.
Ramping Up LeaseLock
He took his idea and proof to startup incubator Mucker Capital in LA. They introduced him to his now co-founder, Derek Merrill who he hit it off with immediately.
Together, with their complementary skill sets and the idea of turning this into an insurance company, they officially launched LeaseLock.
Derek brought his fundraising and marketing experience to the table. Reichen brought his experience in the space and legal knowledge.
With a premium put on the rent, renters can avoid having to pay a security deposit. Landlords of multifamily properties are able to be covered for damages or in the case of tenant defaults.
The real traction came when they found the B2B application for their product. By integrating with property managers’ software like Yardi, the process was streamlined and automated. LeaseLock bills property owners/managers for a low monthly premium based on the number of leased units on the platform, determined by these integrations. Properties are then insured for, typically, a 10x multiple of what the old security would have covered for unpaid rent and damage by defaulting renters. They can choose to have the tenant pay for it if they like.
When they did away with all of the usual exceptions and restrictions on making claims and integrated it into software, things just took off.
Reichen says that every one of their customers has experienced an increase in their NOI thanks to removing the need for security deposits and onerous application and qualification demands.
So far the company has raised $68 million from top-tier investors like Westerly Winds, Vertex US, Moderne Ventures, and Liberty Mutual Strategic Ventures.
Storytelling is everything which is something that Reichen Kuhl was able to master. Being able to capture the essence of what you are doing in 15 to 20 slides is the key. For a winning deck, take a look at the pitch deck template created by Silicon Valley legend, Peter Thiel (see it here) where the most critical slides are highlighted.
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Listen in to the full podcast episode to find out more, including:
- Creating insurance products for big industries
- Raising capital
- Building revenue with technology
- Don’t ask, don’t tell
- Reichen’s approach to interviewing recruits
- The importance of authentic relationships
- His top advice before starting a business