“Workers are mad and no longer willing to sit idly by being spoon fed ‘we’re family’ bullshit from bosses:” Logan LaHive is Helping Employees Organize & Collectively Bargain. But Did He Compromise His Own Vision By Taking Venture Capital for the Startup?

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Why This Repeat Entrepreneur Founded Frank, a Software Platform for Workers. And Does He Think Chicago Is a Good Place for Entrepreneurs?

Logan is another one of those folks that I can’t recall specifically how or why we met, but I’m so thankful for his friendship. He’s someone I really consider a ‘good egg’ as we’ve enjoyed the stories of his own entrepreneurial journeys and strongly held opinions on Chicago coffee. I’m excited to shine the light on Logan and Frank, a software startup focused on worker empowerment. Thanks Logan!

Hunter Walk: Frank, your current startup, is a platform for workers to organize in order to protect or advance their rights. When I read this mission statement I think ‘unionize,’ but maybe that’s just a tactic, not a requirement. Can you help me understand the difference?

Logan LaHive: First, the problem… The incredible imbalance of power in workplaces is driving continued acceleration of income inequality, which along with climate, is a top issue facing society today. I don’t profess to have the solution — just believe that workers having a stronger voice in their workplaces is a good place to start. There are many forms of worker voice, and differing approaches to exercising it — so you could certainly say that unionizing is a tactic… but it’s clearly the most established, strongest, and legally-protected path to worker power.

Other options for workers can be taking collective action, solidarity unionism, forming independent unions, employee resource groups (ERGs), guilds, joining a worker center, new innovations/ideas, etc. All of which have merit, and may be best in different circumstances. Being honest, unionizing is fucking hard. Intentionally. Many decades of corporate lobbying, republican policy, and near non-existent enforcement of labor laws has quite successfully established roadblocks to workers exercising their right to unionize.

But unionizing has clear benefits — beyond improving wages, benefits, and workplace conditions — it offers the resources and backing of experienced representatives (the union) for collective bargaining, in which the employer is legally obligated to participate and negotiate in good faith (make your own assessment of “good faith”).

Our mission at Frank is to provide workers with tools not only to have a voice in their workplace, but to ensure that they’re heard. Our product is purposefully built to pursue the tactic of unionizing. We build organizing software for unions and labor orgs — a customizable and private platform for Organizers to support workers all the way from interest / onboarding through to submitting union authorization cards. So, while personally supportive of any and all workers seeking to improve their workplace conditions, we spend our days focused on providing better software to unions enabling them to improve efficiency and accessibility of union organizing.

HW: But at the same time we’re seeing lots of stories about new segments of workers seeking to unionize (such as Amazon). What’s your take on the potential here? Are we going to see a new generation of service and trade employees turning to unions? Will these same groups every formalize for segments like engineers?

LLH: Yes. Next question.

The trends and data are quite clear. Union elections are way up (NLRB), unionizing is incredibly popular — with people under 35, support for unions is equivalent to marriage equality and legalization of weed (Gallup), and nearly 50% of workers in the US would join one if given simple yes/no chance (MIT). Workers are mad and no longer willing to sit idly by being spoon fed “we’re family” bullshit from bosses making 350x more than they are, doing layoffs over zoom from a yacht.

It is a certainty that things are and will change… How fast? What will unionization rates in private workforce be in 2025? 2040? I don’t know. Like mentioned previously, worker power can take on many forms. For most people, when they say or hear “union” they think of one cookie-cutter type institution… but the reality may certainly be more a mix of escalating collection action (demand letters and walkouts), independent unions (Amazon Labor Union, Trader Joe’s United, etc), worker-led union organizing (Starbucks Workers United), more Worker Centers, etc. (and yes, I’m intentionally not throwing DAOs or web3 in the mix here as just doesn’t yet deserve implied parity).

For anyone reading this, if you work at a company with 100+ people, there is 98% chance that at least two of your coworkers are actively discussing unionizing. But like I said, it’s hard, and it must become easier. I’m no policy wonk, nor do I put much faith in our current political landscape to enact sustained change (even though you’d really expect better ROI on the $Billions that Labor has funneled to Dem politicians over past few decades). So a sincere hope of mine in building Frank isn’t that we’re right, it’s that we can be part of growing an ecosystem or community of folks building tools specifically for worker power (LaborTech).

HW: Frank is venture backed. I’m going to assume that your funding conversations here were a bit different than your last startup. How many times did you get called a socialist?

LLH: It’s been interesting. Frankly, raising capital to work on this problem is and was privilege. Straight cis white guy from background in tech/startups, who ran an accelerator program so has many years of relationships with VCs, and raising preseed in the yolo era of 2019 (rip). Building tools for unions is certainly not a category or product that most VCs want to exist, let alone see grow. I’ve heard many fast and hard passes. Lot of people I’ve known for many years certainly aren’t returning emails the way they used to. Endless anti-union tantrums, delivered with the confidence that only a VC who had a single personal interaction with a union 7 years ago could muster. A lot of confused, raised brows, “Wait, aren’t unions bad?” then a passing reference to Jimmy Hoffa.

What I do find quite funny is just how many contrarians have the exact same reaction. How personal opinions immediately cloud this topic, but how many new categories are evaluated with some marginal intellectual curiosity. Probably a correlation here with why there was more venture funding for golf tech than women’s fertility until very recently…

Look, socialists hate venture capital, and venture capitalists hate unions. But building new tech to try to address major problems in a large category (Labor) requires $. It requires valuing the labor of the team we hire to build it, to support our partners (unions) that use it, and to invest in continually making it better. We didn’t have access to union funding, grants, or bags of cash that fell off a truck. I tried, and I self-funded for probably longer than reasonable.

We don’t aspire to be venture backed, to be a mark-up, or to chase the headline of a valuation. Nor are we seeking to advance a political agenda. We’re working in a space where, historically, funding has been sparse. So I’ll take some shots along the way, but keep head down and stay focused on mission we know to be deeply meaningful, and on delivering value for our partners (unions).

HW: When we first met you had founded Belly, a B2B2C loyalty/retention startup. There were a number of similar companies formed around the same time — I think a byproduct of mobile apps and businesses starting to want more data on their customers. What’s one thing you were right about and one thing you were wrong about that fundamentally impacted the trajectory?

LLH: When starting Belly in 2011, yeah, we were tracking something like 15 companies in the Loyalty space. It looked more like a market map than a competitive landscape slide. Most were in SF, mostly early stage, some generating buzz out of YC or 500 Startups, almost entirely ‘check-in’ type apps. We very quickly outgrew them all, and within about a year it was clear there were 3–4 key competitors.

I think that with time, the things we did right and things we fucked up get clearer with perspective, but tainted by fading memories compressing themselves into tidy narratives.

Early on, something we absolutely did right that helped propel us quickly was spending a LOT of time in stores with customers (small business owners), and deeply prioritizing what they needed to see within their four walls rather than what we wanted to be said about us in Techcrunch. Many competitors were building cool new things, that felt hot and buzzy… like, they were mobile only products at a time (2011) where less than half of a small businesses customers had smart phones. And the POS (point-of-sale) in all markets outside of SF were antiquated, closed systems, that the owners didn’t want touched because last time someone tried to add a new SKU the “3” key stopped working for 6 months.

So, we put an iPad on the counter, customer facing, and enabled consumers to sign-up or use Belly with our app or a physical key-chain card (QR code). Business owners loved it because it created 100% addressable audience — all of their customers could easily sign up and use it — so they promoted it. And it created a digital billboard at the highest value location in a retail store (POS) which we used to market directly to the businesses customers. It was our flywheel. We were able to intensely focus on selling to business owners, and they drove all consumer acquisition from within their stores.

Once growing quickly, and pulling ahead of competitors, I think we lost track of whether the race was worth running. Being so focused on growth, market expansion, hiring, fundraising, I convinced myself and others that dominate market share would enable us to ship XYZ, to “be a platform” 🙄, and expand share of wallet. Hard to pick just one thing I was wrong about, but, today’s answer: The decision to operate stand-alone outside of POS (point-of-sale) rather than building core POS meant we were a feature. There was something so core to the businesses operations — it took payments, could clock-in employees, process all SKU/transaction data, and was required to be utilized for every single transaction… and we were sitting near it, but we weren’t it. We were pushing a rock up the wrong hill.

HW: The last two years have seen an acceleration of ‘tech startups can be built anywhere’ and of course, intense debates about remote work. You led TechStars Chicago for two years (2017–2019) and have been connected to the local scene there for a quite a while. Has Chicago over-performed or under-performed your expectations over the last decade as a home for startups? Any predictions going forward?

LLH: I don’t know. Chicago VCs and all the institutions spun up to sell Chicago tech will say it’s over-performed, and will quote bunch of random stats they gathered in a survey or a Pitchbook article like the MOIC of Chicago venture investments. I have no idea what MOIC is. I looked it up a few times. But honestly couldn’t care enough to remember. Or, I hear about the % ROI from Chicago investments being top decile because of lower entry valuations, as if that’s something that is attractive to founders…. “Hey look at me, my midwest valuation got you a better return! Cool!”

Folks in Miami will say Chicago is cold, Enterprisey, no vibes, and yolo miami bro. No comparative data, just pumping the hype / meme campaign.

Each tweet storm or blog post about City A vs B, “Top 10 Hottest Places to Start a Startup”, “Is Boise the New Austin?” I read them knowing the vast majority are biased narratives with a self-serving purpose — a politician promoting their city, a founder trying to attract exec talent, a VC test driving their new geo-concentrated LP pitch… Honestly, I get annoyed momentarily then just move on. Others can waste cycles debating it.

I know there is everything needed to start and build a great team and company in Chicago. There are some markets that offer advantages vs others, and some geos best suited for startups in specific industries. But remote and distributed teams are here to stay, and I’m still learning to effectively lead a distributed team. So, no, no real predictions — just that I’m happily staying put in Chicago and trying to constantly adapt with new norms.

Thanks Logan!

Go to Publisher: Hunter Walk
Author: hunterwalk