David Nadezhdin of MYR
Want to know what it is really like to start a company? In our Founder Spotlight series we have candid conversations with real founders about the good, bad and ugly of getting your hands dirty and building a business.
Meet David Nadezhdin of MYR. MYR created the first quick-service POS (point of sale) with a full order ecosystem that bridges online, mobile, and regular orders seamlessly for quick service restaurants. We had the opportunity to speak with their founder, David, to learn more about his journey into the POS world, his love of cinema and why he takes four hour walks daily. Learn more about MYR and their all in one POS solution.
What’s your story? How did you get here?
I did sciences in college, but then I went into cinema. I wanted to become a cinematographer, and I worked in that industry in Canada for about two years. The issue was that I didn’t want to live on grants. So somebody said, ‘Hey, you know, cinematography and project management are kind of similar.” I thought about it and when they asked me to help with a website I said, “I don’t even have a computer but sure.”
I got into that and then ended up founding my own agency called Fidel Studios. We started doing the digital part of creative ideas for almost every major, traditional agency creative agency in Canada. We ended up with about 45 employees and did some pretty big campaigns.
At a certain point, I was just tired of it. You have 20 different projects and 20 different understandings and 20 different budgets and 20 different changes and it’s a lot. I thought, “what am I going to do when I’m 45 and I burn out?” So I stepped away from that and weirdly enough, I then ended up building apps.
After a period of strong success, somebody came and approached me asking for a point of sale. My immediate reaction was to question why, and why they wouldn’t just go get one like Square or Shopify? And their answer to me was they were inadequate. That kind of piqued my interest. That was about 14 years ago. I built that and it quickly started growing organically.
Next, a cardiologist that had heard that I made apps approached me. He had been to see multiple development studios and they all said no because they were scared of working on medical stuff. I didn’t even know anything about it either, but I said yes and I built it. Then the cardiologist shared another idea with me and I spent about four or five months on it.
At that point I left the agency and went off to build a healthcare company. It was a cardiology based medical device. In Quebec we raised approximately 8 million over five years, which is like raising 50 million in the States. Then I got thrown out of my own company. They threw me out, and actually, funny enough, they brought me back because they burned through the last round that I raised, and they ended up with nothing.
You know, it’s funny how things happen. I have this word I invented a long time ago called “Perspection.” It’s a mix of perspective and perception. It’s literally having a perspective on your perception, not someone else’s, and understanding that the way that you’re looking at something, you just skew a little bit and it could be a completely different life and gradient of colors.
What problem are you trying to solve?
The quick-service restaurant service industry needed to process more orders in less time. It may sound basic, but they needed the fastest POS on the market.
It was originally designed, 14 years ago, for the busiest coffee shop in Canada. It was the first third wave coffee shop in Canada, right next to Concordia University, so it’s busy all the time. They called me to design a POS that did one thing and one thing only – input as many sales as possible within the two hour window in the morning and the two hour window right after lunch.
We looked at all these other POS companies that were doing full service restaurants, and then we looked at McDonald’s and we realized that they are doing something completely different than everybody else. So what we did was mimic the idea of a McDonald’s point of sale, but accessible to everyone on iOS. We built that and then slowly but surely third wave coffee shops expanded into taco trucks, salad bars and others. We naturally gravitated and built our tech stack to what was dictated by the people that understood the quick service restaurant industry.
Once you do it, you want to multiply and so then you become a multi location, and you become a franchise, then eventually become a chain. We built a tech stack that answered the needs of the franchisee like the needs of a single location, as well as a tech stack that answered the needs of the franchisor managing their franchisees. We have become this go-to system. In Canada we’re pretty dominant in this space and we’re expanding in the US.
It’s been an interesting time for us because while everybody was doing the valuation game, going after this growth at all costs even in such a volatile market, we focused on profitability. We’re focusing on growing with multilocation deals rather than the SMB individual first full service restaurants. We want nothing to do with that because there’s so many players. We’re going to do something where, when we walk into a deal, we have no competitors. I mean truly no competitors. I don’t mean the full service restaurant guys. It’s either enterprise, like NCR or Micros, or it’s going to be the willingness of the franchise to invest the money to switch from legacy over to cloud based technology.
When you went out for initial funding, how many pitches did you have to give?
When we pitched it at the very beginning we were already generating some revenue. It can be very difficult to do, to play on that hype machine when they’re looking at revenues. People that are looking at revenues – those types of investors are going to look very differently than if you’re selling the growth dream. They want something they can put in a spreadsheet.
So what we did is we bootstrapped. We went and got some debt. I mean, again, in Canada, we have access to the BDC (Bank Development of Canada.) They lent us some funds, and then what I did is I raised a small seed and I went to get smart money, I mean, I wanted to get people that understood revenue growth, not market growth. Like market share growth. So I actually got one of those people, Lester Fernandez, who’s the co-founder and former CFO of Pivotal Payments (also known as Nuvei).
When he invested it gave us a lot of confidence. I had Rainer Wellige, who’s the former Vice President of SAP Hybris – he was at Hybris when it got bought by SAP. It was a Canadian e-commerce platform and they paid around 1.5 billion for the company. We got him and we got Mark Laurente from TD private equity banking. We went and got money from people that understood what it is to generate revenue and figure out very quickly how to turn it into profitability.
Don’t get me wrong, we went, and saw VCs in the States and Canada. We started to look at them when the pandemic hit, and then during this time we grew really quickly because all the full service restaurants were closed down and didn’t go that route.
What’s funny is that the VCs and their mentality wasn’t changing. They were still like, ‘are you going to be the unicorn?’ It’s like, have you looked outside yet? Do you know what’s happening right now? Like unicorns are starving to death, man.
What keeps you up at night?
Cash flow into profitability and cash flow into growth versus cash in and out. Also, the timing of making sure that all your suppliers and team members are all happy. Not like happy-go-lucky, but everyone’s taken care of and the risks or the little or bigger steps I’ve tried to take won’t affect the environment of everyone else.
Do you have any pets?
No, but you know what I have? I have plants because now it’s like plants are the new pets and pets are the new children.
Would you consider yourself a risk taker or how did you learn to embrace risk taking?
Both. I learned the hard way to have “perspection” – even though I invented that word. I am a natural risk taker, so twenty years ago, it took me a while to learn to take five seconds before letting my brain make the decision. I am a risk taker, but now I analyze the risk I’m going to take before I do it.
What are your passions and interests outside of work?
I try to take four hour walks every day. That’s my fun. I literally work off my phone because I earned that right to do that. Just call and you know, work with people that way. I’ve also been a cinephile since I was 12.
What do you think is a misconception about being a founder?
That you’re in charge of everything. You’re always working for somebody, whether it’s the people that you’ve entrusted or your shareholders.
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