You may not think too often about the roadside assistance services you’d need to call if you get into an accident, but when you need it, it can become a lifeline. To learn more about the industry of roadside assistance, and how one company is working to provide it to even more people, we spoke with Chris Spanos, CEO and co-founder of Urgent.ly.
Well, we’re happy to have in the studio the CEO of one of the fastest growing companies, United States. Chris Spanos is the CEO and co-founder of Urgently Roadside Assistance, a very exciting startup that’s a grow up here in the region. Talk with him a bit about how the company got started, why it’s succeeding, and how it relates to a broader question about whether or not D.C. is a great place to grow a technology company. Chris, thanks for joining us today. Thanks, Jonathan.
ABERMAN: Well, let’s start with Urgent.ly. Great name, but what does Urgent.ly Roadside Assistance do?
SPANOS: Urgent.ly is what we call a mobility assistance platform. We have a very simple premise. If it moves, it will break and it will need assistance. And our entry point into this marketplace was reinventing and reimagining traditional roadside assistance, which was a completely broken customer experience. But we built a platform that is capable of taking signals from any distress vehicle. And we all know about the future, mobility is being transformed right now. The future of assistance will also be transformed. And we’ve built a platform that’s capable of doing it on a global basis.
ABERMAN: What’s interesting is, to me, you described building a platform, which means, you know, technology enablement. But fundamentally, you and I have been in technology for a long time, just having a technology platform doesn’t get you customers. So are you direct to consumer, direct to business? How do you find the customer for a great technology platform?
SPANOS: Yeah, we are a B-to-B customer. So, we power assistance programs in the U.S for companies like Mercedes, BMW, Volvo, Uber, across a wide range of automotive, transportation and logistics verticals. So, our customers bring their customers. Our job is to deliver a great service, both through technology and management of the service experience. So in some respects, a platform and a tech-enabled service. We’re not a direct to consumer company, although we started off that way, in the first two years of our six year journey so far.
ABERMAN: People will often say, well, if they aren’t particularly informed, that D.C. is not a place where you can start and grow a consumer- or business-focused technology company. that we’re the kings and queens of consultancy because we don’t have enough talent to grow these type of companies. How do you react to that?
SPANOS: I mean, I would react violently in disagreement. D.C. is a tremendous place to do this. I mean, there is a ton of talent here. So, you know, my background. I came out of MCI, the telecom revolution. I was at AOL. I was at NEW, you know, which merged with Asurion. A number of our co-founders came from AOL, Verisign. There is a ton of talent here. There is a ton of capital here. It is a great platform in which to have an idea, build a team, get that early money, even get that big money. You know, we’re in a building right now that has the largest VC firm in the world, which is NEA, right around the corner from here. So you can do it here. It is a great place.
ABERMAN: I’m going to try a theory out with you, which I’ve been rolling around for the last couple months. My theory is that what D.C. excels in is what I call intrapreneurship, where a lot of us, me included, cut our teeth doing startups, this is instead being entrepreneurial in a large organization, where we learn the lessons of finding a customer and learning execution with somebody bankrolling us. We didn’t necessarily get all the upside, but we learned an enormous amount which then set us up to be entrepreneurial. And maybe that’s the secret sauce for why we now have some really, really good startups. EverFi was a huge success, and many others. I wonder if that’s what is really setting us apart.
SPANOS: Yeah. I mean, I think that’s a good theory. I mean, that certainly aligns with my experience. MCI was a very entrepreneurial company inside, very Type A, aggressive, finding new markets, go after it. Same thing with AOL. NEW also, right? So, really good. I was very fortunate to have really, really good training. And in fact, my first job out of school was in a publishing company in Old Town Alexandria, and they were building a new newsletter off their existing financial newsletters, but they treated it like a startup. So we were in the other half of the building. We had the folding tables and chairs. The other half of the building was quite nice. And, you know, we built up this publication into this most successful financial newsletter in history, but it was a startup inside an organization. And that just continues.
ABERMAN: A lot of people have focused on Amazon in different ways. My gut is that, what Amazon ultimately will do for us is, it’ll validate that the region has great technologies.
SPANOS: Yeah, I mean, I’m a big fan of Amazon coming here. It’s going to cost us money. It’s going to cost us talent in the initial phases. But, you know, the way I look at it is, rebuilding the Crystal City area, and then having UVA, George Mason, Virginia Tech, putting education campuses there, and then even the University of Maryland coming across the river into Virginia to establish a foothold, now we’re going to start to have what I think Silicon Valley has, which is this great entrepreneur spirit, great universities, a ton of money, a ton of history. And it becomes this machine. Now, if we can create a similar machine, where the university component is a key function in that, I think it’s a great springboard to a wonderful future.
ABERMAN: I do too. With my Dean’s hat on over at UMD, I see the same thing for my school. You’re absolutely spot on, I believe. Speaking of spot on, I think it would be fun for me to reveal that, as an investor, I was approached very early on by Urgent.ly, and I didn’t invest. And there are some interesting lessons. Lesson number one is: sometimes investors are wrong. Sometimes you look back in sadness. But, you know, at the time, it was a very different business. And I think there’s some interesting lessons there for entrepreneurs as well. Could you give some insight into how the business evolved, and what other entrepreneurs could to learn from how you went through the process of modifying your business to be able to scale it?
SPANOS: Yeah, absolutely. The original vision for Urgent.ly was that any urgent need connected to servicer who could provide it. And that’s a very broad approach, and we needed to benefit from focus. And very well entrenched competitors who grew up in the Internet, Service Magic, which became Homeadvisor, there’s a reason why they’re the king of the hill, and why there isn’t, you know, a new local services startup that starts every week and then doesn’t make it. Because, they’re super smart and they know what they’re doing. So, we had the opportunity to take the team, take an early version of the platform. We were able to get a roadside assistance network, a preexisting one with 17 years of performance history. And in 2013, we looked and said, look, it’s Uber for X, everything’s being Uber-fied. Uber was changing the culture. On-demand economy was going to destroy all subscription businesses. So, we thought, let’s focus on roadside assistance. No one is focusing on this whitespace. It needs to be Uber-fied fine. Transparency, speed, convenience. VCs love a clean story, on a big market, with entrenched legacy analog monopolists. That’s roadside assistance. So, that’s what we did. As it turned out, climbing the direct to consumer market was just too much of a mountain for us. And we pivoted to B-to-B. Because if you’re a car company, insurance company, rental, you’re offering roadside assistance to your customers. And if that service goes poorly, your brand is exposed. You may never choose to buy a car because of its roadside assistance program, but you may never buy that car again if you have a terrible experience. So, we made a pivot to B-to-B. And the story I like to tell is, we were on the phone with a car company in 2015. They said, hey, we’ve been tracking you. We would like to work with you. We would like the speed and transparency for us. Can you do that? And I said, let me put you on mute. I turned to our CTO and I said, all this stuff that we’re using to run and monitor the business, can we just pull it forward and put their logo on it, and give them a view of just their customers? And he said yes. And the reason why I had that thought is. I knew the guys who had created the Domino’s Pizza Tracker. And they had gone into Domino’s and they saw all this data behind the scenes and they said, let’s just pull it forward and give it to consumers. And that was that split second decision. I went off mute and I said, we can do this for you in 48 hours. We gave them the first version of it. And that was the turning point for the company.
ABERMAN: Is the moral of the story that, before I let you go, the financial markets are relatively unforgiving, but relatively perfect in that, if you can really find that mix between customer consumer adoption, and rapid growth, there’s money to be had.
SPANOS: Absolutely. And once we started along that journey, and then we were able to show that we could deliver service, our customers were super happy. We could win more customers. We could see a path through scale to get to a really good unit economics. Then the investors started getting behind us, and our first set of investors really were strategics. Because they understood the pain point they had on the operational side. And so, they had an incentive to support us to get stronger. And now we’re at the point where the financial VCs have said, OK. You’ve got all the characteristics we’re looking for. And we have had a number of investors who passed, who then came back around, paid a higher price to get in, because they can see this. This is massive, just roadside assistance. It’s a 32 billion dollar global market.
ABERMAN: Yeah, I suppose you’d be happy if you could just command two thirds of that! Well, Chris, it’s been great having you on.