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RobKanda's comments

RobKanda | 5 years ago | on: Launch HN: Kanda (YC W21) – Let tradespeople offer finance to their customers

One of the features we recently launched and have a good user base using is an estimator widget we host, specific to the contractor, that allows for estimation fo boiler installations. We're also working on an electrical installation one at the moment. These allow the homeowner to get a quick estimate without bothering the contractor, then select an option if they decide that's what they want, at which point the contractor is sent an email to arrange with the customer. We work with the contractors on these to ensure they're as accurate as possible, and priced as the contractor wants.

In terms of the dishonesty, we believe that's a completely untrue and unfounded accusation. We have a very trust worthy base of users, who whenever an issue has been raised have been the first to jump at rectifying the situation. In our contractors eyes, customers can be the untrustworthy ones, not paying on completion, saying things aren't up to code when they are, accusing the contractor of property damage they didn't cause. We try not to discriminate.

RobKanda | 5 years ago | on: Launch HN: Kanda (YC W21) – Let tradespeople offer finance to their customers

The bank we offer the finance through run full credit checks and assess the risk. Non-payment is only tied to our lending bank, the tradesperson isn't at risk. If the customer is a risk of non-payment, the bank will elect not to lend to them. For the tradesperson, we'll let them know if the customer has been rejected for finance, and they can choose to proceed with the work and hope the customer can pay them if they choose, or decide the customer isn't worth the risk

RobKanda | 5 years ago | on: Launch HN: Kanda (YC W21) – Let tradespeople offer finance to their customers

The bank makes commission on the 0% finance - we charge the tradesperson a 9% subsidy for any 0% finance agreement taken out, which includes the bank's fees. If the customer takes personal loan finance, then the bank charges them an APR instead.

Thanks for the heads up on the spelling mistake! Slipped through review somehow!

RobKanda | 5 years ago | on: Launch HN: Kanda (YC W21) – Let tradespeople offer finance to their customers

Whilst you could maybe set up a monthly payment plan for your customers, that leaves you very exposed to them not paying. Assume you have three or four customers on a payment plan, and they decide not to pay, you could be out of money for the month, not be able to complete other jobs, etc. Also, there are legal obligations and restrictions in place for these types of agreements as well. With us, the tradesperson has no risk of non-payment. They are paid the full amount on completion.

RobKanda | 5 years ago | on: Launch HN: Kanda (YC W21) – Let tradespeople offer finance to their customers

We've seen it here in the UK as well, with the larger firms being able to offer finance, either by lending their own money or agreeing with a bank and having spent the time and money to ensure they're fully compliant. This compliance includes how they can advertise, how they can talk to customers about finance, how they can handle their invoices and payment plans, etc. For the UK, they need to stay compliant with the FCA. With Kanda, we ourselves are the ones offering the finance. All of our systems, advertising (including the bespoke social media advertising we give to our contractors) and such are compliant, so the tradesperson knows they can use us and not need to worry. We're putting finance in the hands of the every day contractor, something previously only available to the larger firms who have outlaid costs

RobKanda | 5 years ago | on: Launch HN: Kanda (YC W21) – Let tradespeople offer finance to their customers

Well if they wouldn't qualify for financing, then the contractor is informed the customer is unlikely to pay for work, so they know not to work for them. Similarly, if they are approved, the contractor knows they will get paid, as the money is held by Kanda upon the customer agreeing to the loan. It becomes a win-win situation for the contractor. Finally, they are completely de-risked - if there is a non-payment, it'll be the bank who has to follow up on the non-payment and recoup any costs. All this does is empower tradespeople to ensure they're paid fairly for their work

RobKanda | 5 years ago | on: Launch HN: Kanda (YC W21) – Let tradespeople offer finance to their customers

We're a UK founded and based company, so we see this all the time as well. The finance option makes it a lot easier to sell to a customer - if you're told you can pay £700 for a TV today, or take it away and pay £30 a month for 2 years, most people would rather take the finance. I don't know why the sales reps would only get commission for finance sales, but the stores would rather take a small loss and make a sale than lose a customer to a high price.

For our tradespeople, most of their customers know they can get finance from companies like British Gas. Even though our tradespeople would be cheaper outright, BG can offer 0% and so the customer doesn't have to pay it outright. We've had people tell us they signed up to use us for this very reason, with someone even saying BG were £1000 more expensive, but the customer went with them as they could pay monthly!

RobKanda | 5 years ago | on: Launch HN: Kanda (YC W21) – Let tradespeople offer finance to their customers

These fees are actually representative of the fees charged to retailers to offer 0% financing options. We don't hide these fees from the tradespeople, so they can decide to up their price to include that fee if they wish, or can choose to swallow the cost to win more work. We put the power in their hand to decide how they want to handle each situation as they see fit

RobKanda | 5 years ago | on: Launch HN: Kanda (YC W21) – Let tradespeople offer finance to their customers

Hi, thanks for taking the time to look over the site and thanks for the feedback! Our base price for our subscription might seem cheap, but for tradespeople, whose margins might already be tight, its seen as a fair price for the quoting and invoicing features. The 9% or 11% subsidy we charge is on the quote total when the tradesperson offers 0% finance - if a customer took out a 0% loan for £1000, we would charge the tradesperson a £90 (or £110) subsidy for the finance package. If you’d like to see the demo video, here’s the link:

https://www.youtube.com/watch?v=pVHBFHTNS90&ab_channel=Kanda

For card processing, we actually support both debit and credit cards, though typically we process debit cards and have a subsidy charge for credit card processing, due to higher processing fees from the banks.

We do think Kanda is a big win for the small guy - we put the power in their hands to compete with the big companies in the sector, offering finance products they couldn’t otherwise offer and winning more work for it

RobKanda | 5 years ago | on: Launch HN: Kanda (YC W21) – Let tradespeople offer finance to their customers

Whilst some outside financing is available, for the general contractor the ability to offer 0% finance just isn't there. Kanda provides these contractors the ability to offer this and compete with larger companies. Rather nicely, the agreements that both parties sign on our finance products actually achieve what you’re asking for: the customer signs a satisfactory note on completion of the work (assuming they’re happy) which allows the release of funds.

For customers, however, we do know that an issue can be that work isn't completed to the standard you expect. One of the products Kanda hopes to bring to market soon is a secure holding account to arbitrate payments, allowing upfront payment with tranches released on milestones being completed, pretty much exactly as you've explained above, to hold both parties to agreements.

RobKanda | 5 years ago | on: Launch HN: Kanda (YC W21) – Let tradespeople offer finance to their customers

Whilst you could take out a HELOC to complete a home maintenance project, the minimum you can often take out is $5000. If your project was only $1000, you may end up paying more in interest for the HELOC rather than a personal loan for the amount you want to borrow with Kanda. Not only that, but our tradespeople can offer 0% finance to their customers, reducing the repayments even more. Sure, if they were unlikely to get an HELOC they are unlikely to get approved with us, but then the tradesperson knows the customer is unlikely to be able to pay for work completed and is protected

RobKanda | 5 years ago | on: Launch HN: Kanda (YC W21) – Let tradespeople offer finance to their customers

Most tradespeople are professionals, running professional businesses. Whilst your tradesperson might have gone on a bender with the cash last time, that wouldn’t be possible with Kanda. The money doesn’t get to the tradesperson until they’ve completed the job and the customer signs off on it. Then they can go on all the benders they want, they’ve done the work and it’s now their money. Whilst many jobs are still done in cash, the average person doesn’t have sufficient cash in their account to pay for larger outlays, such as a boiler, but could afford it on a monthly payments. What happens in that case? They just don’t get a new boiler, despite needing one? No, they look for an alternative payment option. Kanda offers the tradespeople that option, to offer monthly payment options to their customers, with zero risk to their own business. Finally, in terms of taxes, surely the income tax only applies on profit, with material costs subtracted. But regardless of that, paying tax on a job and getting income, versus not getting the job and not getting any income is surely better. $500 after tax is better than $0 because the customer can’t use you. And when your competitor is offering monthly plans, all of your customers will go to them to get their work done instead

RobKanda | 5 years ago | on: Launch HN: Kanda (YC W21) – Let tradespeople offer finance to their customers

Whilst the main concept itself is subject to local legal variations, the idea of contractors being able to make their jobs more accessible and more affordable to the average homeowner resonates around the world. What Kanda aims to do is to take this legal restriction minefield away from the contractors, so they can continue to do what they do best, whilst offering their customers an affordable payment plan. Securing a lien when doing smaller work, such as fitting a boiler or rewiring a house, is not ideal when you want to get paid as soon as the job is done. If the customer instead arranges finance with us, the payment can be immediately paid out and the contractor can continue on with their business without worrying if they will get reimbursed. Finally, the concept of fronting the money for the materials arises from the fear of the contractor not getting paid at all; if the job isn't paid for, at least the contractor won't be out of pocket. With us, the money is secured before the job starts. They don't need to worry about being out of pocket from a customer refusing to pay or being unable to pay.
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