An interview with Michael Johnson of Yoke as told to Sergio C. Muñoz
Note from Sergio: I connected with Mike at LAVA's Meet the VC event in October of 2015. We developed our relationship for a few years and then after returning again in October of 2017 with a fresh $750,000 investment, he was investor-ready. HOTB issued him a term sheet for $600,000 and an investment of $300,000. Now, with MRR of $30,000, Michael and his partner, Ben Thomas, are now ready to syndicate the remainder of his $3M angel round.
"I was born and raised in Cleveland, Ohio and came from a family of entrepreneurs. My mom and dad both owned their own business and the apple didn’t fall far from the tree. I was the kid with the lemonade stand. In 4th grade I was forced to stop selling candy out of my locker because my business was cutting into the vending machine proceeds that went to support after school programs.
In 2003, I started college at Arizona State University and met my best friend and future business partner, Ben Thomas. We shared an immediate connection when it came to living an active and healthy lifestyle, enjoying life to the fullest, and viewing challenges as opportunities to create something new. We both possessed that entrepreneurial drive to create our own success.
After college, Ben and I were completely fed up with the lack of access to healthy food during work hours. The only food option available in our break room was from the vending machine. We knew there was an opportunity here, so naturally we dug in. We learned about a brand new concept called micro markets, self-checkout shops that combine the quality of Whole Foods with the convenience of Grub Hub and places it right in your break room.
We were convinced micro markets were going to change the vending industry, but the existing technology was in the dark ages. Overpriced bulky equipment that ran on clunky software made scaling micro markets next to impossible. Operators could only afford to put them in 1,500 person offices and even then running them was a pain.
Ben looked at me and said, “Everyone has a kiosk in their back pocket. Let’s build a self-checkout app that allows micro market operators to take this concept to any size location.” In 2015, we brought this idea to a long time mentor of ours in the payments space and he believed we were on to something. So, we opened up shop at WeWork in Hollywood and started talking to vending operators about a smarter way to grow their business.
We put together $750,000 and came to market with affordable plug & play hardware and user-friendly software designed to help operators scale their micro market footprint. A micro market typically produces 2-3 times more revenue than a bank of vending machines, and we have the only system designed for locations with 100+ employees.
Micro markets are now the single largest growth driver to the vending industry. We currently service over 75 micro market operators with hundreds of locations nationwide. We have $35,000 in monthly recurring revenue, 5,000+ mobile app users, and are processing over $200,000 of merchant payments every month.
That little kid back in Ohio always dreamed about starting a business, but to wake up and realize that I get to go to battle every day with my best friend by my side is beyond imagination."
For more information: www.yokepayments.com