How an App Developer turned His No-Income Startup into a Multi-Million Dollar Venture
In 2013, UpKeep founder Ryan Chan taught himself to code in three months while working full time at a manufacturing plant, studying for the MCAT, applying to med school, and living with his wife in his mother’s garage.
If that sounds like a lot to you, you’re not alone. How he developed the efficiency and tenacity to accomplish this is a bit of a mystery, though he recently offered us some clues.
“Growing up, I was always the smallest kid in class,” said Ryan. “I always felt like I had something to prove. I don’t know why. It was just this weird chip on my shoulder. I wanted to be able to prove people wrong in these untraditional ways.”
The founder of a now multi-million dollar machinery maintenance app that has clients from Yamaha to Jet.com, Ryan is known for skillfully iterating on a broken system.
Before UpKeep, maintenance software for tracking, predicting, and preventing equipment malfunctions was either expensive, desktop-based, or both, but Ryan introduced a game changer after a post-college job exposed him to the industry’s weaknesses.
“I was working full time as a chemical engineer at a manufacturing plant, and I noticed we were paying tens of thousands of dollars for this maintenance management software that was 100% focused on the desktop. In a manufacturing plant, hardly anyone is ever sitting at a desk,” he laughed.
The result was that technicians would have to spend most of the day out in the field writing notes with pen and paper, return to the office, open their computers, and add an extra hour typing maintenance notes about the equipment before they could leave for the day. Understandably, the software saw little popularity or follow-through.
“It hadn’t yet occurred to me that I was actually going to build my own software though,” said Ryan. “What I initially took from it was how bad technology as a whole was in Industry, and I was like, ‘Hey, I can do this better. Bring it on.’”
At the time, Ryan was a 20-something with a Chemical Engineering degree from U.C. Berkeley who had previously tried several different majors. He began teaching himself to code during nights and weekends while also applying to med school, though he eventually nixed the latter idea.
“I decided not to go the medical route,” he said. “My wife got into UCLA Med, and I decided I was going to see if I could get a job as an iOS developer down in Westwood or Santa Monica.’”
If You Build It, Will They Come?
Ryan started working as an iOS developer in Los Angeles and began building UpKeep in his free time.
“Once I started coding, I saw 10,000 problems that technology could solve within my company, so I tried to find just find one. And I landed on maintenance and asset management.'”
“The whole premise was: ‘build better software that my old company could have used.’ I wasn’t really thinking about turning UpKeep into a product or business or a massive startup by any means. I was just doing it because I knew that there was a big problem, and people could definitely use this software.”
A year passed in development, then Ryan launched UpKeep on the App Store with the encouragement of a friend who also ran a startup in LA. Importantly, he initially offered UpKeep entirely for free, though the launch wasn’t without its challenges.
“On the first day, nobody downloaded the app,” he said. “On day two, I had to beg my mom to download the app! On day three, I had to beg my brother. On day four, I finally got my wife to download the app.”
“At some point, you just get so focused on the day-to-day, and it feels like this big grind every single day. It feels like you’re making no progress. But then, two years in, my friend told me, ‘Hey, Ryan, turn around and look how far you’ve come.’”
The progress Ryan's friend was referring to was that UpKeep had gradually reached 10,000 users within the first two years of its launch.
When we asked Ryan how he accomplished this, his answer was simple:
“There's this belief, ‘If you build it, people will not come.’ I think the normal saying is, ‘If you build it, people will come,’" he said. "But [in business] it's actually the opposite. But I kind of did that [I built UpKeep first].”
“I decided I was just going to have fun building it. I was the app’s sole support person. We had zero sales. And I was like, ‘I'm just going to talk to everyone that wants to talk to me in the support channel.’ And I did that for two years, and how we grew was that, when I launched the product, it was 100% free. There were a lot of competitors in the space, but they were all super expensive, and none of them were as easy to use.”
The Breakthrough Moment
Even though UpKeep had 10,000 users, it still wasn’t technically a business—or rather, it wasn’t a profitable one—until something changed.
“One day I got a support message from a user that said, ‘Hey Ryan, we got a quote from one of your competitors at half a million dollars just to add our small team to their software. We know UpKeep is a free product, but we really love it. And we'd love to pay you for UpKeep.’”
The user in question turned out to be none other than Brad Ritti from Universal Studios. Ritti offered Ryan $350 per month to use UpKeep for his parade float maintenance team of 35 people. Even though it wasn’t a huge amount, Ryan was ecstatic.
“Brad had no idea that UpKeep was just one person part-time on nights and weekends working and living in mom's basement garage,” said Ryan. “I was like, ‘Hell yeah. Mom, I made it!’”
Ritti was so pleased with Ryan’s product that he flew Ryan and his wife to Universal Studios Orlando, where he got to meet Universal’s maintenance team.
“They were using UpKeep for things like pyrotechnics, motors, and other machinery for the parade floats,” he said. “The whole experience of seeing that was so cool and inspiring.”
For the Love of 'UpKeep'
Fueled by his own progress, Ryan decided to apply to startup accelerator Y-Combinator as a solo founder.
“YC generally discourages solo founders. I was recording the 3-minute YC pitch video to get in. And Shelley [my wife] was walking out the door to go to school. And, she was like, ‘Oh, you should try a little bit harder. The background’s not very good.’ And I said, ‘Oh, don’t worry. There’s no way I’m going to get in.’”
“Two weeks later, I found out I actually did get in. So I went and lived with my wife’s mother for five months in the Bay Area while I went to YC. I was in YC’s 2017 Winter Class.”
As part of their usual grant for students, YC gave Ryan $120,000 to get UpKeep off the ground. But since YC focuses primarily on helping students achieve product market fit, they told him to move on to the next step.
“They basically told me that I already had product market fit, and I should focus on hiring employees.”
Today, UpKeep has grown from 1 to 150 full-time employees in the US, UK, India, and Canada, and has over 400,000 users, among them Unilever, Siemens, DHL, and McDonald’s.
“Our goal is to keep growing,” said Ryan. “We’ve really only just tapped the market. I would say we're less than 1% of where the global market is, meaning the space is huge in terms of product. We want to build better predictive technologies, and also do big things like getting a million maintenance technicians higher-paying jobs.”
When asked what tools have been most helpful to him in scaling and running his business, Ryan said he uses Brex as a business bank account alternative and as a solution for keeping track of UpKeep’s finances.
“I started using Brex because our business bank account at the time just had this really terrible interface, which led to us having issues with getting people to use and adopt it.”
“It was difficult to set up virtual credit cards, which is so important, especially in this remote world. We need that. I'm also a terrible culprit of not adding in my receipts and doing like, stupid memos and stuff. Brex reminds you to do all of that and makes it easy.”
“There’s also the security factor,” added Ryan. “We’re a really high-growth startup. We want to trust and enable our team to make smart purchases and to do it in a secure manner. The issue with our previous bank was that it was just super clunky, super cumbersome when you talk about things like just sharing your credit card with another employee. When you want to move fast, it's not the most secure thing in the world. Brex gives us security. So that's kinda the main reason we use Brex: managing our expenses, better interface, and virtual credit cards.”
Ryan says he also resonates with Brex’s philosophy to achieve the ‘impossible’ and reinvent dated systems that don't— and can't— give customers what they need.
“All of our competitors are literally 10 times the number of people than us. They have like hundreds of years more experience than us collectively. They have more money. They have more time. They have more engineers and designers and everything in a lot of ways.”
“So what we’re doing is largely what a lot of people would say is ‘impossible.’ But that’s what I’ve always believed in," said Ryan. "I believe in doing what people didn’t think was possible before.”
UpKeep is an easy-to-use asset management app that takes the work out of work orders. In need of machinery maintenance and malfunction prevention? Learn more about UpKeep and how it can help your business here.