Today we’d like to introduce you to Tom and Rachel Ruginis.
Tom was in a Ph.D. program at Univ of IL-Chicago studying Pharmacology in 2012. He was hoping to cure cancer but a few things got in the way. 1) Lab life is boring 2) Career outlook for a scientist is bleak (low salaries, and little respect 3) learned that cancer will not be cured anytime in his lifetime. So he left the program backed by one of the few people who supported his decision… his girlfriend Rachel.
After 2 years in the business side of science, the idea of a company began churning. As a sales rep, it became clear that scientists were at a disadvantage when shopping for lab supplies and equipment. They have NOWHERE to go to double check a price. Scientists in the US spend >$30 billion per year and some of the biggest companies in the industry are some of the wealthiest companies in the world.
Scientists were constantly being taken advantage of this lack of transparency and these companies were profiting largely from it. (side note: Tom had to quit the sales job b/c he was diagnosed with Psoriatic Arthritis, requiring significant flexibility in his work schedule that a sales job didn’t allow. So he quit that job.)
Rachel has a background in graphic design, so the two of them began developing a “magazine”, similar to Consumer Reports, that listed prices and quality ratings of lab supplies. Tom used his network to gather the data for the early reports. You should read more about the financial origins of HappiLabs here:
https://happilabs.wordpress.com/2016/06/21/the-financial-origins-of-happilabs/
Simultaneously, as they worked on the magazine idea, he took coding class at Starter League in 1871. Knowing the magazine was going to be difficult, he thought he could learn to build a website, like Expedia or Yelp, to share with scientists. He was wrong! Coding that large of a database and website was gonna take a full team of developers. So scratch that idea. Eventually, it all turned into a service.
Where that blog post finishes, they’re at about 4 customers using the Virtual Lab Manager service. The magazine revenue model didn’t work out, but their knowledge of the industry and the lab manager job turned into a very valuable service, especially for biotech startups in Silicon Valley. The service is called the Virtual Lab Manager. They’ve been called personal shoppers for scientists, an outsourced purchasing department, and plain ole’ “lab manager.”
They’ve been hired by 40 labs to date and can call themselves a million dollar company.
Over time, they became smarter and faster. They built a database of pricing data, optimized their workflow with software, and grew mostly by word-of-mouth. They are happy to have been raised in Chicago and learned the Midwest work ethic. Bootstrapping is the way to go!
Overall, has it been relatively smooth? If not, what were some of the struggles along the way?
Bootstrapping. In year 1, Tom had a bunch of odd jobs–dog walking, delivering pizzas, babysitting, social media consulting (Twitter was taking off, and I loved it. I found several people/companies to pay me to teach them Twitter or manage their social media).
Having a kid in year 2. We have a photo of me working in our living room with a baby strapped to my chest as I made phone calls to scientific suppliers. This obstacle was more financial than anything. The kid actually brought me more focus and motivation to keep going.
Realizing the magazine idea was a dead end. A tough hit to my confidence.
Figuring out the service model was a challenge. We really wanted a product that is usable by all scientists. But since there are only 2 million scientists in the US, the market (# of consumers) is so small that the product cost has to be high to be sustainable. It’s the main reason most startups fail in this space. Focusing on the service, as a luxury (and therefore we could charge more), for the first few years, ended up making sense.
Alright – so let’s talk business. Tell us about HappiLabs – what should we know?
We’re a scientist’s best friend. Many labs have a lab manager to support the scientists, but when you break it down, about 60% of a lab manager’s job can be done anywhere in the world with a computer and internet. We do that 60%.
We know how to purchase things, but more importantly, we know where to find things. Scientists spend so much time searching the internet and talking to untrustworthy sales reps, that it limits the speed of science. When using a Virtual Lab Manager, there’s no doubt that that lab is moving faster than any other lab on the planet. And we’re saving them a ton of money b/c we know the supply chain and how to negotiate pricing in this industry.
Aside from purchasing, we provide all kinds of lab support, such as: helping organize safety documentation, basic bookkeeping so scientists are not distracted with tracking down receipts, product/technical research, and much more.
We’re proud that we’ve created 12 jobs.
What sets us apart…. because Tom and Rachel are in full control, we have our full attention on the scientists. We don’t have to answer to any investors or partners and can be as flexible as we need to be to make them happy. Also, our app, the ETA Dashboard is pretty fucking cool.
Any shoutouts? Who else deserves credit in this story – who has played a meaningful role?
The family and friends that invested $48,000 in all with the expectation that they “will lose their money.” It helped us hire the first couple part-time workers.
From Tom’s perspective… Rachel deserves a ton of credit. She helped pay Tom’s rent in the beginning and supported the grad school dropout. She won’t call herself a co-founder, but she is.
Seth Kravitz and Technori played an inspirational part. I learned how to be an entrepreneur through my meetings with Seth and attending Technori events.
The culture at 1871 inspired me.
And inspiration from Richard Branson and Tony Hsieh helped created a positive culture at HappiLabs. Tom read all their books.
Contact Info:
- Address: 2242 W Harrison St Chicago, IL 60612
- Website:www.happilabs.org
- Phone:3125690161
- Email:hello@happilabs.org
- Twitter:https://twitter.com/HappiLabs_org
Image Credit:
Perfect Cut Productions
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