Industry experience is among the things we look for in startups that want to pitch our group. How can you offer a better solution if you haven’t experienced the problem in some manner? I recently sat down with CRäKN President and CEO Scott Mindrum who gave up the life of a CPA to enter the “death care” industry more than 20 years ago. He was, in fact, very hesitant; funerals are kind of a downer. But his wife convinced him it was O.K. Today he’s happy he did. Scott launched and successfully exited one company in this space before launching his new company, which he will be pitching during VisionTech Angels’ February Road Show. It’s a good story and even better opportunity for our investors. Here’s our conversation:
Also, over the last 15 years, funerals have moved from being very traditional religious ceremonies to being celebrations of life with cremations rather than in-ground burials. So the expectations of families and friends of the deceased are changing, which places a bit more pressure on funeral directors to meet these evolving expectations. I have deep experience in the industry, have founded and sold a very successful business in this space, and after a few years of retirement and a little angel investing of my own, felt the time was right for a new SaaS venture.
BP: Where did the name CRäKN come from. I envision giant octopus crawling over ships.
SM: (Laughs) Yes, the name was inspired by the legendary kraken, a Nordic octopus-like sea monster that terrorized sailors. When we were naming the company, we wanted something memorable and meaningful. Funeral directors are, by nature, world-class jugglers. Our tools give them extra arms to get the job done. The CR and KN in our name stand for customer relationships and knowledge respectively, which are important in the death care profession. But, the name also makes funeral directors smile—the ones that envision a giant octopus—which is nice to do in this industry. Finally, the name has personal meaning for me. My father, who has passed away, was 100% Norwegian and my north star so in a way, CRäKN is my homage to him.
BP: Explain your solution.
SM: Death care is not a glamorous business, but the people who work in the industry have a high degree of empathy and are driven to help people. It’s very much a detail-oriented business that can be overwhelming. CRäKN’s software platform makes all of the processes that go into end-of-life arrangements far easier to manage. Here are some examples. A large part of a funeral director’s day is spent pulling information from several systems and paper files. CRäKN’s single entry system eliminates duplicate administrative tasks. Call answering services can be integrated with the accounting system. Pre-need records can be converted to at-need arrangements? All with a click of a button.
CRäKN also allows all events to be tracked using the digital whiteboard. Funeral directors can see who is working an event and details that still need to be finalized, so the ball never gets dropped. All of this can be done from a laptop, tablet or smartphone. Funeral directors get calls at all hours so this is a big plus! We also make the compliance side of the business easy and transparent.
BP: Do you have competitors that offer solutions comparable to yours?
SM: We do, but other software companies catering to this market are typically not SaaS and are focused on the accounting side of the business, while CRäKN addresses the entire business from relationship management to finance and accounting and all of the important services provided by funeral homes. Our intent is to automate processes so funeral directors and their staffs can focus on the families and getting them through a challenging time.
BP: What is your competitive advantage?
SM: The biggest advantage is we address the enter funeral home enterprise and not just a portion of it so clients don’t have to manage and maintain multiple software licenses and vendors. And while competitors’ solutions require user training, CRäKN’s patented technology is very intuitive, easy to use and requires little or no training.
BP: What is your revenue model?
SM: We’re a SaaS solution, but with a twist. Instead of charging our clients by the number of users or “desks,” we offer an unlimited license and charge by the number of funerals per month. This way, any person on the funeral home staff can access the CRäKN software. This makes the monthly fee a variable, but allows us to grow with our clients or retract if their business slows. This is attractive because there is some seasonality to the death care industry; flu season and post-holidays can cause spikes. Also, cities that are either losing or gaining population like the financial flexibility.
BP: What market traction do you have to date?
SM: Strong. We’ve grown 1000% year-over-year since 2018. Our client base is a good cross section of the industry, ranging from very small funeral homes to very large, multi-location and publicly traded businesses.
BP: How much money are you raising and what will the funds be used for?
SM: The target is $800,000. This is a syndication deal through Queen City Angels. They’ve done due diligence and have already funded $300,000. In addition to VisionTech Angels, we’re talking with two other angel groups and hope to close the round with angels rather than VCs or private equity groups. We plan to use the funds to accelerate our national rollout.
BP: Why should VisionTech Angels invest in CRäKN?
SM: You may not know this, but Indiana is the world’s headquarters for casket manufacturing and a major state for investing in funeral startups. Aside from that, CRäKN has a number of things going for us that should be attractive to investors. Our technology is state-of-the-art. Collectively, our team has been in the death care industry for 100-plus years so our relationships and contacts are deep. Lastly, our terms are friendly to angel investors.
To learn more about CRäKN visit their website. To RSVP for the VisionTech Angels’ February Road Show, visit our events calendar. Accredited investors interested in learning more about joining our group should contact Ben Pidgeon, firstname.lastname@example.org.