Ruben Serrato is the founder of We Dog Care, a 24/7 dog daycare and boarding service, which, he says, offers “the unique value proposition that we are an affordable, convenient, and highly transparent daycare.”
Serrato started the business when, as a rescue volunteer in San Jose, Calif., he saw local dogs too often ending up in shelters because owners lacked the time, money, and knowledge to care for them well. We Dog Care’s pricing is less than half of competitors’ pricing, and it offers a flexible range of hours for drop-off and pick-up—from 5 a.m. until midnight.
“What we offer is very challenging to deliver. It would have been easy to give up, but it’s working because I stuck to my vision of efficiency and delivering a quality product,” Serrato said.
Serrato was recently recognized as the winner of OnDeck’s Small Business Homerun contest, an initiative recognizing businesses that have positively impacted their local communities.
Why did you start your business?
My day job was in early stage venture capital. I was doing funding for technology and intellectual property companies. I worked a lot with entrepreneurs on the other side of the table. I always had an interest in doing entrepreneurial things, and I have had a few other projects where I’ve done very entrepreneurial things.
About six years ago, I started volunteering heavily for a couple of local rescues. I really fell in love with dogs. I never appreciated the depth of their emotional intelligence before that. It was very compelling to me to work with dogs. On the business side, I saw that the market was changing. Over the past 10 years, peoples’ relationships with dogs have been changing. They are now, more so than ever, parts of our families. From a rescue standpoint, I saw a very big need. A lot of owners may really love their dogs, but they don’t have the resources they need to properly care for their dogs. Sometimes it’s a lack of education, or a lack of time, so the dog is always in the backyard and doesn’t get proper socialization or exercise. I wanted to help people help their dogs. That’s where I thought the doggy daycare could really step in and be an important service for the community.
How did you get the funds to get going?
At first, it was personal savings and friends and family. I mostly invested in it myself and a good friend from college was my other investor.
Have you heard of business credit?
Yes. Probably like a lot of small business owners, at first everything was on my personal credit. But it was a big goal for me to change that as quickly as possible. From the beginning, I had a larger vision for the company. I wanted to develop this to be profitable and scalable.
Getting the company standalone credit was one of my first priorities. I did some research, and one of the main things I did was to get funding from OnDeck. Traditional banks need three to five years operating history. We grew very fast and had profit and revenue very quickly, but it wasn’t a long history, so we had to seek non-traditional financing that was still loan-based so we could establish our credit and keep growing.
Managing the Business
What’s most challenging about running your business?
You have to wear every single hat at some point. You are responsible for everything, and that is a huge challenge. You have to be aware of what everyone is doing, and that goes from the maintenance guy to the people in the groups watching the dogs to the customer service people who are interacting with the owners to the dogs to the finance people. It’s such a range of things you have to become competent in. For example, I now know about construction and the various types of epoxy floors. And I know about building apps, and legal stuff, and banking, and zoning, and regulations, and insurance now.
How do you finance your business to manage cash flow or growth?
We’ve been very lucky that we’ve experienced growth in the two years we’ve been around. We typically have a slight downturn in the New Year, as people tend to be home more in January through March. It’s pretty predictable, though. Since staffing is our major expense, we are lucky in that we don’t have a lot of fixed costs, so I can adjust by reducing hours based on demand.
We’ve borrowed cash to make capital expenditures on things for the facility like computer systems. Similarly, we borrowed money to change our layout and buy more fencing to make things more appealing. The latest time we had to borrow to invest in the business was recently, as we’re opening a second location.
Do you use trade credit from your vendors or suppliers?
What’s the biggest mistake you made in your first year?
Before I did this, I took care of dogs at home a lot. When I did my business model, I assumed I could do it all. I didn’t hire nearly enough. I didn’t invest enough in people. I thought I could get through the day, solve every problem, take care of every dog, and work with every customer. The first six months, there were unnecessary fires that I had to constantly put out because I underinvested in our biggest asset, the people around me.
What’s the smartest thing you did in your first year?
I think the stubbornness in the vision that I had for creating a low-cost 24/7 transparent dog daycare was smart. I was persistent and didn’t let go of that. We’ve never done an ounce of advertising. We are tucked away on a street where you can’t even see us. Other than throwing a grand opening party and letting some of our friends in rescue know what we do, we haven’t done anything to get our name out. It’s all been word of mouth from friends because our customers are passionate about our vision.
What’s the most rewarding thing about owning a business?
I love being able to execute my vision. When you start a business, you have a vision of this rosy, perfect thing. When you get into the mess of it, there are so many challenges you didn’t know you were going to see. But it’s all worth it when you are able to execute your vision. The challenges alter the vision a little bit. You grow up, and the picture you thought you were going to paint is a little different because, in reality, certain parts of your business are different.
What does the future look like for your business?
We are opening a new location in Morgan Hill, Calif. And we are developing an application that’s really going to help improve our transparency and the efficiency of our business for owners. They can really see and interact with their dogs in real time using their smartphones when they’re not there. Plus, they will be able to really efficiently reserve their spots.
What advice do you have for someone starting a business?
I personally believe it’s well worth it despite all of the responsibilities that come with it. If someone is really passionate and dedicated, they will see their vision through. Keep working hard and keep improving. You’re going to make mistakes, but don’t let them stop you.