Main Street Makers

#6 Chad Huber: Using His Small Business Roots to Shape Nav’s Tools

• Nav • Episode 6

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In this conversation, we talk with Chad Huber, former entrepreneur and current product manager at Nav who led the development of the Nav Prime Card. Chad emphasizes how his small business days taught him the importance of understanding customer needs and building relationships as core components of business success. He also discusses how providing value and differentiation can lead to a thriving business — as long as you have the right financial foundations in place.

Nav Technologies, Inc. (“Nav”) makes no assurances or representations regarding the accuracy or sufficiency of the information included in this podcast. This podcast is for educational purposes only, and is not legal or financial advice. If you have questions, consult a trusted professional to help you make specific decisions about your business. The views, opinions, and statements expressed by the host and guests on this podcast are their own and do not necessarily reflect the views or opinions of Nav.

Nav Technologies, Inc. is a financial technology company and not a bank. Banking services provided by Thread Bank, Member FDIC. The Nav Visa® Business Debit Card and the Nav Credit Builder Card are issued by Thread Bank pursuant to a license from Visa U.S.A. Inc. and may be used everywhere Visa cards are accepted. See Cardholder Terms for additional details. All other features of the Nav Prime membership are not associated with Thread Bank.

With regard to credit building features: scores are calculated from many variables; some users may not see improved scores. The Nav Credit Builder Card is a business financing product and may not be used for personal, family or household transactions.

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Chad (00:00)

The core of business is really understanding your customers and solving something for them. Make their lives easier. Somebody pays you for something, they get value. You provide something better than other people or something a little bit differentiated and that works really well.

You build relationships with people and you make sure that their needs are understood and you listen to them, you're probably going to have a business that has hopefully a lot of success.

Catherine (00:20)

Thank you so much, Chad, for joining us. We're really excited to have you on. This is gonna be a special episode of Main Street Makers Chad is actually a product manager here at Nav and has owned businesses of his own and has used those experiences to build business credit and financing products that we have today. So I'm really excited to have Chad on the pod.

Chad (00:42)

Yeah, thanks for having me. Excited to be here.

Catherine (00:46)

So my first question for you is kind of around like your previous business. So we know that you're a business owner turned product manager here at Nav and that you owned a fitness club. What's your entrepreneurship story? How did you find it? What led you to start that business?

Chad (01:03)

Yeah, so I grew up in a family-owned small business. My dad had owned a kind of a health club. It's like I grew up in the industry, if you will.

Coming out of college, had a friend who had graduated a couple years earlier and he was a personal trainer. And so I moved to Bend, Oregon and started a gym with him. We did a lot of different stuff. We ended up calling ourselves Unconventional Fitness, which was a kind of a fun tagline. And we worked with a guy who had been in branding and actually got us in business, which was really cool. 

But it was 2010. It was after the financial crisis and in a place that was pretty hard hit. So it was challenging. It was really hard to get people to pay extra money for a gym. We were kind of hybrid personal training by unconventional meaning like We would do a lot of personalized plans and evaluation and one of our informal taglines was, “Crossfit without the injuries.” 

And so we got really good results and we had a really kind of in-depth sales process, but it ended up being, you know, a litany of mistakes and challenges from, you know, trying to figure out bookkeeping and marketing and what location should we be in? How do we plan that against the budget? Just all sorts of things, but it was a really good learning experience for me, but not particularly financially fruitful.

Catherine (02:22)

I know that we want to go into all of those things like what went well, what didn't go well, but I'm also just curious because a lot of people do start businesses with their friends or their family. How did that go? Were there any like lessons that you learned from that that you would pass along to others?

Chad (02:38)

Yeah, definitely don't go 50-50 in a partnership. I mean, sometimes it works out well, but when no one person has final say, the dynamics can get a little bit weird. In my view, it's better to have somebody at least be like 51-49 and you could flip that later, but have somebody who has the final say just because it gets tricky. It's good for somebody to have that responsibility and weight of the final decision maker.

Catherine (03:02)

What were some of the things that you felt went really well as you built the business? Like what were some good lessons that you learned?

Chad (03:09)

The main one is probably just how much work it takes, like getting in the habits of long days. I mean, I would go to the office, go to our gym at 10 a.m., and then I would leave at 8 p.m.

And usually when I'm leaving, I'm going home and eating and then doing more work. It's like days were really long, six days a week. I think we took Sundays off and even then I was like, I got to do laundry and write an email or something. But you know, I learned a lot around bookkeeping. I made a lot of mistakes in that, like how to project finances, how to hire people, how to interact with customers. We invested a lot of time in our sales process and got really good at it. 

And that has helped me today, connecting with folks and understanding what's the core problem you're trying to solve. Fitness is very personal. People come to you and you know, they want to say, lose weight or run faster. But there's usually another reason why and then another reason like below that. 

It's like, okay. I want to run faster. Well, why do you want to run faster? Oh, well, I'm training for a marathon. Okay. Like why are you training for a marathon? He's like, oh, well, I've always wanted to run a marathon. It's something that, you know, my best friend used to do. And it's a way that I really want to get reconnected with them. And it's like, oh, okay. So your motivation isn't just to run faster. Your motivation is actually to build community and friendships. That's a way bigger motivation than just running faster. 

And so that's what we would use. And we would incorporate that into our sales process and really help people understand the benefit that we can provide. So that was, for me, really big learning that's been able to help me in my career. And I think when you talk to many small business owners, it's a hard thing to articulate. 

You just learn. Your experience and your skills get a mile wide and an inch deep. But all those come to help you in future endeavors. 

And especially if your business grows, then those expand really well because you just start layering on learnings and now you're managing people and you're managing budgets and you're thinking about projects and you're investing money and you're taking out loans. 

So I think even at an early stage we didn't make it, we didn't get to growth really with our business with that one. Those learnings were really helpful for me.

Catherine (05:12)

Yeah, I'm hearing that it was really important for you to understand your customer really, really deeply.

Chad (05:17)

Yeah, totally. You know, I think the core of business is really understanding your customers and solving something for them, make their lives easier. You know, and that creates value that you then interchange and that becomes commerce, right? Somebody pays you for something, they get value. You provide something better than other people or something a little bit differentiated and that works really well. 


And I think that concept applies whether you're doing fitness or even trades, plumbing and electrical, cleaning, even trucking. You build relationships with people and you make sure that their needs are understood and you listen to them, you're probably going to have a business that has at least some success and hopefully a lot of success.


Catherine (05:57)

Yeah, that's a great lesson. So now I kind of want to move over to the challenges. What were some challenges that you faced? It could be anything from customer acquisition to finances.


Chad (06:06)

Yeah, all of them. You know, one that's especially poignant for me was around bookkeeping. Like coming right out of college, I'd never done bookkeeping before. 


Like sure, I had a business degree, but I had never actually had to do bookkeeping where you're balancing double-sided entry. And that's what you need to do if you're going to do your financial reports and for tax reporting. You have to have balanced books. You have to understand what losses you have during the year, what you pay out. even just try to use QuickBooks. 


It seems easy, but you're like, OK, well, we took this money here. That was cash. How do I record that here? OK. Did I get it right? And I got it wrong a lot early on.


And so then we had our tax person who tried to fix it. the tax accountant is the most expensive person. Yeah, they're way more expensive than the bookkeeper. 


And so I learned a really hard lesson around not just bookkeeping itself, but also when to use experts and how to use them. And so we ended up hiring a part-time bookkeeper who would come in like once or twice a month and just help us with the books. And that allowed me to focus on other areas like marketing. Once we had customers in the door, we got really good at that sales process, but trying to go out and get new customers, especially in a place that was hard hit by the financial crisis. Like that was, that was a challenge. And I don't think we ever really got that figured out. 


And if we started it today, it'd probably be different. Bend has grown a lot and people have a lot of money now in that area of the world but we picked a time when people were hurting a bit and didn't have a great location. So you're a fitness business and you're not getting walk-in traffic. So it's just hard to pull people in. We learned some really good lessons around you know just our day-to-day workflows. And how do you maximize time? For me, it was worth it for us to spend money on bookkeeping and try to minimize that cost.


It would have been better if we would have chosen a location, even though that's more expensive. So that we could have had walk-in traffic and drive-by visibility, which we didn't have.


And the third was really figuring out — how do we get people to recommend it to others? How do we get in the door? What are our right channels? 


And that's a hard thing to do on a daily basis. You're doing some personal training and you're teaching classes and you're dealing with finances and you're making sure people are charged right about money and you're ordering products. And then you're also trying to wear this hat of like, how do I go get new customers? And so, yeah, I don't think we really even had that figured out totally by the end of, I think it was there about two and a half, three years.


I don't think we'd still quite figure that out. I wish I would have spent more time and had more mentors that could have helped me in that regard too.


Catherine (08:40)

Yeah, there's a lot there to unpack for sure. I want to dig a little deeper into bookkeeping. How were you managing your books? Did you have a software? Were you figuring it out? Like how what did that look like?


Chad (08:47)

Yeah. I created a spreadsheet with projections, mostly just simple budgeting, and that worked pretty well. So we generally knew, if we had X members, how much money we would make, and then I could kind of budget that out, you know, between rents and products and, what little money we could pay ourselves.


On the bookkeeping side, we ended up using QuickBooks Online and… it was tricky. Because you're trying to sync accounts automatically in the background.


But it was hard, like sometimes those would get mismatched or were just tough to reconcile. And then we also used, I think MindBody, in the early days of MindBody, when they were still like a small company. And that's how we manage it, so we charge all of our customers. But you're still getting people who come through and pay in cash. Or we had people who would prepay us with a check, and we had to deposit that. And that was hard. It's hard to figure that out.


When your transactions aren't just showing automatically and with easy categorization, it becomes really hard to understand how those interact and how those go down into the financial reports that you need. If you're going to do things like open up a bank account and apply for financing and all these other things that you're trying to do as a small business owner. So that was a real pain point and like it sucked a lot of time. It sucked extra hard because I made mistakes because I didn't know. I didn't know what I didn't know. And that was hard.


Catherine (10:07)

Yeah, and you also mentioned that you did end up hiring a tax accountant to help out. How did you make that financial decision that it was worth it for you to invest in a professional versus doing it yourself?


Chad (10:18)

We knew we needed somebody to help us prepare our taxes and we got a recommendation from our lawyer. It was a recommendation from a family friend when we were setting up the business. There's more tools and services available now than there were, you know, 2010. So I would not do what I did then, which was very manual and very traditional. I would try to use online tools and documents and everything as much as I could now that didn't exist back then.


But we just got to the point that like the books didn't balance and we didn't have matching assets and liabilities. The transaction categorizations were off. We're missing transactions. Like it was just pretty evident that mistakes were made and they were made by me, which was frustrating. So we had to hire, our accountant went through and was like, this doesn't work. And then I was very fortunate because the accountant was also like, “Hey, you should probably hire a bookkeeper.”


Because I'm a lot more expensive than a bookkeeper. So if you want me to do it, I can, but this is not a good use of your resources and I know how many resources you have, which weren't a lot. So that then prompted us to hire a part-time bookkeeper. I think we just made a post online. We had some help from my business partner's sister for a bit and then we had somebody local 


And then we just kind of put out an ad and one of our members who also had a business. And so that person would come to our office for roughly eight to 10 hours a month and just go through the transactions and sit with me. It took a little while to unwind and undo my mistakes. Then we kind of got to a good place. We're like, okay, now we know the system. And then once I had somebody who showed me how to do it, then I could learn that. And so then we get faster. So we wouldn't need that person as much because they would come in, sit with me, teach me. That'd be a good use of my time because I'm not struggling, flailing around, trying to learn something on my own. It's like very coordinated learning. And you know, small business owners are nothing if not resourceful and fast learners. So then it got faster and faster. And I just wish I would have invested in that and seen it not as a business expense to avoid, but an investment in me and my learning that will pay dividends down the road.


Catherine (12:30)

Yeah, that's a great point. It's interesting too that you pointed out that all of the mistakes were adding up because I would imagine that that could potentially have really bad consequences come tax time and be more expensive than if you had just hired someone to help you learn.


Chad (12:45)

You have it going great, you can save money on your taxes. We didn't have it going great. So it was really important to do that.


Catherine (12:52)

Yeah, that makes a lot of sense. So outside of bookkeeping, how were you managing your finances in the early days? Were you using business credit, net-30s? How was that going?


Chad (13:04)

Yeah, I also just did a lot of things like checking the bank account and managing finances. How much money do I have today? Okay, wait, how much should I have coming in? Is this right? so we definitely did that a lot, which I think happens a lot with small business owners, especially early on is, cash is king. So we definitely did that.


What ended up being a really big boon for us is that we sold a lot of foam rollers and these other really good fitness products. And so we had a couple suppliers, one was TP Therapy. You've probably seen their foam rollers. They're like for NBA players. We use them before games now. They've got ridges and some flat parts. We got net-30 terms with them after establishing a relationship.


We had a few different orders before we didn't have any credit history. I didn't know what business credit was. Nav didn't exist then. It would have been really helpful if it had because I would have understood, you know, what is business credit? What is a DUNS Number? What are credit bureaus? How do I use this? That was basically non-existent back then, which is why Levi, our founder, started Nav — for the experience that I faced. 


But without that, I ended up paying cash on demand. Basically just like paying for orders until we established a relationship. And then we ended up getting like 30-day terms. And so that was really helpful because I could go get $400 worth of foam rollers and other fitness products. And I could turn that into $800 or a thousand bucks within 30 days. 


So basically just like clockwork, I would be able to add, you know, $500 of revenue of cashflow every single month. And it didn't cost me anything. It was just like, I get $500 of orders and I turn them into $1,000 before I have to go take that $500 cash out of my account. And that was super helpful. So that really helped our cash flow being able to do that and made it actually possible for us to generate revenue by getting these products, getting them in and then selling them before we pay for them.


One of the tricks actually that I found is you can get special terms and special pricing. If you say you're a business and you're a reseller, like this is kind of a hack. Some of these fitness companies I've reached out to, I’d say, “Hey, we're going to resell some of this product.” 


And we did to a degree, not a lot, but we would tell our members like, we sell everything in here. Like if you want, you know, you want these bands for at home or you want a foam roller or you want a ball like we can give you both buy through us. Like we'll give you a good deal on it. 


So we'll go to these companies and say, “Hey, can we, we buy this like wholesale?” And so we ended up beating our cost projections to buy all of our fitness equipment because we did it as a wholesaler, not as just a business. So that was something that I was actually really proud of. Like I saved us thousands of dollars in cost by kind of like doing this little bit of hack because we were a business. I think were an S-corp. So that was kind of a cool way that I highly recommend.


Catherine (15:39)

Such a good tip. I wonder if that's still available for people. So you mentioned that you didn't know what business credit was but you were able to get on net-30 terms with the supplier. How did you develop that relationship and “earn it,” if you will?


Chad (15:55)

Yeah, it's something that we're seeing too within these payment terms — like trade credit, net-30 space — where the companies want to trust you. And we talk about relationships and this human connection. It still comes back to that a lot. That's the baseline. So if there's not ways of understanding your business because you don't have long history and you don't have credit reports with Dun & Bradstreet and Experian and Equifax and you know, so on and so forth, they'll rely on like, just prove to me that you are who you are and that you, you can pay for stuff.


And that's what it was. And so I think it was at least three months, maybe six months of us paying for stuff upfront in smaller orders. I was like, okay, you can pay 200 bucks. Okay, great. Like you can pay 300 bucks. Okay, cool. Like now that you've proven this, all right, we'll give you, know, whatever your largest purchase was as a line of credit. 


And then we're able to make larger purchases. But it was very much a personal connection where they knew me and my email address. If not, like I've never met in person and I knew them by name and their email address. And we establish relationships and orders and talk on the phone occasionally and that's how we built that.


Catherine (17:01)

Yeah, and that is so similar to how business credit and financing work, right? It's just that this was done one-to-one on a relationship level rather than like through an official score or report.


Chad (17:12)

You know, it's funny, there's a couple companies that started out around the same time and they've grown much larger now. And I was like, I used to email directly like with their founders because they were a company of three when we worked with them.


Catherine (17:23)

That's so funny. So I kind of want to talk then about things like, how did you end up making the transition from being a business owner to being a product manager at Nav? Like what were some of those pain points that you experienced that when you came here you were like, I want to solve those for business owners.


Chad (17:42)

Yeah, I'll do the short version. And this is kind of a funny little story and then I'll fast forward. So in Bend there was like one tech company — digital marketing for self storage and multi-unit apartment buildings and senior living places. 


Doesn't sound super sexy, but was a lot of paid advertising and setting up websites and doing SEO and the owner of that company, the founder, was a member of my gym. So when I ended up leaving the gym, because we didn't have enough cash flow to really support multiple owners, especially two and a half years into burning personal credit and my own savings and everything else, I reached out to him and the only thing they had available for somebody like me, which has like very few skills on paper that would fit into a traditional role at a tech company was a temp, temporary position, basically just doing data entry.


But that got me in the door. So I did that and then I turned that into an account manager role, which worked really well because that's what I had been doing, you building relationships with people in the gym. 


And then because we were doing, you know, this digital marketing aspect got into digital strategy and started to like understand technology and work with our product and technology teams, like from the account management rep, from there, fast forward ended up doing a startup in FinTech. So financial technology. 


Trying to make savings as rewarding as spending, made a whole bunch of different mistakes. I didn't make the same mistakes that I did with the small business, but it's a little different when you're trying to be venture capital backed and grow this thing and be a real techie. So I made a whole bunch of new mistakes that didn't end up working out, but it did get me into product management at another FinTech company. And then that in turn led me to Nav.


And so that's kind of long-winded at this point, but how I use that in that experience as we're building products. You're always trying to build for customers and there can be an inclination to build what you think is the right solution. 


That's been really helpful for me because I've been the customer for products that Nav builds. I have a little bit of an innate hypothesis that I can have that I'm like, “This actually is a challenge for small business owners,” or “Wait, we think that this is clear, but it's probably not.” I remember when I didn't know what DUNS Number was. 


It was really confusing. Like trying to figure out an SBA loan. It's like, wait, I need a what and how much time in business? And like, okay, wait, are there any other options here? Like what's a personal guarantee? I remember going through all that confusion. And so that helps me when I'm thinking about how we deliver products at Nav — try to build to that type of person who is getting started, but also something that really helps leverage their time. 


And we still talk to customers all the time. So I'll take that and then go validate and say, “Hey, you work in a salon.” I did fitness, but like, that's not, it's not a salon. “Does this solve your problems? Like, what are you thinking about on a daily basis?” 


But having at least one step into that process has really given me a lot of empathy for what small business owners experience and you really want help. You're like, I can learn anything. I'm running a million miles an hour in ways that people don't see. So help me, help make me better. 


Teach me how to fish, don't give me the fish. And so that's, when I think about stuff we're doing at Nav, is how do we help business owners learn how to fish better or fish for fish they don't know about? Because that's really what it is. We know a lot about the fish that swim in the business credit space and business financing.


And that's a hard area to figure out. So like, how do we help other people understand it in very simple ways that are meaningful for how they're building their business.


Catherine (21:17)

Yeah, I love that. There's a connection here between what you've been talking about with relationship building and how you've approached pretty much like a brand new type of underwriting model for like the Nav Prime card that allows us to give credit to more people. Talk to me about that connection.


Chad (21:38)

Yeah, totally. For those that don't know also, was one of the main people helping build the Nav Prime card and really try to solve this problem like access to credit building. And, to connect the dots to your question, Catherine is like, we noticed that a lot of people were getting denied or just didn't have options in this space. And if you don't have options to get a credit card, then you don't usually have options to building credit. Like it's hard. And we wanted to completely solve that problem of like, are different things we can do to help customers get approved? 


Now the tricky part there is that you're trying to make it a win-win. And there's a lot of information out there about traditional underwriting methods and looking at credit scores. And so we had to figure out, How do we kind of throw out all these traditional ways of thinking that are ingrained within banking, but not helpful for our customers and what we're trying to do for them. 


So that's where we innovated a bit by requiring a connection to a checking account, which allows us to do kind of a cash-flow-based lending, is a term you might hear. 


So we're able to kind of look at the length of the account, understand money in, money out, and then also look at your activity on the card. And so what we're trying to do is, you know, we don't want anybody to be able to overspend. You know, we're not trying to add extra stress into a business owner's life. You know, you shouldn't be spending on the Prime Card and be worried about like, Oh, can I pay this back? Like what's going to happen? Like, so we try to make sure that it always stays within your means. We report all the activity to multiple business credit bureaus, which is really cool. 


And like hint hint to hand to also, uh, personal credit bureaus as well. So excited about that. 


So we just really try to kind of bring this full circle. We really try to make it a thing that would do no harm, would really help build credit in ways that other companies aren't helping with and really try to make it as easy to understand as possible and that's one thing we're still working on. Like it's not quite as clear as we want it to be and we've had a lot of really good feedback from customers and we're gonna keep improving it.


Catherine (23:36)

People are always so curious like how do I get a higher credit limit [on the Nav Prime Card]? Are there any secrets you can give us?


Chad (23:45)

Yeah, I'm gonna try to be as non-secretive as possible. We can't give away like the full formula, but generally speaking, if you use the card regularly and keep as much cash as you can in your linked account, that will be the most important thing for raising your limit. If you do those two things, you will have the maximum possible credit limit we can give you. We're not trying to lower people down. We're also gonna try to be more explicit with this over time. 


That's something that is a big thing for me, and I think a newer focus of Nav is how do we educate, not obfuscate if that makes sense. How do we help? It kind of ties back to like the fishing analogy, right? We really want to do a better job of helping people understand how your credit limit gets set and the factors that go into it. And then we want to apply that same concept across everything we do at Nav. You like your qualifications for different financing offers.


What exactly do you need? What kind of qualifications do you need to get net-30 terms? Sometimes they're just like application requirements versus like certain levels of business credit score or time in business. So we're trying to do a much better job. And I think you're going to think customers are going to see a lot of really cool changes this year of really trying to be more explicit and bring understanding to small business owners in ways that nobody else is.


Catherine (25:04)

Yeah, love that. Thank you for indulging me on that side quest. My last question for you is you're so entrepreneurial. You've started a small business. You've started a startup. Even here, you're very much like a business owner in the way that you think through problems. What's next? Are you ever going to start another small business?


Chad (25:24)

I have this dream that I want to do where I want to have like an 18-hour-day cafe where it opens at seven. We serve some really nice coffee and a place to hang out, chill, has some nice bright airy environments, nice indoor plants, you know, like let's get a fiddly leaf in there, fiddle leaf. I always say fiddly. My wife makes fun of me. And then.


Can we make it a music venue at night? Like, not every night, but like, can we have it be like some loungey kind of cool vibes, play some good music, occasionally have some live music, like keep it up until like midnight. I just think that would be a really fun place to go. You can kind of see more often like in some other parts of the world, like Portland, always. So in Portland, Oregon, like, it is always a super early to bed town. You're like, you go out at nine, you're like, where can we get dinner? And it's like, close, close, close, close, close. You're like, oh, okay.


Like not a good place for night owls. But I would love to have a spot where it's like, you know, we're not going to be a five-star restaurant, but hey, you can get some good food. You can always get a good drink. You can always get some caffeine and you're to get some good music. Like I just think like the place that I would want to go, that's the kind of place that I want to open. Now, I don't know if it would ruin it by being a manager of people, but I would love to start something like that at some point in my life.


Catherine (26:38)

I love that and we need to talk about this more because I have a very similar dream. But yeah what a great thing to do in Portland. I think that's like Portland. And now you have so many lessons that you could bring to make that business really successful so love that.


Chad (26:51)

Thank you.


Catherine (26:59)

Well, thank you so much for joining us. I think this was really interesting for our listeners and for me, and I appreciate your time.


Chad (27:09)

Yeah, thank you so much. This was an absolute pleasure. You know, I could talk all day about small business. I love small business owners. I love the challenge of building small businesses and just like the energy of being around small business owners is so much fun. 


Like it's, it's a blast being here, especially in a company who really cares about small business owners. Like it's not just something that we're doing because we think there's a market opportunity. Like we talk about the people, our customers all the time. We bring them in and have presentations to the whole company. So it's just such a, it's fun working with people like you and everybody else, you know, on our team who invest so much time and energy into this. 


So thank you for having me. It's been really enjoyable for me to be here.


Catherine (27:47)

Thank you.