Jul 16, 2023 - Business

Charlotte tech startup at Y Combinator raises $4 million

The new Charlotte tech startup Craftwork, which aims to modernize the home painting process, has closed on a $4 million funding round. Craftwork is one of only a handful of local firms to participate in Y Combinator, a renowned startup accelerator out in Silicon Valley.

Why it matters: Charlotte’s startup scene, once small and under-the-radar, is rapidly growing and filled with an increasingly diverse range of companies, from software firms like Stratifyd to laundry services provider 2ULaundry. The bigger the industry gets, the more opportunities for funding and networking there are for other fledgling startups.

  • An expanding local tech startup scene underscores that Charlotte is way more than just a bank town.

Flashback: When Craftwork co-founder Tim Griffin bought his first house in the middle of the pandemic, he tore an accent wall in his kitchen and tried to repaint it. In the process he realized “how antiquated home services are,” he tells Axios.

  • Griffin, who also co-founded the local startup Cloosiv, got to thinking about how the home painting process could be streamlined and improved with technology.
  • Early this year, he recruited his wife, Suzanne (now the company’s COO), as well as friends Joey Skavroneck (now the company’s chief growth officer) and Mike Bifulco (now the chief technology officer) to start building a company.
  • By March, when Craftwork officially launched, the small team began taking on projects with friends and family. Today, the startup has grown to 22 employees.

How it works: Craftwork, which the founders consider a tech company, allows homeowners to get an instant painting quote online and schedule their projects. “Most homeowners don’t have an idea of what it would cost to paint your house. You’re likely to get a range of estimates from painters,” Skavroneck says.

Craftwork painters handle the projects themselves. The startup trains and hires painters into full-time roles, meaning they receive health care benefits and equity in the company. That sets Craftwork apart, the founders say — many subcontractors are exploited and paid based on the project.

  • Giving these professionals benefits and equity helps build trust and loyalty, the founders say. “They’re given a reason to stay. They have a forward-looking path,” Skavroneck says.

Of note: Craftwork may be bucking a broader trend: Local startups are facing a growing capital crunch as investors pull back, as CBJ reported. “I’d say the No. 1 reason that people are not funding startups is when there’s uncertainty, people hoard capital and cash,” Dan Roselli, co-founder of Charlotte-based accelerator RevTech Labs, told CBJ.

Griffin, one of the co-founders, says that Craftwork isn’t necessarily immune to uncertainty. But they’ve seen investors refocus their energy on startups “grounded on sustainable business models,” Griffin says.

  • “We’re fortunate to have set out from the beginning with a model that generates those positive unit economics, allowing us to focus much of our conversations with investors on painting — pun intended — the broad scale we can achieve with profitability at our foundation,” he tells Axios.

What’s next: Craftwork, which wraps up at Y Combinator next month, will use the $4 million funding round to support further growth, through funding technology and operations.

  • The startup currently serves the Charlotte metro area.
  • The goal is to expand elsewhere into fast-growing cities throughout the Southeast, such as Atlanta and Miami, the founders tell Axios.
The Craftwork team. Courtesy of Craftwork

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