02:23 And I'm just going to wait just a second because I found lately that it takes it just a second to start buffering our feeds. Will you say something real quick for me? Anything. Perfect. It literally triggered your upload. So now I see it happening. Okay. I think we're golden. All right. Here we go. Hey, welcome back to the show. And today I am so excited to have with us all the way from New York. Mr. Roger, will you tell us who you are and what you

02:33 Hello Todd, how are you today? Todd, thank you so much for having me on the show today. My name is Roger Krulak and I am the Founder and President of Fullstack Modular. And Fullstack Modular is a fully volumetric type one, so all steel solution for building mostly multifamily buildings. So hotels, student housing, you know.

02:58 Awesome, awesome. So take a step back. So you are building modular versions of these units, is that right?

03:07 Yeah, so we build everything in the factory fully fitted facade on fully finished can be fully furnished and we build that in a factory and then we stack it up and bolt together like Legos and an erector set. So that's what we do. And we are focused on mid to high rise. So generally eight to 45 stories. 

03:32 That's insane. And are you actually stacking them and bolting them or are these like a plug into an existing building frame structure?

03:40 Nope, our system is everything. So basically give us something to sit on and then it's all mods all the way up through the Stairwells of the Lego Interrector Set.

03:48 I mean, literally this is just a big boy Lego set, really.

03:49 Lego Interrector Set. Yeah, there's really not much more to it if you know how to use a, you know, if you use how to impact wrench and can follow a YouTube direction on how to connect two pipes if you have all the pieces. Pretty much how it

04:07 That is absolutely nuts. All right, so now I don't know how into the wheeze we want to get on actual construction here because I worked on a lot of job sites in my younger days and I've been part of multi -unit construction before. What inspired you to think that this was even possible and would you consider yourself pioneering the way you're doing this or is this a regular common thing nowadays?

04:35 Such a good question and the answer is slightly complicated, but let me start with this. So my great grandfather was a carpenter and I grew up in the construction and development industry. And the problem is, is that my great grandfather, who I never met, if you put him on a construction site today, he would be totally comfortable with what's going on. Meaning, there's been little to no innovation. Now that's changing a little bit. There's been billions of dollars of investment and there are incremental improvements with things going on. And in the rest of the world, outside of the construction industry, innovation is a driver of progress. And so everything else is manufactured. Frankly, everything that goes into a building is manufactured except for the building. We're wildly inefficient, cost inefficient, time inefficient, know, sort of herding cats clumsy in our process. Although there's people who herd cats quite effectively, it's still herding cats. And so every other industry has embraced industrialization and economies of scale as an opportunity to decrease cost, increase speed. And so I have spent the last, it's going on 13 years right now, pushing our industry to embrace what makes our industry work and embrace industrialization at the

06:06 It's amazing. Honestly, it is amazing because you're right. Construction has always been a process of start at a foundation and then bring these guys in, bring these guys in, bring these guys in. And what you're saying is that you're able to take all of that in a very controlled environment, piece it all together and then just send that crate out with with everything all done. Even furniture.

06:32 Yeah, fully furnished appliances. I tell people all the time that my goal is to have a fully occupied building that isn't installed yet. So you could just like move the families, right? And now of course that's a little bit in jest, but it's not completely in jest. I mean, if you could figure out how to put Tesla battery and you know, some way that they could live there while you know, while while it's being transported and installed, you know, mostly.

07:04 Okay, so that is nuts because I'm envisioning this whole production line where it's like, okay, here's the Jones's unit Here's the Williams unit. Here's a and then you

07:17 Exactly. It's true. mean, all every, yeah, of course you move all their, I mean, look, I do believe that there is an advantage to potentially say move their stuff in. so, so, you know, my friend, Jeff Wilson, who's a, you know, who's an innovator and does some amazing things. He has, he started out his industry in something called Casina and his whole concept was you could have these like ADU that you could move into and then you could, were like parking lots for the casitas that you could say, I'm going to be in Vegas this week. So I want to go skiing in Alton next month. And then I'm going to go live in Spain for a couple of weeks. And then, and you could just take your whole thing and ship it over to where it belongs. 

07:58 Are you serious?

07:59 Yeah, that's where he started. And it was, it was, it was beyond a little ahead of its time, but it's pretty brilliant. If you think about it, like if you never had to move your stuff, like everything was done and you parked yourself where you wanted to be. And it's like a brand new sort of airstream and a more, you know, and sort of like on steroids.

08:16 is taking the RV park to a whole new level.

08:19 Exactly. Or maybe even a wait, know, 

08:20 That is so cool.

08:21 Yeah, maybe in a huge improvement, which I think also it might be.

08:22 Well, I think it could be. And honestly, it gets more interesting in the minute as we're talking about this. But as you're doing this, we've all seen on the highways these massive double wide moving modular pieces of homes and stuff like that. This isn't that. This is more efficient than that, right? mean, how are you transporting? What does this all look

08:50 Well, mean, transport is transport. So it could be truck, could be train, it could be boat. And obviously, the parameters associated with where the final resting place is, how wide the mod is, how long it is, what the end goal solution drives that logistical game plan. But they're still transported. They're generally wider loads. And so if they're on a truck, they have to go at night, that kind of stuff like you've seen on the freeway, cetera. But they don't look like double wides. They have a full facade on them. They're watertight. They're fully finished. They're connectable in a way that you can take multiple mods and create a larger unit, et

09:37 I love it. love it. And so your target audience though is the developer, right? mean, who's buying this from you? Are they cities? Are they government? Like, what's the avatar you going for here?

09:49 Yeah, yeah, no, it's a so since we started, you our customers have either been government or private developers, whether that be hotel developers or affordable housing or government, you know, sort of sponsored. And we are now we are now as we're evolving and growing, we are we are focused on also expanding and pivoting to our own developments so we can keep the factory busy. So the interesting thing about having industrialization is the factory needs to be busy, right? I mean, you can have a development company and have three people working until you get a project and then you hire 12 and then you go down to three. But a factory can exist with two people working there. And you can't cover your overhead. So the industry has sort of divergent needs from sort of the development industry factories want to be busy all the time, development only ramps up when they need it. so finding a common ground between those is the challenge that faces the industry of industrialization of the

11:02 captainscouncil.com

12:40 Wow, I love it. So you are focused on though, more of the commercial end of the spectrum, whereas I know there's some other people we've had on the show before that were geared towards end client user and they're buying a modular unit that they just live in that unit as opposed to you're going tall, going big and going all the way with this thing.

13:04 Yeah, I mean, think, look, if you embrace any element of climate change and you understand that the majority of the work product that comes out of anywhere in the world, but especially in the United States, it's city focused. density of living and availability of food and park and water, et cetera, is a huge advantage to climate change. Like there's probably no better way to affect climate change than to live in a dense environment where people are using the same amount of energy, that there's diversity of load, all of the other things that we drive to. So it's a highly sustainable solution. And I believe the world, I mean, we are so far behind with the housing needs, even in this country, seven and a half million units or something like that. It's just crazy numbers. And the world, it's 10 to 12 X that We've got to find solutions and I don't think as much as we in America and most places love like the house with a white picket fence, isn't going to house all the people. It's just

14:17 Interesting, interesting. And to be fair, a lot of people actually prefer the high density housing units and a lot of people don't. I'm a country guy, so I don't like it, but I know a lot of people do.

14:26 I hear you. mean, it's, yeah, I'm not, you know, it's no judgment. It's just, if the world wants to embrace the needs of housing for the people out there, they all can't have a

14:43 Agreed, agreed. All right, so now let me know what you do, how you do it, and where you're going with it. Talk to us about, I mean, you are a unique creature here because you are the guy that builds systems. You're compartmentalizing so many things. You're organized, you're structured, you're like, you are the antithesis to what most startup founders are, and that is messy shotgun approach. We're just going to go at it. We got our guns pulled. We're going at it. How did you like, have you always been that engineered mindset or, or did this take some practice? Like what did you do personally to kind of systematize your life in the way that you now do this for a living?

15:20 Yeah, such a good question. I have always been a little bit of a change master. I've always had the ability to see something that has to happen often before the world embraces it. And that's not the most comfortable place to be. And I'm holistically an impatient guy. So I don't like standing in line. I don't like waiting in traffic. And I don't like sitting and watching a building that could be built twice as fast just lingering. It drives me nuts when I see inefficient process or workers not showing up so you can't close up the wall. And I've been around construction and development my whole life. it makes me want to pull my hair out and I don't have that much left. And to be fair, my best friend growing up with my grandfather. And my grandfather had actually been involved in modular construction when I was a kid. And it was early stages and it was very different. if you go by the apple doesn't fall far, exactly, apple doesn't fall far from the tree. Oftentimes, if your father's a doctor, you end up a doctor. If your mother's a lawyer, you end up a lawyer. So I think that there's some of that and frankly, my endless impatience and also I'm very geeky. Like when I got, so part of my journey here, I got the Breakthrough Award from Popular Mechanics and like, to me that was like getting in Sports Illustrated. That was like a big thing for me. So I am geeky by nature.

17:24 That's all right, that's all right. It's the nerdy guys that drive innovation. And I will say, like, you are an anomaly in that you are a creative, but you're also a systems guy, which is not very common. As you look back on your building of this business, I mean, you've been doing this for several years now. What's kind of like looking back, what was point at which you said, okay, I think this is actually gonna work and this is actually gonna like, this decision has helped us catapult our growth to some certain level. Are there things you can look back on that you can identify?

18:04 Well, I think I mentioned her, I mean, like six months ago, but I've been doing it for like 15 years. so as I said earlier, like I often see what needs to happen long before anybody's willing to accept it. So as you can imagine, like adoption is not something that happened easily. It's still in its infancy. And so banging my head against the wall, I often say, you know, I go into a meeting and I talk to really smart people who are very successful. And I would say, look, this has got to be the future. And they would look at me like I was a Hydra with six heads, like, what are you talking about? You're out of your mind. And now they don't say that anymore. Like the architects, the engineers, the general contractors, the developers, they're all calling to say, you know, does this work for us? And now part of that is interest rates went up. Part of that is that they know that it's inefficient and it's costing them. Money was free for years and now it's not free anymore. So that necessity being mother of invention is part of the adoption. But the other part is, is it's been around long enough that it's not an anomaly, even though it's a smaller part of the industry and it's still growing 8 % CAGR, which is significant, it's still not a major part yet, but it's getting

19:27 Well, I got to say, I love it. From its very concept, I mean, I'm just picturing all the projects I was involved with during a 10 -year span of working in construction, how much more efficient this would be, could be, should be, and how much waste you're just eliminating. I mean, it's just, you know, even just the disposal of extra materials and repurposing of things like, you've got that in that controlled environment. It's just cool to think about the future of what you're helping build right now. Very cool.

19:57 Yeah, optimization, sustainability, low waste, reused, recyclable. I we talk a lot of people, this is the next wave, but a lot of people about redeployable buildings or disassemblable or relocatable buildings. Think about hotels for the Olympics that you could rent and put in Japan and then move it to Russia and then move into, know, yeah, yeah,

20:30 Yeah, that's pretty next level thinking. That's pretty incredible. That's really cool to think about. All right, so from a business perspective, as you build systems for other people, you obviously need to build infrastructure in your company that enables growth and enables your ability to do what you're doing. Talk to us a little bit about that. What are some of the things that you specifically did to kind of hyper -focus your ability to scale and reproduce this in multiple parts of the country slash world.

21:02 Yeah, so great question, Todd. So I think on the inception, we knew what our goal was to build a highly efficient system that was adaptable to the needs that our customers have. So we spent a lot of time on systems, on creating systems that are adaptable. They're adaptable to different environments and forces. So they're seismically adaptable, wind adaptable, high rise, mid rise you know, it's non combustible. So, so we created an incredible system. And then the question was, great, we have a great system, who wants it? And then, you know, then the question was, how do you scale understanding the risks of having a factory of significant size that can meet the needs when it's not busy? And so we were very cautious about growing the team and spending a lot of money. But the problem is that's the other strain, right? So you're understaffed and you're growing painfully rather than, everybody's ready, just give them something to do. But we did learn very early that we really needed to be cautious of building the team that is. And so now we have all that in place and we're now getting jobs that need that team. And as a result, we're growing into that. Super exciting, super exciting. But we were able, for instance, we were able to, yeah, yeah, we were able to pivot, you know, during COVID and scale down enough so that we did some things to keep moving, but, you know, was significant, significant downsizing and scaling, sort of getting ready for the rejuvenation of the economy.

22:56 Well, let's hope that we're rebounding quicker. the thing that I love about what you just said, you kind of shed some light on a lot of parts of your strategy. that is, it is exciting when you're at max capacity and everyone's busy and everyone's happy. And you know, as an owner, that every person working today is actually generating some profit. That feels great. But when you're in those moments where, Stuff is slowed down, but you've got all these people and all this factory overhead and all this, you know, all the materials that are ordered and inventory you're sitting on, that stuff really hurts. What are you doing to try to alleviate that pain and kind of drive some of those extra resources per se into stuff that's even break even or like, what's your strategy there? How are you keeping them happy and busy? but maybe not super profitable at that moment.

23:56 Yeah, I mean, that's what we did during COVID, right? So we pivoted, we made restaurant mods, we made hospital mods, just sort of normally in our business, but that was the need of the time. you know, we pivoted to create a very effective other product because that was where the market was. So, and you know, I get called all the time about, you like, how do I make a floating house or how do I make, you autonomous dwelling unit like you just talked about that's transportable and relocatable or so you always have to watch the market and I try to I try to just like the reason we're sort of in multifamily student housing, you know, and sort of attainable affordable housing is is that they have different market cycles, right? You know, so hotels when business is great are great. And when the business stops, you know, and schools and schools

As we know, the best schools right now are growing and needing tons more housing and the ones on the bottom tier are losing students. And then of course we all know that I said, there's not a state in this country that doesn't need more housing than it has including the Dakotas.

25:15 Yeah, yeah, yeah. including that, hey, you know what? The Dakotas are going, man. That oil. 

25:25 They are, they are, they are, they

25:26 So as you look at that situation and looking at your business, I'm always curious. You've kind of developed this really cool model. You've developed some really hyper niche use cases. Looking at your infrastructure and looking at the way you've developed so what are some gaps that you ran into that you're like, shoot, I didn't think of that. Can you look back and I mean, obviously COVID was the big surprise for all of us, but like, what did you do right? What did you do wrong in preparation for an event like

26:03 Well, I mean, what I did right was I realized it was a problem and we scrambled to find a solution and we got there in time. We got there in time. And I don't know if that was just right or responsive. You know, we were trying to grow. We had just been awarded two huge jobs. We were actually scaling up. We were super excited. We competed for two massive jobs in New York City and they both kill, got killed. So like, what are we going to do? Like, we've got, you know, 80 people on the floor, you know, get all this, you know, what are we going to do? And we pivoted. Yeah, so like, you know, we, you know, and then of course, the interesting thing is COVID caused scarcity and stuff. So we had all this material that we're actually able to use to fund some of our deficits because we sold copper at 3X what, you know, what we bought it for. You know, but, you know, thank goodness to our, you know, to our controller who is very savvy and that stuff. I don't think we did anything particularly well other than that we adopted and adapted. And unfortunately we lost some very highly talented people, but there was just nothing. There was nothing we could do. And it's certainly something I aware that it might happen again, but I don't know if I'm prepared to do it again, but I am aware that it might happen again and it might have to. And we definitely, I think every founder will tell you, I was reading the founder of Shadow Ventures yesterday and he said, hoard your money. He's not wrong. You have no idea what's coming up and it's probably gonna cost you. The best you can do it, raise enough money, don't over raise money because of course then the returns don't look good, but don't under raise either. that is, that's a talent. I wouldn't say that it's like my strongest sort of like that's such a hard cash management, fund management, raises of capital, those things are so complicated and so hard to predict in an industry.

28:08 Well, and you bring up a good point. You you bring up a really good point and this is kind of gonna lead us to the end of the interview, but I do feel like what you're describing in both the instance of COVID and the instances that you, like there's areas where we're all weak, I guess where I'm going with this. As a founder, as an operator even, you can't be expected to know everything. I'm really curious, you've talked about people you've raised money from, you've talked about people like specialists who've come in to help you. I've gotta think that you're talking to a lot of interest groups, like a lot of contractor groups, a lot of city planners, things like that. What have you done to create a listening mechanism where you ask the questions, you get the feedback, and then you initiate change in your brand or in your company? How are you doing

29:05 Yeah. Clawing, scraping, kicking, screaming. know, mean, sometimes more vocally, sometimes not. I mean, look, there's a bunch of people, you know, who I think are helping this industry along. And the Modular Building Institute has been incredible on the lobbying efforts that are required because, you know, as we grow, people become unhappy with the fact that we exist and they look to stop it. It's not exactly, so they have been amazing at that. And frankly, we wouldn't have the resources to do that if we didn't sort of have that. yeah, and look, other countries have embraced Modular in a way that the US is still thinking about doing, but hasn't. I was hired by, as one of many experts, by Singapore in 2014 to talk about creating a modular industry, they did. They realized that they have no, they don't have any, everybody import all their workers and they don't even speak the same languages. So they're like, well, if we create an industrialized solution for that, it's much easier to manage the process, which it is. And so they did it. And the UK has tried very hard to embrace it and they're still struggling with it. Well, they're still struggling with it, but they have they have managed to do it. And Malaysia is on fire with creating solutions for that. so, yeah.

30:37 Well, and what you're talking about is so cool because, know, if you're listening to this thinking, well, I'm not in the industry, I'm not doing what he's doing, I'm nothing like him, you know, Roger is explaining the process that everyone listening needs to be thinking about all the time, and that is be aware of what's going on in your environment, be aware of what's going on outside of your environment, can you replicate what's going on over here? in the place you're at. You're actually bringing up some really creative thought processes that come natural to you, but aren't natural to other people. And so I highly encourage anyone listening to this to really re -listen to specific parts of this podcast because Roger has literally outlined a take a quick shot, rebound, assess, take a quick shot, rebound, assess like. You've done an excellent job at this Roger and I really appreciate you walking us through the process. Who has helped you do this? Like you can't do something like what you've done on your own. Do you have people in your corner who kind of helped you develop this strategy or is this just a natural thing for you?

31:56 It's definitely not natural. Necessity is the mother of invention. I am generally creative and we've talked about being geeky, but startups are not in my nature, but I felt like it was a need that needed to be met. As I mentioned, the modular building industry is great. Lots of people in the industry. a bunch of consultants, Mod Squad, Jason Carter has been incredibly, sort of a good listener. I told you earlier, the book Shoe Dog is what I read when I'm having nightmares. I was like, it was super painful. Startups can be super painful and they never go linearly. There are generally not meteoric rises to success. It is a journey and the journey has lumps and bruises and so I think about that a lot. And I try to read about this stuff as much as I can and sometimes it makes me feel better and sometimes it makes me really depressed. But you have to keep trying if you don't keep swinging.

33:10 Look out, look out and grab the stuff that works and bring it into what you're doing. And I think that's the main story I'm capturing from this podcast. First of all, thank you so much for sharing your time with us. I honestly think that what you've done and what you're creating right now is super impactful. I mean, you are gonna leave a mark in the world for what you're doing and how you're doing it. And thank you for doing that. Secondly, honestly, So many lessons here. I just think that the people you've been able to tap into, you mentioning industry partners, you're mentioning associations that you're part of. Like if you're holding back from being part of that as a founder, you're not doing it right. I really think Roger's path of getting to know the people that are helping create the laws, creating the environment through which you can succeed is a huge benefit. So be proactive in that area. Dots on that?

34:11 Yeah, no, mean, it's we are deeply involved right now with trying to create a system to streamline the entire development process, not just the manufacturing side of it, but how do you create housing? And we're involved with conversations with the, you know, the national unions, with HUD, with, you know, building funds. You know, we did. I know you're in Utah, got one of the ivory innovation wards for housing. So we are in constant conversation about how to progress and meet the needs.

34:50 I love it. Roger, you're the best, man. I really appreciate you taking the time to do this with us today. And for those of you interested in the journey, Roger's got a lot of information on the website, on his LinkedIn. We're gonna put links to everything down below, but check it out. Very inspiring, very cool, and I know you're kicking against the pricks in your whole industry, and you're being successful at it, so thanks for all the effort.

35:12 Thank you so much, Todd, for the time and the questions. It was really enjoyable talking to you

35:19 Awesome. And we'll catch up with the rest of you on the next episode, but thank you so much. Share this with someone that needs it. And Roger, we'll catch up with you later.