Sponsored by Monday Properties and written by ARLnow, Startup Monday is a weekly column that profiles Arlington-based startups, founders, and other local technology news. Monday Properties is proudly featuring Three Ballston Plaza.
Arlington-based Pryze is expanding after raising nearly $1 million in venture capital.
The startup is focused on boosting productivity and retention for “deskless” workers through material incentives. Co-founders Natalia Micheletti and Tim Hylton said the funding success was only possible with the mentorship and guidance they received from a local tech accelerator, Unstuck Labs.
One night in 2017, while working as a store manager for the retail chain Great American Cookies, Micheletti watched through the security camera as smoke began to billow from one of the seven cookie store’s ovens.
Micheletti quickly called the store to alert a distracted employee, who was engrossed in his phone. By the time he answered, it was already too late: two dozen cookies had burned to a crisp.
Realizing the financial consequences of such mishaps, store owner Tim Hylton quickly did the math with Micheletti. He found that if each of his seven stores lost a single tray of 24 cookies per week — each cookie costing $1.79 — the annual hit to the company could exceed $180,000.
With this realization — and the smell of burnt cookies still lingering — Micheletti started working to find a solution.
Micheletti presented Hylton with a simple napkin sketch outlining a concept for an app designed to keep tabs on employee phone usage during work hours. The app aims to incentivize hourly workers to focus on their tasks by offering points that could be redeemed for prizes ranging from gift cards to airline tickets and gaming consoles.
“And that’s where she started to create the idea of Pryze,” Hylton said. “It kind of moved from just this drawing that she created on a napkin to, ‘Well, let’s see if we could take some of the things that you’ve talked about and some of the things that you started to put down and see if they actually really work.’”
Excited about the idea, Hylton and Micheletti began surveying local business owners around Northern Virginia. Micheletti says most reported that phone usage negatively impacted their businesses and expressed a willingness to invest in a solution if one were available.
In 2018, Hylton sold his cookie business so that he and Micheletti could turn their full attention toward making Micheletti’s napkin doodle a reality. After sinking about $90,000 of their own money into website development and consulting that first year, however, Micheletti and Hylton started to get discouraged.
“Coming from the restaurant world was so different coming into the tech world. I was just like, ‘How do people do this? If you’re not a millionaire… how do you even launch? How do you learn everything you need to learn quickly,” Micheletti said.
After doing some research, Micheletti came across a tech accelerator program based in Arlington called Unstuck Labs.
Micheletti said Unstuck had “a good track record” so they decided to give it a shot.
“So, the first meeting we went to… we had this napkin with this idea scribbled on it, and we’re like, ‘This is it. We sell cookies. How can we be millionaires,” Micheletti said, recalling a conversation with Untuck’s co-founder and CEO, Wa’il Ashshowwaf.
Four years later, Micheletti credits Unstuck Labs with more than just helping Pryze secure investors. She said the accelerator also played a pivotal role in developing the smartphone application and provided the nascent company with needed office space.
“They were there every step of the way through the program,” Hylton told ARLnow. “When you are going out to have these meetings [with investors], they would talk to you about the meetings beforehand to give you that advice to teach you what to say, and how to sell a product that wasn’t built yet, or that was going to be very basic. And that was something that was very important.”
Since partnering with Unstuck Labs, Micheletti said Pryze has raised approximately $850,000 in venture capital, hired three employees, and secured 17 clients, including household names like Subway and Dunkin’ Donuts.
As it stands, businesses are charged $9.50 for each employee who uses the Pryze app. Micheletti noted that approximately 1,300 hourly wage workers are currently utilizing the platform.
Looking ahead, Micheletti told ARLnow that Pryze has plans to roll out additional features on the app, such as trivia questions tailored to employees’ respective businesses — “to ensure employees keep up on product knowledge.”
Micheletti envisions that as Pryze grows, employers could also leverage the app’s data for hiring decisions.
“We can see the app changing the way the hourly workforce gets hired, applies for jobs, and uses resumes,” Micheletti said. “We have tangible data that we can provide that says, you know, [an employee] worked here for two years and showed up on time 600 times. He accomplished 1,700 goals. This is a good employee you’d want to hire versus relying on a resume that might not be accurate.”
For now, Micheletti and Hylton are looking forward to training their newest employee.
“Adding different team members, bringing people into the company, watching the company grow, having that support system around this… it’s been just motivational,” Hylton said.