When it comes to running a hospitality business, Richard McLeod is empathetic to what it takes.
After all, he was one of the "Cook Brothers" - four 20-something-year-olds from Queenstown who bought the lease on infamous Dunedin student pub, the Captain Cook Tavern, in 2004.
Now Mr McLeod is chief executive of Queenstown-based software-as-a-service company Loaded, a hospitality management platform which has raised $3.25 million, via a combination of equity and debt.
Planned entry into the Australian market next year was the first step of a global expansion plan and the expectation was that would happen rapidly after market traction was gained across the the Tasman.
Loaded also attracted a $1.25 million loan from MBIE through the Queenstown Economic Transformation and Resilience Fund which is administered by Kanoa - Regional Economic Development and Investment Unit.
The support from MBIE, on top of the significant equity raise, meant Loaded could invest further in building its product and development team "almost entirely" in Queenstown, something which was important as a company founded by born and bred Queenstowners, Mr McLeod said.
Loaded helped hospitality businesses monitor and manage their revenue, labour, inventory and budgeting all from one place.
The company serviced all hospitality segments with a focus on significant hospitality groups.
What they had with Loaded, and what was "in the pipeline", genuinely helped hospitality businesses, Mr McLeod said.
"We understand that market, we are empathetic to running a hospitality business."
It was originally developed as a central management system for Cook Brothers Bars which expanded, after the Captain Cook acquisition, into a nationwide hospitality group.
The Cook Brothers comprised Mr McLeod, then aged 21, James Arnott and brothers Ben and David Bulling, all friends and schoolmates at Wakatipu High School.
``I guess there is some irony in the fact that today our ambition is to seriously impact the performance of the entire hospitality industry globally, given our complete lack of experience and the somewhat loose style in which we operated as 21-year-olds," Mr McLeod mused.
Two of the four had bought a student flat and were looking around for other flats to invest in. That was when the Cook came on the market and they bought it from DB Breweries.
The legendary Cook had gone "majorly downhill" but the group believed they could turn that around.
"We knew everybody would go back there if a half decent job of running it was undertaken. Rather nobly, we thought we were up to it," Mr McLeod recalled.
The sale process took a long time, which turned out to be in the Cook Brothers’ favour.
"The brewery was not really geared up to buy and sell pubs. It took a very long time and we hung in there. Last man standing was the only thing we had on our side ... they ran out of options."
The learning curve was quick, to say the least, and the stress was high. It was the days when student pubs were big businesses.
They had 50 staff on day one and there were nights when 4000 to 5000 patrons would come through the doors. Turnover was in the millions.
Mr McLeod joked he might not have got his under-graduate degree, having dropped out to run the Cook, but the experience was his MBA.
"We haven’t undertaken anything like in terms of the stress that it brought. It was a pretty high-pressure environment. We didn’t have too much leeway in terms of the number of mistakes we could make.
"We borrowed a lot of money, we had to make mistakes quick and learn quick," he said.
But it was also great time to take on such a challenge, as they did not have the responsibilities of later life. They were able to pour in "heaps of energy and time".
The acquisition turned into Cook Brothers Bars, branching out with other hospitality businesses in Dunedin, Christchurch and Auckland.
Dave Bulling, a civil engineer, started undertaking construction projects and Cook Brothers Construction spun off, also involving Ben Bulling.
Mr Arnott and Mr McLeod continued to run the hospitality business until Mr Arnott became sole owner of Cook Brothers Bars and Mr McLeod was now full-time with Loaded.
At the Cook, they needed to get to profitability quickly and were focused on systems and processes they could utilise.
They wrongly assumed that the hospitality sector would have a best practice way of operating, or systems or structures for managing it. But it became apparent quickly that there "just wasn’t anything".
Mr Arnott had been studying information science - "his natural bent" - and spent a long time looking both domestically and globally at what they might be able to do.
What was coming out of the United States was aimed at big enterprises - "one step down from McDonalds" - or else it involved using a whole lot of systems that the average 20-year-old bar manager was not going to want to engage with at 4am, Mr McLeod said.
The performance gains were significant. There was an ability to utilise managers on-site to do the work in both a consistent and profitable way.
The growth of Loaded then became organic. People started approaching then about it and customer numbers reached 400 or 500.
At that stage, Mr McLeod started to feel very confident about widening the opportunity and spent a lot of time researching.
He had the view that no-one was trying to solve the problems for the average hospo; the person who worked in hospitality and had to engage with the product was not being put first.
About four years ago, Mr McLeod stepped out of the hospitality group and focused his time on Loaded.
The product was rebuilt entirely, with the intention to scale, but Covid-19 meant delays in raising capital and implementing plans.
A small side-project was run - a venue check-in - which was born out of necessity of ``not knowing what tomorrow was going to bring".
Now Loaded was busy recruiting and targeting Australian entry in the second quarter of next year.
It was the first type of international business Mr McLeod had been involved in and that was exciting.
"It keeps me awake at night," he said.
"With 900 customers at home who have demonstrated significant profitability and efficiency improvements when adopting Loaded and very few competitors in the market globally, we’re pretty excited about the opportunity ahead."
Local investment fund Invest South was the major participant in the capital raise and would also appoint a director to Loaded’s board.
"We are delighted to have found a company of Loaded’s calibre right here in Queenstown and strongly believe in the journey they are on to improve the performance of the hospitality industry as a whole, which has never been more important than it is now," chief executive Prue Halstead said.
Other local private investors also invested directly and through the Mainland Angel Investors network.
Mr McLeod, a self-described university drop-out, always thought he would go back and finish his degree but 20 years had gone by.
Queenstown was home for him and it was hard to imagine living anywhere else. But that necessitated working hard to build a quality, high talent team in the resort team.
That was also very possible - ``a lot of developers in the world like riding bikes and going skiing", he said.
In a world where remote working was becoming increasingly popular, Mr McLeod said Loaded wanted to build a culture of a great tech team living and based in Queenstown, which he believed was a real point of difference.
He believed there was a very different loyalty in a company that worked totally remotely. Once people joined Loaded, he expected their tenure would be significantly different, i.e. longer, than for those working in tech in a big centre.
Queenstown was building away from a pure tourism economy. Those being drawn to work in tech in the town could afford to live there, but that did not mean it was not without its challenges.
There were also many people living in Queenstown who had "been through there and done it in technology" and the meetings and advice he was able to get would not necessarily happen if he was living in a big city.
"They are happy to shoot the breeze over a beer or coffee. That’s as valuable as it gets," he said.
Looking back on their experience in Dunedin, Mr McLeod said it would be almost impossible to replicate the fun, energy, learnings "and all-round good time" they had running the Cook.
Asked what his career path was growing up in Queenstown, Mr McLeod said he and Mr Arnott, now Auckland-based, had both been keen to be ski racers, probably chasing an unrealistic goal of Olympic glory in skiing.
That dream was ended for both "by various injuries and things" and he believed it was probably hard for them to drop back into university, after having chosen that, ``and not think we could be doing a bit more".
Getting through their university studies and graduating was not probably something they had aspirations for, he said, citing their restlessness.
He still did a lot of skiing, now with his own children, and probably enjoyed it more than he ever had.
The four Cook Brothers still constantly met people who had met their spouses at the tavern, celebrity chef Nadia Lim among them.
The group remained friends and they all still talked about those first few years at the Cook and their first outlets which were "still pretty fresh" in their minds.
"We still like to get together and embellish about the past," he said.
