Modernizing Bailment: Coatchex's POS system works on more than just coats
It started simply enough. Frustrated over a lost coat at a nightclub, Derek Pacqué began to notice that very few bars and clubs in his college town (Bloomington, Indiana) offered a coat check. His friends had had their coats lost or stolen, too. Feeling entrepreneurial, he started a coat checking service at a few local venues. He'd set up shop at no cost to the venue, and split the revenue 50/50 with them. The first season he made $50,000, a modest fortune for a college kid.
But even with that small-scale success, the business was a mess. Physical tickets were disorganized and there was no way of tracking coats when they went missing. After researching the market, Pacqué concluded that there were no magical systems or products out there for coat checking.
So he built Coatchex, a simple point of sale system that operates on an iPad. It sits on a swivel kiosk, so the coat check operator can take a photo of the person with their coat. The coat owner gives their phone number as a way to retrieve it later; this allows operators to call the people whose coats are left at closing time. Pacqué says he was surprised at how often people enjoy taking the photo and like security of the phone number, rather than see it as an invasion of privacy. They can use their name if they prefer and the photos are deleted after each night.
He built the system with a few big ideas in mind: One, it needed to be easy for employees to operate out of their trunks. They can show up, set up, and run the coat check as a one or two-person operation. Two, they needed to be able to handle high capacity venues where paper tickets just don't make sense.
Lastly, the technology had to be applicable to any bailment industry. Bailment is the legal term for a short-term transfer of property from one person to another. Pacqué believes Coatchex's technology can be used by anything from dry cleaners and laundry mats to tailors, cobblers and valets and has plans to expand into those industries.
Pacqué appeared on Mark Cuban's Shark Tank show earlier this year but turned down a $200,000 investment because it was for a whopping 33 percent stake in the company. Fresh out of college, Pacque knew he was onto something, but didn't want to give up that much of his company at such an early stage in the game.
The company operates in just 20 venues now. It's only beginning to prove out its coat checking technology, expanding to new markets in Indianapolis and Chicago this season. Pacqué raised $250,000 -- enough to get him through this winter season -- from local angel investors. He's talking to formal venture investors to help him with the next stage -- commercialization.
That will happen next winter, Pacqué says, and will include situations outside of coat checking. The company hires its coat check operators directly now but is beginning to recruit partners to operate their own regional outposts. If it works out right, those partners will eventually be running their own little bailment software empires.