With the rapid development of AI technology, many industries are exploring how to integrate AI into their businesses. However, a startup called Netic has taken a different approach, setting its sights on traditional and “non-tech” basic services industries such as plumbers, electricians, roofers and HVAC technicians. This article will provide an in-depth analysis of Netic’s business model, technological innovation, and its application effects in traditional industries, and explore how AI can create great value in seemingly ordinary fields.
Have you ever thought that the next time you call for repair when your air conditioner is broken, it may not be a human who answers your call, but an AI? Or, before summer arrives, AI has already reached out to you and said, “It’s time to upgrade your air conditioner.” “It sounds like science fiction, but it’s actually becoming a reality. What’s even more interesting is that while the entire Silicon Valley is chasing AI applications in the white-collar market, a startup called Netic has set its sights on the most traditional and “non-tech” industries – plumbers, electricians, roofers and HVAC technicians.
I have always felt that the technologies that can really change the world are often not the coolest looking things, but the ones that can solve the most basic and practical problems. Netic’s recent announcement of a $20 million funding round led by Greylock and Founders Fund has made me realize an important trend: AI is moving from flashy office buildings to the real pillars of the socioeconomy – the essential services industries that keep society functioning.
As a long-term observer of the technology industry, I have found that this shift is not only the popularization of technology, but also a fundamental change in the concept of AI applications. We are finally starting to use AI to solve problems that really affect the daily lives of ordinary people, rather than creating more products that only the tech elite will use.
The forgotten trillion-dollar market
As I delved into Netic’s business model, I suddenly realized a reality that had long been overlooked by the tech community: the real backbone of the economy was actually the “unsexy” basic service industries. Melisa Tokmak, founder of Netic, made a thought-provoking point in a presentation: “When you think of a business with $100 million in annual revenue, you probably imagine a glamorous, scalable, software-driven company. But in reality, the backbone of the economy is those basic service industries that operate silently. ”
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I thought about it carefully, and it was. Whenever there is a problem at home – the air conditioner is not cooling, the sewer is clogged, the circuit is tripped – the first thing that comes to mind is not some cool software, but the technicians who can really solve the problem. Although these industries may seem traditional, their market size is actually amazing. The home services industry alone has a market size of hundreds of billions of dollars in the United States, involving millions of employees.
But the problems facing these industries are just as great. Many friends in the United States should have experienced this situation: in the hot summer, the air conditioner broke, and no one answered the call to several maintenance companies, or they waited in line for several days. When demand is not strong, technicians in these companies may be idle. This mismatch between supply and demand is almost unsolvable in the traditional manual operation mode. As Chris Hoffmann, CEO of HB Solutions Group, one of Netic’s customers, said, “I had to match my capacity to customer demand every day, which was really difficult because I couldn’t choose how many people’s air conditioners would break when they called me. ”
What surprised me even more was that these seemingly traditional industries were actually very receptive to new technologies. “You’d be surprised how many of the best founders and entrepreneurs I’ve ever met,” Melisa said in the interview. I’m in the heart of Silicon Valley, and I’ve worked very hard to get here. Now all these founders, they are extremely ROI-focused and extremely customer-oriented. “It’s completely different from my past stereotypes of traditional industries.
Netic’s technological innovation
When I delved into Netic’s technical architecture, I found that their approach to solving problems was very clever. Unlike many AI companies that simply replace human customer service with chatbots, Netic has built a complete “AI revenue engine” that covers the entire link from demand forecasting to customer service to active marketing.
At their core, they are a data engine that integrates multi-channel data from both first- and third-party sources to truly paint a picture of the complete customer journey. It’s not just about recording when a customer has called or what service they’re going to have, but also about proactively identifying service opportunities based on external signals such as weather patterns, equipment age, and seasonal demand. For example, the system can predict an impending storm and contact customers who may need roof maintenance in advance. Or based on the age of the air conditioner and local climate data, the customer is advised to carry out maintenance before the peak of summer.
I find this predictive service particularly valuable because it solves a fundamental problem: moving the business from reactive to proactive. In the traditional model, service companies can only wait for customers to have problems before they know what they need, but with AI analysis, they can take action before problems occur. This not only improves customer satisfaction but also allows businesses to better plan resources and manpower allocation.
From the perspective of product functions, Netic is actually a three-step complete solution. First, they help these companies use data to generate highly relevant and high-quality leads from millions of dollars in ad spend. This is a big problem for many traditional service companies – they know how to do marketing, but they don’t know how to do it accurately, and they often spend money but have no effect. Through data analysis, Netic is able to find potential customers who are truly in need, greatly improving the ROI of marketing investment.
Next up is their AI assistant, which is distinctive, not a generic chatbot, but customized according to each business’s operating rules and processes. “Our AI assistant actually adapts to their operating rules because these are large enterprises and they do have operating rules,” explains Melisa. We help them meet customers where they need them, actually handle everything, convert leads into revenue by handling requests, scheduling work, and actually selling services, 24/7 to ensure nothing is missed. “This AI assistant is able to work across all channels – voice, SMS, online widgets, web chat, third-party integrations, because revenue does not come from a single channel, but from all channels.
Finally, they leverage the data engine to engage with customers again, especially when they need it most, by launching self-directed marketing campaigns to truly convert upsell opportunities into revenue. I particularly appreciate this closed-loop design idea, not a simple one-time service, but rather a long-term customer relationship and a continuous revenue stream.
I was particularly impressed by their system’s ability to understand and handle complex business logic. For example, algorithms can identify signals from customer calls, deprioritize routine maintenance calls, or elevate emergency repairs (weather and emergencies). If a customer has already received a quote from a competitor, the system automatically pushes the customer to the front of the queue. This intelligent prioritization management is almost impossible to achieve in traditional manual operations.
On a technical level, I found Netic’s emphasis on multi-channel integration to be particularly noteworthy. For inbound business, they really integrate across all channels because the same customer may choose different communication methods at different times. As Melisa says, “The same customer, if I’m in a meeting right now, I might text the underlying service provider, but I might call them a few hours later.” In outbound marketing campaigns, they found SMS to be particularly successful “because it respects the customer more,” and they started there and then rolled out to more channels.
From a technical implementation perspective, Netic does not simply use ready-made large language models, but uses specific AI models for each technical function, specifically optimized for customer verification to urgency and priority analysis. They emphasize that engineering focuses on orchestration – “What does it mean which models are best and when they aren’t the best based on the workflow you’re working on.” How do you actually fine-tune just for that task? How do you make sure it looks good not only in the presentation? “They don’t even do presentations within the company, but show real deployments and let customers test because it’s very complicated to talk to someone with an accent or someone who doesn’t know what they need in a real environment.
Real customer stories and market performance
Looking at Netic’s customer composition, I found a very interesting phenomenon: they serve a wide range of customers, from medium-sized businesses with annual revenues of $20 million to large multi-billion dollar groups. This diverse customer base illustrates that their solutions are truly adaptable.
It is particularly noteworthy that they mainly serve two types of clients: private equity-invested home service businesses, which are usually large enterprises with revenues ranging from hundreds of millions of dollars to billions of dollars; the other is small and medium-sized companies with annual revenue of about 1000-20 million US dollars. Melisa explains, “We started with larger businesses to really demonstrate the impact of our platform. Ultimately it was also a business, but now it’s actually my passion in life because I really want to help smaller companies. ”
What impressed me the most was the experience of Chris Hoffmann, CEO of HB Solutions Group. He mentioned that there are many startups in the market that are automating phone appointments through AI voice assistants, and he often receives promotions for various AI products, so much that he often has to reject sales from suppliers. But Netic’s AI platform not only answers calls and replies to messages, is more accurate and remembers than humans, but it also helps Hoffmann Brothers plan and prioritize which of the company’s hundreds of technicians should accept appointments and when.
This case specifically illustrates a key issue. “I had to match my capacity to customer demand every day, which was really difficult because I couldn’t choose how many people’s air conditioners would break when they called me,” Hoffmann said. “This is the core challenge facing the traditional service industry: the unpredictability of demand and the complexity of resource allocation. Even though Hoffmann has invested heavily in AI technology in his company, only 20% of customer calls are currently answered by Netic’s AI platform, which shows that there is still a lot of room for technology applications.
In terms of business results, Netic’s performance is quite impressive. They have self-booked more than 50,000 jobs in the field of home services in just a few months. Even more impressively, a specific customer case showed that a company booked 5,500 jobs with complete autonomy, generating $5 million in incremental revenue. This customer has shifted from reactive to proactive demand generation, which is exactly what Netic wants to achieve.
I am particularly interested in Netic’s collaboration with NextStar Network, which is a groundbreaking collaboration. NextStar is a network with decades of experience in these industries and has accumulated a lot of knowledge. Through this partnership, Netic is able to deploy a Netic tenant that includes this knowledge for NextStar members, allowing mid-market companies to directly benefit from the business insights of a superior member network like NextStar with virtually no technical implementation burden. This collaborative model is clever because it solves the problem of insufficient technology implementation capacity in SMEs.
In terms of pricing model, Netic uses an enterprise contract model instead of charging per solution. Customers choose platform packages based on the products they want to use and the channels they want to expand, and then add traffic packages that can be used across any preferred channel on top of that. “It also allows them to do more than just sign a contract and see you goodbye, because in many of these industries or frankly in any company, AI doesn’t mean I can use it and then work,” Melisa explained. It won’t. You really have to make it work, make sure it works for their operational workflow. This pricing model reflects their emphasis on long-term customer relationships.
Judging from customer feedback, business owners in these traditional industries have an unexpectedly high level of acceptance of AI technology. Melisa shared her observations: “You’d be surprised how these are probably the best founders and entrepreneurs I’ve ever met. They are all extremely ROI-focused and extremely customer-oriented. The incentives are very consistent, right? They only do better when they serve the end customer better, and I only do better when I help them do better. ”
The closeness of this customer relationship is also special. “I have brainstorming calls with clients on Sundays, and they call me to share really cool ideas, and I’ll say it’s fun, try this tomorrow, and I’ll follow up the next day to try this demo,” Melisa mentioned. See if you like it, and then we’ll actually launch it for you this week. “This kind of rapid response and iterative cooperation model is rare in traditional enterprise services.
Looking at market performance, Netic achieved millions of dollars in annual recurring revenue in 8 months, with the earliest customers going from pilot to annual contracts in just 15 days, and now they even skip the pilot and sign contracts directly. This rapid customer conversion shows that their product really solves the customer’s real pain points, creating immediate value. Moreover, they are currently working with some of the largest industry leaders in the United States, including Hoffmann Brothers, Heartland Home Services, and Paschal Air, Plumbing & Electric, which are prominent names in the industry, further validating the effectiveness of their solutions.
Greylock investor Asheem Chandna mentioned that home service businesses often have “underutilized capacity” or that employees are not being used most efficiently. The role of AI is to optimize the pairing of technicians with customers, matching customers with the right people when they need help, and reaching out to customers even before they realize they need help. This view reflects the ultimate pursuit of operational efficiency by private equity investors.
I think this trend is very noteworthy. Traditionally, private equity investors have focused on creating value through financial engineering and operational improvements, but now they are investing heavily in AI technology, hoping to achieve productivity gains and generous returns through technological innovation. As mentioned in the article: “Private equity firms have invested heavily in this space and are now injecting technology into their portfolio companies in hopes of productivity gains and good returns.” ”
The background of this change is also interesting. “I think 20 years ago, there were a lot of companies in all these industries waiting to be acquired, right? That is not the case today. You’re not really looking for that perfect business, everything is excellent, waiting for you to acquire somewhere in the United States. “This means that private equity firms can no longer simply rely on financial leverage and basic operational improvements, they must be more innovative and look for real partners and technology solutions.
From Netic’s customer feedback, this technology investment is yielding real results. In just a few months, Netic has already booked more than 50,000 jobs autonomously in the home services space, and one client even booked 5,500 jobs through full autonomy, generating $5 million in incremental revenue. These figures illustrate that the application of AI in traditional industries is not just a proof of concept, but a solution that can bring real business value.
Why now
I have been thinking about why the application of AI in the basic service industry is exploding at this point in time? I think there are several key factors that converge to create this window of opportunity.
The first is the improvement of technology maturity. Large language models and speech recognition technology have reached a level capable of handling complex and real conversations. But more importantly, these technologies are starting to become reliable enough to handle critical business processes. Melisa emphasizes this: “We absolutely can’t drop the chain, you know that engineering is not only about improving and integrating machine learning progress, but also about doing our own orchestration, fine-tuning, and evaluation, so that you can be as reliable as a utility, really reliable when you replace these systems and augment the teams that rely on this. ”
The second is the change in customer expectations. Today’s customers are accustomed to 24/7 instant responses and are no longer willing to put up with traditional phone message systems or long wait times. At the same time, business owners are also under pressure from labor shortages. Finding qualified technicians is increasingly difficult in the industries that Netic handles, and AI can help maximize the efficiency of existing human resources.
The third is the change of business model. Traditional home service businesses are moving from simple on-demand services to more proactive customer relationship management. With predictive maintenance and proactive marketing, businesses can build a more consistent revenue stream rather than relying solely on contingencies like equipment failures. This transformation of business models creates greater value space for the application of AI technology.
Finally, I think the maturity of the capital market has also played an important role. Private equity and venture capital capital are beginning to take digital opportunities in these traditional industries seriously and are willing to invest in supporting long-term technological transformation. Netic’s ability to raise $20 million in a short period of time shows investor confidence in this market.
From a broader perspective, I think this also reflects the shift in AI applications from “icing on the cake” to “charcoal in the snow”. Early AI applications were mainly concentrated in industries that were already highly digital, such as recommendation algorithms for Internet companies or risk control systems for financial companies. But now, AI is beginning to solve the basic problems that really affect the daily lives of ordinary people, and the social significance of this shift is even more profound.
What this means for traditional industries
As I delved into the impact of Netic’s business model on the traditional service industry as a whole, I realized that this could be a real paradigm shift. It is not only a technological upgrade, but also a reconstruction of business logic.
The traditional home service industry is basically a “passive response” model: customers will contact the service provider when they have a problem, and the service provider will send someone to solve it after receiving the call. The problem with this model is that it is difficult for businesses to anticipate demand and build stable customer relationships. With AI-driven predictive services, businesses can move to a “proactive service” model to deliver solutions before customers need them.
I think the deep meaning of this shift is that it redefines the concept of “service”. In the past, service was about solving problems that had already occurred; Now, services become about preventing problems from happening or solving them when they are just budding. This not only improves customer satisfaction but also creates more business opportunities for businesses. As Netic mentions in the description, they help businesses “move from providing workflows to delivering results, automating actions and assistance across channels.”
From the perspective of human resources, the introduction of AI is not simply to replace human labor, but to reconfigure human resources. Skilled technicians can focus on complex issues that truly require human expertise, while AI handles those standardized communication, scheduling, and initial diagnostics. Melisa mentioned a great example in the interview: “They can spend time working on only mission-critical interactions, actually seeing the context of the conversation when they need to take over, about the person, about the family, so they don’t have to repeat anything, they can build rapport right away, and the rest of the time they can focus on more important and higher-level tasks as the AI really handles everything else.” ”
I am particularly concerned about the impact of this change on small businesses and self-employed people. Traditionally, only large companies could afford complex customer management systems and marketing tools, and small businesses relied on word-of-mouth and simple yellow pages ads. But with platforms like Netic, small businesses also have access to intelligent tools that were previously only available to large enterprises. This could change the competitive landscape of the entire industry, allowing small businesses that are truly professional but lack technical skills to compete in the market.
From a customer experience perspective, the application of AI will revolutionize the way people interact with service providers. No more repeated phone calls during business hours to inquire about progress, no more waiting for customer service to call back for a simple appointment, and no more frustrating voice menu systems. AI can provide instant responses 24/7, understand natural language queries, and handle complex scheduling and scheduling tasks.
But I also see some potential challenges. As AI increases in customer interactions, how can we keep services human and personalized? How can you ensure that AI can handle complex situations that require emotional understanding and flexible judgment? These are all questions that the industry needs to think about. However, judging from the current application of Netic, these challenges can be solved with the right human-robot collaboration mode.
My predictions for the future
Based on my observations and reflections on the Netic model, I believe that there will be several important changes in the basic services industry in the next few years.
First, predictive services will become the industry standard. Those companies that are still stuck in the “wait for customers to call” model will gradually lose their competitive advantage. Customers will be used to receiving maintenance reminders and service recommendations in advance, and those that cannot provide this proactive service will fall behind. I expect that in the next 3-5 years, proactive service capabilities will become an important criterion for customers to choose service providers.
Second, AI will redefine the boundaries of “customer service”. Traditional customer service focuses on answering calls and scheduling appointments, but AI can handle more complex tasks such as initial diagnosis, quotation calculations, and even simple technical guidance. This means that many problems that would otherwise require on-site service may be solved through AI remote guidance.
I also believe that data will become the new competitive advantage of these traditional businesses. Companies that can effectively collect and analyze customer data, equipment data, and environmental data will be ahead in predicting demand and providing precise services. Data analysis capabilities may become the core competitiveness of traditional service enterprises, just as important as technical skills.
From an investment perspective, I expect more capital to flow into this space. Netic’s success story will attract more investors to the digital opportunities in traditional industries. We may see more AI solutions for sub-industries, such as AI platforms designed specifically for medical services, car repair, or cleaning services.
But I also realized that this transition will not be easy. Practitioners in traditional industries need time to adapt to new ways of working, and customers need time to embrace AI-driven service models. The key is to find the right balance so that technology truly serves people, not technology for technology’s sake.
Ultimately, I believe that Netic represents not only an innovation in a business model, but also a rethinking of the question of “what is a valuable technology application”. Truly valuable AI applications are not those that make things that are already convenient a little more convenient, but technologies that can solve practical problems faced by ordinary people in the real world. AI is the technology that truly changes the world when it can ensure that you can be served immediately when your air conditioner breaks on a hot summer day, when it can remind you to check your roof before a storm hits, and when it can enable a plumber in a small town to provide large company-level customer service.
From this perspective, Netic is not just building a business platform, it is redefining the way technology serves society. This top-down technology popularization will ultimately allow everyone to benefit from the advancement of AI technology, not just those living in a tech bubble. I believe this is the right direction for the development of AI technology, and it is also why companies like Netic deserve our serious attention and consideration.
