PartPay — warranty recouper for HVAC service contractors

1. One-liner

Captures every eligible HVAC manufacturer warranty claim and files the documentation-complete packet before the window closes.

2. Trend signal — why now?

HVAC contractors are leaving a staggering amount of manufacturer money on the table — not because manufacturers refuse to pay, but because the contractor never assembles the paperwork in time or correctly.

• The average HVAC service company recovers only 12–18% of eligible warranty claims, with 82–88% lost to missing documentation, expired filing windows, parts discarded before claims are initiated, and a general assumption that “warranty claims aren’t worth the hassle.” (Oxmaint, 2026)
• Roughly 40% of submitted claims contain errors or missing documentation, leading to rejections and weeks of delay; the average claim takes 20+ minutes to process plus a 30–45 day wait on vendor approvals. (Continuum / IRCG-HARDI study, 2026)
• ServiceTitan — the dominant field-service OS — explicitly does not solve “ensuring warranties are registered with manufacturers” or “submitting warranty claims and ordering replacement parts.” Its own warranty template page lists these as the unsolved hard problems. (ServiceTitan, 2026)
• Existing warranty software (InsightPro, Continuum) is built for manufacturers and large multi-state distributors, not for the contractor who actually floats the cash and assembles the claim. (InsightPro, 2026)

What changed: cheap multimodal AI can now read a nameplate photo, pull the serial/model, look up the manufacturer’s warranty rules and filing window, and auto-assemble the exact packet a claim needs — collapsing a 20-minute, error-prone admin chore into a 90-second phone task the tech does on-site.

Provenance:

• Signal 1 (Demand): HVAC contractors recover only 12–18% of eligible warranty claims; 82–88% lost to documentation gaps and the “not worth the hassle” assumption — https://oxmaint.com/industries/hvac/hvac-parts-return-warranty-claim-processing — 2026-06-26
• Signal 2 (Feasibility/Economic): 40% of claims fail on errors/missing docs; 20+ min/claim + 30–45 day vendor wait; warranty failures drive ~$9M/yr revenue shift at a $100M distributor — https://resources.gocontinuum.ai/why-warranty-claims-decide-who-wins-hvac-distribution — 2026-06-26
• Signal 3 (Gap/Economic): ServiceTitan does not handle manufacturer registration or claim submission; incumbents target manufacturers not contractors; 120,461 HVAC contractors in the US (93% single-location) — https://www.servicetitan.com/templates/hvac/warranty , https://www.ibisworld.com/united-states/number-of-businesses/heating-air-conditioning-contractors/1945/ — 2026-06-26 Category: Workflow automation

3. The opportunity

Every HVAC manufacturer (Carrier, Trane, Lennox, Goodman, Rheem, etc.) pays contractors back for warranty parts — and sometimes labor — if the contractor submits a clean claim: proof of authorized-distributor purchase, install date, model/serial, failure mode, and the defective part, all within a tight filing window (often 30–90 days from failure). The contractor side of this is a swamp: each manufacturer has different rules, portals, return windows, and RMA procedures. So contractors triage — they file the big-ticket compressor claims and silently eat the rest. At 82–88% of eligible claims unfiled, a typical shop is leaving thousands of dollars a month uncollected.

The incumbents (InsightPro, Continuum) built for the manufacturer’s side of the ledger — they help the OEM process and audit claims. Nobody has built the contractor’s recouper: the tool that catches every eligible claim at the moment of the repair, knows each manufacturer’s rules cold, assembles the packet, and tracks it to payment. ServiceTitan deliberately punts on this. That’s the gap a focused AI-first team does 10× better — because the entire failure mode is “missing/wrong documentation,” which is exactly what multimodal AI eliminates.

4. Target market

• Primary customer: Owner-operator of a small US HVAC service & install company — 1–3 trucks, single location, $500K–$3M annual revenue, the owner or office manager handling warranty paperwork between jobs.
• Why they buy: “I know I’m leaving warranty money on the table but I don’t have time to chase every claim, and half the ones I file get kicked back.” It’s recurring, it’s cash they’re owed, and it’s pure margin — recovered warranty dollars drop straight to the bottom line.
• Rough TAM reasoning: 120,461 HVAC contractors in the US (IBISWorld, 2026), 93% single-location → ~63,680 single-shop targets, plus tens of thousands of 2–3 truck shops. Even 3,000 paying shops at a $250/mo blended ACV is ~$9M ARR — comfortably inside the sub-$5M-and-attractive band well before saturation.
• Why now for them: Equipment costs and part prices have climbed, so each unrecovered compressor or coil claim hurts more; labor is scarce so office time is precious; and AI finally makes the per-claim admin cost near-zero, flipping the “not worth the hassle” math.

5. Product sketch (MVP)

• Snap-to-claim: tech photographs the equipment nameplate and failed part on-site; the app reads model/serial, identifies the manufacturer, and pulls the active warranty terms and filing window.
• Eligibility catcher: flags in real time whether this repair is a fileable warranty claim and how many days remain in the window — so nothing gets silently discarded.
• Packet auto-assembly: builds the manufacturer-specific claim packet (proof of purchase, install date, model/serial, failure description, RMA where required) and pre-fills the portal/form fields.
• Manufacturer rulebook: maintained library of each major OEM’s documentation requirements, filing windows, and restocking/return procedures — the knowledge most shops never master.
• Claim tracker: dashboard of every open claim, its status, expected reimbursement, and aging — so claims don’t die in a 30–45 day black hole.
• “Money left on table” report: monthly summary of recovered dollars vs. estimated unfiled eligible claims — the retention hook and the upsell trigger.
• ServiceTitan/Housecall Pro import: pull completed jobs so eligible warranty events are caught even when the tech forgets to snap a photo.

6. AI angle — what’s load-bearing

Remove the AI and this is a clipboard. The AI does three things no form can: (1) vision OCR reads grimy nameplates and part labels in an attic and extracts the exact model/serial that determines coverage; (2) rule reasoning maps that equipment to the right manufacturer’s warranty terms, filing window, and required documents — a body of fragmented, frequently-changing knowledge; (3) packet generation drafts the failure description and assembles a submission-ready packet that clears the 40%-rejection bar. The entire value is “turn a photo and a repair into a documentation-complete claim,” which is precisely the work that multimodal models now do for cents.

7. Localization angle (if any)

N/A — this is a US-first play. The wedge is US manufacturer warranty programs, US distributor RMA rules, and the US contractor wallet. No language or payment-rail angle. The same shape could later port to appliance and pool-equipment contractors, but geography is not the moat here — the manufacturer rulebook is.

8. Business model — path to $1M–$5M ARR

• Pricing: hybrid. Base SaaS at $149/mo per shop (unlimited claims, rulebook, tracker) plus an optional contingency tier at 12–15% of recovered dollars for shops that want PartPay to actively chase claims to payment. Contingency aligns incentives and lowers the “will this pay for itself?” objection.
• ACV: blended ~$2,500–$3,500/yr per shop once contingency on recovered claims is layered in (a shop recovering even $1,500/mo of previously-lost claims yields $2,160–$2,700/yr in contingency alone on top of base).
• Rough math to $1M ARR: ~350 shops × $2,850 blended ACV ≈ $1M. Reachable inside year one given 63K+ single-shop targets.
• Rough math to $5M ARR: ~1,500–1,800 shops, or fewer shops plus an appliance/pool vertical expansion and a per-tech seat upsell. Requires the rulebook to cover the long tail of OEMs and the contingency-collection ops to scale.
• Expansion path: more trucks → per-tech seats; add labor-warranty and extended-service-agreement claim types; adjacent verticals (appliance repair, pool equipment, generators) reuse the same rulebook engine.

9. Go-to-market wedge — first 100 customers

• Distributor counter partnerships: HVAC contractors buy parts at local distributor branches (Ferguson, Watsco/Gemaire, local supply houses). Branch managers see contractors lose claims daily. Partner with 5–10 branches to co-market PartPay to their contractor base — the distributor wins because clean claims reduce their own RMA friction.
• Cold outreach to the IBISWorld/Orbital contractor lists: scrape the ~63K single-shop contractors, send a personalized one-pager: “Here’s roughly how much warranty money shops your size leave unfiled — we recover it on contingency.” Lead with a free “money left on the table” audit of their last 90 days of jobs. Expect 2–4% reply on a contingency offer with no upfront risk.
• r/HVAC and contractor Facebook groups: the trade lives in a handful of large online communities where “warranty claims aren’t worth the hassle” is a recurring gripe. Show up with the recovered-dollars proof, not a pitch.
• Manufacturer rep / ESA-provider referrals: Trinity-style extended-warranty providers and manufacturer reps benefit when contractors file correctly; warm intros to their contractor networks.
• The contingency hook means the first 100 close fast: “you only pay a cut of money you weren’t collecting anyway” removes the budget objection that kills most SMB SaaS.

10. Build complexity — justification

Medium. Off-the-shelf: multimodal vision/OCR, document generation, the web/mobile app, ServiceTitan/Housecall Pro API imports. The custom work is the manufacturer rulebook — building and maintaining an accurate, structured library of each major OEM’s warranty terms, filing windows, and documentation requirements, and keeping the portal field-mappings current. That’s a domain-research grind, not a research breakthrough. A pair can ship a credible v1 covering the top 6–8 manufacturers (which cover the majority of installed base) in ~3–4 months; the rulebook deepens over time and is itself the moat.

11. Gating checklist

Gate	Pass?	Note
Legal in target market	✅	Filing legitimate warranty claims on the contractor’s behalf; standard service.
Ethical — no harm / dark patterns	✅	Recovers money contractors are genuinely owed; aligned incentives on contingency.
Market exists (evidence above)	✅	120K contractors; 82–88% of eligible claims demonstrably unfiled.
1–5 person team can build this	✅	Pair builds v1 in ~3–4 months; rulebook deepens over time.
Launchable with <$50K / ₹40L	✅	Off-the-shelf AI + web/mobile; main cost is the founder’s rulebook research time.

All five pass.

12. Feasibility score

Axis	Weight	Score	Notes
Problem intensity	20	16/20	Recurring, pure-margin money owed; “not worth the hassle” is felt weekly. Not life-or-death, so not a 17+.
Demand evidence	15	12/15	Multiple strong third-party stats (12–18% recovery, 40% rejection, ServiceTitan’s explicit gap). Docked for thin verbatim contractor voice.
Build feasibility	15	11/15	Vision/doc-gen are off-the-shelf; rulebook is a real but bounded grind.
Distribution clarity	15	11/15	Distributor counters + contingency offer + contractor communities = concrete. Conversion math still partly assumed.
Revenue mechanics	15	11/15	Contingency removes budget objection; blended ACV credible. Recovered-dollar volume per shop needs validation.
Time to first revenue	10	8/10	Contingency = paid on first recovered claim; pilot-to-cash in weeks.
Defensibility	10	7/10	Rulebook accuracy + workflow lock-in + claim-history data compound. Copyable but the rulebook is a 6–12 month head start.
Total	100	76/100

13. Qualitative modifiers

Founder-fit tags

technical-heavy · domain-expertise-required — needs solid multimodal/integration engineering and a co-founder or advisor who has actually run HVAC warranty claims and knows the manufacturer-portal swamp firsthand.

Key assumptions to validate (3–5)

1. Assumption: A typical 1–3 truck shop has enough monthly unfiled-but-eligible claim dollars ($1,000+) for contingency to be worth both sides’ while. How to test: audit the last 90 days of completed jobs for 15 cooperating shops; quantify eligible-but-unfiled claims.
2. Assumption: Owners will let a third party touch their warranty filing and take a cut. How to test: offer a free audit + contingency pilot to 30 shops; measure how many sign.
3. Assumption: The top 6–8 manufacturers’ rules cover enough of installed base to deliver value at MVP. How to test: sample equipment mix across 20 shops; confirm coverage %.
4. Assumption: Distributor branches will co-market. How to test: pitch 5 branch managers; measure willingness to refer.

Risk flags

1. Platform/portal dependency: manufacturers can change portals, forms, and filing rules at any time; the rulebook needs constant maintenance or claims start failing. This is both the moat and the operational tax.
2. Manufacturer pushback: OEMs could view a high-volume third-party filer as adversarial and tighten rules or block automated submission. Mitigate by positioning as accuracy-improving (40% rejection rate is their cost too).
3. Recovered-dollar variance: if average eligible-unfiled volume per small shop is lower than assumed, the contingency model weakens and pricing leans on the flat SaaS base.

14. Structured verdict

Score:                  76/100
Verdict:                GO
Confidence:             Medium
Best-fit builder:       Technical founder + HVAC-warranty domain advisor (ex-distributor or ex-contractor office manager)
Time to revenue:        6–10 weeks (contingency pays on first recovered claim)
Capital to launch:      $15–30K ($ mostly founder time on the rulebook)
Top 3 assumptions to validate first:
  1. Unfiled-eligible claim dollars per small shop ≥ $1,000/mo — audit 15 shops' last 90 days
  2. Owners will sign a contingency deal letting a third party file — 30-shop pilot offer
  3. Top 6–8 OEMs cover enough installed base for MVP value — equipment-mix sample across 20 shops
Kill criteria:
  - Abandon if audits show median small shop leaves <$500/mo in eligible-unfiled claims (contingency can't carry it)
  - Abandon if <10% of 30 pilot shops accept a free-audit + contingency offer
  - Abandon if 2+ major manufacturers actively block or void claims filed via the tool

15. Next step — 1-week validation sprint

• Day 1–2: Recruit 15 small HVAC shops (via r/HVAC, a distributor branch, and direct cold calls) willing to share 90 days of completed-job records.
• Day 3–4: Manually audit those jobs against the top 6 manufacturers’ warranty rules; quantify how many eligible claims went unfiled and the dollar value. Simultaneously pitch a free-audit + 12–15% contingency offer to all 15.
• Day 5: Decide go / no-go. Go if median unfiled-eligible volume ≥ $1,000/mo per shop and ≥ 4 of 15 verbally commit to a contingency pilot. No-go if either threshold misses — the money isn’t there or owners won’t share the upside.

Falsifiable: the audit produces a hard per-shop dollar figure and a hard count of pilot commitments — not a vibe.