The Property Management Show

The goal of the Property Management Show podcast is to deconstruct business success into its key components and invite subject matter experts to help you improve every facet of your property management business. The topics covered here range from property management marketing, industry innovations, success stories, all the way to general best practices on how to run a successful business enterprise. The podcast creators are Brittany Jones and Marie Liamzon-Tepman from Fourandhalf, Inc – a marketing company that works exclusively with fee-based Property Management companies. Fourandhalf Marketing Agency was established in 2012 and has the best and longest track record for helping property management companies grow. They help with both marketing strategy as well as implementation. Their services include property management website design and SEO, content creation to attract and nurture leads, reputation management, online ads, you name it. Visit fourandhalf.com to learn more.

Episodes

Mentioned books

Jan 10, 2019 • 52min

Property Management Acquisitions, Growth and Marketing: The Renters Warehouse Strategy

Dec 27, 2018 • 54min

Turn Any Sale into Lifelong Loyalty in 100 Days

We’ve made it to the end of 2018, and on this year’s final episode of The Property Management Show, we’re setting you up to take full advantage of the opportunities available in 2019. Think about the journey we’ve traveled over the last few years. In 2017, we focused property managers on the idea of sales and marketing and how it can impact and grow a property management business. In 2018, we told you it’s time to think bigger. We started talking about revenue per customer and profitability. What’s next for 2019? You’re about to find out. Today, we are joined by Jordan Muela, who is going to help Alex interview our guest, Joey Coleman. Joey holds the title of Chief Experience Composer. He’s also written an incredible book called Never Lose a Customer Again. Introducing Joey Coleman Joey has an eclectic background. He’s a recovering criminal defense lawyer, he’s worked in the intelligence community with the Secret Service, the CIA and the White House. He ran an ad agency for 15 years and he taught at a post-graduate level. The single thing that connects all these pursuits is that he’s a student of the human condition. He has sought to understand why humans do the things that they do, and he’s uncovered how we can persuade them to do the things we want them to do. Currently, he’s helping companies keep their customers. He works as a consultant, workshop leader, and a keynote speaker. He encourages business owners to talk about what happens after the sale. A lot of companies focus on marketing and sales. They fill that funnel and they work hard to get owners and keep tenants, but they don’t spend a lot of time thinking about what happens after the sale. How can you create an experience that keeps your customer coming back year after year? That thinking process led to Joey’s First 100 Days methodology. You should also know that Joey will deliver the keynote at the 2019 PM Grow Summit in April. The Importance of Self-Assessment One of the things that you’ll notice about Joey’s book is that at the end of every chapter, there’s a period to assess. You may breeze through the reading and quickly absorb the content, but you’ll need to stop and focus on some thought-provoking questions at the end of each chapter. Here’s a self-assessment question that’s particularly appealing: Do prospects receive a detailed and accurate preview of what the experience will be like after becoming a customer? Stop and think about that. This book of Joey’s is not short, and it’s meant to give you a unique perspective for approaching your customer experience. The questions allow you to process the chapter. Those speed bumps will intentionally slow you down and get you to think about how you’re applying what’s discussed to your own business. The book shouldn’t only be something you read; it should be something you use. Customer Retention and the First 100 Days Why do 20–70 percent of most customers stop doing business with a company within 100 days? Retention is an issue for every business. Mentally, your customer will make the decision to check in or out of your relationship in those first 100 days. That’s the most important part of lifecycle. If you want someone to stay with you, how they feel on day 101 is more important than any other day in the process. The customer journey includes eight phases. First, there’s the assessment phase. Your prospect is considering whether or not to do business with you. This is the marketing and sales part of the journey. It’s where you should be able to give your customers-to-be a preview of what it will be like to work with you. What will it feel like? Do you keep your word? Are you timely and organized? The Emotional State of Your Prospect As property managers, we tend to be tactical instead of emotional. So, you may not be paying attention to tracking, identifying and working with the emotional state of your prospect. Step into the shoes of the property owner you’re trying to reach. That owner spent a lot of money on this property. You’re suggesting that they give up some of the income they could earn by hiring you to perform services they believe they can perform themselves. They probably don’t think you could ever care for that property as well as they can. Are you considering that emotional state when you deliver a sales pitch? Or, are you focused on the minutia of convincing them they’ll never have to answer a maintenance call or chase down late rent? Shift your approach and start thinking emotionally. The owner is probably a little uncertain. They’re worried they’ll make the wrong choice. They’re anxious that you’ll put the wrong tenant into the property, and they dread the headaches and the expense of bouncing back from your bad decisions. They fear disaster. How can you reach them on an emotional rather than a tactical level? You can invite them to a property you already manage. Show the results of working with your company. Assure them that you want to visit their property and understand its nuances and needs. But, if they can see what your standard of excellence actually looks like, and they can see that you aren’t just talking about efficiency and effectiveness, you’ll have incredible results. This shows your potential customer what it’s like to work with you. You’ll get the attention of those great owners who you’d love to have as clients. You can hand over brochures and direct prospects to websites and get on a call to tell them how great you are at solving their problems. But, there’s nothing exciting or emotional about those tactical things. They want to have an emotional experience. Empathy and Emotion: The Winners in 2019 The American culture is one in which people are afraid to be vulnerable. Americans are taught that it’s weak. It starts happening when we are children and then it’s reinforced through schools and even in the workplace. How many times do you hear that “it’s not personal, it’s business.” This construct results in humans who are desperate for connection. Everyone feels isolated after looking at electronic boxes every day. So, human interaction can catch you off guard. Distance feels safe. Emails and text messages provide a safe time and space barrier. The winners in the next decade have high Emotional Intelligence (EQ). They will lead from a place of empathy. To have whatever you want, you need to be an expert in empathy. You need a high emotional quotient that allows you to empathize with owners and with tenants. What are they feeling? What are their emotions? What’s working, and what isn’t? This is a lot of work. But, investing in emotional intelligence pays off more than an investment in book intelligence. So lean in and get comfortable with it. To succeed in the future, you need to make this investment. Property Management’s Problem is Its Opportunity You’ve heard this stat before. Only about 30 or 35 percent of properties are professionally managed. The vast majority of investment real estate is self-managed. There needs to be a great migration of those properties into the competent hands of empathetic property managers. The 70 percent of owners who are managing on their own have a lot of emotion. They are probably anxious about how much it would cost. They might not think the property manager would understand the investment. Buying a first rental property is a big leap. It’s a huge shift, and those owners don’t want to make the wrong move. So, they manage on their own without any training or education. Tony Robbins says that people don’t change until the pain of not changing is greater than the pain of changing. Change causes pain, but you have to shift if you want to find the catalyst necessary to make the changes that matter. Defining Professionalism in Property Management There are some unique dynamics of working in a market with a wide variance of quality. The main challenge for professional property managers is that there really isn’t a consistent definition of what professional means. Many people call themselves professional property managers, and they’re anything but professional. They’re not very good at the managing part, either. Many people have experience with unprofessional property managers. Everyone has had an experience renting a property that was “professionally managed,” and it was a nightmare. So, the outstanding property managers who are truly professional are meeting potential clients who come with baggage and preconceived notions. This is infuriating. Your customers don’t come to your door as blank slates. All of their bad experiences are there with them, and they’re expecting you to add to those bad experiences. Those potential customers are skeptical. They doubt what you say. And then, they run into property managers who affirm those beliefs. They come off as slick or not listening. Or, they launch a pre-canned sales pitch. This doesn’t work. Initial Engagement and the Depth of Discovery You know by now that a discovery process is important. If you fail at discovery during the sales process, it’s probably because you’re doing a few things wrong. You’re approaching it with a script. The person you’re talking to will know it’s a script because it feels like a script. They’re falling into a template, and they can sense it. You’re checking off boxes as you talk and listen. Maybe you’re asking a question but not really listening to the answer. You simply move to the next question. This is not professionalism. This is not attention to detail. Be better at empathy. Stop talking and start listening. When it comes to discovery, you should have a plan of topics to cover. But, don’t have a script or a checklist. This Is the Future Now you know how 2019 is going to work. If you build out the best customer experience and you have empathy, you will help the property management industry realize what it’s capable of achieving. Marcus Sheridan moved the whole industry after his keynote at PM Grow Summit in 2017. Joey is now going to move us forward even further, and you don’t want to miss his keynote at PM Grow Summit 2019. PM Grow is for the people who want to provide great service. If you offer low quality services and you’re okay with getting something over on your clients now and then, and you’re focused on slathering sales and marketing on top of a low quality operation – WE ARE NOT GOING TO BE ABLE TO HELP YOU. The clients of our clients win when people raise the bar and increase the quality of their service. We want to raise outcomes for the whole industry. You can buy Joey’s book anywhere books are sold. Consider getting the print copy so you have instant access to all those great self-assessment questions in written form. You can actually answer them right there in the book. Visit joeycoleman.com, where you can watch videos and gain some insight on enhancing customer experience. Finally? Put this into practice. If you have a positive customer experience somewhere, tell them and thank them. It’s easy to call out negative customer experiences, but go ahead and start shouting about the positive experiences. Happy New Year to our listeners – it’s a privilege to provide The Property Management Show, and a joy to learn with you. The post Turn Any Sale into Lifelong Loyalty in 100 Days appeared first on Fourandhalf Marketing Agency for Property Managers.

Dec 13, 2018 • 33min

How Remote Can You Go? Running a Virtual Property Management Business Without Sacrificing Service

Here at Fourandhalf, we love our sixth-floor office that looks out over Silicon Valley, and we find it helpful to have everyone in the same place. But, we often wonder whether it would be possible to build a property management business that is completely virtual. The Property Management Show received an email from a listener named Nicholas who wanted to know if it would be possible to start and run a property management company without a physical office. Can it be done virtually? We reached out to a company that’s doing it, and our guests today are Noel Pulanco and Mike Sargent from HomeQwik. They also run yesVIRTUAL, a business providing highly trained virtual assistants to property management companies. The Thought Process Behind Going Virtual Leasing agents and property managers spend a lot of time in the field already. There are so many tasks that don’t even require a desk: following up on leads, taking marketing photos of properties, posting signs, leaving keys in lockboxes, and meeting with renters. All of these things happen outside of the office. Inside the office is where most of the customer service happens. If you’re transitioning those customer service tasks to virtual assistants already, as HomeQwik had begun doing, there are very few reasons to keep a physical office. Renting office space costs a lot of money, so moving all of your current office-based staff can save money and provide flexibility to your employees. As long as you have good software, good systems, and processes that work, you can keep your company virtual and mobile. Pre-sale Considerations When Running a Virtual Property Management Business Having a physical office does not provide any advantages when it comes to signing new owners. There might be a tendency for people to hire you based on where your office is. You might attract owners who are within five miles of your office just because they know you are there. But, those are easy clients. And, it really doesn’t matter how close you are to the properties you manage when you’re not the one fixing the garbage disposal or locking the tenants out. It’s probably rare that you meet with owners at your office. Most property owners want to meet at the property. You’ll want to see the home, walk through the property, and talk about the necessary repairs and the most advantageous marketing strategies. You don’t have to bring potential owners into an office in order to manage their homes. You can take them out for coffee or to lunch. Usually, you’re going to meet at their property. However, your website will need a physical address. Without a physical tie-in, it’s hard to rank a website. So, you’ll want to use your home office. Tie yourself to a physical address so you don’t have problems ranking your website and getting leads and traction. Anchor your office somewhere, even if it’s not a physical office where your entire staff goes. Post-sale Considerations When Running a Virtual Property Management Business After you’ve landed new business, you can implement systems to manage properties and tenants. There doesn’t need to be paperwork, for example. DocuSign allows you to get documents back and forth through email. That doesn’t require a physical office. All of the tenant application and screening processes can also be done online. There’s no need for a tenant to walk into your office to talk about a property or an application. You can collect virtual copies of identification and have conversations over the phone. You don’t have to drive them around to see properties. If you’re not showing properties in-person already, there’s no need to feel like the process cannot happen without a physical office. Instead of having tenants come into the office to review and sign the lease, HomeQwik will send them a video that talks about all the important points in the lease. The keys will be delivered to the lockbox, and even though they’ll talk to the tenants multiple times before they move in, the team at HomeQwik won’t have to see their tenants. Showing a property can be done virtually with lockbox technology. This automates the process and keeps you from having to show every house. You can use virtual assistants to handle direct contact or to answer questions. You don’t need a licensed broker to answer questions about pets or move-in dates. With the amount of help you’re getting from virtual assistants, you want to make sure they’re trained in certain processes. Work with VAs who understand the leasing process and how to submit an invoice and start a work order. A company like yesVIRTUAL trains them in these processes before sending them out to property management companies. These virtual assistants know how to enter leases and manage data. They understand the property management software and the processes involved in this work. The technology stack that’s needed to virtually manage the move-in process is probably something similar to what most property managers have in place already: Have a solid and transparent website that communicates qualifications, pricing, and value propositions. It should educate potential tenants and owners. Adopt a showing technology like Rently, ShowMojo, or TenantTurner so you don’t need a leasing agent to show the home. Use tech-driven software like PropertyWare or Appfolio or Buildium that allows you to virtualize the application process for tenants so they can view the property and apply online. Qualify tenants using virtual assistants who can answer questions and follow processes. Application to Lease Process: How to Do it Virtually At HomeQwik, all of the application information is collected and uploaded into the software system. If the application is denied, an automated denial letter goes out. If you have a qualified tenant, the lease terms are discussed and the virtual assistant creates the lease and sets it up in DocuSign. After one or two conversations with the tenant, a signing date and move-in date are agreed upon. The lease goes out, the tenants pick up the keys, and then inspection tools are provided for the move-in inspection. The team at HomeQwik moves in between 20 and 30 tenants every month, and they believe the virtual process is scalable. If they had the houses, they could do 100 or even 1,000. Think about the virtual platforms that are already encroaching on the real estate and property management space, like Zillow. It’s important that you’re prepared and flexible if you want to compete. Giving Up the Physical Office Even if virtual offices work better, you’re still giving something up when you move the team out of a physical office. You won’t be able to see and reach out and talk to your staff. You won’t have everyone in one hub. If you’ve got a big team, moving your staff to a system where you’re not around each other every day might be a challenge. It’s also important that you’re confident in your staff. You have to know that they don’t need to be micromanaged, and that they will work and be productive. You can use technology to hold meetings. With video, people can keep in touch with each other and see one another every week or two. You can get together for lunch or coffee. The personal touch is important, but no one will likely miss your office. There’s rarely going to be an emotional attachment to it. And, you’ll be saving thousands of dollars a month. Automattic is the company that made WordPress, which runs about 80 percent of the web technology people use every day. They recently said on a podcast that they’re fully virtual and they have 600 people. They have been able to maintain the culture, the heart, and the purpose of their organization even being completely virtual. It’s important to keep your culture alive. It’s hard to have it both ways. You might find that you either have to be 100 percent virtual or 100 percent office-based when you’re running an effective property management company. Otherwise, things can get confusing and processes could fall apart. When you’re virtual, get together for holiday lunches. Have team-building events and stay connected. If you’d like to hear more about what it’s like to run a completely virtual property management business, Noel and Mike would be happy to tell you more about it. Look for them at HomeQwik or yesvirtual.com. And, if you have any questions about your property management marketing and sales processes, you can contact us at Fourandhalf. The post How Remote Can You Go? Running a Virtual Property Management Business Without Sacrificing Service appeared first on Fourandhalf Marketing Agency for Property Managers.

Nov 28, 2018 • 51min

How I Did It: Kristin and Shawn Johnson Discuss the Successes and Failures of Independence Capital Property Management

On The Property Management Show, we love helping people in the industry learn from the successes and failures of property management business owners. The feedback we’ve received on our How I Did It series has been phenomenal, so we’re bringing you another episode today. Our guests are Kristin and Shawn Johnson, and they run a successful property management business out of Farmington, New Mexico, called Independence Capital Property Management. We’re talking to this husband and wife team specifically about what may help and hurt you while you’re building your property business from 100 doors upwards. Introducing Independence Capital – Where They Are Today Currently, Independence Capital manages about 500 rental properties, down from their high of 615 doors. Most of that portfolio is made up of single-family homes as well as some four-unit and six-unit buildings. They have been in business for six years. As a husband and wife team, they have learned the importance of respecting each person’s role and talents. Their business starts with a solid relationship and a good marriage. While their skill sets are similar, their passions are a lot different. Kristin has a marketing background but prefers the sales and accounting side of things. Shawn is a helicopter pilot and needs to be constantly engaged, so does a lot of marketing and creative work. Shawn sees the growth, and Kristin operates against it. The system works, and it works well. The Big Lesson Learned: Being Quick to Buy Kristin and Shawn said their biggest failure was twofold. They bought a portfolio of 295 doors, and missed a bit of due diligence. Several of the properties within that portfolio turned out not to be legitimate contracts, and they faced about $70,000 in lost value. The properties in the portfolio were legitimate at some point, but while the portfolio was being sold, those properties were listed for sale, and the clients terminated after Kristin and Shawn took over. They had a clawback clause* specific to a client with a large percentage of the portfolio, but it didn’t extend to all the properties. There are many things they would do differently today. *(A clawback clause allows you to regain revenue for lost accounts that may leave within 12 months of acquiring a portfolio.) The second error was to push changes too quickly. Independence Capital enjoyed a high level of client satisfaction among their existing clients. There was a lot of trust. While bringing new clients on board, Kristin and Shawn expected those new clients would be just as happy. So, they immediately introduced their own fee structure, and that didn’t go so well. They upset a lot of clients, and they had to back off and take a deep breath. This caused a 17 percent loss, which was higher than expected. Here’s the important takeaway: Even with all the losses and the stress and the mistakes, Kristin and Shawn said they would still do it all over again. That’s how property management companies grow. They experiment. Focus on Integration: How to Make it Work The previous management company had neglected a lot of maintenance and even charged owners for repairs that weren’t completed. Once they took over the portfolio, Shawn and Kristin had a line out their door and had to field about 450 phone calls a day. They had hired extra staff, but this was hard to predict. There are a few things to remember when you’re integrating a new portfolio to grow your business: New clients deserve a personal phone call. This goes a long way, especially if they’re caught off guard by the purchase and they don’t realize they have a clause in their contract that says their account is assignable to someone else. Don’t change management agreements for at least 12 months. Keep the terms the owners know, but provide your own higher level of customer service. Don’t touch the tenants’ leases until renewal time. Kristin and Shawn had a zero-day grace period policy in place, and the company they bought allowed five days for rent to be paid. You want to keep your tenants happy and in place. The Independence Capital Founding Story Not everyone chooses property management as a career, but Kristin and Shawn did. Kristen worked in real estate as a paralegal for a large investment company. Shawn was offered his dream job of flying helicopters in his hometown of Farmington, New Mexico. There was a huge need for good property management in that market, so they moved back and started their company. Their goal was to get to 150 properties. This goal was achieved in the first two years of business, thanks in part to membership in National Association of Residential Property Managers (NARPM). Then, they doubled in size the next year. Independence Capital just opened their second office in Flagstaff, Arizona. Why Flagstaff? Kristin has a sister living in Flagstaff who was having a terrible time as a tenant. None of the property management companies would call her back when she wanted to see a home. From a tenant’s perspective, Flagstaff was a nightmare. So, Kristin and Shawn opened another office there since they had someone on the ground and able to help. The business is still run from Farmington, but Flagstaff is a strong rental market with high rents. Know Your Market and Diversify When Necessary The Farmington economy is driven by oil and gas, and it hasn’t been strengthening like the rest of the nation. A lot of jobs have been lost, and Farmington was ranked as one of the largest shrinking towns in the U.S. This means it made sense for them to diversify and look for other places to do business. It’s also a good reminder to know your customer profile. Most of the clients in Farmington are accidental landlords. There are some intentional investors, but they’re not the majority. In Flagstaff, there are far more investors looking for professional management. The First 100 Units: A Learning Curve Property Management Software While you’re growing your business to 100 units, invest in property management software, even if you don’t think you need it. If you don’t have management software yet, get one immediately. Having the software in place before you land even your first unit will allow you to grow. Systems are Necessary. Figure out your systems. As you grow, those systems become harder to implement. This is the most time you’ll have; once business starts coming in, you’ll feel like you don’t have any time to work on systems. Do it right away. Envision everything you see happening from the time you earn a listing to the time the tenancy ends. This will help you develop and implement your systems. Join Associations Kristin says that because of NARPM and the people they’ve met there, growth has been fast and healthy. NARPM has a good vetting process and will introduce you to vendors and experts you wouldn’t be able to find otherwise. There are great educational opportunities, and you’ll meet a lot of outgoing, friendly professionals. The biggest mistake that was made with the first 100 properties is a mistake that many new property management companies make. They took on any and all properties. It didn’t take them long to realize that they didn’t have to manage every door that came along. It’s okay to be selective with what you’ll manage and what you won’t. Not all business is good business. Screen owners, and screen properties. You don’t want to travel for 45 minutes to get to a home you’re managing. You don’t want to take on a house with a lot of maintenance, and you don’t want to work with an owner who cannot pay the mortgage. If you tell an owner that a property will only bring in $1,000, but the owner insists on asking for $1,500, you don’t want to waste your time. Dropping from 615 properties to 500 properties was intentional. Kristin and Shawn work with Darren Hunter, a business coach, and they were willing to trim the fat and get rid of the junk. It wasn’t easy. You can raise your rates to weed out the clients that you don’t want to work with, but as Independence Capital found out, not all undesirable owners will leave, even when they’re told to pay more. Eventually, Kristin and Shawn sent letters explaining that their business was going a different way, and their systems no longer supported the management of certain properties. Many owners were distressed to have to find new management. Most owners wished them well. Pricing Property Management Services Pricing is a mysterious thing. A lot of property managers don’t know what to do and how to price their services. It’s always a good idea to put your pricing on your website. Independence Capital posts their pricing for Flagstaff because there’s a three-tier flat fee system in place, as well as a lease-only option. In Farmington, they have value-added services that complicate their pricing structure, and they’re working on posting them on their website. What is the purpose of growth? Shawn says growth builds morale, and staying stagnant in a business devastates that morale. Kristin says that people are here to learn and grow constantly, and business owners who can drive that kind of growth will provide wealth and jobs for other people, thus contributing to the greater good. According to an article in the Harvard Business Review: “Significant value creation cannot occur without growth. So, the failure to scale has social as well as investor and managerial costs. It effects job creation and innovation throughout society.” Kristin and Shawn will be at PM Grow Summit to talk more about how they built their company and nurtured their growth. Get your tickets today so you can talk to them there. To find more episodes of The Property Management Show, click here. If you have any questions about The Property Management Show, be sure to contact us at Fourandhalf. The post How I Did It: Kristin and Shawn Johnson Discuss the Successes and Failures of Independence Capital Property Management appeared first on Fourandhalf Marketing Agency for Property Managers.

Nov 21, 2018 • 48min

The Next Big Thing in Property Management Innovation: Talking Data and A.I. with Home365

The Property Management Show is based in Silicon Valley, and the beauty of our location is that we get to meet entrepreneurs driving property management innovation. Today, our guest is Daniel Shaked, the founder of Home365. This is a company that sells maintenance end-to-end through technology, specifically using artificial intelligence (A.I.) and their own network of service providers for one flat fee. Home365 and Property Maintenance Traditional industries can be more efficient by leveraging cutting-edge technology, and that’s where Home365 comes in. They want to connect homeowners and property managers with service professionals, and they want to do it in a way that’s more reliable and more cost-effective. There can be pain and friction between homeowners and maintenance service providers. There’s a low level of trust, and Home365 believes they can remove that pain and provide a better experience when you need maintenance on your property. They believe maintenance is one of the biggest components of property management, and it should be handled by professionals in a predictable and transparent way. There’s a shortage of qualified contractors, vendors, and tradespeople all over the world. It’s a global pain. But, the question you may be asking is – how does Home365 help property managers? It may sound like the business platform actually competes with them. After all, property managers are in business to solve maintenance issues for homeowners. The way Daniel sees it, a property management company’s main job should be to manage more doors and to do less manual work. Instead of focusing on logistics, a growing property management company needs to focus on winning more business. Remember, only 35 percent of rental properties in the U.S. are professionally managed. There’s a lot more business to go after. Do you want to spend your time going after that business or chasing down maintenance service professionals? Daniel believes Home365 offers a real value proposition for property managers. Leveraging Data and Evaluating Quality in Maintenance Professionals Daniel says that Home365 can predict what will be spent on each property by leveraging the data they collect. Using A.I. and looking at a house and its address, the company can predict what the home will need in maintenance over the next five years. That allows them to build an insurance product where property owners pay a monthly premium, and then after that – they have no expenses when repairs are needed. It creates freedom and removes obstacles. There’s also an element of service assessment. Home365 also uses data to assess the quality of the work and the customer service that’s provided by vendors and contractors. The good companies are rewarded with additional work. It’s tech-based and works like a credit score. You don’t necessarily do anything to impact your credit score – you pay your bills and you create a financial footprint. This technology does the same thing. Service providers do their work, answer their calls, and make their repairs. Home365 aggregates how those tradespeople are dealing with incidents. They track how they communicate and what tenants think about the work. It allows them to quickly figure out who the best vendors are. For example, a person who is always late for meetings will never finish the tenant’s turnover on time. A person with a habit of rescheduling when he gets a better job somewhere else will not always be reliable. If technology can be used to sort out the reliable vendors, the fair prices, and the good workmanship, property managers can win, and so can their owners and tenants. Algorithms are used to match the service workers to the problem. The right people are going to the right projects and there’s more time and cost efficiency. The Home365 platform can find people who did similar jobs at similar properties for similar tenants. Tenants and homeowners are guided in the description of the maintenance that’s needed. They get something that’s like a teleprompter on top of their screen, and they can explain the problem, record video, and share pictures. This structures the best solution. The full project description is sent to the vendor who seems to be the best match. The vendor gets to see the same description of the problem. Then, all parties get access to a messaging platform. They can video conference or chat, and that often reduces the need to travel and diagnose a problem. This all happens in real-time communication with real-time technology. How Can Property Managers Make this Service a Revenue Center? This can be an interesting way for property managers to offer a new product to their customers. Every property comes with a flat-rate price for maintenance. If your owners pay this flat rate every month instead of paying for maintenance issues as they happen, you no longer have to wait for their approval before fixing something. With a modest markup, this can provide some additional recurring revenue. Instead of marking up every maintenance invoice 10 percent, you’ll have this regular income on a monthly basis. Many property management companies lay out a three tier pricing plan. There’s a starter plan, a traditional plan, and the third plan or the premium plan might offer this all-inclusive maintenance model. Artificial Intelligence and the Future of Property Management A.I. can identify patterns in data. It’s clearly different than how we used to build software and systems. Especially in property management, we’ve always had to say IF this happens, THEN that will solve it. With A.I. the data organizes itself, and the system learns and understands things that we humans simply cannot see. Pricing and maintenance events become predictable for a property. It’s possible to know how many garage doors won’t open next year in Palo Alto or how many toilets will be clogged in Las Vegas. If you can do that, you can reduce costs and increase efficiencies. That’s how the industry is changing around technology. We often think that maintenance issues just happen. Things break unexpectedly. But, statistics are everywhere, and if we’re paying attention, nothing just happens. Building something like this is hard. There are a lot of A.I. companies where the technology doesn’t work right. If you make a wrong decision with a car, that’s life or death. Netflix can make a mistake and there’s really no downside. If Home365 prices a maintenance event in the wrong way, they are taking the cost on that. They take on the risk, and that risk is built into their pricing model. With time, they expect to reduce that risk. The technology gets smarter with time, so a more precise and predictable model will emerge. Future Predictions: What Can Property Managers do with this? If you’re an average property management company with 300-500 doors, what should your next move be? According to Daniel, you should be working on winning more homes, and with less people. Leverage the technology that’s available and be smart about the data. If you measure everything and you’re data-inclined, you can make smart decisions. It might mean firing a customer. Aggregate and leverage technology. It’s the overarching concept for winning in next few years. What is the future of the connected home? The younger generation is driving innovation, and even older generations are using Facetime and smart phones. We have Alexa delivering food to our doors and turning on our lights. These are meaningful services that people need and appreciate. They’re powered by technology and by sensors. In the future, every separate element will talk to all the other elements. Your fridge, locks, security system, vacuum cleaner and music will all talk to each other. That’s a connected home, and Daniel sees Home365 fitting in. The plumber can be delivered similar to the way Whole Foods delivers your grocery order. This is the smart home investment. Most homeowners spend $5,000 or $6,000 a year to maintain their home. A leak detector under the water heater will tell you there’s trouble before it explodes. A small vibration detector on your air conditioning unit will tell you something isn’t working right. Your maintenance people can get there before the whole system fails. Microphones can track termites. You can listen to the noises of pests and not only will you know there’s a termite problem; you’ll know exactly what kind of termites they are. That allows you to address the problem the right way. Distribution is required, so new properties need to be built to accommodate these things. The technology is available, and companies like Home365 are working to integrate the signal and the response. If you’re interested in learning more about technology like this, visit Home365.co. We’ve never asked you this – but if you enjoy The Property Management Show and you listen to it regularly, please take a few minutes and go to iTunes to give us some comments and maybe some stars. If you have any questions, get in touch with us at Fourandhalf. The post The Next Big Thing in Property Management Innovation: Talking Data and A.I. with Home365 appeared first on Fourandhalf Marketing Agency for Property Managers.

Nov 14, 2018 • 55min

How I Did It: Lisa Wise Discusses the Growth and Expansion of Nest DC

How I Did It: Lisa Wise Discusses Property Management Growth Today on The Property Management Show, we’re talking to Lisa Wise, who runs a boutique property management company called Nest DC. She spoke at PM Grow Summit in 2017, and she’ll speak again in 2019, so if you’re curious about the conference or you haven’t bought tickets yet, go to pmgrowsummit.com. It’s the perfect event for property management entrepreneurs who are looking to improve business outcomes. In our How I Did It series, we’re talking to successful entrepreneurs about the mistakes they made as they were growing their businesses. Introducing Lisa Wise and Nest DC Nest DC is six months from turning 10 years old. The company has gone from being the new kid on the block with a novel marketing plan and way of doing business to one of the largest management companies in the city of Washington, D.C. for single-family rentals. The company is currently looking at ways to build on their reputation and introduce new income streams while helping the community. That energy keeps the staff engaged and excited, and growth mode requires inspiration and excitement. Nest has developed a sister company called Spruced DC, which handles condo and building management for HOAs and owners. The newest brand coming from Nest is Starling DC, which handles turnover and light construction. So, even though Nest is turning 10, they always feel like they’re in start-up phase. But, they’re not in a start-up phase because they’re earning over $3 million in revenue. Measuring the Property Management Growth Curve Nest DC has been on the Inc. 5000 list, which was a big win. However, Lisa points out that you reach a stage where you can’t have hockey stick growth any longer because the portfolio just gets too big. When a property management company moves from 100 to 200 properties, it’s an inspiring math equation. But, you cannot go from 800 properties to 1,600 properties in a year. It’s simply unsustainable. Leveling out can be good. A business that keeps growing isn’t necessarily thriving. You need healthy growth. Giant profit numbers year after year are hard to come by in a service-based business. And, the core business clients are important and need your attention. Don’t seek growth just for the sake of growing. For Nest DC and Lisa, growth right now means allowing the leadership team to take over more of the day to day business operations so that Lisa can be more visionary. She feels lucky that she’s built a good senior team who is willing to continue taking on new challenges. Growth Can Mean Complementary Business Units (CBUs) To really have a healthy and growing business, you need a profitable company. One way to increase profits and growth is to introduce CBUs. Maybe that’s a maintenance division or a sales division within a property management company. The goal, according to Lisa, is to use those additional businesses not as independent companies that are predatory and focused solely on profit, but to use those business units to improve and develop relationships. While you’re building CBUs, it’s important not to sacrifice what you do best just to do something new. Property management companies often make this mistake. There’s a shiny ribbon of a renovation business or a sales business, but suddenly you cannot get your lease done or your basic customer service needs met. Don’t threaten or risk your core business. You can monetize your current relationships with customers without being predatory. People trust the relationships you have. Here’s an example of how Nest DC made this work with their new company, Starling DC: When a property owner comes back to occupy the home after being away, the Starling DC business can make sure the space is ready when they get back. Nest is losing a door because that property no longer needs to be professionally managed. But, they’ve made a grab for some cash flow on the way out the door. That’s pretty smart. In addition to starting two new brands, Nest also provides some consulting services that build additional income. They do expert witness work in court, and they consult with small condo associations who cannot afford full-time management but need help with some of the shared responsibilities like roofs and taxes. Building long term relationships is the best way to cash flow your company, especially when you’re adding extra services and businesses. There’s a window of opportunity for CBUs, and a growth-minded property management company will identify that window and act. Learning from Mistakes: Liability and Insurance Lisa’s main mistake while growing her business was legal exposure and not being able to identify and address risk before getting into trouble. Like many entrepreneurs, she and her team pieced a lot of those systems-based regulatory risk management activities together without investing in good legal and accounting advice right away. There were several points when Lisa realized she should have had more insurance. There was a situation in 2013 when her company was hammered with a lawsuit based on lead paint exposure. Lisa acknowledged that she made a mistake and didn’t do her due diligence with a vendor. No one was truly at risk, and it wasn’t the end of the world, but the company was at risk. Lisa had to detour from growing her business to deal with this conflict. Property management can be a risky business. The more visibility and the more resources you appear to have, the deeper people think your pockets are. So, spending money on legal advice earlier is something Lisa wishes she had done to better protect her company. Lesson: Don’t have a friend write your contracts. Paying legal bills doesn’t feel good, but you need that expertise and that protection. Growing from 0 to 100 Units: Marketing and Systems Confidence and belief in your services is the best thing to propel you from zero to 100 units. Lisa was telling everyone Nest DC was the best in the business. They built a reputation and became visible in their market. Creating an attractive brand and using every resource that was free and available started the marketing and branding that led them to growth and success. They used social media and took advantage of every networking opportunity that was available. They went to open houses every weekend with a gift bag and introduced themselves to real estate agents. That provided free one-on-one face time with prospective clients. That’s the marketing they used to get to 100 doors. It was all about gathering clients one unit at a time. What really got them on the map was a “Best Of…” contest in the DC City Paper. They only had between 18 and 30 properties, but they were voted Best Property Management Company in DC. This got them a lot of visibility and an instant reputation for excellence. Since then, they’ve been in the top three every year. Operationally, Lisa didn’t have a lot of structure in place. Whoever answered the phone was the team member who took care of the inquiry or the problem. There were five people on staff, and Lisa wasn’t earning a salary. Next Stage Property Management Growth: From 100 to 300 Properties Systems became incredibly important in the journey from 100 to 200 properties. At this point, you cannot simply keep keys in a box. You need to organize and track the portfolio of properties you’re managing. Nest DC began working with Appfolio, and having a property management software that was aligned with their business model was exactly what they needed. The volume became a driving force in getting everything systemized and operationalized. Like every other property management business owner, Lisa learned that what works at 50 units doesn’t work at 200 units. Software is only as good as the user is at using it, and the team had to make sure everyone was clear on roles and how to use their software. They had to come up with some best practices and standard operating procedures. They embraced consistency and they reduced risk. Employees were free to do their best work on the confines of an endless beach. Appfolio gave Lisa’s company the sandbox to build their practices around. Sometimes, they still felt like they were on that endless beach. But, they had better strategies and solutions were easier to come up with. The marketing strategy didn’t change much, they just did more of it. They continued getting the brand out there and they kept participating in the industry. They did lot of blogging and made an effort to comment on the social media posts of other businesses. They kept doing the open house visits and they began participating in roundtables. Professional affiliations were important, and Nest DC sponsored different community events. They did everything they could to become visible in the community. Beyond Property Management Growth: From 300 to 500 Properties Departmentalizing became the most significant part of the transition as the company grew to over 300 units. The company had about 12 employees, and there needed to be more structure around a finance department and a leasing team. Then, they developed a maintenance team. There was more clarity around how those departments worked, and investments were made in training people. Internal culture became important, and there was an increase in salaries because longevity was the result they wanted. Lisa wanted to invest in people who aligned with the company’s values. That element helped the growth continue. Every year, the company takes a giant step back to fine tune what they’re doing. Internally, if there’s something an employee doesn’t like doing, the advice is to find a better way to do it. Sometimes, the things you do aren’t necessary, but they simply become the fabric of your company. Edit out whatever you can. Take advantage of innovation. Scalable growth means delivering the best services and products without killing yourself. Over 1,000 Properties: How do Things Change? Leadership makes the difference when your company jumps to over 1,000 doors. There’s not necessarily a big leap in how things are done, but there needs to be a shift in who is doing what. More leadership, stronger managers, and people for staff to look up to are critical. You need to invest in a larger pool of people. A sustainable staffing model is essential. You can refine your systems and get better at what you do, but what you really need are decision makers. Encourage your staff members to build on their strengths and develop their leadership. Lisa doesn’t know how to lease properties or screen tenants anymore. That’s a good thing. She’s focused on property management growth and developing the next brand. Reputation is the next thing for Nest DC to conquer. Their rating on Yelp is lower than it should be, mostly because filtered reviews are a problem. A handful of the negative reviews are minimal compared to the majority of four or five star reviews, but those are the ones that get the most attention. Building a better reputation online will be the company’s focus in 2019. They will keep working with their survey system and they’ll be more proactive about getting happy customer to share their positive experiences. We look forward to talking more with Lisa at PM Grow, and if you have any questions about what you have heard or read – contact us at Fourandhalf. The post How I Did It: Lisa Wise Discusses the Growth and Expansion of Nest DC appeared first on Fourandhalf Marketing Agency for Property Managers.

Oct 30, 2018 • 52min

All About Acquisitions: Michael Catalano and Steve Rozenberg Discuss Evaluation and Integration

Mike Catalano and Steve Rozenberg joined Alex on The Property Management Show to talk about growth through acquisitions. Mike Catalano is one of the most experienced property management owners to talk about acquisitions, and Steve Rozenberg runs a tightly systemized company and is thinking about acquisitions as part of his growth strategy. Alex and Mike spent some time talking about acquisitions in 2015. A lot has changed since then, and a lot hasn’t. Why Would Anyone Want to Acquire a Property Management Company? Steve has a successful company and is growing organically. He executes well. So why would he suddenly be interested in acquiring new companies? Many people would see it as an unnecessary headache. But, you don’t have to grow one way or the other. You can use both strategies to grow – organic marketing and new business acquisition. When you’re trying to grow your property management company, you have to look at all the avenues. Adopting a growth through acquisition strategy doesn’t mean you have to stop pursuing your organic growth. If you’re thinking about expanding into a new city, for example, acquisitions can get the momentum moving. It provides instant doors, an immediate presence, and a lot of momentum. You don’t have to build in a new market one property at a time. When you have a strategy of both organic marketing growth to attract new leads, you win on every level. Your organic growth is steady and your growth through acquisition is immediate. When should you not acquire companies? When you don’t have solid systems and procedures in place, and you cannot support the growth internally. As they say in the airline industry, that will get you to the crash site quicker. Acquisitions help you capture a market share, and you have to be procedural. Before you buy: Operations and Sales/Marketing When you’re buying another company, you need to know that the operations are in place. From there, you’ll decide what you’re going to change and what you’re going to keep. Once you know a company is set up operationally, take a look at their sales and marketing. Before you do any new marketing, you’ll want to make sure you have the capacity to support the new business it will bring in. You don’t want to bombard the staff you’ve kept on board. Operationally, you want a company that has a structure allowing them to stand on their own. Structural soundness is essential before you acquire. And, every single company runs differently. Sometimes, you can learn from the companies you acquire. For example, you might buy a company with value-added fees and services that you never heard of before. Then, you can incorporate those into the rest of your business. Evaluating the brand value is a little more complicated than evaluating a company’s operational soundness. You can look at the website, reputation online, and how long they’ve been in business. If a company has been around for 25 years with a percolating website, that’s valuable. But, it’s hard to quantify brand value. The industry is learning metrics. Understanding value per door and the cost and value of the leads that are acquired every month are valuable tools in evaluating a brand. People are tracking more in this industry than they ever have before. So, the day will come when it’s easier to put a value on each brand. Some companies know their numbers and can talk about lifetime customer value and profitability. But, not all companies can currently say what their acquisitions costs are or how much they spend per lead. Until it becomes easier to identify brand value, don’t evaluate for current opportunity. Evaluate for future opportunity. Did you get that? Evaluate for future opportunity, not current opportunity. Remember, that company’s reputation might be strong and you don’t have to change the name or intrude upon their brand. If they have a company name in the area that people recognize and embrace, leave it alone. They’ve been in business for a long time, so changing their name to yours won’t help you. What is a Property Management Company Worth? Property management companies are worth whatever a buyer is willing to pay. Currently, the industry standard is pretty wide, and every acquisition is different. In general terms, your company is worth between 8 and 18 times the monthly gross revenue. When you think about your monthly gross revenue, you’re not just talking about management fees anymore. It includes any consistent income on anything – from management fees to leasing fees to late fees, pet fees, etc. A sample size of two or three years is also required to make these calculations. The amount that company owners are willing to sell for often depends the motivation behind the sale. There’s now a generation of property management company owners getting out of the business. They often have lower valuations because they made their money, they ran a good company for a while, and they’re ready to exit. The newer companies that are operationally strong often want to exit in order to make money. So, they’re going to have a higher valuation. It’s a mixed bag, always. It’s important to be selective. Out of an average of 10 companies that Mike looks at, he probably buys one. If it doesn’t fit, don’t force it. You have to be careful with what you buy or you’ll run into problems. The Deal: How Property Management Companies are Acquired Cold calling is one way to find companies who are interested in selling. You can also speak at events, and let people know you do this. Banks hold trust accounts and they know who wants to sell. Talk to different groups like NARPM, PM Grow and Broker/Owner. Let your colleagues know that you’re looking to buy. Social media works, too. Facebook groups are full of people you’re trying to reach and hoping to target. You can share some information so people know you’re an authority; maybe put out an eBook. People can read it and take a look and ask questions. Integrating an Acquired Company with Your Own Integrating a new company can be a challenge, especially if you have a lot of momentum and depth and you’re able to execute with your existing company. It can be difficult to bring in a new part of your business that does things differently. But, there are many ways to make it work, and it really depends on the company you’re acquiring. Mike’s new strategy is that he doesn’t initially change anything. The accounting is integrated because it helps the company flow smoothly. But, there’s no change to pricing, and none of the property management systems are disrupted. Things run smoothly for a while and the employees are comfortable and productive. Then, new things may be introduced. The website is integrated. Contracts are changed. This strategy has helped Mike keep a 100 percent retention rate in his last two acquisitions, which is pretty remarkable. So, for companies that are running well on their own, there’s not any reason to force the integration right away. If the company is not aligning or there are problems that need to be addressed right away, you can work with an immediate integration and change all the contracts. Sometimes, that’s the only way to do it. It depends on the team and the alignment between the buyer and seller. Don’t fix what isn’t broken. You can buy a company and do nothing to it, and you’ll still make money. But, if you buy a company that’s underperforming, you can systemize it on the back end and make it scalable. You’ll want to look at it on a case-by-case basis. Owners need to be notified when ownership changes, and that also depends on the seller. Letters are sent out to tenants, and then Mike works with his sellers to notify the owners. Sometimes the seller makes a phone call, sometimes they make the phone call together, and sometime Mike calls to introduce himself and does it on his own. The goal is to keep it as personal as possible. Let the clients know there won’t be any changes. They need a familiar face, so consider keeping the owner on staff for a few hours every week. Then, that time commitment can taper off. Keeping your clients makes the profit higher for the buyer and the seller. Work together. There’s a lot more to talk about when it comes to acquiring property management companies. Contact Steve at steve@empireindustriesllc.com. He wants to acquire property management companies in Texas, the Midwest, or even in the east. Mike can be reached at mike@recproperties.net. He’s looking to stay in California, but will make an acquisition work anywhere. Thanks for joining us, and if you have questions about The Property Management Show, contact us at Fourandhalf. The post All About Acquisitions: Michael Catalano and Steve Rozenberg Discuss Evaluation and Integration appeared first on Fourandhalf Marketing Agency for Property Managers.

Oct 11, 2018 • 56min

What Does Fiscally Responsible Growth Look Like? Twelve Markets and 4,000 Properties in 2.5 Years – How Benton Cotter Did It

On this episode of The Property Management Show, we’re talking to a guest about fiscally responsible growth after he emailed Alex a response to the podcast about Mynd.co and Doug Brien, who received a lot of venture-backed funding to grow a property management business. Benton Cotter remarked that it was a great interview, but thought our audience should know that it’s possible to grow a property management company quickly without raising funds. We thought that might interest you, so he’s here with us today, talking about how he went from 450 properties two and a half years ago to 4,000 properties today, in 12 markets. He has no venture capital backing him, and he calls his strategy fiscally responsible growth. What’s more – he wants to get to 10,000 doors in 20 markets by 2020. Benton is the co-founder of RentVest (rentvestpm.com), and he has a lot to teach us. Growth through Acquisitions vs. Organic Growth Initially, a big company fell into Benton’s lap in Phoenix, bringing 850 doors with it. So, the breakdown has been about 60 percent acquisitions to 40 percent organic growth for RentVest. The key to finding people who want to sell is simple: cold calling. Benton and his business partner, Jacob Ash, get lists of property management companies from NARPM and other sources, and they make a phone call and introduce themselves. It doesn’t take long to get an idea of whether there’s a deal to be made. If you want to grow this way, get connected. Talk about what you have to offer, and start building the relationship. It’s a hustle. AdWords and Its Role in Organic Growth Growing by 700 units organically is some pretty incredible growth, and it was done in new markets. Benton admits he doesn’t have great SEO. But, he does have a firm grasp on how AdWords works, and it’s the cornerstone of his digital marketing efforts. AdWords delivers a benefit that others platforms cannot. It captures people who are searching and learning and visiting websites. By the time they pick up the phone to call you about your management services, the lead has really self-nurtured already. They are taking the initiative to call you. That gives you a tremendous advantage when it comes to closing business. The approach to AdWords is strategic and includes: A projected customer acquisition cost for AdWords before opening a business in a new territory. An understanding of the search volume in an area. Researching search terms and average monthly rents and competition. Spending $1,000 or $2,000 just testing a market. This provides a good idea of what can be done and what it will cost to attract customers. When you know your cost per click, you can figure out your cost per lead and your cost per customer. All of this data helps Benton decide where his company has a chance to earn the most ROI. It’s hard to get it wrong when you have this data to work with. With a plan to move into more markets, adopting a system that’s easy to duplicate is critical. Benchmark the data, check the data, and study how it works in each market. There are always going to be variations, but when the system is easy to duplicate, growth is inevitable. Mailers as a Marketing Tool: How to Reach New Audiences Mailers have not worked particularly well for Benton because they results are so different in each market. He prefers the digital marketing strategies, where the leads he receives are prepared and already in the buying funnel. But, if you’re growing your property management company, mailers can work. Five or six touches are usually required. It can be expensive, but not cost-prohibitive. You get a different set of people than you’ll get through an AdWords campaign or other online marketing leads, and you’ll never overlap. Prospects aren’t going to receive your mailer and then also click on your AdWords campaign. It’s a different clientele, and they require a trigger. But, with those five or six touches, you’re able to convert. A Unique Sales Process: Enabling Entrepreneurs It’s no secret that the property management industry has some catching up to do when it comes to operationalizing sales. With Benton’s explosive growth, he must have a pretty outstanding business development manager, right? Wrong. In emerging markets, keeping the overhead low is critical. So instead of hiring BDMs, Benton goes after really qualified employees and agents. And, their success starts with their ability to sell. Finding someone who is strong with sales and marketing and also knows property management can be a challenge. In their emerging markets, Benton uses 1099 employees. Their first month on the job carries one task: to grow a business. Can they sell? Can they be effective property managers? Can they present a message and understand the sales content and read a client? That one unicorn of an employee who can sell, manage maintenance, and be the overall real estate expert who can help landlords buy and sell will do very well opening up an office for Benton and his company. This defines fiscally responsible growth. It’s keeping overhead low and finding just the right person to help you grow your market and your business. If you cannot afford a BDM, a broker, and a property manager in one place, you need to find a rock star. Conversion often depends on those rock star employees. Underperforming agents know where they stand. The company provides KPIs and expects the agents to measure and evaluate themselves. This creates self-awareness, especially when conversion rates are shown to everyone in the company. They know where they stand. They also have the freedom to deviate from standard procedures if it means success. These 1099 employees are treated as entrepreneurs. They need to be creative, and they need to be exposed to as much information as possible. Establishing a Pricing Model with Potential RentVest has a simple, flat-free pricing model of $80 per month. With a motto of just say no to business, they choose high-performing properties with high-performing tenants. They have very few $100,000 properties. They have one multi-family home that they inherited. Generally, they manage single-family homes with three bedrooms, two bathrooms, and a rent that’s between $1,600 and $2,500 per month. With quality homes, you’re working with landlords who have the funds to buy more properties. You’re getting quality tenants with enough income to afford ancillary fees and optional services like renter’s insurance and filter programs. Provide these owners and tenants with value, and your revenue will increase. Lease-up fees are 50 percent of one month’s rent. Tenants pay an administration fee at move-in and a monthly administrative fee. These things are common in Arizona, but not in all markets. Those fees are justified with the cost of maintaining the tenant portal and the ease of paying rent online. Other auxiliary services are offered. Your property management company can bundle services like cable or satellite television and utilities. You can offer real estate services. Offer your tenants a credit repair program so they can start preparing to become buyers. If they’re already in good financial shape, offer them the opportunity to become landlords themselves. This is rentvesting; when a tenant buys a home to gain some income and equity. Then, they can either move into that property or sell it and buy something else. There are a lot of revenue options with your owners and your tenants. Benton currently earns 85 percent of his income from property management fees, and his goal is to bring that down to 60 percent, with his complementary business units bringing in 40 percent of his income. Scaling Locations and Managing People When the single rock star agent at one of Benton’s location grows to over 100 doors, it’s time to hire a second agent. The original agent can maintain their portfolio and continue to earn referral business. They even had one agent hire an assistant. It’s been a work in progress. Technology as a Means to a Customer Service End Benton’s role is not operational, but focused on marketing and technology. He’s very hands-on and has even built some of the tech that’s being used by his company. Technology is expensive, and part of running a fiscally responsible business is wearing multiple hats. SalesForce is the software of choice and they also use PropertyWare. Big data helps them tremendously, and they’re integrating everything they can, whether that means building an app from the ground-up or working within one of SalesForce’s modules. Big data has helped with calculating KPIs and lead cost. Benton knows the cost of leads in every market. In Phoenix, it’s $22 to $40 per click and in Reno, it’s about $9 per click. Their average cost per click is around $18. Technology is stacked to help them earn smart money. If you’re not tech-savvy yourself, work with someone on your team who loves experimenting with software and apps. Let it be someone’s secondary function. You don’t have to bring on an expensive software guy or IT expert. If your accountant also loves writing software or gets enthused about making a current tech system work better, they’ll spend some extra hours on it and build whatever they want. There are plenty of free platforms out there to help. Let that person experiment for a while before releasing it to the whole staff. Remember – tweaking software is going to help you succeed as a fiscally responsible company. But, no amount of outstanding technology is going to help you if you don’t have a purpose and a vision. Software is a solution, not a purpose. As an industry, we need to get better educated on customer experience. If you’re thinking about the customer retention game (and you should be), try this book that Jordan Muela recommended: “Never Lose a Customer Again” by Joey Coleman. Customer engagement has to be first. You have to know what they want. Don’t go out and build a huge tenant portal with all the bells and whistles if all they want is a way to pay rent online and request maintenance. Alex always says there are three core principles to business success: Define your Purpose Know your Numbers Culture of Experimentation Benton is an example of all three. There’s how he got to 4,000 units in 12 markets in two and a half years. Thanks for joining us on The Property Management Show, and we look forward to seeing you at the PM Grow Summit. Contact us at Fourandhalf if you have any questions about what you learned today. The post What Does Fiscally Responsible Growth Look Like? Twelve Markets and 4,000 Properties in 2.5 Years – How Benton Cotter Did It appeared first on Fourandhalf Marketing Agency for Property Managers.

Sep 27, 2018 • 51min

Steve Welty Talks about How to Dominate the World (or your Property Management Market)

Are you still passionate about property management? If you’re not, you may be driving away business. Today on The Property Management Show, we talk to Steve Welty, owner of the hugely successful Good Life Property Management. There’s a lot to discuss, from how to become competitive in a new market to the importance of reputation to – barbers. Alex can’t go back to his barber because his barber has lost passion for what he does. The barber is more interested in thinking about other things he’d rather be doing than trimming hair and beards for men. Alex isn’t willing to work with someone who is no longer passionate about the services he’s delivering – and your clients probably feel the same way. Passion and the Three Pillars of Success Passion is required in your business to achieve success. You have heard about the Three Pillars of Success before, and Alex recently did a NARPM webinar about these pillars: Know the purpose of your organization and what you’re driving towards. Know your numbers. Embrace a culture of experimentation and innovation. Passion drives these things. Steve understands passion, and the danger in losing it. He came to a place where he had to decide if he was going to go full steam ahead with his property management business or just find something else to do next. He decided he still had a lot to accomplish with property management, so he set a five-year goal: to get to 3,000 units with a 30 percent profit margin. That goal has given his entire team purpose, and passion is a part of that. Enthusiasm and passion fuel the purpose. Pivot Towards Passion and Decide Where You’re Going Entrepreneurs often take too little time zooming way out to decide what they’re doing and where they’re going. Even the most motivated business owners struggle to focus on their purpose in life and in their company. It’s an easy way to miss your purpose entirely. Don’t get caught up in the weeds of your business. If you do, your life will stand still and your batteries will die. Think about who you surround yourself with. If you’re a micromanager and you don’t understand the basic principles of human psychology and delegation, you’re going to suffer and so is your business. Put together a brilliant executive team and feed them passion and motivation. You can set the long term vision and show up. Your team can do the rest. You have to build your business. You have to know where you’re taking your team. People want to be taken somewhere and if you don’t know where you’re going – fire yourself. Steve recently had his team review him. He did a performance evaluation on himself, and he got a lot of great insights. One of his accountabilities is culture. His team said the culture had been struggling because of their workload and the fact that they hadn’t had a team outing for a while. If Steve had not asked for this review, he wouldn’t have known what he needed to do to re-ignite the passion in his team. Communication is critical. Happiness starts with a competent leadership team you can rely on. Put people in place who are better than you in their specific disciplines. Getting to the Goal: Operationalizing Sales and Marketing to Reach 3,000 Doors The plan for reaching those 3,000 doors is this: SEO Reputation Conversion After studying great companies that have grown, Steve noticed one thing they had in common: killer SEO. Google property management or any related keyword, and those companies pop up every time. So, Steve educated himself on what that meant and how to achieve results. He hired a writer to focus on blogging. The number of website visitors went up and so did their ranking on Google. He worked with Fourandhalf to build a good marketing foundation. With SEO comes conversion. Once you have that visitor to your website, you want to be irresistible to that potential customer. You want to understand your perfect client so you know how to appeal to that client. Great content brings you website traffic, which brings you potential conversions. This is the next phase after SEO mastery, and between the two is reputation. Steve built his company on Yelp. He understands reputation and its importance. Yelp is a missed opportunity for a lot of property managers, and Steve has some good advice about what he’s learned when it comes to gathering reviews: It’s important to have so many positive reviews and be so in the game that a few negative reviews don’t matter. Customer reviews are only going to become more relevant. Set up a culture of asking for reviews. Talk about asking for reviews in every team meeting. Appoint a Yelp Czar on your team. That person is responsible for increasing the number of reviews your company receives. Try to convert the negative reviews. They are usually tenants, and find out what you can do. Maybe it’s someone who didn’t get the apartment they applied for. Refunding their application fee can turn a one-star review into something better. Don’t delegate one-star review responses. The number of reviews you have is key – sometimes more important than your rating. Keep an eye on reputation. Incentivize your team to get these reviews coming in, and your company will look good. Expanding into New Markets: Landing Pages and Microsites Good Life Property Management is working on expanding from San Diego into the Escondido market. Steve sees his company as educators, so they’re doing all the blogs and videos and setting up landlord seminars and doing Facebook ads. What else can be done to dig into a market that’s 30 miles away? AdWords won’t help with SEO in this case because no one is really searching for property management in Escondido. The best way to use the power of SEO and conversion is through a microsite. Steve can create a lot of content and include a lot of links from his main website, which already has a lot of authority with Google. If you find yourself in the same situation, consider using a microsite for a new location. A landing page might work equally as well, depending on your territory and the strength of your mother ship, or your main property management website. Check all the boxes. Put some content on there that’s more than 500 words per page. Make sure you have substance. Create a subdomain. These things will help. Long form content creates magic, according to Steve, who has effectively done it. Writing something with 2,000 words or more allows you to do a deep dive and reaches important audiences. It also makes Google pay attention. Consider writing long articles or white papers. Short form content is always going to be necessary because you want to show consistency and quality. Long form content, however, can really help you gain significant SEO over time. If you want to take over and play in a new area, build an engaging page on your website. From there, convert it into a microsite and then include those valuable links from your main site. Linking higher authority sites to your new page is where it’s at. When you’re expanding into a new, smaller market, your plan is this: Build your main site and make sure that website really ranks. Once it has authority, build pages and microsites that link. Giving What you want to Get Social media also has a lot of promise. Steve has effectively used Facebook Live videos to reach an audience and share his expertise. It’s like throwing up billboards in front of people who will find the content relevant. It’s inexpensive and doesn’t take much time. He recently did a Facebook Live video talking about the advantages of being a landlord. It can be intimidating if you haven’t done it before, but once you start to roll, it becomes comfortable and easy. Steve believes in educating and sharing knowledge, and if you read Deepak Chopra’s book “Seven Spiritual Laws” you’ll get to understand the Law of Giving. Whatever you want – you have to give. So, if you want knowledge, you have to give knowledge to the world. Apply this to your business. If you want a great review on Yelp, leave great reviews for other services you use. If you want more education, educate people on the things you know. Hear more from Steve on his Good Life Property Management podcast, and contact us at Fourandhalf if you have any questions or thoughts about what they discussed today. The post Steve Welty Talks about How to Dominate the World (or your Property Management Market) appeared first on Fourandhalf Marketing Agency for Property Managers.

Sep 11, 2018 • 52min

How I Did It: Stephanie Gordon Shares the Challenges that Helped her Succeed

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