AGC had a SaaS conference and a panel I was on discussed our thoughts on SaaS within the rental industry. Here is a transcript of a few of the questions that came up:
Do you agree with forecasts for the strength of the rental market going forward? Is real estate SaaS a good place to put new money?
Yes and here is what I believe the future will look like for real estate:
the rental process will be so simple, we will be able to rent long term properties just like we book hotels online today.
- Virtual and Augmented Reality – Viewing properties will change dramatically with VR and AR.
- IOT – Sensors will literally be in everything within the home. From appliances to lights, locks and even sensors within the floors.
- Sharing Economy – The Sharing Economy will continue to change the way apartments, landlords and renters can earn more money.
- Rental Process – Will be 100% in the cloud and completely streamlined.
Real estate will become more liquid where we will be able to buy and sell real estate in seconds, just like we do with stocks
Where is the best opportunity currently? Platforms with a broad set of functionality, or point solutions with new and best-of-breed tech? Is there an opportunity for multiple point solutions to continue thriving?
Some customers do not want one company doing everything and having access to all of their data and controlling it. Once a customer is using multiple products from one company, the switching costs continue to grow. Good for business, could be bad for customer.
Is that good for the customer in the long run? Maybe, but having other options that may be better and more cost effective that can easily and openly integrate with larger systems is a win win for everyone involved.
Is there a silver bullet or killer app that we have yet to see?
Virtual Reality within the real estate industry is going to dramatically change how we tour rentals and real estate.
Open houses where we drive around on weekends will become obsolete.
In the near future, in the comfort of your own home you will be able to walk the neighborhoods and walk into your next apartment.
You will be able to feel the texture of the walls and carpet. By 2025 VR will be so real, our minds won’t know the difference between what is real and what is virtual. I recommend reading, “The Singularity is Near” by Ray Kurzweil.
What challenges have you seen regarding the adoption or deployment of real estate SaaS products? How have you addressed those challenges?
There tends to be slow market adoption for new technologies. My first advice I received from an apartment executive 10 years ago was:
“Hang in there. The Apartment Industry is like Russia, it has never been penetrated from the outside.”
At first, I thought he was crazy, but then I realized there was a lot of truth to it. For good or bad, It doesn’t matter how much money you have raised or who you know, it matters how much time you have spent meeting decisions makers within the Industry. Showing up to trade-shows and developing relationships. All of this takes time.
Even online advertising on sites like apartments.com and rent.com in the early 2000’s etc was significantly behind other industries.
The apps that see success faster can quantify an ROI for the owners / managers. Rent.com was the first to do this by offering an advertising solution that was a cost per lease where owners could fill their vacancies with no risk at a much lower CPLease than anywhere else.
How does your service create more value than anyone else?
Given the broad appeal and opportunity of Vertical SaaS, what other industries do you think are worth trying to penetrate? What challenges will you face? Or should companies stick to one vertical?
At Google, Larry and Sergey would always say, lets do one thing and be the best in the world at it. Of course over the years, they have entered other industries by having the same mindset of doing something that is 10x better than anyone else.