Part 1:
An Idea is Born, Neutered, and Born Again
1.1 - Some Origin Stories Begin with a Phone Call
It can be difficult to pinpoint the origin of a new business. Companies often mythologize origin stories for marketing purposes. Ours, however, began with a phone call.
Late on a Spring evening in 2016, I felt a buzz in my pocket. I answered, and a familiar voice dove right in. “Just talked to Eric,” Andy said. “Wanted to run a couple ideas past you.”
I met Eric Broughton and Andy Hamilton ten years earlier at a startup named Yield Technologies. We were three of the first six employees. In its infancy, the company performed software consulting projects for a range of industries, from offshore shipping logistics to self-storage to construction and farm equipment. By the time we sold the company to RealPage five years later, it had become a fifty-employee SaaS business developing marketing and resident-management products for the multifamily apartment industry, earning annualized revenue in the millions of dollars.
After the sale, we served various roles at RealPage, pursued other opportunities, and even experimented with a mobile app startup called Dander in the summer of 2015. Dander’s goal was to raise money for animal shelters with an app that functioned a little like Tinder and a little like GoFundMe, matching people to adoptable pets and letting them donate small dollars to support those pets. Sadly, Dander proved unviable, and we shut it down.
By 2016, with our RealPage non-compete agreements exhausted, we shared almost a decade of experience together and were contemplating new opportunities.
On this call, Andy and Eric had discussed two ideas.
The first was another web-based marketing tool for multifamily. Andy loved CRM applications. He knew from experience there were few truly forward thinking options in the industry. CRM was an easy path to acquiring a handful of early adopters who were exhausted by the tedium of existing tools. I agreed with his sentiment, but I wasn’t in love with the idea. We had built something similar in the past. At the time, there was a lot of well-moneyed competition blanketing the space. Even if those other solutions were clunky and poorly designed, it was hard to be heard through the noise. We both agreed it would prove a long slog with incremental growth and, at best, a moderate exit when we tired of the grind.
The other idea instantly piqued my interest.
During the preceding year, Eric had spent a lot of time, as he often did, with his finger on the pulse of the multifamily industry, regularly attending conferences and chatting with peers. He began to sense a growing discontent, an abstract fear, a buried unease. He summed it up with one word: AirBnb.
Short term rentals had become a nuisance for the apartment industry. Residents loved to share their apartments on Airbnb, even when it violated their leases. This opened the door to limitless liability for property owners, who had little visibility into the scope of the problem, little control over it, no share in the revenue, and nearly all the risk. Management companies had spent years trying to create a sense of community at their properties. This new transient population of Airbnb guests, wielding luggage and throwing parties, threatened that close-knit sense of community and risked property damage to billions of dollars worth of assets.
Eric's idea, which was brilliant, was to bring transparency and organization to the Airbnb dilemma, to give multifamily owners and operators a bit more control and a share of the revenue. This transparency would make the process safer for property owners, safer for residents, and safer for short-term guests.
The timing felt right. Airbnb was growing as fast as any other company in the world, disrupting an entire segment of the vacation and hotel industries. The problems for multifamily were just beginning. Plus, we were well positioned. We had built a similar solution for Craigslist.
At Yield Technologies, we had identified wild inconsistencies and inefficiencies around how multifamily companies marketed apartments on craigslist. We built a product called RentSentinel to help centralize, coordinate, and report on craigslist marketing activities, which helped large portfolio companies understand how their individual properties used the platform to generate leases. Now, a decade later, facing a new type of marketing dilemma, we could build a solution with nearly identical goals.
"That Airbnb idea is intriguing," I said. "We could actually build that. We know the industry. We have the contacts." For me, after too long building for – and integrating with – the old kludgy software in the apartment industry, this would be a chance to focus on a modern solution, in a growing space, integrating with a savvy tech partner. If I mentioned to people I was working on something related to Airbnb, there was a chance they’d actually know what I was talking about, which would be a far more exciting experience than the blank stares I received whenever I explained to people I built marketing optimization and yield management tools for real estate companies.
After that call with Andy, I paced around my house for hours considering the possibilities and trying to poke holes in the idea from all directions.
I went to bed excited. The vague outline of a plan had been born. A real possibility. A real opportunity. The timing seemed right. It was the first step on a long journey, but that first step is always thrilling.
I couldn’t yet fathom the pushback we would receive from nearly everyone.
Next: Hello, Rejection
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