Technology

Things proptech startups should know

Author
Jessica Swesey
No.
1100

I’ve never bootstrapped a tech company. I’ve never pitched to a room full of VCs. And I’ve never had to make the painful decision to turn off the lights on a project, product or company.

But I’ve worked closely over the years, both as Managing Editor of Inman and as a Partner at 1000watt, with many who have done these things. I’ve sat through hundreds of demos, perused miles of expo halls, shaped dozens of marketing strategies, and experienced real estate technology as a bystander for nearly two decades.

There’s nothing more exciting than talking with a new founder who’s onto something totally cool. It got me thinking about what I’d say to all the new founders in 2019 if we were to sit down and have a drink.

This article is my side of that conversation.

Your customer

If you’re creating and selling technology to the industry, you’ve no doubt been thinking about the best way to get your product into the hands of agents. Do you go directly? Through brokers? Partner with MLSs or franchises?

There are many paths. But at the end of the day, agents drive pretty much everything. That may sound like an easy answer, but it’s not, for a lot of reasons. Agents are expensive to reach, require a lot of in-person selling, onboarding and training — even for “simple” software. And there’s a LOT of churn. People seem to try on this career like a hat in a store window, then move along to other pastures often.

And there’s this: An irregular, commission-based income and a regular credit card charge for a software or service subscription just don’t live well together.

And whereas virality can work wonders with other business apps like Slack, agents tend not to want to tell others about new tools they suddenly can’t live without.

You could go the broker route — but remember agents are independent contractors who like to create their own tech stacks. Brokers in almost all cases cannot mandate the use of specific software, have little influence over their agents, and therefore report low adoption much of the time.

On top of that, brokers often aren’t good at communicating with their agents, which means getting your core messages through them and into the minds of agents is wishful thinking.

So, more on your customer… the agent. Here’s another challenging reality when it comes to brand and marketing your product: there is no typical agent.

The agent profile can only be haphazardly drawn around where they are in their career (rookie, mid-career, experienced/top producer, solo practitioner, team lead or member). They come from all backgrounds — college, no college, former careers, grew up in the biz. This is a diverse business in many ways.  

The important common thread to know is that the vast majority of agents wake up each day without a paycheck, a scary reality even for successful ones. If you can immerse yourself in that mentality, it explains a lot.

When there’s no paycheck, the constant motivator is the next deal. This is why, during your product demos, an agent is always going to be thinking, “how will this give me leads?”

Your brand and message

Shed the belief that your brand must look like things in real estate.

I’m not saying there’s anything wrong with using houses, keys, doors, chimneys, etc., in your design. I’m just saying it’s… expected. And there’s something special about doing things that are surprising.

Going against the grain with your visual identity could quickly turn up the volume on your product in a sea of noise.

Likewise, in terms of naming, every compound of “home” or “real” has either been taken or starts to sound cheesy or like everything else. We’ve done hundreds of hours of research on product and brand naming over the years and have realized a few truths: many of the best brand names start out with no meaning at all (what we call “empty vessels”), and are filled with meaning through deliberate branding and marketing; and there is a science behind good naming that relies heavily on sounds, subtle associations, and shapes of letters.

Bottom line: If you want to stand out in real estate, create a product and brand that looks like the rest of the world, but not the real estate world. This is one industry in which you actually can squeeze a lot of juice out of having a good brand identity and nicely designed product because it’s a differentiator in and of itself.

And along with differentiating on brand, don’t forget to tend to your core message. It may be true that your most potent end benefit is a bigger business for your customers. But do yourself a favor and steer clear of these messages and wording, in particular:

Recruit and retain

Grow your business

Dominate your market

Pay for this with just one closing

Create clients for life

Agents and brokers have heard these so many times they are more likely to put them to sleep than to pique their interest.

Your marketing

Event marketing is pretty high up in the real estate tech marketing playbook. And for good reason. The streetwise education you can get from getting out and talking to real agents, brokers and others in the industry is a thousand times more valuable than formal market research.

You’ll get brutal real-world feedback on your product.

You’ll get words you can use in your marketing.

And you’ll get ideas for where to go next.

But…

In recent years, the industry has been flooded with events. Your marketing team could be on the road 52 weeks a year. It’s draining on staff, expensive and takes a ton of prep work.

If I were a startup and I had to pick just a few to get started with I’d go to Inman (Las Vegas and NYC), and also the annual NAR Expo to get a broad taste of Realtor culture from all corners of the country.

I’d also caution, though, not to get so sucked into the conference scene that you forget to spread your marketing chips over other bases to learn what works.

Your leadership team

Alright, I’m about to say something that no doubt is going to be taken the wrong way by some of you. But hear me out…

Real estate is an industry of women. The majority of agents are women. A lot of broker/owners are women (though not nearly enough). But given the sea of women in the ranks, there are too few at the top. In real estate tech, in particular, there are very few female leaders.

So… if you have a chance to bring a woman into your founding team, do it.

There’s been a growing awareness of the lack of female leaders in real estate. As a result, they are sought out to appear on stage at industry events (an amazing opportunity for a new company to get its name out there). And there have been a number of grassroots-style movements and meetings of the minds where women in real estate are connecting with each other in ways never before seen. (WomanUp is an exciting new one.)

I’m not saying hire a woman for the sake of it. I’m just saying, this is one industry that is so ready for more female founders and leaders to step up that, if you happen to have the opportunity sitting in front of you, it’s a damn good one. (Disclosure: I am a woman.)

The last drop

The complexities of the real estate market are too numerous to totally nail into one post. We actually do spend hours and hours talking about these things at 1000watt. I’ve no doubt missed a bunch of things, so hit me up if you’re ever in the Bay Area and want to talk more.