In the second part of my exploration of startups, I talk to a number of people with lived experience of creating businesses from scratch – in some cases from absolutely nothing and with no outside funding.
First, though, I’m going to offer some of my own experiences of launching a small business and, more recently, a startup in the form of The ValPal Network.
I first invested in what is now known as fintech in 2000, when we generated mortgage leads from the web and sold to local advisers. This business, however, was very badly hit in the crunch, so I started to look for ways of finding and generating the holy grail of vendor and landlords leads for agents.
I set up a standalone site – Value My Property – in 2011 with the property valuation algorithm embedded, and we soon found the conversions were truly amazing.
However, it was incredibly costly to drive consumer traffic to generate leads on a national level to sell on to agents. We’re talking Purplebricks-style funding here, and I certainly didn’t have a spare £100 million down the back of my sofa!
This meant I had to figure out where I could get free traffic. The lightbulb moment soon came along when I was on a run (I do my best thinking here…Run Forrest Run!) – where do sellers and landlords hang out? That’s right, on agents’ websites.
With this in mind, we created a white label version and whacked it on agents’ websites. Then turned it into a subscription model.
One of the main challenges we faced in getting ValPal (later renamed The ValPal Network, as all our members get more leads as they share out of area leads) off the ground was PropTech fatigue, with agents being chased down every day with shiny new products.
But we made a lot of noise and put a lot of people on the phones. If only all the CRM’s out there could talk/connect with each other we would all be in a better place. Talking of CRM’s… that's one for another Natter.
In five years’ time I hope TVPN will have more products and services for agents, with an end-to-end process to help drive traffic, convert, and get more MAs booked in, with higher fees maintained.
We’ll also automate as much of it as possible - definitely NOT taking the human touch away but to enable the human(s) to focus more on customer care.
Millennials, in particular, want to press buttons and only speak with humans when they really have to.
Back to business…
Nick Lyons, founder of No Letting Go
Lyons founded No Letting Go in 2007 after recognising that legislation around deposit protection would require nationwide evidence to validate a landlord claim. That evidence was in the form of inventory and checkouts.
How did you launch No Letting Go?
Having a background in providing search reports to the conveyancing market and having had several of REMAX franchises, I had gained insight into both reporting for third parties and building a successful franchise network.
I was convinced of the need for a high-quality inventory service on a national level.
In early 2006, just before the deposit legislation became law, I bought a small inventory business in London and convinced the owners to teach me everything about inventories.
I found that the best way to deliver excellent service was through regionally owned offices with a centralised support team with expertise in inventory management and building businesses.
I also felt that technology was going to play a big part in growth, so invested in building software that could support our clients and network. Today, this is the cornerstone of No Letting Go.
How long until it became established?
Deposit legislation came into force April 2007 and it took several years for the value of inventory management to come through.
Today, we have nearly 70 regional offices throughout the UK. All offices are owned by a fantastic group of individuals. Building a successful franchise business with a system and core values at its heart is not quick or easy, but creates a solid platform.
We have made plenty of mistakes but with the right team of people who are totally committed, the journey becomes much easier.
TK Gondo, CEO and founder of student housing app Polygon
Polygon started in August 2018 and enables students to navigate through thousands of rooms in over 30 cities using a swipe interface (similar to Tinder) and be matched with housemates based on personalities and domestic habits.
Where did the idea come from?
I had a terrible experience with both housemates and searching for the best accommodation while at university. I had the seed of the idea but presumed because I had no formal business education, did not know how to code and had just dropped out of university, that someone else would be the person to bring it to life.
What are the risks/challenges and rewards?
The main challenge is the looming threat of death every day. It’s no secret that most startups ultimately fail. Also sacrificing the best years of my life, sleep, relationships and general comfort.
Rewards: Watching what was once just an idea in your head turn into a living, breathing organism. Building something that makes people’s lives easier. Getting to ‘think for a living’ by solving complex puzzles through dialogue with my team.
Where will Polygon be in five years’ time?
In five years’ time, I see Polygon operating beyond the borders of the UK. By then we hope to have earned a reputation as the company that serves students all over the world in their quest to find phenomenal accommodation and friends to share it with whilst helping landlords and PBSA providers fill rooms.
Tom Reiss (pictured right), Elad Ben-Ami (left) and Offer Peylan (centre), co-founders of Roby.ai
Roby, founded in Tel Aviv in 2017, is the world’s first and only Artificial Intelligence (AI) assistant for letting agencies and property managers.
Where did the idea come from in the first place?
Like any good startup, it all started from a self-need, which in our case was that of a personal hassle of manually managing apartment rentals.
It was during our army service, where we conducted and implemented a project, that our relationship with automation began. Together we implemented a delicate automated system, where we were able to craft the perfect balance of having the availability of information that needs to be shown versus what should be hidden from view but, should it be required, still be easily accessible.
We looked for a name that demonstrated the marketing message that we want to put out there, that what we have built and continue to build is an artificial assistant, rather than just another software.
We also like that Roby is a combination between the well-known British name ‘Robert’ and ‘Robot’.
What challenges have you faced in establishing Roby.ai?
Some of the challenges that we have experienced stem from creating a system that will cover the whole process.
Whilst covering every angle, we want the process to be easy-to-use and mobile-friendly - the challenge of creating the perfect User Experience and User Interface whilst incorporating the philosophy of the product is a daily battle.
It’s also the fine balance of creating and providing a fully automated system, without making the user feel as though they are being kicked out of the driver's seat.
Where do you see Roby.ai in five years’ time?
We truly believe that Roby will be the ‘go-to’ operational solution for property management across Western Europe for agents and property managers.
With our Head Offices being based in Tel-Aviv, and our second offices just opening in London, by the end of 2020 we have plans to expand into Germany and France.
Glenn Seddington, managing director of utility management service Tenant Shop
Originally founded in 2008, bang in the middle of the recession, the idea for Tenant Shop came from current Director of Partnerships, Jamie Parks, having worked as a letting agent and at a price comparison business.
Parks witnessed the hassle and headache involved with utilities and saw the opportunity to take that hassle away from tenants, offering choice and value when moving home.
What were the main challenges in getting the business off the ground?
The main challenge was dealing with inbound interest from the letting agents with this brand-new idea; they genuinely all saw the value in the service. The interest was more than one person could deal with.
The technology (or lack thereof) was a huge challenge with Jamie receiving all data via fax machine. The biggest challenge and that faced by all new businesses, was cashflow to grow and develop software.
The Inchora Group came along to invest in the concept and over ten years later Tenant Shop has gone from strength to strength. At the start, Jamie worked with 15 local agents dealing with around 120 lets a month, Tenant Shop now offers a portfolio of products and services to agents UK-wide.
How has the rapid digitalisation of society in recent years helped Tenant Shop to grow?
Digitalisation has been key to Tenant Shop’s growth. The development of our proprietary software SULU has been a huge part of the journey.
Without a move to digitalisation as a society the adoption of this innovative PropTech would not have been fostered and Tenant Shop would be altogether different.
Where do you see Tenant Shop in five years’ time?
Tenant Shop will be continuing to pride itself on the same things that it does now such as customer service, value and choice. The shape of the platform and the offering of the portfolio will inevitably have expanded. However, we will continue to focus on what works best for our agents and how we can best service their customers.
Jon Horton, product director of sales progression and communication tool mio
A data-driven tool, designed by estate agents for estate agents, mio launched as a pilot in Cardiff in September 2017 following a consultation period with the agency market to understand the frustrations around sales progression.
“Move it on” of course, the name that describes what it does. However, when it came to creating a product brand that would be short, snappy and suitable for the consumer app, the name was contracted to “mio” – and has become somewhat of a talking point as to how to pronounce it!
What challenges have you faced in establishing mio as a solution for agents and consumers?
As homemovers need to be invited by their estate agent to use the app, our focus has and continues to be on bringing new branches on board.
Our key challenge has been getting agents to think differently. This starts with them understanding that working in silos is the Achilles’ heel of the moving process, and seeing how mio can provide transparency and improve communication.
What are the main risks/rewards with launching a start-up business?
We launched the mio pilot with the clear purpose of creating a smarter way to manage the homebuying process. The biggest reward is seeing this in action – not only in positive customer feedback, but in the results from our growing communities, which have already seen average fall-through rates reduce to 21% compared to the UK average of 33%.
Unlike startup businesses, where the main risk is financial, mio is part of a product suite from tmgroup, which has been established for 20 years. Our risks are therefore different and associated to market awareness and adoption, but this has been helped with the support of our shareholders.
Once again, fascinating answers everyone.
Until next time…
*Nat Daniels is the Chief Executive Officer of Angels Media, publishers of Estate Agent Today and Letting Agent Today. Follow him on Twitter @NatDaniels.