Is your brokerage focused on the right type of technology platform? Vance Loiselle CEO of Propertybase offers strategies for choosing the right tech platform, questions to ask vendors and high-level trends that will impact your brokerage.
Listen or read the full podcast interview below.
This is Tracey Velt, editor and chief of content for REAL Trends. On our Game Changers podcast today we're speaking with Vance Loiselle, CEO of Propertybase, which is a real estate tech company that developed an all-in-one platform for brokerages, teams, and enterprises, to manage their business and marketing.
Vance is going to talk about the top tech tools brokerages need to compete in the real estate industry.
I know you came to PropertyBase about a year ago from a tech development background for enterprise software. Tell me a little bit about how the transition has been, and what's unique to the real estate industry that you didn't encounter in your previous career.
Well, certainly, it's been very interesting. I've been here a whopping 15 months. Just by way of background, most of my experience has been in data analytics, data center software [and] machine learning software for large enterprises. I got into this space because a couple years ago my wife started to get into real estate, and she's currently a real estate agent in Massachusetts. And she kept asking me, "Hey I need help doing this CMA and using this tool," and I honestly didn't know what a CMA [comparative market analysis] was. I didn't know what half the tools were in it. And it was eye-opening to me how cumbersome the tools were and how nonintuitive they were. They felt like 10 years behind a lot of industries that I experience with.
A couple of things that I really love about this industry, it's one of the few industries where the agents, the brokers, they're super passionate about their business. I mean they eat, sleep, drink real estate. They're everyday a work friend, a regular friend, may also be a customer, right? That's kind of the nature of the business, so it's infectious when you spend time with people that are super passionate.
There's some drawbacks as well. The nature of how the industry is set up, a large number of people in the industry aren't actually employees of anybody, right? So most enterprise software that I've worked with, you're basically selling to somebody who, as a day job and they kind of think about their job. Not as passionate about necessarily their company, some people are, but usually they're kind of just going about their day. But, they're spending somebody else's money, and in this industry everybody's pretty much spending their own money. They're making trade-offs, "Do I upgrade my car, or do I buy software?" So it's a very interesting dynamic, and it makes you kind of think about how you build software, how you sell software, how you support those people, in a lot of different ways.
So obviously you mentioned brokerages are a bit behind their development of tech compared to other industries, but they're embracing it and they're starting to really build robust packages. But there are challenges that come with that. So what do you see as the biggest challenges for brokerage leaders as it pertains to developing a great tech platform?
Certainly. I would first echo what you said, there is definitely a very big push for brokerages and real estate professionals to embrace technology. I've even seen an acceleration of that in just my 15 months here from when I started to where I am today.
Certainly the amount of funding that's happening with kind of the big names out there getting a lot of money and growing rapidly. It has made people think about technology front and center and that's no surprise. I think if you look on the challenges front, the first challenge goes back to something I said earlier; It's just funding, right? It's kind of a chicken and the egg. Do you buy technology and hope it'll turn into more business, or do you just leave that up to the agents and hope they'll be productive just based on their sphere and the way they interact with people? And so the implication of that is these brokers and teams need to think about a lot more focus on return on investment. If I'm spending money, what am I going to get in return for that? That's something that's been around in the enterprise IT space for a long time, and so I've been very focused on trying to help create business cases and rationale for doing these things.
I'd say the second big challenge is really just around how you think about training and support, right? Most of the successful brokerages and agents that I work with realize ... to use a local analogy, the New England Patriots, who everybody loved to hate, the reality is they're a leader. Bill Belichick, his mantra is, "Practice and prepare." Everything is focused on practice and preparation. I think quite frankly all technology, and especially in a real estate space, you really need to invest in what you put into the technology around what you have for marketing folks and specialists, what you have for trainers, how you get the system set up to go execute on the weekend when there's an open house, or there's a listing or you need to put a CMA together. I think training and support is another big challenge that people have to weigh hand-in-hand with the technology itself.
I want to talk some specifics, here. There are several vital components to a tech platform, and a lot of brokers know their pain points. But I figure through your work you've seen some things that they don't. So what've you seen as the aha moment of brokers when you're talking to them about Propertybase, or just technology in general?
First, I would just challenge you on your premise a little. I think a lot of brokers know they have pain, I don't think they necessarily know the root cause of their pain, right? And I think they may think it's, "Oh I just need this piece of technology here," or they read something and they think that's the direction they need to go. A lot of times I'll talk to a customer or a potential customer and they'll say, "Oh I need a new website. I need to refresh my website, it's gonna drive more leads." In reality, they just need a better digital marketing solution, right? On how they do email and text nurturing and things like that.
But as it relates to aha moments, I think when we take potential customers or existing customers through where our technology has been going and they see a dashboard that ... And it's not super sophisticated, but it shows their entire business in action from when that lead manifested itself from either a lead-gen tool or the website, all the way through to closing that transaction and seeing how the commission is split out and how it impacts their financial statements. Immediately kind of lights come on like, "Wait a second, I can actually see how money I'm putting in in the front of the funnel spits out to commissions on the tail end of the funnel." And you know that level of visibility really helps them prepare their business.
I'd say the second thing is, just simple capabilities. When I show agents that they can go and, through one click of a button, pull something that we call a seller activity report and it can show you, for that listing that they have with their customer, their seller, everything from website visits to Zillow views, to how many times customers are clicking on email marketing or SMS marketing things. It opens their eyes like, "Wow I have a lot of ammo to go back to my customer to show all the activity on their house," in the event that it hasn't moved immediately.
And so, just, couple of things that don't seem overly sophisticated are actually super-powerful, and surprisingly a lot of people don't have that level of visibility and can share it with their customers.
So what components in your opinion make up a perfect tech stack for brokerages?
So a couple things, I'm going to go into a couple of components.
I think the first thing that I'd start out with is more a philosophy, right? Philosophically, any vendor that you talk do, things that you build, no matter how you approach technology, you have to think about in this day and age; Is it open, and can it easily integrate and play nicely with other technologies? I think this is one of the things that I've also been surprised about in looking in the tech stacks that have been out here for a while. A lot of them, quite frankly, the data has been held hostage by the technology vendor. And just getting simple things out of it like, "How do I get my leads out so I can bring them to a new technology vendor? How do I get my saved searches out? How do I get the history out?"
So being able to get access to your data and understand that you control the data and it's easy and flexible. Coupled with the fact that yeah, somebody out there is going to have a really good idea, and it may not be me or my company, and the ability to plug into that good idea or that technology through an API [application programming interface] is critical, right? And I think making sure, just philosophically, it's open and flexible.
If you look at specific components I would kind of break it down into three things. My view, and if you look at most industries, kind of the hub of successful selling and productivity is some flexible, intelligent CRM, right? And in the case of real estate any CRM that you're looking at really should go hand-in-hand with an integrated MLS. I think, there are so many CRMs out there that people think are great CRMs that don't have really have access in real time to the data that powers the real estate industry, which is MLS data. So, smart CRM coupled with MLS data can really change the productivity of agents on the ground.
I'll tell you the second component is a workflow driven transaction management. Again, a lot of people are coming into this industry new for the first time as a change in career, their first career, or what have you. The ability to have very simple step-by-step workflow driven processes to actually take you through your transactions ... Everything, what forms are required, what signatures are required, what disclosures are required, how the escrow process works. So look for things that have that workflow built into the transaction management.
And lastly, I think, a tightly integrated marketing center, right? And when I think of marketing it's everything from email marketing, SMS marketing, social, FaceBook, Instagram marketing, and print marketing, right? It should be all one focused area because a lot of the content you will develop whether it's promoting your listings or promoting your just sold, a blog post ... All that stuff can be replicated across all those distribution methods. And having that kind of marketing center, that would be kind of the third thing that I'd be looking for when you're looking at tech.
Sounds like the perfect package.
So, everywhere you look obviously artificial intelligence is ... I mean I think every newsletter I read, every newspaper article I see, or news article, it pops up as kind of the future of real estate. So, other than the obvious, what do brokers and teams need to know about AI-powered tech?
Yeah, I think, first and foremost obviously everybody goes to AI. A good example is Alexa, right? And Alexa's a great example. I mean the AI, the artificial intelligence in Alexa is ... Not so much that it can translate speech to text and turn that into a query, but actually understand the query without someone having to interpret for Alexa, right? If you apply that to the real estate space, I think looking for places that aren't massive lifts that can have a significant impact.
So one area that we're spending a fair amount of money on is around intelligent nurturing, right? I mean I consistently hear whether it's talking to my wife or talking to agents in the field, most people, it's just human nature, don't want to follow up and qualify leads, right? To have to pick up the phone, and nurture that lead, and so this is a great example of place where artificial intelligence can get that initial lead, qualify the lead through some artificial intelligence, and text nurturing, can actually have a text conversation with that lead to figure out, "Is this somebody that should be connected with an agent soon?" So I'd say look for areas like that where technology vendors can help you solve things that are a pain, that are impacting productivity, and then it's a walk before you run, but you'll see a lot of those things start to spring up that will significantly impact the productivity and the return on investment of what you're spending on technology.
So let's talk trends. Obviously as a tech provider you're on the cutting edge of what's new in the tech world. So what are some possibilities you're exploring in trends that maybe brokers haven't even dreamed yet?
Yeah, geez, if I had the crystal ball. I mean, having looked at the space, it's interesting, just look at kind of some of the macro differences in this industry. The lobbying, and NAR, is super-powerful in this industry and it's not necessarily ... You don't have that same dynamic. Obviously regulation is a big influence in this industry.
But if I look kind of near-term versus long-term trends on what I think is going to start to happen, I think you're going to start to see brokerages use their brand and things like their website as more of a home base or portal for everything, right? So, I think you'll start to see brokers start to put things like a digital vault on their website. So instead of just things like market insights and saved searches, they're going to start to store everything from the person's documents, closing information, and store it for years into the future so people will feel sticky and want to come back to that broker to get the information that they need related to their housing purchases.
I think related to that they're also going to use things like their website for a concierge. Like "How do I sign up for cable? How do I get property management system?" You know if you're in New England, "How do I find a plow guy?" Right? And so more of a concierge and marketplace, I think they'll start to use the leverage that they have and their local knowledge as more of a marketplace on their website. So I think you'll start to see that in the near-term.
I think the second thing, just based on where you're sitting on the funding out there in companies, I think you're going to see more fixed fee a la carte commission structures. I am not sure, but if you just look at the trends in the tools that are out there from the recent Lyft IPO, what's happening with Uber, and Slack, and all current generation technologies that are taking hold, millennials and Gen Z are used to doing everything on an app with little human interaction. And that's not a fad, right? That's just going to continue, and I think it's going to continue to drive behavior in all industries and real estate's no exception.
So what that means is, I think in the future you're going to see literally a home seller go to an app and request that somebody come give them a listing. There may even be a marketplace or an auction for the opportunity to even pitch that listing. They want to go through and just pick five services they want to help list their home, but it's going to be very interaction-oriented on the app as opposed to whole relationship-oriented process. I think you'll start to see more of those things become more transactional-oriented.
And then I think, this last one, if I just look at some other industries, I think you'll start to see buyers monetize their value. And when I say that, there's a whole spectrum of category of buyer out there, right? There's some buyers who do a ton of research, know exactly which house they want to buy, and just need a little hand holding because there are certain regulatory things they need to do to purchase that house and get the mortgage, right? That person may only need to see three homes and it's a very quick ... They may have no contingencies, maybe they're a cash buyer. Well the idea that that buyer should basically have to pay or give up that same level of commission as a buyer that goes to look at 50 homes, and then finally pulls the trigger on a very difficult sale, I think you're going to see some democratization of levels of buyers. And I think you'll start to see buyers monetize their value, potentially.
Again, there's no leading indicators that's happening, but that's a hunch based on what I've seen in other industries like financial services and other things.
Okay, that's very interesting. Thank you for sharing that.
Finally, your last question, can you just give our audience of brokerage leaders, and teams, and top agents some advice on choosing a tech platform? What questions should they be asking tech providers?
Yeah, great, great question. I get it all the time.
I mean I think first and foremost, going back to a point I made earlier, is the platform open and accessible? Can I move the data easily, how portable is the data, and to cut to the chase, can I leave your platform with all the history, or am I going to be held hostage? Like I would ask that question point-blank and how it works.
A second question, which is, is the vendor independent? Or are they part of some other conflict, like are they owned by another real estate brokerage, or have investments from other real estate brokerages? Are they owned by a title company? I find it crazy, this is the only industry I've been experienced with where somebody will become a partner with somebody and get in the software space, and buy software from somebody that's a competitor. I think, in this day and age, I think you got to think through that, and everybody can make their own choice but, I think they should think through it.
I think the third set of questions I'd ask is, just understand the viability of the vendor that you're working with, right? I mean I've had literally in the last two months, three customers that have basically had in the last minute bail from their provider, because the provider either ran out of money or decided that they didn't want to be selling this kind of real estate software anymore, right? And with all the money that's come into the market, you should really align yourselves with vendors that are going to be there as partners for the long haul.
And then lastly, I would say, really be thorough in your evaluation process. I think putting together a requirements document that says, "Hey these are the capabilities I think my team needs." It is super-important that you can evaluate that if you're looking at two vendors or three vendors. Just evaluate, "Okay does this vendor have this technology? Does this vendor have this technology?" And use a scoring matrix. So then your answer, you have a lot of confidence in what you're getting into so down the road you don't come back and say, "Oh geez, they told me that they did that." You should really use kind of an evaluation process.
Again, I could get into specific nerdy technology for people to look at, but at the end of the day if you kind of look at a technology and go through somewhat of a process, you're going to find that you ended up in a very successful place six months down the road.
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