Building an STR Empire in Non-Traditional Markets with Homehop founders, Nate Klatt and Dan Mitchen

Alex Husner  0:36  
welcome to Alex & Annie: the real women of vacation rentals. I'm Alex.

Annie Holcombe  0:40  
And I'm Annie.

Alex Husner  0:41  
And we are joined today with Nate Klatt and Dan Mitchen. And we are super excited to dive into this amazing business that they have built home hop, and just excited to have you guys here today. 

Dan Mitchen  0:54  
Appreciate you guys having us on.

Nate Klatt  0:55  
looking forward to Chat,

Annie Holcombe  0:56  
we don't have a lot of people on our show that are in like what we would call the STR space or the smaller operators not in the traditional vacation rental space. So it's likely that some people don't know who you are. But I feel like you guys are gaining popularity by being on other shows and being present in social media. But why don't you give us a little bit about your background and how each of you came together to start this business?

Nate Klatt  1:18  
Yeah, absolutely. So Dan and I are best friends throughout throughout grade school through high school. So again, it's always fun whenever you get a chance to work with friends. From there, I went off to college, played football at Michigan State got my CPA license and really had a career focus in accounting three years of public accounting five years as a director of accounting then I currently work for a Y Combinator from the bay. And one thing I'm actually very excited about is on Tuesday, I put in my notice to officially go full time with Dan into the business. So very exciting time right now for us. And we continue to scale this business. Dan, I actually started in 2020 doing flips. First home, we purchased the first week of February. Great timing, yeah. COVID hit, we had a little bit of a fear. Ultimately, we did end up going forward had like 12 flips that we did in totality definitely made some money definitely had some growing pains. But ultimately just didn't feel like it was a scalable business model for us kind of fell into short term rentals, which Dan will speak to, but kind of fell into short term rentals and 2021 on a deal that we were struggling to sell were like, Oh, wow, this is actually making us quite a bit of money. This is a cool business venture. And then you really have the ability to put software systems in place to scale a business, which is always our focus from a business aspect. And from there we've grown to now oh nine between Dan and I, we have a fun that's raised over 1.5 million with six properties currently purchased and growing. And then we have a property management group that we launched early last year, which currently has 10 listings and again, gaining significant traction. So we're all excited for the future that home. I'll pass I'll pass over to Dan.

Dan Mitchen  2:44  
Yeah, so I've been in real estate since 2015. I started as an agent, always knowing that I wanted to get into investing in some sort of capacity. I did a little bit of everything. So I was an agent. I also coached agents, I did some apartments syndications. So my first investment deal was a 70 unit. I've always kind of had the mindset like I'm just gonna jump in and figure it out. So flipped a couple of apartment buildings got into single family home flips. And while all this was going on, I also had a to short term rentals. But as kind of as just a side gig side business, thought I knew what I was doing, but not really ultimately, as Nate mentioned, I was working with another partner during COVID. We had a single family flip that was just kind of sitting on the market, we couldn't move it. And that's when Nate and I was talking and we said why don't we buy this outright and Airbnb it so that was nice. First Airbnb, we created the systems and processes and I finally saw the full potential. And that's when we decided to go all in, we stopped doing flips, I solely just started working with Nate. And here we are today.

Alex Husner  3:45  
Very exciting. Guy, you guys covered a lot of ground in a short amount of time.

Dan Mitchen  3:50  
It definitely had his growing pains. But I think Nate and I have worked really well together. Like I'm always like, I just want to dive into something, just do it go and figure it out. And Nate's more so like, hey, let's pump the brakes a little bit. Let's put a plan in place. And we'll we'll slowly figure this out. And thankfully, that's the route we ended up going down. You have the

Alex Husner  4:08  
ying and the yang to figure out what everybody's best at and then optimize around it. So that's great. I just looking on your website, you're in some kind of interesting locations, not the traditional vacation rental destinations. I would say it was their strategy around where you've put up your shop. It's

Nate Klatt  4:24  
clearly not the traditional vacation rental market. I haven't booked

Annie Holcombe  4:30  
yet this year. We don't want to discount Cleveland and Vertica

Nate Klatt  4:36  
Yeah, I mean, LeBron was there twice so you know, we'll take for us really came to honestly, and we're fortunate for this I would say too, but it's our neck of the woods is where we grew up, but it's where we have the most traction. My dad was a new home construction and owns a tile store there multiple family members that are contractors. Dan was a top performing agent and kW before switching into business. So we really had our roots in Cleveland, but the thing that's just really interesting about the Cleveland market and some of the just the different Midwest markets, some of the Southern markets that aren't quite as coastal is your cash on cash returns and your your return on investment just can be significantly higher. So a lot of people are shocked when we tell them Yeah, well, we'll buy a home, you know, single family home in Cleveland, it might cost us 225, and will grow 60,000 on it on Airbnb, where traditionally you kind of get those numbers. And it's like, well, if I buy something in San Diego, where I live at if I spend $2 million, I'm definitely not going in that same return. So we kind of fell in it from that standpoint, but just love the way the numbers work out in the in the Midwest region.

Alex Husner  5:36  
So just kind of, you know, on that topic, I mean, that the cash on cash return, we were talking about this before we went live that it just seems like a lot of the new STR investors that are coming into this are they've caught on to something maybe that the older generation vacational investors, you could say did not that Airbnb was not around during those times. But it just seems like you're getting a lot more potential out of your investment. Going into some of these cities where there's there's not a whole lot of Airbnb ease or short term rentals. And people just want other alternatives than staying in a hotel. So I like your approach. I think you guys are really smart doing it that way. Do you think you'll continue to look for other more, you know, city based destinations, because of the success you've had? I think what's

Nate Klatt  6:18  
interesting, and you guys have spoken about this on your podcast before, but it's the maturation of of the industry, right? So you know, in the beginning, it was, hey, put up an Airbnb, throw some Ikea furniture in there, you're good to go in now it really is turning into more sophisticated investor truly a business involving money you're seeing come into. So again, you're seeing host away was a $500 million raise. Like there's just a significant focus on it now. And I think that's what makes this industry so interesting as well. It's just you do have the ability to put the right system software's in place. But yes, absolutely, our goal is to probably we constantly don't want to boil the ocean. So we're not trying to be in every single market, we want to be really good in a few markets. So our focus right now has been Cleveland, that's where we're dedicated to, but I see us towards the end of this year, probably leaning into like the Columbus market, the Cincinnati market, potentially the Pittsburgh market and those larger cities that are still in the Midwest, they're going to have those kinds of returns. So that allow us to still stay somewhat geographically centralized. So that way we can really focus on being the premier company in this this general region versus, again, trying to reach out every single location. So you're telling

Annie Holcombe  7:19  
me you're not going to actually go buy something in San Diego to put on the market.

Nate Klatt  7:23  
Unless you want to come invest with us.

Alex Husner  7:27  
I'd love to come visit.

Annie Holcombe  7:31  
So I have a question and kind of along those lines of like doing these rentals in cities. So one of the things that came out of COVID, again, blew up the industry and Alex and I've interviewed a lot of people. And we've been doing this for such a long time that it was kind of all of a sudden, everybody noticed us and I always joke, it's like, well, because all the cool kids were hanging out and short term rentals. It's like where we've always been. So everybody's in it, everybody's excited about it. It's where people want to invest all their money. And so the urban markets became kind of this new hotspot for people to visit over traditional vacation destinations. Now that travel is sort of normalizing. I know I see that the cities are going back to more like the business travelers staying in the hotels, but there's still a need for the short term rental. What are you guys looking at to forecast for the future to say like, this is a city that we want to go into? Are you looking just at the real estate value of it? Are you looking at travel trends as well to help you make those decisions?

Nate Klatt  8:27  
I'd say right now our key is we do use things like key data price labs, and we're going to be able to understand what the market holds. But going back to the numbers again, my brain CPA braided always thinks of how is my cash on cash gonna look, getting into factor in my appreciation, we don't want to be strictly focused on cash. How does that appreciation impact? Look, you know, that's where Columbus is really appealing. They have a lot of investment coming into the city, you have the capital there. You have a lot of just growth there. Cleveland in its own right, right now they have a program called reimagined downtown where they're about to spend, I think it's around $2 billion on the lakefront. So how do they increase the lakefront? How do they make it more vibrant, you know, that inevitably is going to draw a lot of attention, a lot of people coming in a lot of people workers coming in that need somewhere to stay. And again, from a cost effective standpoint, if I'm thinking about how seeing 10 Different people in a hotel versus Hey, everyone can split an Airbnb is just significantly better. So we are looking at the demands, but it's really more of what do current prices kind of hold? What do our current costs kind of hold? And then from there, we kind of project out what we think it might look like, but kind of focused as much as anything on that, like that current aspect.

Alex Husner  9:33  
We just had Katie Brisco on our show, probably like a month or so ago, I would say, and she's the CEO of MMG. Why global, which that's actually the agency that Cleveland uses as their like agency of record for the destination and for marketing. So I've followed along with the Cleveland story of how they've really rebranded the city and like you mentioned, I mean, bringing in those different like different types of travelers and just sparking that desire to go there. And I would like to go to Cleveland to I've seen some really Good. So it's working. But you know the role of a destination marketing organization, whether you're in a tourist area or in a city, you know, that makes a huge impact on what you're able to do in the short term rental space. If

Nate Klatt  10:13  
you ever need a spot we know someone that can have an extra Airbnb. So

Annie Holcombe  10:17  
you guys have said several times and it's always a hot button for us, Airbnb, that you have an Airbnb that you do and Airbnb that you have Airbnb ease, that not that you have short term rentals. But you mentioned that you have hosts away and Nate, you and I met through your interest in homes and villas with my current role there. Are you guys using more than Airbnb? Or are you just now because you're just getting kind of a portfolio that you need to start distributing out more? Are you starting to look at other channels, what is your your distribution mix look like?

Dan Mitchen  10:47  
We're on several channels. So Airbnb is our biggest revenue driver here in our market. We're also on VRBO. So like, I guess it makes sense, we do have some more vacation style houses like up near the islands. And those are, I would say Airbnb, still the the primary revenue generator, but VRBO is a little bit more prominent in those areas. And then we have another house randomly in a city called Berea like a college town. And VRBO is probably like 35%, which is probably one of our highest rates as far as like VRBO bookings. And then we just started exploring with booking.com. And then we're also on Google. And then we also we're going to start making a push now that Nate's about to get into this full time, one of his first tasks is direct bookings, and really building out our direct booking platform just because as you guys know, like, Airbnb is great and everything, but at the end of the day, their fees are like 16%, towards the from the guests. And if we can reduce that, that means we can increase our nightly rates and guests saves a little bit of money. We make a little bit more money. Yeah,

Alex Husner  11:48  
absolutely. This is a first and I don't know if I even shared this with you. But I was somewhere recently, and I heard somebody say I booked a verbo Oh,

Annie Holcombe  11:55  
down south. I do. Yeah. Did I really? Wow. The panhandle and Florida. verbo has been always been the bigger of the two. Airbnb didn't have they had more of the urban markets down here. But yeah, you'll hear that a lot in the south part.

Nate Klatt  12:10  
I was gonna say one follow up on that. But I just think it's an interesting exercise. So you know, I think Anna, you got to ask her about like, again, what other platforms are we on, we tried to do an exercise where we go through and we actually have a spreadsheet called brain dump. It's a Google Doc. And anytime we have an idea that we think could be interesting, just put it down on there, get it off the mental and then we try to sit down roughly once a month, reorganize those into buckets, and then talk about what makes the most sense for us to strategically focused on I think sometimes when you first start, especially if you're newer in the industry, it's bells, whistles, you got all these different software, you want to do everything. And our strategy was let's really lean in, let's be the best on Airbnb the best on VRBO. And not really worry about the marketing, not worry about this segment of business. But as we scale and grow now, that's when we start to focus on it. And that's, that's again, why I reached out about about Marriott. That's why we're starting to kind of lean on this direct booking. It's like, okay, we've reached that that inflection point where now it makes sense to start to focus on that. But just something to challenge yourself whenever you are newer, and this is like what get really good at certain things. What are your priorities? And don't try to boil the ocean? Don't try to do everything? Because inevitably, you're gonna do half as well.

Annie Holcombe  13:15  
Yeah, well, I love that you have a plan. So many people get into this and just see the dollar signs. And they forget that like at some point, there is that inflection point where you have to make a decision, and you can't continue down one path. And so you guys are like music to our ears, saying that you're going to start working focusing on your direct booking and your branding, because that's one thing that we see a lot of people get into from the STR side is they once they get to a certain scale, they become so beholden to one pet one channel, that they don't know how to get away from it. They don't know how to like wean themselves off of it, they haven't diversified enough or even really looked into it. I mean, you guys have a great a great system, right? PMS that you're working with. They have good connectivity, you know, a lot of good options with that. So I think that having that brain dump and getting together once a month to kind of revisit what you're doing is super smart. And definitely a lot of people could learn from that. Yeah,

Alex Husner  14:03  
absolutely. Do you do get a lot of repeat guests and the areas that you're in?

Dan Mitchen  14:09  
I think it's property dependent. And that's actually something that we're working on as well, once they gets into this full time is really collecting that data and guests information through things like sci fi, and then just Yeah, creating those sorts of campaigns Overall, though, no, we don't get a ton of repeat guests. It's maybe 5% And I might even be being a bit generous, but yeah, overall, just because most of our houses are not vacation sell houses, repeat yes are kind of rare. Although there is a we did just have a guest that just popped in my head. She's a pastor locally, and she books with us probably once a quarter and brings her church group and they do their thing in our house. And yeah, she's probably our top guests is Yeah, exactly. She always leaves us raving reviews, which is nice. So

Annie Holcombe  14:59  
yeah, praying over your property that's always

Alex Husner  15:03  
those early top fans made a lot, especially as you continue to grow the business. Like you'll probably always remember her being an early believer, but yeah, and you know, it's it's tough. I mean, like Andy said, you feel like you have to do it all when you first start, and there's so many shiny things. And it's like, just making the decision on the technology, I think is really a struggle. And I talked to a lot of operators that they've bought multiple different tools. And as we're looking at things and like, you know that you only need one of those three, like there's overlap in them. And I'm just curious when you guys were very sharp, gentlemen, but how did you when you jumped in? Like how did you start your decisions on? You know, getting the software and different things stay fi like, how did you go through that process of determining what your tech stack was going to look like?

Nate Klatt  15:48  
A lot of listen to Alex and Annie podcast here. I will say it's amazing how much free content is out there now in this space. And again, you are pioneers in helping to put that out there. I think it's probably in the last three years, I've probably listened to, I don't know, 1500 2000 hours on podcasts and take it take a walk. It's a short term rental podcast. What are other people in the industry doing what are the experts doing and kind of just trying to copy that in the year that I came very close to 1.2, opening up a gym called metabolic I went through discovery day I had done ready to sign the papers. Also, like right before for COVID happened. So again, knock on wood, I didn't go that route. But I was always interested in the franchise space, because I feel like I'm more of an operator than maybe creative and being able to have this blueprint that you have in the short term rental space. I feel like that's what makes it such a fascinating space. Because you can really learn people are open to giving advice, if not this cutthroat, like in your last podcast, and they were talking about how they, they didn't always like speak to each other as far as like how things were doing and how things are progressing. And now it's an industry where actually dan met on Tuesday with six other local property managers in the area to to discuss like how they're doing now something you've seen a lot of other industries. So it's a really cool space to be able to have

Annie Holcombe  16:59  
very, very smart to make sure you're it's the you know, keep friends close enemies closer kind of situation. And Alex and I call them frenemies. I think, you know, Leno calls them coopetition. That guy. What did that journey look like for you guys? So you landed on host aways, your system? How did you get to that point, because again, coming into this with one or two units, and like recognizing that you needed a platform, it's a pretty overwhelming process. And some of them are just they just have way too much for what you would need to beginning to begin, but you want something that you can scale with. So what did you guys, what did you guys start? Did you go to a conference? Did you again, was it just on a podcast? How did you research that and come to this decision,

Dan Mitchen  17:40  
we actually had a I won't name any names, there was another PMS that we were using. And it was okay for when we first started. And then once we hit that, I think it was like eight properties or so it just wasn't doing what we wanted it to do. So what's nice about we mentioned in the beginning, like me and Nate are kind of like ying and yang, our brains were completely different. So Nate is focused on the accounting stuff. So when we knew is time to switch PMS, he was focused on okay, what's going to do what I needed to do as far as accounting goes, and then I was more so the operations guy, and it was okay, we need something that does X, Y, and Z. So we just, I think we had three different demos with some of the top PMS systems, and ultimately broke it down to pros and cons. And that's how we landed on hosts away. And honestly, I've been very, very happy with him so far as well.

Alex Husner  18:33  
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Unknown Speaker  18:37  
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Speaker 2  18:39  
And I'm Gina Allison Jeannie and we're the owners of Phoebe vacation rentals.

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And we've been with XM team for the past year.

Speaker 3  18:48  
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Speaker 4  19:11  
We use extend team mostly with our guests communication vendor coordination, they handle a lot of the day to day that you know we have 35 properties so are you know, there's a lot of questions and inquiries coming in nonstop from current guests or potential guests and they answer all those questions.

Speaker 3  19:34  
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Annie Holcombe  20:32  
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Alex Husner  20:51  
And you guys do some kind of unique things. It sounds like too, we were talking about Zapier or Zapier, wherever you said before on how you're taking some of that data and extrapolating it to other things, but tell us a little bit about you know, some of the creative processes and things that you've built around your tech stack. So

Dan Mitchen  21:07  
we're all about systems and processes. How do we make our life easier is what it boils down to. So anytime that we get a, I guess, constant issue, like how do we how do we create a system and process to get rid of that? So the first one was our cleaning team. So how do you track and pay all of your cleaners when you get to 20 plus properties. So we use Slack, and we have a cleaning channel within Slack. So in order for a cleaning team to get paid, they have to go to that slack channel and they have to say 123 Main Street is cleaned and ready. I then created a Zapier bot that analyzes that cleaning channel looks for keywords. And if it's from a specific cleaning team, it automatically takes that creates a bill in QuickBooks. And now we can track okay, this, this cleaning needs paid out, this hasn't been paid out. And then obviously what 1099 is and everything, if you're going that route, it tracks all of that, which makes our life 100 times easier. And then we also have another really cool one where we can analyze maintenance issues. So again, once you get to a certain amount of properties, it can be very time consuming to just make sure like you're looking at every single review that comes in. So we integrated chat GPT to where it'll analyze our reviews coming in. And again, this is done through Zapier, it's a little bit more in depth and detailed. But what it'll do is anytime we get an email with a review that comes in chat, GPT analyzes if it has a negative sentiment, it'll automatically take that review, identify what the issue may be, and then it will put it into a sauna on our project maintenance. It gets assigned to our maintenance man. And a message goes out to Slack. So everybody's aware, like, hey, this guest stated this problem or this property, and they said the toilet was leaking, or whatever the issue is, now we can track what is outstanding, what's been done, and again, just makes our life 100 times easier.

Annie Holcombe  22:57  
I love that. I haven't heard anybody using the technology for that type of communication within that like on the back end. But that's a brilliant usage of it. I

Dan Mitchen  23:07  
also love doing that stuff. Like anytime I can create like any sort of automation, like, again, just to make our life easier. There's something I don't know what it does. But yeah, my brain just loves doing that kind of stuff, kind of

Annie Holcombe  23:20  
like Nate like spreadsheets. So everybody has their thing, right? Yes,

Alex Husner  23:23  
exactly. I'm curious, sir. Host away, are your cleaners not able to log in and be able to mark the unit as clean within the system? Or is that not functionality they offer,

Dan Mitchen  23:33  
there may be a way to do that. And I know that so they have tasks within host away. And we explored them in the past. And I don't remember what the issue was, but it wasn't doing what I wanted it to do. And so that's why I went this route and built this. And

Nate Klatt  23:48  
our our cleaners do have a calendar where they're they're checking to make sure that hey, this property is ready for clean. So it is a hands off from that standpoint, but more from a payment processing standpoint. Gotcha. Out

Annie Holcombe  23:59  
of curiosity, are your cleaners. Are they just your cleaners or are they ones that do others in other homes in the market, maybe hotels, that type of thing.

Dan Mitchen  24:07  
We started with having cleaners that also cleaned other units, we do still have some I would say they stay busiest with us. But most of our cleaning teams do work solely for us. So we have a director of cleaning operations. And then it's her job to bring on other cleaning teams. And she kind of trains them oversees everything. She lets them know like, Hey, this is how you get paid. This is what you need to do in Slack. This is where you upload your cleaning video. And yeah, a lot of a lot of our cleaning teams ultimately work for us directly although we have a couple that work for some other like the standard like home cleanings as well.

Alex Husner  24:43  
So day one starts very soon for you since you left the W two and what are you going to do on day one? What was the first matter at hand? So

Nate Klatt  24:53  
I'm gonna go for a hike with my dog on day one but I are one of our focuses right now is that direct booking website? How do we start building that out? Even the insurance that goes along with it, it's a different level of insurance needed when you have you know, Airbnb has their thing. It's $5 million, and verbo has their Urhobo or VRBO has their $1 million policy. So right now we've been kind of messing around with like, what do we need to put in place administratively? How do we start to do guest checks, something that's something that we've done in the past with Airbnb. So kind of like just all the things that need to go into getting that off the ground, I think the part going back to that last conversation, I think is interesting is kind of goes back to like the different inflection points you hit in the business. So for a while Dan was our interior designer life. And that did a great job, but not the best use of his time. And now we have a full time interior designer that works with us, she designs, all the properties that we bring on she if there's anything needed, she helps to structure bring on new, you know, we need to refresh. And you kind of have these different inflection points where again, now we have three virtual assistants working with us to maintenance men working with us, and it's like, kind of over scaling a little bit or over overstaffing a little bit to make sure that as we grow, we're able to really handle this good. Some I've heard the name hectic hosts get get tossed around a lot where you know, it's fun, it's exciting. There's two people you think you can do everything. And then you realize you cannot do everything in this business, you have to make sure you're setting yourself up for success. And you know, when did those different moments really kind of hit? So that's kind of the other focus just kind of again, thinking big picture like they can end end in mind, what do we need to do to get to the end in mind,

Annie Holcombe  26:27  
one thing that Alex and I are focused on this year is kind of the bridging the gap between the short term rental and the vacation rental business, and not necessarily that they belong together. But they can they can exist together and kind of the same space, help each other out, educate each other advocate for each other. I mean, we're all facing in various forms. Regulations, I don't know how Cleveland is I don't know if you've had any any problems there within Ohio. But it's a problem. And a lot of it stems from people who are in, you know, areas where there's not a lot of opportunity to connect with other operators. So there's not a lot of education that's going on. So what do you guys are, I would say in from what we've been meeting a unique operator, you guys are really doing all the right things. You're looking at the software, you're making a plan, you're discussing things, you're you're thinking down the road, not thinking just how much money you're gonna make this month, and maybe next month, what are you doing to actively educate yourself, educate your peers, and create kind of that ecosystem for people to come up in this space. Again, most people fall into this space, just like you said, it wasn't anything that you planned, it just happened. But once you get there, you got to be able to go find out what to do and how to do it. I

Nate Klatt  27:38  
was actually sitting around a bonfire on the beach last night, having this exact conversation with another one of our partners that help with our fun, it was really around this idea of we to this point, we have not done any of the we've done, we are in a mastermind for short term rentals. So we do meet once a week through a mastermind for short term rentals, just so we can at least kind of be around other players in the space. And again, we'll we'll try to connect with people in Cleveland. But to this point, we haven't done any of the the events. So going into like the like the STR wealth con or some of these other like events that are going on. So that's actually one of the focuses for us this year, as well, we have a goal, to go to three different events this year together, which up until now just was kind of precluded with having that the W two job wasn't as easy to quite get away. But it may be something that we're still kind of wet behind the ears on but really want to lean into is this education space and this networking space. And you know, you're always hoping to fill one of my goals is to do three podcasts this year. So this is one of one of the reasons you're so how do we start putting ourselves out there and really learn from the best? What

Alex Husner  28:34  
is the end goal in mind? I mean, how many properties would you have an ideal world?

Nate Klatt  28:39  
I think with the Cleveland market, I'd love to see us hit high 100 to 200 units. But you know, right now our focus is property management and then our fund so I did the day I would love to see us really lean into equity in these in these properties as well. We use property management really it's kind of fuel for the fire and be able to have the cash flow to be able to hire the team to be able to scale the business. But how do you ultimately have equity and and kind of have that that growth. And part of that too goes back to this is where like I'm, I'm super stoked right now because my dad was an entrepreneur growing up, never missed a sports game. You know, my goal here recently married at some point, have kids here soon, like my goal is to be able to never miss a sports game to be able to be there and be that like that father figure you want to be for your family. So the opportunity that this lends itself is, is thrilling because

Alex Husner  29:22  
you're just firing on all cylinders. Super exciting. It's fun to talk to entrepreneurial people like you guys that have taken that leap and you know and trusted yourselves and knew that you guys had a good thing between both of you and your skill sets and you have the ambition and the talent and great things are just going to continue to happen. It's gonna be fun to watch your journey. I'd

Nate Klatt  29:44  
be curious there's obviously the difference between the short term rental the vacation rental, but where do you guys think like that biggest gap is and like, is there any work like areas where you think like one's lacking versus the other where like they should really lean into like maybe short term rentals to really be leaning into this aspect of vacation. lentils,

Alex Husner  30:00  
I think it comes down to I mean, we just had on our podcast this week, it was the OGS of the Panhandle. And these are group of guys that have been down and Andy's neck of the woods and operating since the mid 80s, or late 80s or early 90s. Somewhere around there a very long time. And, you know, the the knowledge that so many people in the vacation rental industry have accumulated over the years is something that I think the the short term rental side that are newer, really need to lean into. And just, you know, understand, we've been doing this for a very long time, I think, you know, the, the newer STR managers are, in some cases, more tech savvy than some of the, you know, the legacy ones. But in the middle is really where it needs to be that at the end of the day, we are all hospitality businesses, we're not a technology business, the technology, I think Leno said this, the technology should be in the background and something that the guest doesn't know anything about. And so how do you really bridge that gap of wanting to do all the things and make sure that you're, you know, running the most efficiently and that you're, you've got top of the line tech on every part, but really balancing that with the needs of the guests that are going to make people even if you're not in an area that you would get a ton of repeat business, if people are going to come back that they do want to come back and stay with you, because that experience was just so strong. So I think the STR side probably needs to lean a little bit more into the hospitality and legacy needs to lean a little bit more into some of the newer age things, but in the middle is probably where everybody needs to be. Yeah,

Annie Holcombe  31:29  
I think overall, we all need to come together because we're seeing in in a lot of a lot of markets where there's a lot of pre emptive regulation that's coming into place. And a lot of it is just because people don't know what the business is. There's no definition of it. And unfortunately, the definition has become it's an Airbnb, you know, I joke about I joked about it earlier. But that's, that's what's happened. So you Whenever there's something bad, everybody gloms onto that name, and all of a sudden, all of us are in this, you're an Airbnb and Airbnb, Airbnb is bad, and they're not bad. And it's not and they're just a platform. But unfortunately, you know, whenever you have something bad happens, that's when it gets on social media, it gets blown up. And that's when all of a sudden everybody in the market goes, Well, it happened down the road, it could happen to us. So let's just be pre emptive and plan ahead and get rid of all this business. But you know, in some markets, you guys are successful in a market that again was not a market that people were doing rentals and other than long term rentals. So you've proven that it works out you're you're making money at it, you're doing all the right things. But if you're not careful, there's a guy down the road who might be doing rental arbitrage which is also a crazy part of the business that people do. And they don't think about again the quick buck versus running a good business and if we're not careful and don't come together and unify our voice like the hotel lobby has we're gonna get regulated out of business in some markets so I think that along with the leaning into each other's knowledge base is super important. I

Nate Klatt  32:55  
would say I love the reframing of it again I think even you saying this right now kind of gives me pause with like, should I be saying Airbnb? Or should I be saying hey, we are an STR player and str space like again just changing the mindset of again when you're when you're speaking to people because it's it's easy to say Airbnb to investors because they know what it is. But when it comes to like the general perception of what it is it really is a hospitality business. It's a short term rental business it's not an Airbnb. So I love that mindset.

Alex Husner  33:23  
Yeah. When I was at condo world, I had never once heard a guest say talking about staying with us that they booked an Airbnb they said I stayed with condo world and with is the main word there. And they stayed with us and they weren't our guests. And I think that's kind of the mindset that these companies that have leaned into direct bookings really understand that, you know, back to the hospitality, we are here to make memories for these guests, whether they're going to Cleveland for business conference, or for a retreat or for vacation, whatever it may be, you're making memories and you're hopefully making somebody's life better. To reference another great quote from the OGS podcast. Paul Wolford said that when a guest leaves, they either leave with a memory or a folio. And if they leave with the folio is more of an issue, then you know, you did not fulfill your duty to be able to really, truly provide a hospitable, memorable experience for them. So that was a unique way of saying it and very true.

Nate Klatt  34:21  
I think with your new adventure, and again, we might be a little smaller side. But I look forward to being able to kind of see what you put out there. Pick your brain. And again, we'd love to even discuss more about what that looks like. I think the branding that you bring, like we we want to figure out how to make home hop a name and not just a booth at Airbnb. I think this goes back to that repeat guests. If people know who you are, they know your brand. That's how you started, get that repeat guests and really start to you know, put yourself out there. Yeah, and

Alex Husner  34:47  
even just the word of mouth, you know, I mean, even if it's not a repeat guest but if somebody stays with you, and they go back and they tell their friends and family, that they had a great experience and it's like that, really that's where you start to really gain that momentum. Absolutely.

Nate Klatt  34:58  
And then I know we're probably coming short on time. But one thing I do think is going to be interesting as well. And you guys kind of touched on this. And we always try to make this distinguish them whenever we're talking to you. One is that we are not property manager, we are a hospitality business. I do think it's going to be interesting here over the next two to three years as large language models really do get to the point of being enterprise ready. We've, we've tried a few different software's that you like GPT to do guest messaging, again, leaning into that tech. But where is that balance out of like, too much tech and not enough personalization? Or when do we actually get it's good enough that, hey, this actually feels like it's a human therefore, you know, people when they're calling a call center, they'd rather talk to a human versus a, you know, a bot, but it's like, when does that trade off happened? And like, are you still going to have this personal touch that we we might lose otherwise? So just an interesting dynamic to kind of think about as we start to progress?

Annie Holcombe  35:48  
Yeah, if robots become more hospital than us, then we're really in trouble.

Alex Husner  35:54  
Exactly. Yeah, that was a very good point. Well, we are super excited to watch your journey this year, I think you guys are just going to see a lot of growth now with a little bit more attention on it on the business now that you're gonna be in that new role. And we'll certainly have you come back on the show later this year, and maybe for an update and we can hear cut in the trenches as as we coined that with Michael James a few months ago and his journey and it's just fun to see different sides of everybody in this journey that are at different points and how they've approached it. So we wish you nothing but the best of luck this year. If anybody wants to reach out to you, what's the best way for them to get in touch

Dan Mitchen  36:32  
for me? I'm kind of old school. I would say Facebook, or via email email is Dan dot Michonne at home hop pm.com Or like I said, Facebook, there's two dimensions just go to the ball guy and that's

Nate Klatt  36:47  
what we're building off of social media right now. But we do have an Instagram for home off. I kind of disowned social media that I didn't want to go on it but I'm going to probably start leaning back into it. You can find me on LinkedIn at Nate. Nate clad and then same same email Nate dot Clyde at home hot pm.com. For anyone interested.

Alex Husner  37:02  
If anybody wants to get in touch with Andy and I you can go to Alex and Annie podcast.com And thank you guys so much. We appreciate you being here today and we'll talk again soon