📢 our second podcast 🎙/Article with Vlad Costea, first and hopefully not the last from podcaster.sk
This was our first episode from the Podcaster.sk, second with Vlad Costea, who despite our three days lasting grilling in person in Bratislava, we hope has become our dear friend and, altogether, fifth episode of our podcast series Real Estate: Better so far. I have enjoyed this episode even more than the previous ones. We had very nice opportunity to speak in person and the location is truly remarkable. I strongly recommend this studio for other podcast creators as well. We have to come back ourselves.
💡 The “Real Estate Better” is our series featured by PropTech Slovakia and its partners from Slovakia and abroad. Each episode is devoted to actual real estate challenges, while we share tips, solutions and experiences on how to solve them: this episode was again focused on our challenge: 🔦 “How to make life of large real estate portfolios easier ”.
Links to the episode recorded on 24 November 2023 on www.youtube.com:
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Time stamps/chapters
00:00 Introduction
2:33 Start of the Three Minutes Pitch
4:45 Internal Private AI
5:10 Differentiation from Competition
5:48 Ideal customer
6:34 Customers that we are proud of the most
9:36 How hard is it to become a supplier of a large global RE agency?
11:49 The tenant is the hero
12:49 Branding and Corporate Identity at stake
14:55 Product covering the whole tenant lifecycle journey
18:39 Storage of data via cloud or physically?
25:37 How do you enjoy Slovakia?
Complete Transcription
(Dear visitor, this is complete transcription of our webinar and podcast made by the AI “Whisper”. Whisper is very good, but not perfect and we dared to make just a very quick human supervision of its work. Anyway, if you find some gaps, errors, etc. do not let them disturb you. You can freely contact us or any of our podcast participants via LI profiles, should you wish corrections or further explanations)
Milan
So, thank you very much! This is our first podcast in Podcaster, but I’m very happy that we are finally here because I heard only good things about recording here. Any podcast edition that I’ve seen was good. This is our podcast series called Real Estate Better, and it is designed in a way that we do it together with our partners.
We, I mean Proptech, Slovakia, and our partners are usually innovators that help the real estate sector function better.
And we also devote each edition to Real Estate Challenge. The last one was „How to make life of large real estate portfolios easier.”
And we a little bit did not finish it. But I even didn’t dream that my partner will come to Slovakia because I had a discussion with him via online space.
And now he is with me together. We are here in the studio.
Dear Vlad, thank you very much that you came.
Vlad
Thank you for the invitation.
Milan
That you accepted our invitation! Because we wanted to have a real experience either with your product, with you: How are you as a person?
And we would like to grill you even in this way.
Vlad
Okay, you should try.
Milan
Okay, let me – let me place the first question.
You know about me that I like startup and scale up competitions. I like pitches.
I know that it has a lot of disadvantages and you do not have a good chance to see all that you need if you look for a business partner.
But I think that it always gives you a solid starting point.
You can always refer to it.
And if you could be so kind and try to do a three minute pitch for me.
Vlad
Three minutes? Oh!
Milan
Three or five minutes pitch.
Usually, it is three minutes and two minutes are for Q&A’s.
Vlad
Okay.
Milan
So if you could in three minutes tell us, I will stop it not to prolong this first question. And after three minutes, I will tell „Enough!” and I will place first question, okay?
Vlad
Perfect. In this case, it means that I have enough time to say that Bratislava is an amazing city.
Milan
Thank you!
Vlad
And now to start with the pitch. We offer an operational platform for real estate property and leasing managers.
And real estate has been changing throughout the last few years, even during the pandemic and post the pandemic.
And now we face a situation where the leases that were signed before 2020, so 18, 19, will renew starting with 2024.
And most of them will renew with a lower space value than they were initially signed.
This will create a lot of small spaces that will become available in the market with an average availability of around 15% across Europe.
And our product has adapted over time to address this changing environment.
So therefore, we offer an application that supports operationally the leasing managers when they interact with the tenants and they interact with the brokers.
And then they transfer the platform, the lease sync space towards the property managers.
And then we support the property managers to do a better job in engaging with the tenant, monitoring suppliers, offering perks and benefits and have an effective communication.
All of this by reducing the number of hours necessary to handle a very, very large portfolio.
So we target large portfolio, mixed portfolios, ideally of commercial offices, retail spaces, residential, we can cover all of them.
In a nutshell, this is our solution to, I would say, a growing problem.
Because the problem is that the volume of work for the real estate professional increases during this period of time.
We are heading towards a recession, but the number of resources usually decreases because all the companies are reducing budgets and they are reducing costs.
And I think we have the right tools and a very, very good product to help all of this.
Of course, in the age of AI and supported also by AI because this is something that we managed to do in building – our own internal private GPT product.
That will support everything that I’ve said until now. And I think I am under three minutes.
Milan
Yeah, one minute left.
Vlad
One minute. So, I have time to speak also a bit about our competitors and what differentiates us from them.
And the main thing is our possibility to absorb large portfolio really, really fast.
So do all the configurations on the fly because the product is very, very flexible and it’s also aligned with the current ways of working.
So, while other products focus on verticals, we focus horizontally and extract value from the tenant journey from lease to property management to exit or release.
Milan
Thank you very much. Thank you very much. Two questions. Who is your ideal customer?
Vlad
Asset managers that own a diverse portfolio that they want to manage their portfolio by leasing it and having a yearly yield out of it.
And when I say large portfolio, they should be higher than 200,000, 250,000 square meters of office and commercial spaces and on residential side, maybe more than 500 apartments.
So, they can be developers that they do internally the leasing and property management processes, or they can be asset managers that have their property and leasing management processes,
or they can even be large agencies who sign a lot of deals, maybe exclusivity deals, and are also handling on behalf of the landlord’s leasing and property management processes.
Milan
And the second one, the last one, could you name some of the customers that you are the most proud of?
Vlad
I’m proud of all of my customers.
Milan
Excellent!
Vlad
And actually with most of them, we have a very, very low churn rate and actually most of our customers have increased their portfolio over time and have come with new requests from us.
We work with the largest agencies in the market and right now we are present in Romania and Hungary and we work with the largest asset managers from those countries as well.
So especially in Romania, we work with the biggest asset manager. Hopefully pretty soon we will work also with the second biggest one.
And in Hungary, it’s just something that has started happening now this year and it will continue to grow in 2024.
Milan
Thank you very much. It now should come applause during the competition. My impression is very good. You went without any presentation, so it was pure personality.
I miss a couple of things like a little bit of history. What’s your team? It’s very hard to include it if you do not have this structure and to get it in the minutes.
But I think that we’ve heard about it during our first edition, so I didn’t need it. But on the competition it is needed because they do not know anything about it, of the competitors and they need to get a feeling who they’re speaking with. What’s the first experience and what’s the history of the solution that competes and why is it better than the other competitor basically.
Vlad
That’s the idea that the team comes with the story behind it.
Milan
But this we covered in the first edition of our series, so I’m happy with how you use these three minutes.
I would like to ask you a question which is quite closely related to what you have mentioned. To become a supplier of a big real estate agency, there are just four or five of them in the world.
And it’s often dream of startup to become a supplier of this agency. How hard is it to become such supplier because I know that the process is really difficult and you passed, am I right?
Vlad
Yes, yes, yes. Well, it’s a matter of luck. But if you define luck like preparation meeting opportunity. You do pass through a lot of questions, thousands of questions, because they do need to understand that you would be a reliable partner over time.
We all know that there are risks associated with startups. The ecosystem is in such a nature that startups are pushed to sometimes expand quite quickly.
And from time to time, this kind of expansion or chasing customers, new market, pilot projects, expanding the product, the team, sometimes they don’t end up well.
And, actually, I’m quite sure that we will see, unfortunately, a lot of companies that now in 2024, they will stop existing, maybe because too high spending, maybe because the deals are not closing fast enough, and things like this.
And obviously, the large corporations need to ensure that once they have invested the cost of adding a new product, the cost of including the product into operations, those costs would not have been for nothing.
I mean, they would need to ensure that they have a good return on their initial investment. And it’s understandable.
Milan
I can imagine building a brand takes time and costs. Thousands of people work on being somewhere and facing the relationship with bad partner can really harm it.
Vlad
With a product like ours, take into account that we are interfacing the tenant. I mentioned in one of my posts on LinkedIn lately that the tenant is the hero here. And the hero goes through a journey.
We don’t want the journey of the hero to end badly. So obviously, both the large asset managers and also the large agencies, they have to take very good care about their heroes.
So because of this, also the audit verifications to ensure that the product is stable and solid enough.
Milan
Yeah, I think that last time we covered the question, a very big advantage of your product is that it is widely labeled product, and real estate company can name it after itself.
But then comes also the responsibility that, okay, I will name it by myself. But then it has to be 100% reliable, and I need to have this partner really living.
And that’s why I understand why it should be secured.
Vlad
It’s not only a matter of branding. It’s also a matter of imposing your corporate personality, because the product, not only that it’s brandable, it’s also configurable to follow the ways of working and the processes of our partners, of the asset managers or the agency.
So yes, they do, and they are able to present them in front of their customers as a product of their own. And for us, this creates indeed a huge, huge responsibility.
Milan
Okay. And to go a bit deeper into what you offer, who are you connecting? My impression was that the number of interfaces your product offers covers a really impressive spectrum of real estate verticals. Because it can not serve only to asset managers, as you mentioned first, but also property, also leasing, also FM. And it gives quite a user-friendly interface also to tenant and to supplier.
Vlad
It sounds complicated, doesn’t it?
Milan
It sounds complicated, but if you make a simple graph, and you connect these three things, and you give the asset manager or the property manager, who will be the person setting up, who will get which information, because what’s unique on your platform is that it’s not done by IT expert, but by real estate experts. It’s so that the real estate expert shapes how it will work and what functions the tenant and the supplier will get, or another vertical.
Vlad
Yes. Well, to clarify, so we follow the tenant journey, as I mentioned before. Horizontally. So obviously following this journey, we need to cover all the stakeholders involved.
So, right in the beginning, when we can’t even call him a tenant, it’s just a prospect. He will be interacting with the brokers and he will be interacting with the leasing managers.
So, this is the first moment where we offer the necessary tools to the leasing management team to interact with both the brokers and the potential future customers in a faster and more effective way.
This will mean submitting offers in certain various forms of templates. It can be through a mail, it can be through a document, it can be through a message.
I mean, just that an offer that potentially has been approved by top management reaches its target, the target being the future tenant or the broker that will present maybe in the same time to the tenant the offer.
So now we have these players. After we move along on the tenant journey, let’s say that the tenant signs a pre-contract and has some negotiations.
Maybe you have some of the legal departments here. After this, he signs the contract, the lease agreement. You definitely have legal departments here that will also review the documents.
But everything needs to be kept in a central place because 5, 7, 10 years down the road, this information will become quite valuable.
So this is where we ensure that everything is centralized. All the discussion, all the negotiations is centralized and made available over time.
After the contract has been signed, there is a transfer between the leasing management team and the property management team.
This transfers also implies some sharing of information and sharing of documents.
If this kind of information is present only on the mail, and let’s say that big companies have turnover with personnel and one of the leasing manager leaves. He leaves with all the emails.
And if some of the documents remain, but they are in a, let’s say, OneDrive or Dropbox kind of format, they are difficult to find. It’s difficult to extract reports out of it.
It’s difficult to have notifications or pop-ups after a certain period of time. So this is also something that now we handle.
And then when we transfer the tenant, now the tenant is happy. He had got his amazing feet out. He’s moving into the building.
For him to remain happy, there needs to be some tenant engagement that needs to happen from a community or directly from the property manager.
And also there needs to be, the property management teams need to ensure that the problems are solved swiftly.
So quickly with very good communication that the suppliers, the validated suppliers do all their job.
And this is where we measure a lot of performance indicators. A lot of KPIs, the suppliers will have service level agreements that they will need to fulfill.
And also there will be value added services that will also need to be delivered correctly towards the tenant.
So following the tenant also on this path of coming regularly to work and liking the place where he is working at.
And why not? This is also something that can improve the percentage of people that come back to the office over time.
Milan
You mentioned that it will be stored in one place. I noticed when you showed us the platform that you were always accessing via internet and via some kind of browser.
Vlad
Browser, mobile app.
Milan
Is there a demand for even other solutions like storing it on physical server in the headquarters of real estate company or is this cloud way of storing things acceptable for all?
Vlad
Such a good question. I’ve seen discussions happening. I mean, right now, none of our customers use anything locally on a local server stored in a private server that they own.
But we do provide private installations for any of our customers. So, any of our customers, they will get their own installation and their own data and the data cannot mix between itself.
This being said, I do believe that it is a trend. I do believe that at some point in time, not everything will need to be and will be on the cloud because right now the cloud costs are growing sometimes even on a monthly basis.
And at some point in time, it will not be cost effective.
Milan
Because if I imagine the number of services and if you have large portfolio, the number of services will be exponentially higher.
And if the platform is so good that it’s very easy to record the services, to copy the agreements and set up SLAs and you want to report KPI of nearly all the services that are somehow connected with the building.
In large portfolio, this must generate a large amount of data. So it can be relevant.
Vlad
Yes. The amount of data generated from this kind of engagement is not that big. But we also know that now it’s a time of where a lot of certifications that are touching on sustainability and on the ESG targets, there are a lot of certification.
Parts of this imply getting large volumes of data by monitoring the location, the building in itself.
A lot of developers are installing from the get-go all sorts of sensors that are monitoring the air quality, the temperature, humidity in the room, natural light levels and things like this.
This kind of information generates volumes of data. And this is the type of information that in my view can attend.
And in the future, it also will be stored locally and managed and aggregated locally.
And what it will be presented outside through the Internet and on the cloud, it will be only the type of data that will generate decision making on the spot.
It’s something that you need right now, right there, and you need to have it access directly on your mobile.
So if you wanted to have it on your mobile phone, yes, it needs to go through the cloud.
But otherwise, if it’s a type of analysis that you will do on a monthly basis, maybe in this case, it can work with local PC, local servers.
Local area network.
Milan
You know that I’m a bit deeper in FM matters and we quite often meet with computer-aided facility management, but this is not computer-aided facility management.
I understand that it even supports this kind of software in a way that a large real estate portfolio gets another view on it.
Vlad
Yeah, so facility management services is definitely a critical component into managing the building in the right way.
But it does not manage anything related to portfolios or to, let’s say…
It’s very concrete, very special, and it relates to every building. Every building can have different…
For me, from time to time, it’s like going to the university exam and grading your paper by yourself.
This is what happens. For me, the property management teams or the asset management teams, they should have a helicopter view over their whole portfolio.
And they should have tools by themselves to have data aggregated in one place and to monitor everything that is happening at portfolio level.
From the moment where you have 15, 20, 25 buildings, you will not work with only one facility management company. You will have many of them.
And it becomes very challenging into monitoring the performance of each facility management company.
And the CAFM softwares are not built for that. They are built for specific tasks, operational tasks that ensure a proper maintenance of the spaces and of the building.
Milan
Thank you, thank you. This is a very interesting view, although I cannot fully agree with the statement that the need for a number of FM companies can be always present.
I can imagine that there can be a big integrated contract. And for some companies, this is the solution. Even global ones, that they have one integrated provider.
But I meet on the market both solutions, that there is a number of FM providers and there it is even more needed to have one check for all of them.
Vlad
Yeah, but listen, even if it’s one company, because I do get this, you have very large companies that can sign a group deal, but you will still have different teams and not all the teams perform the same. And you need the view on each building separately. How is it performing? What kind of services are there? Which do well, which do worse?
So I think it makes sense to see it like this.
Milan
Okay. Thank you – thank you very much. It’s in many respects enlightening me. I think that you are second, third day here in Slovakia.
Vlad
Third day, yes.
Milan
You started with the sentence that Bratislava is amazing.
Vlad
It is. I’ve never been to Bratislava.
Milan
How do you enjoy being here? What did you like the most? I don’t know, because I was grilling you since Wednesday.
Vlad
Yeah.
Milan
Yesterday we had even I took you on one brand new conference that I really liked.
I liked it as well. I mean, the subjects were very interesting.
Vlad
I mean, one idea that I got from that is that residential investment will surpass commercial investment over the next period of time, which I also believe it to be true.
So, yes. And now coming back to Bratislava. I don’t know why I’ve been to the big capitals around it.
So I’ve been to Vienna a couple of times, to Prague a couple of times, to Budapest a few times. I’ve never been to Bratislava.
And what I find in Bratislava is to be a mix of all of these capitals, but with its own identity.
So you will definitely remember that you’ve been to Bratislava because it’s not a copy-paste city and it gets bits and parts.
I mean, you can definitely get bits from what you see in Prague, definitely parts that you see in Vienna, definitely parts that you see in Budapest.
So especially this is my perspective. Also, amazing specialty coffee. I’ve tried, I think, five places I like the coffee.
And I actually bought two bags of specialty coffee that I will prepare myself at home. I’m quite passionate about it.
Milan
Thank you for mentioning this. Bratislava is a special city because the original, it was called Prešpork.
But the original inhabitants here, they used to speak three languages. They used to speak Slovak, Hungarian and German because Austrians speak German.
And it’s due to the unique locality. It’s on the borders of three countries.
And the Czech Republic is closer due to another reason that we were one state for a very long time. So it’s understandable.
And what you notice is really, I did not see it in this way, but you reminded me.
I think you need to come from outside to be able to, and everybody will have its own perception of it. That’s quite clear.
So once more, Vlad, very, very much. Thank you for coming. I think that spending time with you was very good.
Vlad
Thank you. And by the way, your hospitality is amazing and I highly appreciate it. So thank you for that.
Milan
Thank you very much.
