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Alexandra Alvarado: [00:00:00]
We are live. Thank you for joining us. My name is Alexandra Alvarado. I’m the Director of Marketing and Education at the American Apartment Owners Association. I am so happy to have with me two very special guests from Innago property management software. We’re going to do a quick interview with Dave Spooner, the co-founder of Innago, and Tanvir Sattar, who is their Director of Business Development. They’re going to give us some more information about property management software in general, a little bit about their story, and how you can implement some of the features that they have on their software into your own rental property business.
So I’m really excited to get it started. Dave, can you tell us a little bit about Innago?
Dave Spooner: [00:00:52]
Yeah, definitely. First of all, thanks so much for having us. We’re really excited to be here, especially live. So Innago is rental management software, just like you said, designed for small to mid-sized landlords.
Whether you’re a DIY buyer or a property manager with five employees underneath you, you probably don’t have a lot of time on your hands. Innago is built to be a really simple, easy-to-learn software that can take a lot of the pressure and a lot of the things that you’re doing day-to-day off your hands.
So that includes things like automating late fees, paying rent online, and virtual tenant screening and lease signing as well as communicating with your tenants. All sorts of different features are included in the package. And oh, it’s software that’s free to use but feels like it should cost.
Alexandra Alvarado: [00:01:42]
Yeah, I think you ended with the most important part. So that is uncommon. You have to pay for most property management software. So what led you to start Innago and make it a free property management software?
Dave Spooner: [00:01:57]
I was involved pretty early on in a company that was building a college listing site.
It was supposed to help tenants and landlords of student housing better connect with one another. And through that process, I got a lot of exposure to small to midsize independent landlords. That’s mostly who comprises student housing. We kept hearing over and over and over again that these landlords didn’t really care about a listing site, which was definitely useful information for us. We also learned that they really wanted tools that were easier to use, easier to pick up in their very limited free time and didn’t have a high barrier to entry.
The biggest barrier of course is cost. So finally after hearing that for a couple of years, our co-founder at Innago and I decided we can give them these tools. We worked on a lot of different pricing models. We tried out a lot of different things and eventually realized people want this kind of stuff for free. We can find other ways to monetize it. We can find other ways to bring value. Let’s give it to them for free. And that’s what we did pretty shortly after starting an office.
Alexandra Alvarado: [00:03:07]
That’s pretty amazing. I mean, that’s one of the first softwares I’ve heard of that is completely free to use. And I’m also curious about your backstory a little bit. I know Dave and Tanvir, you work very closely together. You’re in the same office and you have marketing and sales that you’re working on together.
How did you two meet and what sparked that encounter?
Tanvir Sattar: [00:03:31]
Yeah, absolutely. I’ll take this one. So it’s going to be four years next month of us working together here. It’s gone by really quick. We met like any other young professionals would – on a basketball court. Some friends of friends got a game together. Dave and I were both odd man out. So we were fully hydrated, not sweating yet, so we were talking a little shop and Dave introduced me to the idea of Innago that he was just getting off the ground.
I came from a consulting background, so I worked for Ernst and Young and another consulting firm for about seven years at the time. And I was really interested in getting into sales. I loved developing relationships with people. And then I also had the background of consulting where I could help Dave. He didn’t give me a job right there on the spot, but it kind of sparked my interest.
We played a couple of games of basketball over the next couple of months. We sat down and had a cup of coffee. I told him what I was looking to do. At that point, Innago was not funded at all yet. So he said, that’s great, but I’m going to hire you as an intern.
So I took a leap of faith with Innago and at 30 years old, I was probably the oldest intern we’ve ever had,. Then we got started and the rest is history.
Alexandra Alvarado: [00:05:00]
That’s exciting. So it’s been four years now. What would you say are some of the biggest lessons that you guys have both learned along the way?
Tanvir Sattar: [00:05:21]
I started in August, 2017. As far as the biggest lessons learned, and this was a big learning curve from me coming from more of a corporate environment, was how much Dave championed customer support. That was his bedrock. That was what he believed in. And that was something that took me a long time to get used to because customer support in general wasn’t something I was familiar with. But from day one, we have really put the customer first.
Because when someone signs up for Innago it’s the same thing as when you get your first smartphone. Right? You have a lot of questions. I know my parents give me a call and ask a lot of questions anytime they have software issues. And that’s kinda what I feel like we’re doing on the customer support side. At the beginning it was just Dave and me helping out people from all walks of life with customer support and our customer support team has grown ever since.
Dave Spooner: [00:06:29]
If I could piggyback on that really quickly, Alexandra. Especially when we were first starting out, we identified early on that there are really three things, especially as a software company, that can make your company the best. You can be the best at marketing and selling your product. You can be the best product in the market. Or you can have the best customer support. And when you’re first starting out, there’s no way you can have the best product. Right?
There’s no way you can have the best marketing. We had a great product at the outset, but it wasn’t the best by any means. There were companies that had been around for years and years. We had a different spin on it, but it wasn’t necessarily the best. But we could be the best at customer support. So we really made sure that that is a central pillar of everything that we do.
We’re confident now that we do have the best product and possibly the best marketing team out there, but we still are committed to that customer support. So it really was a central kind of foundational piece for us.
And if I could also just really quickly answer the question, I think the biggest thing that I learned was the importance of building the right team around you.
Eventually you run out of time. You can’t do it all yourself. That means understanding not just that you can delegate, but sometimes that other people are a lot better at things than you are. They can accomplish things. They have their own special set of tools and techniques and approaches that may be far better than what you can bring to the table. Understanding that and learning to rely on team members and continuing to commit to the team members that we do bring on has been a huge and, and really great, lesson for me throughout this.
Alexandra Alvarado: [00:08:14]
Interesting you say that. I recently interviewed a real estate investor with a similar thought. I asked what’s your investment secret? How do you have the best portfolio?
And she said, it’s my team. And so whatever you do, it’s about having the right team. And I also really love the customer support aspect. As we’ve said, we’re really big on customer support too. So, if you start with that, you can’t go wrong, and you get to know what your customers actually want.
So that’s probably why your features are really helpful for people. I like that. So speaking of rental property ownership, I heard that you both are rental property owners. I’d love to know how that has influenced your features and your experience at Innago.
Dave Spooner: [00:09:02]
Well, like you said, customer support has been such a great way to learn directly from landlords what they want.For the first year or two, I did not own any properties, but about three years ago, I purchased my first and now I have eight rental units. So I’m a DIY landlord.
And it’s been great to learn from that experience. I use Innago, of course, which makes my life really easy. But I also have been able to conceptualize some of the challenges and problems that maybe were a little harder for me to understand before. And there have definitely been features that have come directly out of owning property.
One that’s coming in the not too distant future is actually a maintenance scheduler.
It’s really annoying to remember to go change air filters in your furnaces every three months. It’s great to be able to set a scheduled calendar within a platform like Innago, and it reminds you directly. You can mark it as resolved, you can mark it as incomplete or you can make comments on it. So that’s just one example of a feature that came directly from that, but there have been plenty of others.
Alexandra Alvarado: [00:10:05]
That’s great. I imagine it’s kind of nice to be able to develop your own features on your software. We want to get to know just a little bit more about you both. Is there something about you that most people don’t know you know that our audience might be curious to find out about?
Dave Spooner: [00:10:29]
I don’t know how exciting mine is, but keeping in the rental property realm, my wife and I purchased a fixer upper not too long ago. And I have learned that I am not very handy. So now the rest of the world can know that too. It’s harder than you think.
Tanvir Sattar: [00:10:48]
Yeah my wife and I bought our first home a couple of years back as well and she knew already that I wasn’t the fixer upper. We both were Joanne Gaines in the process. Both creative, but no one’s swinging the hammer. So we definitely settled on the turnkey. That was great for both of us. But since I don’t have any projects to work on, like Dave, I spent a lot of my free time playing soccer. So I play two or three nights a week and it’s something I really enjoy.
Alexandra Alvarado: [00:11:23]
That’s fun. Well, back to property management. So obviously, we’ve had an insane last 18 or however many months it’s been, because of the pandemic. And I’m really curious to get your perspective on what is the biggest challenge that landlords are facing today as we exit the pandemic?
Tanvir Sattar: [00:11:48]
I think the pandemic definitely put a microscope on this, but I think whether it was pandemic or not, the things that I’m going to talk about right now don’t change. When you become a landlord, there are going to be some things that you can control. Like what property you’re buying, what insurance company you want to go with, what realtor you’re going with.
When you do get the property, it’s “Am I going to update some of the appliances? Am I going to wait a few years?” Things like that. So all that is in my control. But the thing we cannot control is the tenants.
That’s something that took me a long time to understand until I was a property owner. Something that I always say whether it’s your first unit or your hundredth is make sure you spend some time thinking about your application and the questions you want to ask.
That way you can get a really good tenant in place. So the first step is creating a really good custom application. The second is screening.
And put on the application that you use a third party to screen your tenants. That way you can get a criminal or credit check and a background check. I know it’s something AAOA offers and so do we.
Alexandra Alvarado: [00:13:19]
Dave do you have anything to add?
Dave Spooner: [00:13:20]
Yeah, I think it’s really well said. I had eight units in the pandemic and we were able to keep all those units filled and our tenants pretty much paid on time. We made some rent concessions to help them get through. We waived half month’s rent and held late fees and kind of spread some payments out for people. But they were able to get through because they had solid income and because they passed our very thorough screening practices, we knew they were great renters. And if you had bad renters during the pandemic, you’re probably still dealing with the fallout.
So like Tanvir said, it’s really put a microscope on the importance of having great tenants. So go through those rigorous screening practices – I can’t emphasize that enough.
Alexandra Alvarado: [00:14:06]
Yes, I agree completely. And I also think something I saw on my end was just the lack of communication. I think a lot of landlords take a step back and let their rental run itself if the tenants are paying rent every month. But the tenant doesn’t really have a relationship with the landlord at all in some cases. Some landlords found out it’s a lot harder to start a relationship when it’s based on non-payment of rent versus checking in on them on a regular basis.
So you both do a DIY sort of property management. We have some landlords that are growing their portfolio. They get to about a dozen units and then they realize this is a lot more work than they thought. Obviously Innago might make that easier for them, but they’re also considering, “Should I just hire a property manager? Should I hire a property management company? Is it worth it?” If you’re talking to a landlord like that, what kind of advice might you give to them to make that decision?
Tanvir Sattar: [00:15:18]
I can start us off here. I would say it just really depends on their situation. Dave, for instance, is local. He can do the DIY thing. The properties that I have are 1500 miles out of state. So I probably would need a property manager. The nice thing is that I have family that’s right near the properties, so they can run it. And then I can also use Innago for rent collection and things like that that probably weren’t available in the last 10 or 15 years. So there’s a time and place for each and you really need to figure out how it works in your portfolio.
The next thing is, if you are going to go with a property management company, that’s going to take eight to 12% of your revenue. Is that something you’re comfortable with? For someone in my dad’s position, who is getting closer to retirement, it might make sense to them.
They just want to golf seven days a week and they don’t want to deal with any rent collections or maintenance requests or anything like that. So they’re okay giving up the 12% and they’re okay with the results whereas someone like Dave and I, who are younger in our careers, want more revenue, so we’re going to stick to DIY. Dave, anything to add?
Dave Spooner: [00:16:49]
I think like Tanvir has said, there’s absolutely a place for property management. We, in fact, work with tons and tons of property managers.
We’re not just software for landlords exclusively. I think the key is as you’re evaluating property management companies, recognize that they are going to be the face that the tenant puts on you. The tenant is going to think about the property management company as a representation of you, so make sure that they’re representing you well, not just in their business practices, which are obviously critical. That’s not just in the cost that they charge you. It’s also in the software that they use. Be sure to get references, do your due diligence, almost like you would with a tenant, in order to make sure that they’re going to represent you well. Also, understand the difference between a property manager and a property management company.
Once you hit a certain number of units, it may actually be more cost-effective to bring somebody onto your team instead of going out and hiring a company. Build that out as an alternative if you feel like you’ve got too much happening on your end.
Alexandra Alvarado: [00:18:01]
That’s actually really true. The thing is, you still have to check in with that property management company or property manager to make sure they’re doing their job, too. So there is still a little bit of work involved, I think. No matter how you look at it, it’s never truly a hundred percent passive, but we try to get there as much as we can.
You mentioned if you do hire a management company you want to know what kind of software they’re using. So what are some of the features that the software should have?
Tanvir Sattar: [00:18:43]
Anytime I have an intro call with the landlord, I ask them to think, “What do I want to streamline in my life?”
For me, I’m 1,500 miles away from my property. So the first thing I want is online rent and collection. But the first thing Dave wants is a maintenance calendar because his properties are closer to him. So evaluate what makes sense in your business model. Pick three or four things that are going to really make your life easier and then take a look at what property management software makes sense.
Alexandra Alvarado: [00:19:18]
Hmm, that actually makes a lot of sense because there are some softwares that have so many different features that I don’t know that all landlords necessarily need. We touched on this briefly, but what types of landlords are using Innago?
You mentioned you do have some property managers and property management companies, what type of landlord would you say uses Innago?
Tanvir Sattar: [00:19:49]
I would say our smallest landlord has one. We have a lot of new landlords or landlords that are just comfortable with having one unit. Our largest has over 2,000. And as Dave alluded to earlier, we have property management companies that use Innago. We have DIY landlords that use Innago. But when you average it all out, it’s about 35 units per landlord using Innago. Whether you’re strictly residential, strictly commercial or both, that’s totally fine, too.
Dave Spooner: [00:20:26]
I think it’s well said. We focus on ensuring that Innago is really flexible to use and easy to use, but also offers a depth of features.
And I think it’s a testament to that, that we can work with such a wide range of people. Our bread and butter from a marketing and sales standpoint is 1 to 100 units. That’s what we talk about and focus on. We have tons of landlords with way more units than that. And we also have landlords that are not really landlords. For example, a lot of people sign up with us that own salons these days, and they rent out their chairs to different hairdressers or barbers. We also have people that own restaurant warehouses that will use a centralized place to do carry-out.
They rent their little kitchens using our software. Basically Innago is for anything you can rent because of how flexible it is. So, bread and butter, 1 to 100 units, but we’re all over the map.
Alexandra Alvarado: [00:21:29]
I had never even considered that for a property management software. That’s crazy. What kind of processes does Innago automate?
Dave Spooner: [00:21:47]
Yeah, it’s a lot of stuff. Really anything that you’re doing repetitively we can pretty much automate for you.
So of course, online payments is a really big one, right? The first time that you receive a payment on the first of the month from all 10, 20, or 30 of your tenants, it really changes your world. So online payments is a huge one. Signing documents can be automated in large part.
Screening tenants – major chunks of that can be automated. Handling maintenance tickets. All those pieces can be automated.
You touched on a huge one earlier, Alexandra, which is communication with your tenants. Communication is such an important piece of managing your tenants effectively. You can automate messages like “Hey, don’t forget to pay rent today”. or “Hey, late fees are about to stack up.” Or even just a welcome packet that you want to send to all your tenants when they move in. These things that we can automate for you just add a nice touch and a nice bow on top of the package for you, your landlord, your property manager.
Alexandra Alvarado: [00:22:49]
I like that. Especially the welcome feature. So you mentioned all these features, what would you say is the most used feature?
Tanvir Sattar: [00:23:07]
So, if you asked our customer service team, they would say the customer service aspect is most used. Dave and I would say first and foremost it is the online rent collection.
Going back to the pandemic – we’ve had so many landlords come over that were kind of hesitant about the online rent collection or just want to do things the old school way. But now they’re seeing that transferring funds without touching hands is actually a good thing. Definitely more sustainable. So after online rent collection, the second biggest feature is tenant screening.
We do have a lot of people that come over that just use us for screening because we have an application builder. You can build out a custom application and then send it electronically to tenants either via email or text, or you can create that on your own website. And then the last is, which I think is a pretty big differentiator, is document signing. So you can sign leases and then you can also sign the addendums in anything else that you want to sign on Innago. Dave and the product development team over the last 12 months have put a lot of time into this. So I would say it’s the best on the market.
So definitely after this, if you have some time to take a look at that, it is a great feature.
Alexandra Alvarado: [00:24:26]
I’ve actually sent over some of our members to you because of that feature. Because we have amazing custom state-specific forms and, you know, the signing aspect is always such a pain.
So that’s one thing I think that sets you apart, right? Obviously the other big one I see is the free aspect, right? So what other features would you say set you apart?
Dave Spooner: [00:25:21]
I think automating a lot of communication is a big one which I hear people talk about a lot. I think they’re all surprised by just how impactful it is once they start. Like our late fee feature. Now that seems fairly innocuous, right? You can automate some late fees, but our late fees are really simplifying a complex process. You can charge percentage fees, you can charge repeating fees, you can charge a flat fee, you can do all sorts of complex things. One of the benefits of charging a fee in this manner and doing it through a platform like Innago is like the classic tale of the late fee for most landlords, especially when they’re doing things on their own without property management software.
A tenant is late, let’s say five days. The landlord calls them up and they say, “Hey John, you’re five days behind, you’ll need to pay a $50 late fee. You need to give me that and the $500 rent in two days or I’m writing up a three-day notice to quit.” The tenant is always freaked out and they say, “Oh man, I gotta get this rent together.” They cut you a check. They put it in your mailbox, but it’s 500 bucks and doesn’t have the late fee included. And now the landlord has to decide, “Do I call up this tenant again and chase this 50 bucks? Do I just accept this and move on without my 50 bucks? Do I really care?” Most landlords go with the latter option.
Unfortunately, they’ve taught their tenant three things. They’ve taught their tenant that they don’t need to pay the late fee. The landlord’s going to call them up and notify them when they’re late, and that the landlord makes empty threats. They don’t mean it. They don’t have teeth when they bark. Those are terrible lessons to teach your tenant. But when you first start using a platform that’s going to automatically assign those late fees, it’s going to automatically notify your tenants of those late fees stacking up and that the tenant can’t pay the next month’s rent until they paid the prior month. Plus the late fee. This is really powerful. All of a sudden, tenants are paying late fees. All of a sudden, tenants are not paying late anymore.
It really changes the collection game. It’s not just about no longer having to drive to the bank. It’s about the entire collection process. And I think that’s a big feature. After just a couple of months, people reach out to us and say, “I had no idea what impact this was going to make on my business, but it’s tremendous.”
Alexandra Alvarado: [00:27:52]
It’s so true. It really is a psychological game more than anything. We had someone from a rent collection agency come in and speak to our members and they thought that she was going to tell them about a complex collection procedure. It was mostly psychological tactics and establishing relationships with tenants in a way that makes them want to pay. And you’d be surprised what those tactics are. I mean, they’re pretty simple. I imagine when the late fee is there in front of you and it’s automated, you can’t deny it, so it’s harder to get away with.
So, I want to wrap up with just a couple more things. You’ve spoken quite a bit about customer support, but if somebody wants to start using Innago, they may be wondering if this is going to be too hard to learn? What would you say about that and using your software and how easy it might be for someone?
Dave Spooner: [00:29:06]
When you’re getting started, it depends. Are you transitioning from another platform or are you picking up software the first time? If you’re transitioning from another platform, you’re going to find that a lot of the tools we’re offering are similar. If you’re coming from no software at all, honestly, it’s even better because you have no baggage from other software.
I would say the biggest difference between us and other platforms is we are there to hold your hand. We have worked really hard to take complex challenges and make them simple and make them easy to engage with.
But we recognize that there’s a learning curve for everybody. For some people, it’s a really steep learning curve, for other people it’s nice and easy. Whichever side of that equation you’re on, we’re going to be there to help you. We have videos that can walk you through different features. We have our customer support team, which is available for you to jump on the phone or talk with through email or send screenshots.
Tanvir does an awesome job hosting a webinar every couple of weeks where we teach new users how to use Innago, which is great to leverage, not just the questions that you have, but to also hear questions from other landlords.
The second thing, when you’re building software or when you’re building any sort of solution to something, it’s easy to take a simple problem and give a simple solution. It’s also kind of easy to take a complex problem and give a complex solution, but it’s really challenging to take a complex problem and provide a simple solution. And that’s something we talk about all the time because landlords have complex problems.
Some of these processes are not as simple as they seem. Different landlords do things differently. And that’s one of the biggest takeaways that I think you’ll find at Innago, especially as you transition. There’s some subtle nuance to our features where you can do things that maybe you weren’t able to do in other software platforms. You can handle all sorts of different tiny tasks that you need to in unique and different ways.
Alexandra Alvarado: [00:31:29]
I suppose once you do learn it and get the hang of it, it’s all worth it, even if it does take you a little time to learn it. And with the support, it should be much easier, so it’s great that you have that.
You mentioned a new feature that’s coming that you made for yourself, but that other people will benefit from, which is your maintenance scheduler. I think that is super helpful and useful.
What other features do you have coming up on the horizon that we can look forward to?
Dave Spooner: [00:31:58]
A big one is tenant credit reporting. I think that there are a lot of applications out there on the property management side that put a ton of emphasis into the landlord’s experience, but they don’t necessarily put as much emphasis on the tenants’ experience
You have to remember the tenants are the ones paying the bills, right? You want them to have a positive experience. You want to make it really easy for them to make rental payments and to do all the other things that they need to do within the system. So we’re always trying to service that.
We’re always looking for different angles to bring value to tenants as well. And one of those is tenant credit reporting. So tenants will be able to sign up for a service that helps them build their credit score by paying rent.
It creates additional incentive to pay the rent on time. It creates additional value for these tenants, especially good tenants that are always paying their rent. They can boost their credit score. It’s just a great feature all around for tenants. And because of that, it’s a great feature for landlords too.
Tanvir Sattar: [00:33:00]
Just one more feature to add. We’ve had a tenant mobile app for a year. And pretty much once a day, someone asks me, do you have a landlord app? And my answer always is no. And I remind Dave of that every day.
So finally, Dave and I are going to end this conversation once and for all. We are pleased to announce that we’re releasing a landlord app mid August. So stay tuned for that. It’s something we’re really excited about. The reason it took 12 months is because we wanted to make it not just good, but great.
And we’ve done a lot of beta testing. We’ve taken a lot of time getting user feedback and it’s something I think everyone’s going to love, so be on the lookout for the mobile app for landlords coming out mid August.
Alexandra Alvarado: [00:33:51]
That’s actually really exciting. I can’t wait to see it. I definitely want to take a look at it when I get the chance. I would like to quickly share that Innago is doing a full-blown hour-long webinar with us next week and we are super excited about it. This webinar is going to really focus on the nitty gritty of property management software and how to get the most out of it and how to grow your business through it. You know, this can really help you determine whether or not you’re going to do it and how to get started. I think it’s going to be really helpful and I’m really happy to have you both back next week to talk about it.
And if you want to give Innago a try you can go to Innago.com. Dave and Tanvir, do you have any other ways for the audience to get a hold of you or is the website the best way to go about it?
Dave Spooner: [00:35:05]
Website’s great. You can also check us out on social media. @innagosoftware is our handle on Twitter, Facebook, and Instagram. We do have a phone line, so call us up. Our phone number is listed on the website.
Alexandra Alvarado: [00:35:37] Great. Well, this was fun. I’m so glad I got to learn a little bit more about both of you and Innago. I’m looking forward to having you back next week on Tuesday, August 3rd at 11:00 AM PT. Put it in your calendars. I’ll be in touch with you guys. Thank you so much. Have a great day, everyone.