- The complexity of relocation and real estate in Asia
- The role of curated real estate platforms
- The convergence of PropTech and FinTech and how this leads to innovative solutions
- Building a flexible and scalable tech infrastructure for Rently
- Expanding outside of Asia while continuing to create a comprehensive real estate service offering
Some other titles we considered for this episode, but ultimately rejected:
- Let’s Provide a Great Experience
- Providing an Experience for Both Sides That Is Ideal
- It Was Literally Geotagged to Your Biometrics
- Less Is More, But Higher Quality
- The Game Changer for Us Is the Real Estate Management Piece
Read the best-effort transcript
Read the best-effort transcript below (This technology is still not as good as they say it is…):
Michael Waitze 0:05
Hi, this is Michael Waitze. And welcome back to the Asia Tech Podcast. Dominic Schacher, a co founder of Rently is with us today. Dominic, thank you so much for coming to the show. Let’s give our listeners a little bit of your background for some context before we jump into the main part of this conversation.
Dominic Schacher 0:21
Hey, thanks, Michael. It’s great to be back. A little bit of my background. So I’m, I’ve been living in Singapore for almost 10 years. Originally, I was only meant to come down for two years work assignments, I think, you know, not the only expert but got caught up. And this is ended up staying. But my background is actually quite International. So I’m Swiss. Grew up though in Spain, my parents retired down there and decided to go to university over in the UK, did a master’s in finance, or was thinking about going into investment banking, just as 2009 and attended. So, you know, I’m pretty good with timing. But then they said, Actually, private banking could be quite interesting. So I was lucky enough to receive a job offer in Liechtenstein, worked there for a couple of years, and mainly with UK restaurants and Russian clients. Back then it’s a quite big and an interesting segment. And then it was sent out to Singapore for two years for work assignment did that. And then it just ended up staying so moved across the private banks, then decided to go into Asset Management more into private equity and venture capital. Do Now we’re running Brentley trying to combine kinda the best pieces of both worlds tech and finance.
Michael Waitze 1:33
Yeah, I mean, pretty much what I’ve been doing my entire career is trying to combine those both worlds tech and finance. When we recorded at the Singapore FinTech festival. I asked you like what would be one word that would define the rental market in Singapore? Do you remember the word that you used? I think it was chaotic. Yes. And I can’t get away from that. Can you just start there? And then we’ll jump into a little bit more detail.
Dominic Schacher 1:55
Yeah, sure. So obviously, you know, think when I came down to Singapore, myself, never I haven’t been to Asia. I’m except for for a short holiday. Obviously, quite daunted, but also quite, quite relaxed about the whole thing. Everyone’s saying, hey, Singaporeans, Switzerland of Asia, you’ll be fine. So yeah, turns out that was a little bit different, when when actually arrived when it came to finding an apartment. So I think, you know, one thing that’s a little bit different I find in Asia, too many markets is to find an apartment, sometimes you only have, you know, a couple of months, a couple of weeks, two weeks, one week, to try to align all these meetings across all these different agents trying to find listings, that double, triple, quadruple listing the percent units, when units are fake, or like, you know, fake listings for agents trying to generate business. So really trying to find a place was actually extremely stressful for me. And then I got to the point where actually found a place great, let me sign. And they’re like, Okay, well, we need a check, please, for for a down payment. Never use the check in my life, like, you know, what am I meant to be doing? And then obviously didn’t even have a bank account in Singapore at the time as well. They wouldn’t take transfer, they wouldn’t take credit cards. So yeah, so my employer had to lend me a check, because I could actually get my apartment. And it’s honestly not changed much. It is a bit more flexible a check, and they’re happy to accept pay now and things like that. Apart from that, yeah, it’s pretty, pretty similar. I’d expect to be the same for you guys. You know, in Thailand, absolutely. Anywhere pretty much don’t think it’s much different.
Michael Waitze 3:25
I mean, look, one of the things that I find, because I’ve moved around a lot, right? When I moved from New York to Tokyo with Morgan Stanley. You know, when I hired a real estate agent, a couple of real estate agents that actually my firm recommended to me, they took me to places that were not appropriate for me to live. I didn’t understand the landscape, if that makes sense. I didn’t, and we could talk about it in location, but I had no strategy for understanding like where the right place was to live. And you’re right, I had two weeks to find a place. So it wasn’t even enough time for excuse, though, I didn’t even have enough time to, to kind of make enough friends to figure out like, what were the right neighborhoods? That is that is I presume that’s true in Singapore, you don’t want to live in the wrong place. Because then your commute sped your shopping sped your you know, your neighborhoods bad. How do you handle that? And how does Renly Look at that?
Dominic Schacher 4:12
Yeah, so it’s obviously you know, one thing that’s been luckily improving across platforms, you know, not just us, but our competition as well, if you look at the marketplace piece of it, if you will, again, same you know, anywhere people go there’s usually a couple of different listing portals. And they’re improving, right, so they sometimes show amenities like schools and supermarkets. Again, it’s not great, right? Because I think, you know, finding a place to live it’s a home it’s a home is where the heart is, you know, it’s actually quite true because a lot of the factors you can just feel you can’t see like, it’s this condo, right? It’s the vibe, right? Or you know, the kids. I don’t have kids if you have kids as well. So there’s, you know that there’s an element of physical interaction, which I think platforms can never really truly show. You notice this advancements in AI They’re trying to kind of match personality to places for tomorrow. And it’s more of, you know, let’s provide a great experience, end to end. But obviously not with that, like human touch it. So it’s a, you know, let’s show people kind of condos that could be suitable based on these criteria, like schools, supermarkets, but in the end, they still have to go visit and see. But I think, you know, traditionally, that’s where the next piece of your Chaos starts was the paperwork with the financing. That’s the piece that we’re trying to at least, you know, alleviate for most people.
Michael Waitze 5:31
So can you talk about the current status of the paperwork and the financing as well, and then jump into what rental is doing to kind of change that entire process. And if there is an AI sort of aspect of that, or a tech aspect to it as well. And I do want to say this too, again, just to get back to my experience, when I was looking for my first place in Tokyo. Once I’d lived there for a year, and they started sending other people out, this gets back to the human element you were discussing, I remember when the new guys and gals came out, I was like, Look, your real estate agents going to show you a bunch of garbage at the beginning. Just ignore it. And here are the places where you’re really going to want to live and make sure because you’re going to spend most of your time on the weekends in the place where you live, it’s got to be the place where you want to be not where they want you to be. There was no tech back then to do that. So anyway, just wanted to mention that because I think it’s super important, as you noted, but talk about the financing the paperwork stuff.
Dominic Schacher 6:19
Yeah, no, I think you know, just to touch on that last point, I think that’s where we are also different to kind of, you know, other portals is that we are selective on who will add on. So we don’t just let any agent or any landlord on you know, because I think a good agent and a good landlord make a big difference as well. But yeah, when it comes to, you know, traditional renting journey, dry that you go by agents, you find your own places online, you go to visit them, you know, you found your place. And now what usually the agents, you know, it comes with a letter of intent, or if you’re lucky to straight to the tenancy agreement, which you have to do sometimes sign physical wet ink as well, then they want a check, and then they want, yeah, so it’s all the things, then the contract that usually get is very landlord biased. And when we agent friendly, it’s just all these different steps, extended contracts around once that’s done, you’d have a clear check with your pay now, you never really have a real record of what you like, you have a record of what went out, you know, but the confirmation from the landlord doesn’t arrive, they received the money, then you’ve got to pay the deposit. It’s all these things, which are kind of really disjointed. So what we’ve done is we’ve decided, once you found the unit, click, you know, offer price, we have a contract generation tool actually leverages the government standardized contracts in Singapore, again, I think, you know, side note here, Singapore is one of the very few places where every contract is different. Right? So there’s no standardization, which is, you know, leaves you open to a lot of issues as a tenant. So we’ve decided look, because we met the people that come on, and we you know, you know, the good people, quote, unquote, they’re happy to use the CA standardized contracts. So you kind of know, okay, straight away, I make an offer, everything gets prefilled, automatically, everybody gets verified with SYNC Pass, which is again, the Singapore Digi ID, and you can sign it with one click again using sync pass. So you know, eight, you know, it’s a good contract is a fair contract. You know, the landlord is really who he says he is, right? That’s a big issue when it comes to scams, which again, we can touch on later. And there’s no more Waitze ain’t running around all these kinds of things. It’s all done. And then obviously, we get to the financing piece, right. So one, paying your rent, you know, hooking up with the government, with the banks here with API’s, you can do all the payments, actually by gyro. So you don’t need to do that manually, more deposit down payment, you know, I think that’s a thing of the past as well. So for us, it’s really once you sign the contract, will pay the deposit on your behalf if you want that you fully insured when you move in. So you get home contract insurance, fire insurance, damage, locksmith, everything really is done. That’s it, you’re settled, right? There’s no more hassle.
Michael Waitze 8:55
Can we talk a little bit about this curation process as well, right. And it just I want to get back to this idea about financing. And this check, right? So when you first moved in, you said you had to go to your company, which is kind of it’s not embarrassing for you because it’s not your fault. Like the idea that I don’t have enough money maybe could be embarrassing, but the idea that I don’t have a check, your company must have been like, yeah, that’s ridiculous. But if if Renly is now standing in the middle, it must make the landlords happy as well to have a standardized contract, but also make them happy that no matter who comes in the door, potentially rent Lee is going to solve that financing the down payment, all the insurance stuff for them as well. And he talked about curation too, because I think this is really important. You mentioned earlier about on all the portals. There are four or five multiple listings, some of them are real, some of them aren’t you curate all that stuff that if I go to Renly that thing’s actually available. The landlord knows it. Everybody’s identified. It feels like a much safer place to transact and easier financially as well. No,
Dominic Schacher 9:52
correct. That’s, you know, hitting the nail on the head. That’s what we tried to do. I think the biggest pain is obviously finding a place that you like dualistic so again, we use SingPass, the my input verification process to actually verify, you know, is the landlord, a real landlord, if he’s an individual, does he actually own this property? Very good with that, to actually find out who the owner is of the property. And when it from when is it available. You know, from that perspective, it’s nice for 10 Because again, what you see is what you get, there’s one unit that said as property unique thing, so we don’t have a property 15 times it’s less of an issue fewer when it comes to the curation process, if you will, for individual landlords, because again, you know, as one landowner usually has one or two properties, which is verify that he’s real, you know, again, we take the risk away, because stuff happens over our platform. So he was a tenant, even though we might not know the landlord, personally, we know who he is, we know everything about him that we need to know you’re fully insured, we take the risk when it comes to scams, because we pay for it on your behalf, if that’s what you want, there’s just a much more secure process. But when it comes to the more institutional clients, if you also, let’s talk about agencies, large landlords, co living spaces, you know, you name it, that where we actually have a vetting process. So just because you’re an agent, and you’re registered, doesn’t mean that will actually let you participate in the platform. I think that’s the big differentiator between how we look at the business versus all the other existing players. Because all the players at the moment they’re monetizing the listings, you know, the more listings you have, the more money they will make. So it’s in a play in their interest, to have anybody list as many properties as possible, and ideally, the same property two at a time. So you get paid 20 times for that. We don’t monetize them at all. It’s completely free. Because I think that aligns us with the tenant landlord. Right? Less, there’s more, but higher quality.
Michael Waitze 11:44
Yeah, can I just say this, I’ve always looked at the real estate listing business kinda like the way I looked at the job listing business, you’re right there just heavily incentivized to have as many listings on there as possible. You know, we’ve got 25 million listings, to me doesn’t feel like an advantage. Like I’d rather have five. The landlords themselves that have legitimate properties that really want to have them listed and really want to have them rented must be happier, to be represented by Brentley, as well, because they’re, you know, look, we always talk about engineers are trying to minimize noise and, and amplify signals. And your signal is definitely de amplified. If you’re on a platform with too many listings. The landlord’s must love this as well, no, yeah,
Dominic Schacher 12:24
so obviously, that’s kind of our goal, right? To experience to provide an experience for both sides. That’s ideal. So if you’re a landlord, you know, you don’t want to list something and then wait eight weeks to receive an offer, or, you know, you want to, obviously you want people as soon as possible, you don’t want an empty apartment. Yeah. The other side as a tenant, you don’t want to go through AD listings to find one that’s actually available. We were quite aggressive in how we manage supply and demand on our platform, right, in terms of kind of the type of tenants that are coming on, to kind of match the supply of properties on the other side, because obviously, you know, a task in itself, for sure, yeah. It provides a better experience. I think people deserve better. Laughter. You know, 2024 now, so yes.
Michael Waitze 13:08
And again, just to make another analogy, like when I walk into a restaurant in the in the menu has 25 pages of things listed. I don’t want to eat there, because there’s no way they can do something really well. I want to go to the Italian restaurant that has like five dishes, you know what I mean? Because I know the chef is going to cook it and make it amazing. You mentioned something earlier about about fraud. Can you just talk about overall fraud in the market? Like how it manifests itself? And then how Renly goes about disintermediating that and mitigating those risks?
Dominic Schacher 13:35
Yeah, so you know, surprisingly, it’s I think one of the most surprising facts we speak to you know, replies to investors to even frightens the guy in Singapore that there’s no fraud, Singapore, so secure, right? Turns out actually rental market is one of the highest fraud cases in Singapore. So there’s usually two kinds of ways that it happens. The initial one is especially when, when we have a shortage of housing, you know, maybe 18 months ago and prices went rampant. Sometimes apartment prices double and people like hey, I need a place to live like I’m gonna get kicked out in a week’s time. What would happen is affordable agents or people pretending to be agents would say hey, I’ve got this apartment and they will list at a reasonable price. And you will inquire and they are you know, we have so much demand like we need to know you’re serious, you could pay us a down payment. So you would pay $500 $1,000 right which again, when you’re stressed with your family and you know you’re gonna be homeless in a week’s time and it’s an agent or what you think isn’t agents it seems kind of yeah something that could be true right which turns out the apartment and the agent whenever real so that money so you have quite a bit of that. And then you’ve got quite a bit again, you know, people showing apartments down there they collecting the downpayment, actually places and there you have landlords take landlords double and triple letting units you know so they we had we’ve had there’s been a few articles of that and a landlord just letting out Up to three or four families, they will show up the same time. And you know, he kept moving again, it’s more rare, but it happens quite a bit as well.
Michael Waitze 15:07
Can I just ask what the legal framework is around that in Singapore? If you don’t mind commenting on it? Because that used to be like in a in a country like Singapore that seems so well regulated and so well managed, right? And where their reputation is so important to them externally? That seems almost unfathomable to me. Yeah,
Dominic Schacher 15:23
so the legal framework is okay. Right. In that obviously, you know, if that gets, well, it depends a little bit, can you prove it, right again, comes back for us, we think pass for everything. landlord can’t say I didn’t sign this, like it was literally geotagged to your biometrics. But like, as long as you can prove it and go to small claims court, you know, assuming that they agree with kind of the verdict, or there was fraud, you can get your money back, obviously, that’s dependent upon the guy cheating you a, you can find them, you know, or be that actually has the money to pay you back. So the process is there. I think enforceability is relatively questionable, just because I feel a lot of the scams are from overseas people as well. So again, for us using SingPass, you have to be here, you know, so that that photo is just goes to zero. Hence, we’re also obviously happy to take that risk, we pay the deposit on behalf of our tenants, we know we’re established, we are well funded, if something happens, whether it be fraud or just other get, we can get to that afterwards, kind of peculiarities with the landlord withholding deposits and things like that we notice the legal process in place. What didn’t go through it, it’s fine for us.
Michael Waitze 16:33
So again, just to get back to the difference between a normal real estate portal and what rent lease doing, it always surprised me. And I’ve thought about this for years, right? That the portal just lists things and they don’t get involved in any other part of the transaction. Like none of it. They’re just there to connect you maybe. And then you’re on your own with an agent or whomever you’re dealing with. Can you talk about this, like front to back integrated solution approach that you have? And we’re just kind of everything fits in and why it’s such a massive differentiator?
Dominic Schacher 17:00
Yeah. So you know, I think that the reason why most people stopped at the portal piece is because after that, it gets complex. It’s hard. Yeah, exactly. Which obviously, we found as well, right. So it wasn’t, you know, straight, straight sailing and easy. But you know, they’re making so much money with listings, if you’re a dominant player in any market, and you’re the number one listing portal, there’s very little incentive to do anything else. For the cash keeps on rolling in that there is no alternative, you know, you’re the monopoly. What we’ve just found is, you know, maybe simple analogy. When you go to book a holiday, you go on booking.com, you find the place, you book, you pay, you’re done, right, you arrive at the hotel, anything goes wrong booking.com sorted out for you, right, if the payment wasn’t done, or there’s an issue with the hotel, like, why isn’t that available? In real estate? You never question if the hotel in booking.com is legitimate or not, you know, it is capital in the work, you pay on that platform because you trust that platform. So for us, it’s really about that, right? So once you found your place, that’s when a process starts, you know, both sides, you know, landlord and tenant, they’ve got this trusted intermediary in the middle in case something goes wrong. But it just makes everything else easier as well. Right, as I said, you find the place you sign the deposits paid for will hook up the bank accounts, we can each area payments for you as well. Obviously, we have repair future. Again, we’ve not released that yet, because it uses new complexities. But you know, the biggest thing is always when something breaks at home, yeah, find a handyman, and you’ve got a message the landlord, and maybe it’s not in town. So you know, all that is taken care of as well, or will be relatively shortly. And then I think the biggest piece, which we haven’t built yet, but which is actually one of the most interesting pieces is one of the biggest hassles when you move is connecting your new electricity, changing your address with your banks, changing the address with insurers, right, because that’s all possible paths. It’s just one message saying, Hey, by the way, you know, Michael, now let’s hear. So actually, for us, there’s nothing stopping us from doing that to perceive this afterwards.
Michael Waitze 19:01
So it’s not just connecting the landlord with the renter and vice versa. And again, I want to understand how you actually make the payments and do the downpayment and stuff like that for somebody. Right? That that they’re not doing themselves. But this idea, then you’re also providing services, because now it gets much more interesting, right? Again, I always say it’s this my favorite business. You’re building this horizontal, kind of platform business. It’s based on rental properties, and then saying what are their services to people that are renting need? And also what are the services that people that are renting the apartments, we need the landlord’s need, because they need services as well, right? Whether it’s an escrow service, or all the other things that they need, and you’re plugging it on both sides, but multiple things. I like this idea of also the service providers, who knows you may even do babysitting and like fixing the air conditioners and stuff like that. Is that all part of the idea? Yeah, so
Dominic Schacher 19:50
it’s you know, I think the vision part is really like making renting hassle free. That was That is for both sides, right? So anything that’s a hassle we can solve, right? So I think I think the cool thing is because everything happens on a platform, right? So the rental contract is done on our platform. We know the key details that we need to know about the apartment, the inventory of the quality of the apartment is done. Our platforms are pictures of the air cons, everything’s done on our platform. So when you say, hey, I need my aircon repairs, it’s as simple as saying, hey, select which one, send it out to the service providers, they come back, they have the pictures, they have the address to have the floor size to know how many air cards you have. It’s all there. And it’s there. Okay, schedule an appointment, and then sync it up with your Outlook calendar at work. So that kind of syncs up is when you tell her service provider, Hey, these are the slots you can choose when you want to come by. Right. So it’s it’s just it works extremely well, because we do that next piece, which is the contract piece. Yeah. And yeah, then it just makes renting hassle free. If you like anything, you have just open rentals and click a button. It’s done.
Michael Waitze 20:51
I think I might have told you this when we were sitting at the Singapore FinTech festival, but I was sitting in my apartment a few months ago. And literally somebody knocked on my door. I don’t know if I mentioned this to you.
Dominic Schacher 21:00
Michael Waitze 21:02
Someone claiming they were the landlord. How do you know? I have no idea. But I didn’t have a choice. I was on a call like this. I just said give me a second I opened the door they came in, you know what they did? They started taking pictures. You’re laughing but this actually happened to me. And then they left. But my feeling is like, whenever I need to get my air conditioners fixed. I don’t even know who to call to ask right? When I need to do all this other stuff here. I need to hire a maid to clean as well, like all these services will be so much better. I feel like at some level, the portals who are then printing a ton of money, as you said, because they’ve got all these listings on it are going to look at what you’re doing and think, Well, it’s kind of embarrassing for us now like I can say it, maybe you can’t but because we provide no other services right? At all.
Dominic Schacher 21:46
Zero. They are trying right. So I think they’ve noticed as well. So some of the larger ones are trying to do different things, and even acquiring smaller players in specific niches Sure, or aircon, repair and things like that, because they do realize, okay, that what we’re offering probably isn’t kind of up to standards, kind of what people should expect nowadays when it comes to technology. But it’s also hard to change. Yeah, like if you built your infrastructure for last 20 years to do one thing, not so easy to then pivot and say, Look, you can add other services. But to make it successful, it’s really quite difficult.
Michael Waitze 22:20
It is I mean, look, I learned this when I was at Goldman Sachs. And we were taking an existing trading system, right. So a market facing trading system and trying to rebuild a brand new one, what we couldn’t do was take the existing system, and fit it to the new technology, because the exchanges, tech stack had completely changed. And this was really old. And we had to build modern. And we literally had to start from scratch. And my feeling on this. And again, tell me where I’m wrong here is that the existing portals built their businesses, their tech stack and their business model to look a particular way. And then compete, even if they and Citibank tried to do this. If you try to buy all these little players, and then integrate them in, I’m telling you, all you’re doing is creating one gigantic technological mess. And if you build a business from scratch, with the proper tech stack in the proper flexibility, from the beginning, you have a much better chance of succeeding. Yeah, no, 100% Agree.
Dominic Schacher 23:09
Right? I think, you know, I come from banking. So I see them trying to like cram new technology, right? And it just doesn’t get best, but it doesn’t work. So again, you know, when we built this, from day one, I always say that we need to build it in a way that’s actually, you know, again, I’m not a tech person. But I mean, like in silos in terms of, you know, the Digi ID in Singapore is great. But if you go to Dubai, two different sets of Digi IDs, right? You go Netherlands, again, different sets, right different signing infrastructure, different security infrastructure, different API’s different connects with the government. And so we built it in a way that, you know, for us, it’s plug and play. For the time being, and, you know, speaking 10 or 20 years, we might be the old company with, you know, I didn’t get with the times. But it’s super important to build things with foresight and actually realize, you know, things will change quite well, yeah, we had to pivot a few times a little bit to find kind of product market fit. Luckily, we didn’t have to rebuild everything. It’s just tweaking a few things.
Michael Waitze 24:13
Yeah, I’m just gonna go back to this analogy one more time, then I want to move on. But we realize as well, that if you’re trading in multiple equity markets, you have to build a system that’s flexible enough to handle every different market microstructure. And at the end of the day, they’re all different, and they’re all changing and dynamic. And if you don’t build a piece of dynamic technology, you’re just gonna lose. We did talk a little bit about this multi pillar strategy that you have, maybe you can share what that strategy is, and then maybe a success story where you’ve seen it actually work and play itself out.
Dominic Schacher 24:43
Yeah, so I think, you know, for us to be and again, I think that’s why prop tech is such a hard industry actually successful and we built our strategy kind of around three main areas that one is financing. The other one is listings or like a marketplace, and the other one is what we call AMS real estate management, I so it’s actually three pieces that need to come together for it to kind of pan out how we want wanted to explain them, you know, the marketplace piece quite a bit, again, listings, you know, I think we’re not doing something magically new there. I think we’re doing stuff better. It’s faster, it’s nicer. But you know, there’s nothing different there. I think what’s a game changer is for us to get a state management piece. Again, all that contract automation built on, you know, Digi IDs, SingPass sign completely adaptable to kind of any of the inputs that people need, is actually kind of what makes us special them. Right? So, you know, if you think about contracts, you get a piece of paper, right? Like, Hey, Michael, I’m gonna buy that bike from you. Here’s a piece of paper, sign it for me, what we actually do is we build our contracts in basically a database format. So it is our variables coming in once everything is there that we need to things like, has he identified with SingPass? Do we know his name, address when he moves in? Do we know the land? Do we know that he owns the place a contract generated instantly based on that data, and based on the format that we want, and it’s instantly assignable. And it’s then encrypted, and filed with the government as well. So if there’s any dispute afterwards, you can track that right. So it’s, it’s not blockchain. But it’s pretty much similar in that it’s hashed and, you know, it’s enforceable. Interesting. And from there, obviously, for us than we can do what our financing, right, so quite simply, you don’t want to pay deposit because you can’t be you don’t trust the landlord, whatever it might be. Yeah, that’s, that’s fine, right, we have all the data that we need on you and the landlord, and we have an enforceable contract, or can pay it for you, you know, automatically, there’s no credit risk doesn’t really matter that much, right? Because you can choose to deposit the landlord, we know that people we have the data kinda on how people pay how they don’t pay back, I think even more interesting is afterwards, it’s actually the only financial services around that that you can offer. Let’s say I’m the landlord, and you know, you’ve rented the place for me for 24 months, and tomorrow is my daughter’s wedding. A bit too young for that, but let’s just go with that analogy. And you want $30,000? You know, maybe you don’t have that maybe you have it, but you don’t want to sell assets, or maybe you know, whatever it might be, why don’t you just borrow against future rent? You know, we know who Michael is, we know is very fun. We know his job, we know his salary, we know he’s, quote unquote, good for the money, we know your asset, which is your apartment, we know you own it, you know, so we can actually lend you against that, you know, things like when now pay later, I think is a big topic for me, because a lot of people let’s do in Singapore, but in general, a lot of people work in the gig economy, right? So they get paid daily, they get paid weekly, but they need to save up all their money to pay the rent once a month, because that’s what the landlord wants, why can’t we let them pay on a daily basis or on a weekly basis just to make their lives easier, right? So it’s just a lot of flexibility you get, once you have that, you know, real estate management software piece in place, and actually doing kind of what it’s meant to be doing right feeding into the credit model feeding into the payments, infrastructure, and feeding always look to the government databases as well, to get the verifications that you need. Where
Michael Waitze 28:04
do you get the funding or the capital to be able to just like, do something simple, like make the down payments for people? Do you have to maintain your own balance sheet as well? Are you funding that out of other fees and services that you’re doing? We
Dominic Schacher 28:16
have a vehicle but we raise debt from investors, you know, which comes obviously from the multifamily office, which I run, but also external investors, and then we use that to kind of pay for deposits. Obviously, you know, our credit rate model is hopefully relatively sophisticated. Yeah. So we take the full the full risk of defaults on our own books. So investors, you know, don’t take any of that risk. So it’s a little bit similar to bank, right. We are, you know, capital adequacy ratios that we need to keep, make sure that we want to risk book in a way that you know, makes sense. And then everybody should go home happy. I
Michael Waitze 28:50
love this idea that right? It’s almost like you’re building a FinTech inside of a prop tech or pop tech inside of a FinTech or just creating an entirely new business model. What was the generation for you? Because you mentioned the family office and the sort of debt facility that you have, what was what sparked the idea for you to be able to do this, but how did you understand that being able to use that access to capital could then be applied to the real estate market? That’s first of all, but second of all, what else can you do now that you have this kind of two sided market access to capital, and then access to opportunities to lend that capital out?
Dominic Schacher 29:24
Yeah, so again, I think the experience came from two areas, right one, obviously, as a founder if you’ve gone through the pain yourself, yet, so I think, you know, I think pretty poor experience when it comes to renting definitely help from the family office side, we looked at a lot of pop texts, especially in 2018, and 19. And they were great ideas. They had some great founders and very capable founders. But I think it was always like, they’re not going to be able to pull this off when it comes to the execution just because the value proposition isn’t strong enough for kind of what they’re offering at a price point, which they’re offering that and how much it cost them to run. However, If you actually built it like this, you’re not offered kind of these additional services that it could make sense. That’s kind of what sparked the idea.
Michael Waitze 30:08
Do you feel like all the experience you’ve had up until now working in private banking, working in private equity working in venture capitalist kind of prepared you uniquely and your team to be able to do this? Because you can see things in a way that maybe other founders could not have seen in the Prop space?
Dominic Schacher 30:23
Yeah, I think it definitely helps. Right. So I made the conscious decision actually, to take more co founders than other people would. So we have five actually a while, but it’s very, very rare. Yeah. Actually, there was a conscious decision behind that. And because it’s such a complex thing to get right, you know, we are basically competing in three separate businesses, if you look at it, you know, real estate management listings, and financing. I know I’m pretty good at finance. I know, I’m also not very good when it comes to tech. Right? So it was a conscious decision, actually, to bring certain people in that bring that value, right. So we have our CTO, actually Barbra Trendle, we’ve got one of ours architects, which is he’s just joining now, but he’s one of the top architects when it comes to tech infrastructure in Europe. Like it’s just so complex to run. And there’s just no way I could run that. I don’t have the knowledge on the tech side, right? They could tell me anything, and I’d have to believe it. And so that’s kinda think what makes us very unique, right? It’s a very conscious decision to take on more people just to make sure they actually works properly.
Michael Waitze 31:25
Interesting. Okay, before I let you go, this has been really fascinating, actually. But before I let you go, tell me about the future. If you’re expanding to the countries, other domains, other locations, and what some of the challenges are about that.
Dominic Schacher 31:38
Yeah. So you know, we’re already doing Singapore, we’re in Hong Kong already. We’re going to hopefully, to more markets, mostly UAE is quite big on our list. Yeah. Because of the expat population that you have the you know, financial services industry is relatively regulated, it’s very clear cut, and dry. It’s definitely quite high up on our list to be at least, you know, in four markets this year, once the tech is built, and the way we’ve built it, it’s actually relatively adaptable, right. So then it’s all about go to market execution. So challenges, obviously, again, you know, let’s say we go to Dubai, it’s a new market. Again, luckily, the contracts are standardized there. But yeah, that makes that I probably stray away a little bit easier. But then it’s all about go to market and execution, right? How do you get people to know about you? How do you get them to trust you, you know, because again, like that we are the intermediary, if you will, doesn’t need that element of trust, it needs capitalists, good people. So the usual things, I think we don’t want to expand to new markets. Okay,
Michael Waitze 32:34
I’m gonna let you go Dominic, Dominic Schacher, co founder of Rently. I really appreciate you doing this today. I want to be able to follow up with you as you continue to expand because I want to get a better understanding myself about some of these other market microstructures how they’re different than Singapore. And also just what the progress is when you operate in one market. It’s still non trivial, but when you expand to like multiple markets, things get really, really complicated, particularly because like you said, you’re trying to run three businesses at once, inside of one infrastructure. I’m super curious how this feels. Anyway, thank you so much for doing this live. Super awesome.
Dominic Schacher 33:05
Thank you for having me.