How to grow your Service Accommodation business with David Diack

What was your background before you actually got into the world of SA and property?

I was working at a family computer shop, selling, you know, fixing computers. They're selling like loads of ink and toner consumables and I just like, you know what, there's a market here for ink cartridges and toner cartridges that people are buying them all around the country. So I could buy them at like 35p to a pound, I could sell them for a fiver. So I quit my job, took out a three year lease on an office, hired my first member of staff, realized I didn't know anything about selling, anything about anything about business. Just jumped in at the deep end and then it all started there, really. Within a year or two, I had five members of staff. We're doing pretty well in terms of turnover and sales. And then, yeah, I mean, the big learn happened. The big learn was like growing a business too quick without any systems or team in place and it come crashing down pretty quick.

All right, welcome everybody to season six, episode six of the Boost Hospitality podcast. My name is Mark Simpson and today we're going to be chatting all about serviced accommodation. By now, if you haven't listened to the first five episodes, you have got in the back catalogue everything that you need to know about SA. So how to start SA with Trish McGeer, what actually SA is with Jason Living episode one, episode three is with David and Amanda Healy on about outsourcing. Episode four is with Naim. We talk about channel managers and episode five was recorded with Elaine Watts. All about networking. So today we're going to go the next step. So you started up an essay business. How do you grow it? And the gender I've asked to help me with. This is something that I've been following on social media for the past six to eight weeks. Recommended to me by somebody to follow him because he's doing some really good things with him and his business partner, it's called David Dayak and he's got a really interesting story, how he got into property, what he has done and now where he's at. And I thought it would be fantastic to get onto this chat, have a conversation with and we can hopefully learn you watching or listening at home a couple of things as well. So, David, welcome. If you could just spend a couple of minutes just introducing yourself who you are and. Yeah. And then we'll get started with today's episode.

Thanks for having me, mate, really appreciate it. And thanks for getting my name right as well. No one ever gets it right. First time they Always say it wrong, but yeah, as you said. My name is David Dyack, I'm based in South Helland Sea in Essex. I've been involved in service accommodation now for, well, since September 2016. And we've gone from a standing start, no experience, to 65 units, a strong pipeline and we're building the business daily, got a strong team in place and our values as a business is all about building that business that's built to scale from day one. So we've implemented systems, we've got team, we've got operations, got manuals, everything in place so that we can build this business and it's unable to grow and continue growing at the pace it's at, effectively.

So you've got 65 units, which is phenomenal. What was your background before you actually got into the world of SA and property?

I was working at a family computer shop selling, you know, fixing computers. They're selling like loads of ink and toner consumables and I just thought, you know what, there's a market here for ink cartridges and toner cartridges, that people are buying them around the country. So I could buy them at like 35p to a pound, I could sell them for a fiver. So I quit my job, took out a three year lease on an office, hired my first member of staff, realized I didn't know anything about selling, anything about anything about business. Just jumped in at the deep end. And then it all started there, really. Within a year or two, I had five members of staff. We were doing pretty well in terms of turnover and sales. And then, yeah, I mean, the big learn happened. The big learn was growing a business too quick without any systems or team in place, and it come crashing down pretty quick and left me in a bit of a sour situation. And I was like, look, do I want to be sitting behind a desk managing people or do I want to be using my strengths and doing what I enjoy and going out there, networking, meeting people, doing deals and building relationships. From that point, I got involved in property and I started to attend a few courses. I think we've all probably done some training here and there and during that process I learned how to. I spotted a gap in the market, shall we call it, where people were looking to do these big deals, investing time and energy in doing deals, but didn't know how to raise the funds for the deals. So I spent work with a mentor who I met along the way. He taught me like a hell of a lot about how to raise finance but build relationships. And we spent A couple of years, connecting the two together. So finding investors and finding developers and linking them together.

What was the. How long did it take? What was the process? What was the obstacles that came up in that time? And what can you recommend to people that are watching who are pretty much where you were? You know, September 2016, I tell everyone.

The first deal was your hardest deal. You know, you don't know what to say to agents. You don't know how to position yourself. You don't know. You don't really feel very confident in what you're doing because you don't know what you're doing or how it really works. You're just trying to sort of share your vision, I guess. So we spent a lot of time sort of door knocking, learning that process. And I always say to my clients, look, whatever you do, whoever you speak to, document it, learn from it, and next time you go back, handle that objection and turn it into a positive and how it benefits them. So that was going on for two or three months. And the first significant mistake, should we call it or learn, was that we found a private landlord, he had 30 properties, was like, he didn't really care about his properties. And we were like, look, you know, we can turn this two bedroom flat. I mean, we walked in there and then he went through the floorboards. You know, them places where you just like, we're dying for a deal. Do you know what I mean? So we were like, we can make this work. So my business partner, Matt Ward, is a surveyor. Went away, schedule of works come back, nine grand was the schedule of works. And we sat down with him and he just literally looked at us and he went, I'm not going to swear. But he swore and he was just like, what the f are you going to spend that kind of money on this place for? What's wrong with you? And he'd done us a massive, massive favor. Because at the time we were like, we're up for it. You know, we were up for it. And he said no. And what that meant was that we left that relationship there, went and met an agent and got our first deal. And I mean, I want to transition into how that deal come about because even down to like getting a deal, the agent didn't, you know, they wasn't really sure still what we were doing. But they gave us like this upmarket one bed, which I'll talk about later on as to why we changed that strategy. But, you know, it was probably a little bit too expensive, but we got there, we made it happen. And then we used that in expensive high end one bed apartment to become our show home. And that enabled us to build our business.

So instead of going for the first thing that came along, which I assume that so many people when they get into this world will do you, so I took a step back, you know, thankfully. And instead of going for tons at once, you just went for the one big one and built it up from there. So you do a really good job of documenting. And you mentioned this document, your business journey. Now how long have you been doing this? Did you coincide it with starting up your essay business? Or is this something that has just recently come along since, you know, you've got to the level now where you're talking about this more? And when I say document, I mean documenting online, document on Facebook, documenting on Instagram, going lives. You do it very, very well, you and your business partner. But when did this happen and what was like the sort of the idea behind it? Yeah.

Thank you. So, I mean, look, I'm a very reserved person personally. Like you probably would say a lot about what we do in business and how the business works, but very little about me. And you know, something that I struggled with for quite a long time just to sort of say put myself out there, if you want to call it that. Right. But you know, at the same time, like we're building a business, we're like, we've always said we're two steps in front of the people that are starting and there's people that are two steps ahead of us still. So as we're starting our coaching and training company, we said, you know what, let's just share the highs and the lows and everything that happens and just be real with it. Because the more real that we find that we can be, it's just us. This is what happens in our week. One minute you've got an amazing deal happening and it's all spended. The next thing you know you've got an issue with a guest that's caused a big problem and a kerfuffle, I mean, even today. So I mean these things happen and it's important to share it, but not just share the fact that, you know, this is what happens. It's like this is what I've learned from it and if we could just share that upside and say, well, this is what I've learned or what you can learn or how you could do it different, then people get value from that and it helps them move forward in their journey.

So you mentioned there about the new coaching company. When was the coaching company for people started?

What we've done really well was we systemized immediately as we started the business, and we spent a lot of time investing in sort of like, structure, and so it was smoother. And then we brought in a team of virtual assistants based in the Philippines. And once we managed to master the art of bringing in the right people to manage the right assistance, our business just blew up.

So 2016, two years in, you've absolutely got the systemization absolutely down to a T, and then you've got people that you're now helping. So there's two years worth of, like, really big growth there. What was your biggest takeaway when you were growing, or what was being your biggest takeaway in these last two years from you being there with Matt getting your first key from the estate agent to now where you've got, say, 65 units, which is intense. What's been your biggest takeaway and what sort of advice could you pass on to anybody else who's at that stage?

Example number one is it's all built on relationships. I am how we are now with everybody that I meet, whether it's with our cleaning team, whether it's for our maintenance team, agents, you know, whoever it might be, my clients. Like, I'm the same with every person. My goal is to reinforce our relationships and always be improving them. Right. Because business is built off the back of that. So that's been key for us with investors as well, in the sense that we've been able to grow at a good pace because we're very approachable, we've got good relationships, we're transparent, which means that we can have the kind of conversation. Now, I would say that the main thing, like, if you're coming off of a training and you're like, what do I do now? The easy thing is to go out there and say, well, I think I can achieve this nightly rate. This is what I want to get, and this is what I think will work. And I'm going to go and get an apartment and do that and not spend enough time on the planning and analysis side. Now that's where my business partner, Matt Ward, comes in. Because he's like, I'm the kind of person that's like. We call it, like, front end, that we're going to do all the deals and speak to people and stuff. And he's the kind. He's the one who's like, the backbone behind the business, who keeps the structure there, ensures that we've planned it all correctly, ensure we've analyzed it in enough detail and that's what I could say to every single person who's considering starting. Don't just go off of a whim, go off of facts like research the higher season, low season, companies in your area, businesses that are being built, redevelopment that's going on. There's so many factors you've got to consider. And I would even say reach out to them and speak to them before you even go and get your first unit and start working out what they want, when they want it, what their budgets are. It's a lot of work, don't get me wrong. But it can solve a huge problem. And what it will do with doing things like that is it gives you the confidence to be able to go out there and conversate with agents about what you're looking to do as a business. At the same time, you can have the same conversations with investors because you've done your due diligence and got your research and results right.

That was a good one. I like that. Do your due diligence, do the research, do the planning and it just makes life a whole lot easier. So you're talking about systems and structure now. How early into the process, how many properties are we talking here where you're like, you're, you know what, Matt, we need to do something about this. We've got all these properties, we've got all these guests, we've got all these things, we've got all these moving variables at the moment. We've got all these things going on. When was the conversation? What did it look like and what was the first steps that you did to then crack the outsourcing?

I think it was always looking at systemizing. Right. You know, sometimes, you know, they're saying that they don't, you don't know what you don't know. I don't know every app in the world that exists. Once we've got it and we've integrated it, I'm a master at it rather because I know how it works. So we was always trying to find something and over time of just like being out there meeting people and connecting, we were taking all these little ideas and tips and tricks and collating them all together, but implementing them within the business. And I'd say that was around like early on. Well, we started systemizing, if you want to call a channel manager system, which it is straight away. But when those systems started to get heavy, it was probably around 9 or 10 units. It started to ramp up and quite volume picked up and things like that. So I'd say from day one, we systemized with a channel manager that was always in place, but until it went up, a level was around nine or 10 units, which is probably too late, which is why I advise people to get into it as early as possible, implement it, and then you can just bolt properties onto your portfolio.

What would have been. So what has personally been your personal. And I sent you this question beforehand because it's always good to have, like a little bit of prep. It does catch a lot of people off guard when I ask this, but what has been the favorite failure that you've done and how did you learn from it and what did you do to correct it to make sure that it never happened again?

I would say my favorite failure is not related to this business. It was related to the office products business. I learned the value and the importance of systems and a team when we were literally building the business. And I was sort of thinking, cool, I'm getting to that point in my life where I've made it. And, you know, you're only young. You know, you start being all confident. I just remember I went on two holidays, come back, and I come back to literally no money in the bank. And I had to go and get an overdraft that day to pay my staff. And that was like a seriously, seriously hard thing to do at that point. My staff were like, you know, you are salespeople that try and start chasing credit. They don't want to do it. They want to get commission. So it was really like a big eye opener that, like, you know, if you try and grow too quick, you can. You will fall on your bum, shall we call it?

I like that. Don't grow too quickly, you know, is a thing that you see so many people want to do. They want to go from that first property to 60 units straight away, and they think about the end goal. But there's a lot of thing that goes in between. And as you say, you've learned that massively. So what has been the one biggest mistake that you've seen? Not only the people that you help and you coach, but just from a general, because obviously, you know, you go to a lot of these events and you see a lot of people in the Facebook groups coming and asking these questions. What's the one biggest mistake that you see that people make when they're getting started in property? What advice do you give to those people who are making that mistake so they can not do it again?

Yeah, I'm going to have to go back to the planning and due diligence side, because it's a serious issue and I won't mention any names, but I saved a client 15k today, this morning. He was going to buy some deals from someone that without having enough due diligence done on it and I had to stop it before that happened because it would have was going to buy them. They weren't going to work, they weren't going to stack. Not doing enough due diligence. Like it's painful for a lot of people. If you're not a spreadsheet person or if you're not a research person, then find someone who is. Like reach out to someone and get a virtual assistant or hire someone on a project basis, although it will cost you upfront money. Get them to help you do the research, guide you through it and tell them what you're looking to achieve. Get that research that you need. It's so important because without that you've got no data. And without data, how can you create a business plan?

I like that. I mean, I think it was Elaine who mentioned in episode five of this podcast the reason, what she has learned massively in growing her own podcast when it came to, because we're talking about networking, was that she was buying people's time. And that's a big thing. You know, you find people in the industry, interesting people that you want to talk to, you approach them and you sort of pick their brains and that's what buying time would be. However you're going to buy that time, whether it's like jump on a coaching call or whatnot. And I think that's what so many people don't do. They try and they invest everything in the first bits. And the first bits with property, you know, is getting those keys, putting the money into the, into the unit, into the apartment, into the property, whatever, to making it all look nice. And they sort of save the website, the marketing, the, you know, the coaching, so to speak, to the very, very end. So when it comes to setting aside the most important parts of it, when you're doing your research, you should really be looking at one of the most important things with service accommodation and that is getting heads on beds, that's getting people in. Because at the end of the day you could have best looking apartment in your area, whether it's Southend, Scarborough, Blackpool, wherever you're gonna be. But at the end of the day, if you haven't got your research done, you don't know what type of guests and what type of demographic are coming to the area or you basically get your property in the absolute wrong location, then what's the point of it? It will just all come to nothing when you open up the doors, you put the properties on all these websites and literally you just hit tumbleweed because nobody's looking to book with you. So that's a good one. Alright, so you've been involved in service accommodation for a while, you've seen and heard a lot of things being said and words that people have said. What is some of the bad advice that you see being given people? Lap it up. And what can we basically address here and set straight once and for all?

I'll start off with the whole like the full no money down stuff. Don't get me wrong, like you can build a business no money down or low money down, should we call it? Right. But it's been sold off quite a lot as a no money down strategy. And the reality of it is that you do need capital to start a business and you should have capital to start a business because you should be using your own capital to get off the ground and get a taste of how it works. Now the way I see it is if you want to work with investors, amazing. Definitely work with investors. I encourage you highly, but at least start off the ground yourself, use your own money, test it out and then scale it with an investor. That's one thing.

Just circling back on that one. What does no money down mean for somebody who hasn't got a clue, that is me, what that means.

So essentially what no money down means is that you can go out there and get an investor straight away from day one to put all the money in while you go and do the sourcing and the work, the legwork.

I don't put any money in myself. I find somebody with a pot of gold and I go to him saying, come on, you know, come and work with me.

Right?

That's number one. What was number two? What so else do you see that? That grand jog is the biggest one.

I guess I've heard people saying, like, you know, for your first deal again is that you should never pay a deposit for your first deal and you should never pay rent for the first two months. I've heard that for a couple of people. This is doing a rent to rent strategy by the way, if you're going to be doing that. But again it's like it can be done, but typically it'd be done at a higher level. So like if you're an operator that might have 10, 20, 30 apartments and you're looking to solve a big problem for a developer, for an example, and take a whole block on. Yeah, you can weave in and negotiate those kind of deals. If you've got no background experience like credibility, money, it's gonna be very difficult for you to go and speak to an agent and get your first deal by not paying a deposit and getting two months.

Nice. I like that. There's some really good things. Is there anything else? Have you had a good rant?

Have I had a good rant? I have a couple every now and then.

I like that.

No, there's one more. One more.

Let's finish on number three. I like this.

Here's the deal, right? So we started off getting stuck in doing a lot of the do ourselves. Then we built a team that took a lot of that pressure away from us. Then we had systems and then we built a bigger team. And now we're in a position where the team control like 95% of what goes on. Right. So is it passive still? No, it's not passive. Team still needs to be managed. You still gotta motivate, you still gotta inspire, still got to educate, you still got to communicate. So even at this level, with this amount of systemizing and teams, it's not passive. Yeah, you can manage it, like I say. But the whole passive income thing frustrates me.

I'm really glad you said that because I do see that mentioned a lot. And it is going to be a future, a future. Podcast Episode 100% what people don't see with people like yourself is their struggle right at the very start when you're literally doing it all yourself. And I think people that buying into it, thinking that from day one, as soon as they get the keys or as soon as they get two or three properties, then that's it, jobs done, we've got the money coming in. Like you said, you've got to a point now where you've really nailed down the systemization, the structures. You've got a team that takes care of 95% of your day to day, but still it's not like you can just sit back, switch off and everything's going to be rosy. You still, like you say, you've got people to deal with, you've got teams to motivate and you've got jobs and stuff that needs done. So it's easy to look at where you are now. And it's so cliche, but everybody talks about it. But the, you know, from the, all the years from 2016 to 2019, what you've had to do to get there, what you've had to learn, new levels, new devils, all of that. So I'm really glad that you mentioned that. Now there's going to be people that are watching this. There's going to be people who are listening this later on in the podcast who are thinking, I want to get in touch with David Dyer. I like what he's saying, I like what he's talking about. I think you can help my service accommodation business grow or even hospitality business grow because obviously there's a lot of people tuning into here from the B and B world, from the rental world. Now, if anybody wants to get in touch with you, if anybody wants to find out a little bit more about your talking about the coaching programs or even the outsourcing side of your thing, where is the best place for people to go to, how can people get in touch with you? And yeah, just little plug for your business right now.

I appreciate that. Thank you very much. My Facebook page is David Dyack sa. So just type my name in the Facebook chat and you see we can put this in the link, Mark as well.

Yeah, yeah, it'll all be linked up, don't worry.

So that's my business page and I kind of vlog on there. Like I just share like what happens good, bad, the ugly. But yeah, I try. I vlog on there quite a bit, open it up for questions. You know, if people want to ask me anything, feel free to jump in and do that. Now what we did say, Mark, is for your followers if they want to get like a free workshop training from what we're doing on how to plan your business, how to analyze it, how to source it and how to set it up. That's our model, the past model. We're going to put something together on just for your community. So I've got the link HTTP bit ly Boostly sa.

I like that. So, yeah, so bitly Boostly B O O S T and I'll put all the links below and in the show notes and all the jazz and like you say, really appreciate you coming on here today, buddy. I really appreciate everybody that has tuned in and has listened or has watched this. As always, this has been the Boost Hospitality podcast. We are now on season six, Episode six. So if you are listening to this for the first time, you've got a full back catalog that you can go and listen to. Going to itunes, going to Spotify, you name it, it is all in there. And whilst you are here, go into those itunes, go and leave that five star review because it means a lot and I want more and more people to discover this. But for those of you who have tuned in, thank you very much, and I will be back for another podcast episode very, very soon.