Thinking Big with Mark Ainley

Peter Lohmann's Podcast. Peter Lohmann's Podcast. Peter Lohmann's Podcast. Brought to you by LeadSimple. Yum. Listen, for Google reviews, you know, we're talking about marketing. Like, if you do nothing with your marketing department, blow up your Google reviews. Like, if you're not 4.5 or higher, like, that's your focus. That should be your only focus till you— don't do anything else until you get that high.

Welcome back to season 3 of Owner Occupied on operational excellence in property management. Owner Occupied is a show about property management in the real world. I'm your host, Peter Lohmann, co-founder of RL Property Management. For season 3, I have a different guest each week, and we go deep into conversation about what actually works when trying to grow and streamline your property management business. Thanks for listening. Now let's go. Welcome back to Owner Occupied. Today we have Mark Ainley on the other Mike, and I am thrilled to be in conversation with him today. Mark, thank you for coming on the show. And for those who may not be familiar, I'd love to have you give a 1 to 2 minute background just to bring us up to speed on what you've been up to and where you are today.

Yeah, for sure. Well, I am in Chicago, so we're in the Midwest. You know, we are a property management brokerage, also investors as well too. You know, we are celebrating our 20th year this year in business. It doesn't mean necessarily we're property managers or being productive early on, but A lot of our early years were survival. But yeah, celebrating 20 years this year. We really went serious on property management around 2014, '15 when we were already accidentally managing a few hundred units and half a million square feet of commercial space. We're like, we kind of have a business here and we're just kind of side hustling it. But yeah, my role, I have two partners and they have, one's been with me for most of the time and the other one came on in '16, '17 when we had to make that decision that a lot of people have to make, whether it be lifestyle business or enterprise type business. And so We got a third partner and we all have our unique abilities. One of them runs operations, one of them runs brokerage, and I get to have fun and do stuff like this and run marketing and business development. So—

I love that. It's a great breakdown of the business. You've got 3 partners who each have a different area of focus. So in your role with marketing, I love watching what you're up to. You're one of the guys in the industry that I kind of quietly observe and learn from. Especially as it relates to sales and marketing. So we're going to park on that topic for a little while. And when I think Mark Ainley, for me, this might be weird, but I think BiggerPockets. You're a big presence on BiggerPockets and you are constantly sending me leads from BiggerPockets. We were recently at dinner at Broker Owner and you shared with me, I think that you spend time every day on BiggerPockets. Share a little bit about what you're doing on there, what you've seen from it, how that platform has helped you. And I think this is something I don't hear a lot of other property managers talk about, and it seems to be working for you. So let's chat about it.

In 2014, that's when I was first exposed to BiggerPockets. I actually was fortunate enough to be on episode 72 of the podcast. First— so Peter, like, first podcast I ever recorded was on BiggerPockets. Like, I, I went right for the big time and, and Man, I can still remember that feeling of that fear. And I bought my first microphone and I was literally set up about 3 hours before and then just making sure—

So what year was this?

2000— it was '13 or '14. So right around there.

Okay. Long time. 10 years ago. Yeah. We should go back and maybe find that and listen. It would be quite an entertaining listen, I'm sure.

They had actually changed the name of that podcast because later on in '17, we did a reality show and CNBC went back and didn't like the title of it because that title, if someone looked me up, it could make the actual CNBC look bad. So it was like the original episode was like getting Uncle Sam to pay all your bills or something like that. And they didn't like that and they made BiggerPockets tweak that. But—

Wow, that's wild.

But anyways, BiggerPockets is something that I think it works and people, it takes time. I think 3 people use BiggerPockets for 3 different reasons. One, you go on there to learn. Maybe you don't know what a BRRRR is, maybe you don't know what a house hack is, maybe you don't know cap rates. You learn. There's two types of people on there. You have the lurkers, the people that never post and just kind of read everything, and then you have the people that are posting. And the second person on there is somebody that's always— maybe they're looking for a deal or maybe they're looking for a resource. Maybe they need a property manager, maybe they need an accountant. And then the third person on there, this is where we come in, is the person that gives back. The person that is trying to take their own history, which we've made a lot of mistakes. I always say on the investment side, we've made $1,000,000 mistakes. So I got a lot of that knowledge to share, and especially in a market like Chicago, and I know you guys have this too, anywhere in the Midwest, you get a lot of these out-of-state investors that just have no clue about what's like some of the— they don't know what they don't know. So it's really low-hanging fruit to help point some of these guys in the right direction and add some, hey, man, Whatever you're doing, just don't do blank. Yeah, exactly. But through that, we get leads, or, you know, so the cool thing about BiggerPockets, and anyone listening to this, is this is a strategy that any BDM or marketing people could use, but there's people looking for property managers on there. Now, there's also rants of how horrible property management is, and I steer clear of those. I don't even try going in there defending, but, uh, oh, interesting. Yeah, but there's people that are looking for property, but I never go on there and I never say, hey, I'm a property manager, throw my flag up. It's always I'm trying to add value in some way to someone else posting on there, or even it's just, "Hey man, you bought your first two-flat. That's awesome. Congrats. I remember the time I bought mine. And that's cool. If you ever have any questions about self-managing, let me know." So I never come out and give the obvious buy. I kind of help people find a way to find me.

Yeah. I want to highlight two things that I think have been instrumental in your success there. One is you're showing up as a human. As a person. You're not showing up as GC Realty Inc. You know, that's not the name of your profile on there. You're showing up as Mark. Hey, I'm Mark from Chicago. Here's what I've been up to. You know, that's a very relatable way of being with other people. And that's what you're doing. You're just with a bunch of other people, just happens to be an online platform. You know, if you were at a real estate networking group, you wouldn't walk up and say, hi, I'm GC Realty Inc. Right? Like that, you know, people relate to people. And I think this is something that When folks are thinking about marketing, especially social media, online platforms, they get this idea that they need to show up as their business, but that's not really what people want. They want authenticity. They want other humans. The other thing that I'm pulling from what you just said is that your goal there is to provide value to other people. And that's, that's not just something that's an act you're putting on, that, that's real for you. That, and I know you as a person, so I can say that. And that's another mistake I see people make when they're trying to show up and build something with social media, whether that's a forum or Twitter or TikTok or whatever. You need to provide value first. You need to show up and be helpful and informative and useful and contribute before you start asking for things or talking about what you can provide in terms of, uh, business solutions.

Yeah, I think going back before the internet, when you had these, and they're still around, but the BNI type groups, the networking groups, the message, if you remember, was always, hey, you got to give a whole bunch before you're going to get anything. And that's translated to the digital platform. And now I will admit that to a fault, sometimes I take that too much of extreme. I'll have people that listen to our podcast and they don't realize I'm a new property manager, or they'll actually find me accidentally and they'll be able to tie the two together and that helps me in the end. But then they'll be like, oh man, I even know you did. So sometimes my messaging gets too, like on bigger—

Too soft.

Yeah, so I do, I do fall on that side of things sometimes. I know I could get better at—

Yeah, and I love, you know, as I mentioned, you, you send me leads sometimes that you just see someone talking about Columbus, you'll fire it over our way. And you identify as a connector, and I love that. And, you know, you and I were joking around about like, you know, that's the Chicago thing. Yeah, I know a guy, you know, that's— I love that. Tell me a little bit about that function and how you've been able to lean into it to help grow your business, your function as a connector.

Well, as you study more business, you study more personal growth, what your unique ability is. I'll take that from my partner who always makes us talk about that. And the unique ability piece is something we all have inside of us. It might not be property management related, it might not even be business related, but for me, there's something I get, an energy I get when I'm able to connect somebody with a resource, another person, Be able to make your lead count go up higher this month because I was able to kind of put a couple things in front of you you didn't realize were out there. There's such a reward in that for me. And it was like this since I was a little kid too. So maybe my mom didn't hug me enough, I don't know, but I was always trying to connect people and help people. And in all aspects of everything, if you help somebody get what they're trying to do, they'll always remember you. And you hope they remember you and give you business, right? But if anything, they'll remember you as someone that's a good person if you ever come up in a reference or a referral or a conversation later on. And that ultimately has undefined sets of positive consequences.

So I love that. And so you must make a million introductions a month, you know, but how do you keep track of all those? Like, do you have a sophisticated CRM where you put everyone's name and their kids' names and where they're located and what they do, or is it just Because that's how you're wired, it just comes naturally, you remember.

It comes natural. Now I have, I think it's about 18 or 19 templates in my— 18 or 19 people that these are the 18 people I have to make introductions to most. And I literally built in my Gmail the templates for making the introduction with a couple of blanks I got to fill in. So I could do that even more efficiently. So Gmail, we use Gmail, G Suite, and we have the little three dots on the bottom. And so I have those templates already built in. So my my commercial lender, you know, my, the architect, the guy that's looking for zoning stuff. Like, I have a lot of that stuff kind of built in so I could do it more efficiently.

So, so if you're in Chicago and you're listening, your new life goal is to be one of Mark's email shortcut templates in his Gmail account, be on that, uh, copy-paste intro email.

But you know, it's funny, I do it sometimes, and you grow relationship with these people. So, you know, like those 18, 19 people, like, I'll go to them every couple years and say WTF, man, I'm giving you all this business. Why are you not sending me anywhere? Like, you can actually like be very real and like, and like, that's fine. It's a trade-off. Give me your email list. And then they'll, you know, whatever, they'll feel bad and they'll actually, but being deliberate about that. Hey man, I'm giving you, you build those relationships though and they feel bad and it works out win-win though.

So, so you said email lists and I've been late to the game with email, but I've been going really hard with, with email lists and email newsletters here in the last year. Share a little bit about your email strategy. So you obviously must have an email list with potential clients, people who own property. And then how are you marketing to that group? How frequently? And then do you maintain a separate email list for potential referral partners? I'd love to hear a little behind the scenes there.

Yeah, we have a few. So we use Mailchimp and obviously we use LeadSimple and stuff goes in LeadSimple, goes to Mailchimp. But then we also have about 30,000 realtors here in the Chicago market. And The, uh, I actually had my, my kids, a couple people in the office, like 10 cents an email, like pull, because you can't just download it from MLS. So we, we've over like a 2-year period, we, we download them all, put my kids to work on the weekend to make a little bucks. But we have a few different messaging. Obviously every Thursday we have a newsletter that goes out and then every other Thursday we send out an email for, uh, realtors. It's, it's like an ad value type thing. But those are the 2 main ones that we send out. But it's all incorporated around like resources. Very rarely is it me saying, "Hey man," it might say at the bottom, "If you need a property manager, if you need help self-managing, we'll throw stuff out there." But it's always pointing towards the podcast, it's pointing towards some other video that we might have recorded, some sort of add value. The realtor thing especially, our goal with the realtors that we do every other Thursday, I named it, it's like the Realtor Investment Series. And every 2 weeks they get an email on a specific topic because the realtors, I'm pretty confident this would be anywhere, but I know here in Chicago, I mean, there's not many call it investment-minded realtors. So And there's not much education going after them. So our continuing education's always around fair housing and how to fill out a residential contract and stuff like that. So there's a huge opportunity, I think, in any market to educate realtors on the investment side.

I love this, and I probably should have done this in the beginning, but can you share just for a sense of scale how big your management company is roughly?

Yeah, so we are at just over 1,350 units.

Units.

We've got about a million square feet of commercial space, mostly industrial stuff we do.

Okay, okay, got it. So, and 1,300 units in one market, which is Chicago, right?

Yes, yes, yes. So we're all in one market. So we have about a million rental units here. You know, you strip out your multifamily stuff like that, we still have a few hundred, I would say probably about half a million, you know, like chances for opportunity for us to manage. And we have 1,200, and there's not many other big players. So We have a huge pond to grow in without having to go outside. But I think sometimes it's more difficult. I think you can almost compare it to if you were in a few of your bigger cities, you may have talked about this in the past, Columbus, Akron, a couple other ones, you have to different rules, different leases, different stuff like that. We have that just within parts of this RMSA. So we are all in one market, but we have to run things differently in different parts of the market depending on the county, the city, and so forth.

Well, I think it's so impressive that you've grown so much in one geo. A lot of property managers look to expand even at just a few hundred units. They look at other markets because they feel like it's getting hard and maybe they're hitting some kind of a ceiling in their local market. I'd be curious to know what other third-party managers have gotten bigger in a market penetration in a specific geography. Than you. I know there's at least one or two that are kind of on par with your same size, but it's pretty few and far between.

Yeah, there's not many. And, you know, a couple have gotten to around the size we're at and they've sold, but it's not many. And that makes the— for me, the collaboration with other property managers— we don't have NARPM here, so I've kind of created my own little group here that we do best practices on. But it makes the give and take of everyone helping each other just because we're all sort of small. You know, we're anywhere from— we're all 200 to 1,300 doors. Now you got some bigger guys that, you know, in Chicago you have a lot of apartments, right? So, you know, you got some guys that manage these 30, 40 units where it's easy to stack up a couple thousand of those. But those, again, the apartment type management is very different, and those guys are not even in any of these NARPM conversations or anything like that. They really do their own thing, and they're not even doing it like the multifamily either. So there's a lot of opportunity if we ever wanted to expand even into that, I think.

Yeah, absolutely. That kind of boutique multifamily under 100 units where it can be managed remotely. I think that's a huge opportunity that isn't often discussed in our industry, and I'd love to go deeper into that world ourselves and maybe collaborate with other folks who are doing similar. So in terms of marketing, just a little bit more here because I want to highlight a couple things. I feel one of the most common questions I get, I'm sure you do too, is, how do I grow my property management business? It's got to be the number one most common question. And in reflecting on what you've accomplished, you're doing stuff that other people aren't doing. One of them is the BiggerPockets thing. Another one is the email newsletter, consistent content creation. You invested that time to build the realtor database. And you didn't just spam them like, hey, hire me to manage your clients' properties. You're actually providing real valuable content. And I imagine that your open rates and your unsubscribe rates reflect the fact that you're trying to contribute to the community and the conversation and not just extract. The third piece that you do, which we haven't talked about yet, is your podcast. You've got a massively successful real estate investor podcast in Chicago. And those are three things the newsletter, the BiggerPockets thing, and the podcast. Those are 3 things that other people aren't doing for the most part. And they reflect what I think is critical to growing to be as big as you have grown, which is a commitment to like a long-term investment in a marketing strategy. You didn't just ask for leads to be handed your way. You looked around at your customers, where they were and who they were in conversation with, and tried to figure out how can I provide something interesting and valuable for those people? And not just today, not just this year, but over 5, 10 years, over a long period of time. So I don't know if that's the message people really want to hear, which is that marketing is hard and requires a lot of investment and a lot of time. But if you want to grow your management company to be 1,300 units, It kind of looks to me like that's what's required. Would you agree? And like, in, in reflecting on this, were any of these, those 3 things like a breakout success, or they're all kind of tracking with what you expected? Love to hear your thoughts.

Well, what I had to overcome, so I got into, so the funny part of the story is when we partnered in with our third partner, Cliff, he basically, you know, kicked me out of operations. He's like, you keep tinkering with everything. You got an exception for everything. You're too worried about this client here and instead of having, so he's like, you go figure out— a lot of talk around then was operationalizing sales and marketing. He's like, "You go figure out what that means." And I went over there right away. And the thing about that I had a hard time with that first year was always trying to track what you're doing back to results. I think that's what a lot of people get held up on. Like, "If I go spend this $2,000 or if I spend these 20 hours this year and if I don't get this, it was a loss." And I think Any of the marketing experts. So it's all about testing and sometimes some of your marketing has unintended consequences, good or bad, right? Most of the time good though. And you do something, you put it out there. Listen, I've done things in '18, '19 that all of a sudden they're working now or someone's referencing that now or like, "Oh, I love what you did with that." Maybe I was too early for it or maybe I didn't have the right timing for it. So I think getting over that mindset of I might do this for nothing is tough because no matter what, Everything you're doing on the marketing side has some sort of blueprint that you're leaving behind, or footprint. And that footprint is whether it been all those things that you posted on LinkedIn. One thing I wish I would've done 5, 6 years ago was continually to kind of message like what we're doing as a company as we're growing on LinkedIn. 'Cause that's so permanent. You go on anyone's LinkedIn page if you wanna research 'em, you can see everything they ever posted. If you post nothing, then you really get no value from looking up that person's page. But if you see all these cool stories and, the culture they have and the type of team they have, or how much of an idiot and funny, fun this guy might be. I put those two together. They might think of those uniquely, but all those things that you could put out there, but all those things are just kind of testing things out and trying them. And then there's a huge part of consistency to it. So I think one of the things that people do is they throw up 4 or 5 blogs and then they don't get anything from it. We have a blog calendar for like 3 or 4 different sites we have blogs on, and we've literally been posting consistently for the last 2 years. Some things catch, some things don't, and we track what catches. The funny thing for us right now is our most looked at, the most traffic we get to our site is around Section 8. Now our goal is not to be the number one Section 8 housing provider in Chicago, but people are coming to us for that. And why not blow out where one of our rocks for this quarter, a little traction drop there, we're blowing out our Section 8 page. We're going to update it all, 2023 rates. People are already kind of coming here half-hazardously. That's getting them attentionally. And now those might not be the landlords we're looking to yet. Or they might, they might be tenants, right? They may be Section 8 tenants trying to get on the program, right? And but they're bringing this traffic to you, no different than the people looking for your houses. Those are people that are helping your traffic, they're helping your SEO, they're helping the right people that you actually want to find you later on in their search that night, find you for property management.

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So we have all one site for the property management. We've actually, we split out our brokerage, we split out our commercial property management, and we split out our commercial brokerage, mostly because the commercial brokerage guys are always complaining about, you know, I got this tenant calling me, or I lost a deal because they said they were a residential brokerage. And so we split that out. Then we got a excited for the podcast as well too.

All right, love it. So I was— to prepare for the show, I like to go back and listen to old interviews and stuff, and I was listening to your episode with Jordan, and at that time, which was a little over a year ago, I think you were still doing the sales calls. I think— is that still the case? You're still the one who takes the, the incoming calls from potential clients? No.

So last year we— so in October, I hired my first BDM. My whole goal, my third quarter rock was to get it all in place and hire somebody. And my mentality was like, I got to hire somebody so I can mess it up and then go hire the right person. So my goal was ultimately to this quarter now, right around this time, March, early 2023, was to have the next guy in place and working based on my mistakes I made. But I hit a home run on the first guy and I couldn't have asked for any more and he's doing awesome. So my role has shifted more. I just do the marketing and run the business development and have a whole bunch of leadership type stuff that I'm always working on.

So, okay, so this is a big deal because you were doing it for years and years and years and years, and I think it was a really important— I think it was really important to you, obviously still is really important, and it's something that a lot of property management company owners are very reluctant to give up. I don't think you were unique in that, and I was the same. I have gone on record saying, I wish I would have given up the sales function many, many, many years ago instead of just 3 years ago. Talk to me about the psychology, uh, you know, how did it feel to turn over the reins and not answer those calls and understand that some other dude who's not you is going to be emailing your prospective clients and representing the brand to folks who may be customers? Like, how did you come to terms with that?

Multiple different ways. So one, so our BHAG is to get to 10,000 doors in the next 9 years. That's our BHAG. And you start making decisions based on, is what I'm doing right now going to help or hurt me from making it to that BHAG? And that's one part of it. The second part of it is what do I want to do as a business owner? Do I want to be in a sales role forever? And you really answer that honestly, probably not. So what's my next progression to manage that next person? And if anything, take your knowledge and be able to help someone else grow their career, and whether it be sales or property management. And then the third thing, this is probably the bigger motivator for me, is no matter where I end up in an operational role in this company, I end up still handicapping our growth. It's because, you know, that I might bridge some gap that my team never knows about. I might know some inside way of doing something that never becomes a problem. I prevent— as a good salesperson will, expectation-wise, will set the, uh, tone of operations, what that's going to be. So, and then operations never really knows. They just kind of get handed something in a nice box. So bringing on someone new, I knew would help, like, all right, where was I carrying the group too much, and, and, uh, where's, where's our real weak points? And that, that's something that I took as a role of, like, all right, so how do I find those things when he's handing these off to operations? And And how do I fix that for the next BDM or the group of BDMs or whatnot? So getting out, no, no, for the same reason I got kicked out of operations growth-wise, you know, sitting in that sales role was not going to help us grow long-term either.

Yeah, I've heard someone say the strength of the owner is the weakness of the business, which is exactly what you were just saying.

Yeah.

Yeah. So here's the big question, and maybe you don't want to answer, which is fine, but talk to me about closing rates. Famously, not famously, but I was not a great salesperson. So when we brought in a real professional salesperson, his closing rate was like 2x what mine was. Are you seeing a similar closing rate to what you were doing or how's that looking for you?

He's a little less. So we have our leads come in and we either have them be an opportunity or not opportunity. And the opportunities are like people are ready to sign in the next 30 days, they have a property. And that opportunity might be something long-term that maybe they're looking to buy a property and they're just kind of lining it up. But As far as our opportunities go, which ends up being about 40% of our total leads, he's closing like 37% of those. So like that's pretty, it's really healthy. And you know, I was just a tad above that. So our total sales, it's kind of cool. If you take all of the deals we close, a third of them close in the first 7 days, another third of them close in the next 8 to, 60 days and the next third close in 61 days or beyond. So we have a very— which makes our drip all that more important, right? And I never really appreciated the drip. Again, that's something you do, you do it continuously. That's the other part of that marketing piece that once you get them in the system, you're dripping to them and again, adding resources every so often. You throw like, "Hey, we could lease only too," or whatnot. But that drip is very powerful, especially in our organization because there's a lot of people 90 days from now that wake up and like, oh, it's time.

Yeah, that— I completely agree. And it's— man, I feel like this is so hard to nail for property owners or property management company owners, this whole marketing world of emails and newsletters and drip campaigns and qualified versus unqualified leads and creating— I know that you guys have some amazing resources on your website to encourage property owners, hey, click here if you want to download this. Now you've got their email, now they're in the drip campaign, like That whole world of marketing is something I think that for me, I've struggled with it. I've struggled to figure out how do we create these resources? Where do they go? How do they get into this drip funnel? Who's creating this content? It's, it's been something that I think it's one of those weird things where I recognize how important it is, but I struggle to really execute on it. Is this something that you gave yourself permission to focus on? Was that part of your journey or was this always easy for you?

I had a point where I gave the resource for free but didn't capture the information. I think that was a lot of early on and being able to always put something new out there. And the thing that I think a lot of people get caught up on is it's got to be something elaborate. I mean, if you take an ebook these days, let's just break this down for real. An ebook is really 3 or 4 pages of words. It's almost an extended blog and it's expanded out because you got a whole bunch of nice graphics and pictures. But now that same blog that you're— you're— no one's really going to, right? And you might get a few hundred reads in a year's time. Now you're offering it like, oh, I gotta, I gotta sign up for this. And it's, it's, it's that— it's kind of shifting some of that stuff to— I used to feel bad about that, like, oh, I got to make them download this, and like, I know people are nervous about entering their emails. And it's like, just people don't care as much as you—

they don't care.

Yeah, like, so, and they have their— if they want to spam or clean up their email, uh, crap once a year, they'll go and do it, and they'll just take you off their list if they really don't want to hear what you're saying. And then we also, for these different email drips and so forth, we also, I think it's like every 90, 120 days, we simply say, hey, do you still want to hear from us? Otherwise, please click here and we'll take you off. We want to get rid of the audience that doesn't want us in their life just as fast as we want to find the people that do want us.

That's exactly right. I've been doing a lot of research on email deliverability as I've grown my newsletter, and you nailed it. You actually want those folks off your list because if you send too much email that's not getting opened and read, you'll start to get flagged as spam by the spam filters and by like the domain whatever, whatever that tracks who's supposed to be getting what emails. And, uh, it can be a really bad scene if you don't kind of keep that clean. Yeah, this is really good overview of, of marketing, and I feel like I'm learning a lot and getting reinspired just kind of hearing you articulate some of this stuff. Let's talk a little bit about I'm curious to hear you talk about operations a little bit. I know it's not your area, but you've got 1,300-some units under management. That's a significant operation. Last I heard, you were on Podio. Is that still the case? And how has that kind of transformed the way work gets done at your business? Yeah.

So we use AppFolio for basically the finance piece to go reproduce that into our own setup is always securities and all that type stuff. Probably not worth it. But we've used Podio operationally, man, for about 10, 12 years. When we were doing the rehabs and the flips and all that stuff, we were using it on the construction side. And we built out this awesome— so this probably goes back to '16. We built out this amazing property management setup for everybody to use, the different triggers and all that stuff. Man, our team at the time rejected it so bad. They were literally going in at the end of the day and checking a bunch of stuff off. They weren't using it for flow. So We made the huge mistake of not getting buy-in, right? And we basically took what we had in Podio back then down to a glorified checklist. And they're like, "Oh yeah, we like this checklist. It's perfect. We know where it is." But then one by one they're like, "Hey, can you do this? Hey, what if we set up every time I clicked here, it forwarded email here?" And then before you knew it, within a year and a half, we were 2 times more sophisticated than we were when we first rolled out. But it's because they helped build it was a lot of what we lacked the buy-in with. So But we're using that still today. You know, we've tied in a lot of, you know, you tie in a lot of third-party stuff with it, like for, for, uh, for our BDM side of things. And we could create a, a management agreement there and we could send it out automatically through, uh, third-party right signature, which is kinda like a DocuSign. So you're kinda combining a lot of those different sources into Podio. It's very, they have an, definitely have an open API that's easy to, uh, work with. You know, Findigs, you know, they, we combine it into there as well too, but The thing that I think that's the most exciting to me is using, we've been really building out the Power BI side of things and the reporting and the dashboards and the off-track dashboards, the newest thing that we're pushing right now to take all the data that we're having. One thing we got from Podio was a lot of reports, and unless you were diligent on reading the reports or even really understanding the reports, the people that were leading were the only people that really reading the reports. So it was really tough for people to gauge how messed up or off track am I from this. So we created this Off Track Dashboard through Power BI that now it's in everyone's face and it's telling everyone how they compare to their other property managers. And my thought is always, if I was the property manager, I just never want to be last. So if everyone's always fighting to not be the worst, then, or as we grow, maybe the bottom 2 or 3. So again, the data use of what we've been using for that has helped us be able to manage the people with that or keep them up.

Super into the Power BI stuff. And this is a world I really don't know much about, but Power BI is a data visualization tool for creating dashboards and colorful, beautiful reports and graphs. And it's an area that I truly believe that our industry is really behind on. I think huge strides have been made in our industry in the last 5 to 10 years around financial performance and reporting at the business level. Where I really see a lack is operational data benchmarking and reporting and surfacing, you know, your lease renewal rate and a bunch of the other metrics that are really important to our property owners and to us as a business that aren't necessarily financial in nature, like your customer acquisition costs and things like that. So I'm really curious to hear, like, how that's impacted your business as you've being able to surface this data, have these beautiful dashboards around the office, and really have folks being benchmarked against a set of objective reports. Love to hear about that. I mean, that's like the dream, I think.

Well, think about this: the, the transition of getting to the size we're at right now, or anybody getting the size— this is not something you need if you have a couple hundred units, in my mind, like, because you're doing it all yourself, it's all in your head. Like, kind of the progression all of us go through is, all right, so we do everything ourselves. That's kind of the first part of our business. And then we hire some people to do some stuff. So now we're managing some people, which is a whole nother skill set that most of us are not good at because ultimately we just know how to manage properties. And then all of a sudden you're managing managers that are managing people, and that's a whole nother skill set to just hire for, right? We made mistakes early on of like, oh, this guy's got so much property management business or experience, he could definitely lead a team, but he doesn't know how to manage. People. So we, we messed up on that a few times. But the, when you start having these layers of, of between you and, you know, call it the leadership team and the actual people on the phone with the clients and customers, you need to, you need to find a way that everyone can read this stuff and be on the same page. And that, that's what it is. And it's helped us big time. We rolled out first in our maintenance department and our maintenance department, uh, you know, at the over 14, you know, it's 3 days not scheduled, like all these different metrics that we have for that. It's just, just right there on a board. Like everyone knows where they're, they're not on top of things. So when the conversation comes of, hey, why are you on top of things? Like, it's never a surprise. If anything, they could tell you why they're not on top of things before you even ask them the question.

So Power BI is tying into Podio, but it doesn't tie into AppFolio.

Is that right? No, I might use the wrong word here, but we do some sort of dump. It's definitely not the right word. Some sort of dump every single night into from So Appfolio and Podio match up every single night.

So, okay, got it. Like some sort of a one-way sync.

Yes.

Yes.

I'm not sure how that works exactly, but, but every day it's, it's, but that makes it for us, we always have to make sure like, like South Street or everything's gotta be, uh, perfectly the same.

Yeah. Uh, property names, you know, have to be exact match so you don't accidentally duplicate.

And, and those are lessons we learn of like who can do what inside systems, permission. I never understood permissions early on because it's like, who cares if they can see this? Everyone knows that this is how much money we made on at least 3. So now it's like, and who cares if they change this? We'll just change it back. And now it's like permanent damage and you don't discover it. You don't discover something was changed until 3 months later.

So. Yeah, we've had similar. We recently learned that, so we're on Buildium and we use PropertyMeld, which syncs up with Buildium, which is great. But what we figured out is if you reactivate an old property, to dig up an owner report or the big one recently was residential rental history. We would get a landlord asking us about an old tenant of ours, but we don't manage that property anymore. So we go reactivate the property to look up the rental history. What we didn't know at first is that as soon as you reactivate it in Buildium, it reactivates it in PropertyMeld and sends an email to the tenant saying, "Hey, welcome to PropertyMeld." So we got all angry tenants emailing us like, why are you emailing me? You don't manage my property anymore. I don't live there anymore. So yeah, some of these data, data sync issues are still getting fleshed out in the industry, I think.

Yeah, no, that's definitely like there's always these— those are always the little things. It's like, oh man, I wasn't expecting to have to spend 3 hours cleaning this up because I never knew this was a problem we're going to have.

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Well, I think what I see happen a lot, and it literally is a decision point that property managers take years to make, or don't make it at all. And it's that, hey, what kind of business do I want here? And that holds up a lot of crucial decisions. 'Cause think about this, when you have a lifestyle business, like you want to only have 100 of those awesome clients, which means you go fire the other ones and find a way to find those awesome ones to make your life easier. Or you want to adjust your pricing to this and you only want those people in there. So you max up that part. So making that decision is something that I see people not make fast enough or often enough. So that's the first thing I think that has to be done.

Now, I think— Begin with the end in mind.

Yeah.

Yeah.

What do you want to do here? Now, I also think you can, for us, ultimately that decision, we made that decision in '16, '17 when we brought the third partner in. And a lot of bringing Cliff in on the business was like, hey man, we've kind of hit a lot of our capacity mentally for what we knew at the time. And if we want to take it to the next level, we probably need someone smarter than us. That was kudos to you, Cliff. So me and Brian, my partner, we have so many yin and yangs, but one of them was not growing a business. I knew what we had to do and the right things to do, but his lack of being on board a lot of times, just kind of like, "I'll deal with it tomorrow," type stuff, because I don't want to deal with Brian and fighting that battle today or whatever. So it took a third party coming in to help us really do it. Now, me and Brian had to make that decision like, "Hey, do we just want to go small and stay small and do what we're doing?" Because we're doing good, And when you have a lifestyle business, you could do a rehab here, you could do a flip here, you could say no to this business, whatever you might decide, there's always that opportunity to make 30, 40, 50 grand on some sort of silly opportunity because that's just kind of what you want to do that quarter. But when you go all in, that's a commitment and you have to start making decisions about what going all in looks like. And if we're going to make that decision, we can't keep doing things this way. And part of the thing about going to 10,000 doors, That I like is, you know what, I'll never say this probably with my team, like, but it's like, even if you make it to $7,000, you still gotta think the way, that same way today. You know, at $7,000, still be a huge win. $10,000's the goal, right? But no matter what, if we get $5,000, $7,000, $10,000, we gotta change the way we think today. And that's the big part about the going with the kind of the enterprise value of that whole thing. Now, I, part of our decision making, and this is probably crucial to the people that I just called out for not making a decision, is For us, it's like, hey, let's go all in and do it. Worst case scenario, we sell. Second worst case scenario, we just kind of fold back down into it. You can always go smaller, right? You can always come in one day, fire half your people you don't like, and take it back to a lifestyle business overnight for the most part.

Yeah. So it's not a one-way decision. You could always come back from it.

Yeah, I don't think so. I think that you choose a lifestyle business, I think that you lose years then, and you start making decisions based on that. So I think that has more finality to long-term growth, or you have to start going in a different way again.

Yeah. One of the things I often reflect on is that a business is an almost perfect reflection of the owner's personal development. Every business is exactly the business that that owner has earned as it relates to their growth as a leader, and as a business person and as a manager. So when I think about my business, I got the business I deserved, for good or for ill, right? We're not at 10,000 doors, and that's because I'm not a 10,000 management company leader, 10,000-door property management company leader yet. So I love the humility that you articulated around, hey, we realize that we're not— I forget exactly what you said, but basically we're not smart enough to keep growing where we're at. We need to bring in another partner. We need to bring in a who if we're serious about getting where we need to go. And by the way, that's, that's going to cost money. That's like you're going to be giving up equity or a big salary or whatever it was to bring that person in, which means a temporary setback in profitability with the idea that you're gonna get to the next level. It's like one setback, three steps forward. And that's— I think I see a lot of property management company owners plateau, and maybe I'm speaking to myself here, because they're afraid or they haven't recognized the need to make that next investment and they think that the business is just going to come from the ether. It's just going to show up and they're going to keep growing for no reason when they haven't actually grown as a person.

Well, I've always been a fan of partners. I've had one bad partnership in my life, but in hindsight, I learned a lot and I saw That partnership served its purpose in my life. But I think there's a lot of people that have partners out there. It might be a spouse or whatnot, that might be tougher. But the partnership piece gives the ability for one of us to be down on the business for a couple months and the other ones are carrying that weight. You carry the weight and workload, but you also carry the weight emotionally sometimes. Sometimes my partner Brian's just down and out for a month and it's like, "Dude, all these great things are happening and it motivates me to do more things." And it might be opposite. He paint my gray clouds, call me out for my BS or being whiny, whatever it might be. And then Cliff carries the operational side of things, and that's tough, and pointing out the wins when he's getting down on things or getting frustrated because things aren't moving fast enough. I think partnerships, now it works when everyone has a unique ability or a different strength, but I think that's been a crucial part for us getting here, and we've always kind of quietly motivated each other without realizing it. So I think that's a big part of it. And listen, this is a lot of everything we talked about today. Just imagine being an owner and then worrying about all that, but yet still worrying about collections. That's tough, I think, as a single owner.

I've heard it said that focus is saying no to great ideas. And I'd love to hear, what have you had to say no to to get to 1,300 units?

So we had to make the conscious decision to stop investing for a while. We were doing very active investing. I mean, we buy buildings, stuff like that now, stuff that's in place or commercial stuff that's just, you're buying on cap rate. But between '08 and '18, we did, I think it was 482 kind of BRRRR strategy type properties. And that took a lot of time. So '18, we made the conscious decision to say, we're done with this. A couple different reasons, economic factors, stuff like that. But it's like our return on our time is going to be putting it into GC. So saying no to and reflecting that our return on our own time is going to be huge. So that was probably the biggest one. It's really easy to say no in the short term.

And we said in—

we were managing 2015, we were managing probably 500, 600 association doors and a new law came out. One of the persons that was really running it said that they want to leave and it's like, hey, you know what? "If we want to protect our Google reviews, we just got to get out of the HOA business altogether." People don't realize how different of a business that really is and different sets of rules and everything.

Okay, great. And looking forward now, what do you think you're going to have to say no to, to continue scaling up to 10,000?

I am seeing it happen every day. I think this year more so than ever, because Think about this. My new BDM came in and he got up and going right away. And I think by January 1st or January 15th, he started in October, end of October, he was taking calls on his own. I rerouted everything, Lee Simple, it was all going to him and just being him every day for half hour. So it's like all of a sudden my calendar opened up. But a couple weeks later, also my calendar was full constantly. So I'm finding myself now, Calling people out like, "Hey, why are we meeting? Is there an agenda? Can this be solved by email?" And so I find myself doing that on the weekend, kind of looking at the upcoming week like, "Hey man, why we got to meet?" So clear my calendar out a lot more for stuff that just, it's really, someone sees, especially these days on Calendly or in our office, we got 60 people now. So someone sees an open, they're like, "Oh, I'll grab this. He's free at 12." But I started using that Reclaim AI. So it kind of fills some of my voids. It's a pretty cool little email tool that helps reschedule some stuff as well too.

Yeah, tell me. I'm not familiar with that.

What does that do for you? So Reclaim basically, so if you would've canceled today, this podcast recording, which is on my Gmail calendar, it would've automatically went in and taken a couple chunks of that hour window we had, if not the whole hour, and made it time for you to decide, or what do they call it?

They call it—

Thinking time? Yeah, thinking time, key account. I have a couple things I can label it as, but Now someone can't come right behind you. I, I find that to be a problem a lot of times where it's like, oh, I open up for an hour and all of a sudden I got 3 phone calls of like vendors and stuff like that.

So, okay, who has access to your calendar? You need to clamp down your Calendly permissions or something.

Yeah, yeah, I know that, but it's, it's always the morning stuff, so I always have my mornings wide open for that. So it fills up if someone, anyone sees it. So, but that Reclaim AI has been something that's been kind of cool. It kind of puts in, uh, these artificial times for me to either take advantage of having that open space or, uh, or maybe moving a key. Like, if you were to say, hey man, I gotta reschedule for 2, I know at 2:15 here on my calendar here today I got, I got an hour open because it's that time is blocked off already.

That's really neat. Any other ways that you're using AI in your personal life or in your business?

Yeah, so yeah, a few different ways. So I sort of have this anxiety right now around like If I am not figuring out a way to get 10 steps ahead of everybody else, I'm failing at this AI. So that's kind of my mentality right now, and that's pushing me to just absorb everything. And it's funny, you got a million things on YouTube, but a lot of them are the same, and a lot of them are just very, "I'm not sure, but you could try this," type stuff. So it's so new, right? But obviously, creating content, that's really low-hanging fruit. We're using it for our team. If a tenant sends, excuse my language, an asshole email to us, it's like, pop it in there and say, "Please give me a customer service way to reply to this." We're doing the same, yeah. Or they'll even do it like the tenant sends that asshole email and you could literally type into Bard or ChatGPT and say exactly what you want to say back and then say, "Please reword this to be polite." So there's some therapy there too, right? We duplicated, we did the whole thing with scraping my voice and reproducing, taking my face and the words and typing it in and do that. That's just creepy right now.

So we're trying to find a way to Am I interviewing the real Mark right now?

Yeah. So we're trying to find a way to create the AI Mark and have fun with it, right? You put it up there and then everyone calls you full of it. But if you have fun with it and call it AI Marco or Marcos or whatever, I'll get a tan and I don't know, whatever it might be. So we're messing with that. And I've started using Fire— I started using it as just the test, but I haven't taken off and I do like it. It's Fireflies. So Fireflies shows up on every one of my meetings and even the meetings I miss, it's in there so I can just listen to it later on that day or whatever. Or it transcribes it as well too. So with the podcast, you take every episode, put it in there and say, give me a short summary that's SEO friendly. And then you take the short summary and give me a title for this show that's SEO friendly. So you just kind of keep dumbing it down and you could ask it for show notes as well too. It'll time it out for show notes. So That helps. Yeah, I just started using the Bard one last week and that's a lot cooler because I'm noticing if I'm trying to create something for the company, you know, we have the whole GC experience and if I'm trying to create like dialogue around that, it's actually going online and pulling it because it's pulling things up till recently. So, or it's not chat, I think is September 2021 it stops at. So, but Bard's just kind of opened up a couple of those things to reproduce some of my own words that I'm already putting out there.

But yeah, fascinating.

We're always trying to, uh, you know, something came out by BetterWho, I think I saw the email yesterday, I shared that with our team. But I think just the challenge right now for any of us is to get us thinking about how we could be using it.

Yeah, so it sounds like you're, you're on the forefront, probably out of all the property managers I've chatted with, you're the most plugged into AI. Other than AI, any other trends that you're staying at the forefront of? And that you're a little paranoid about not wanting to get left behind?

I'm always paranoid about Google reviews, right? That's nothing technology-based or anything like that. But I think, you know, we had that, that Google one on, uh, at NARPM at the convention a few months ago, and it got me thinking. I'm like, I've sat comfortably. Listen, for Google reviews, you know, we're talking about marketing. Like, if you do nothing with your marketing department, blow up your Google reviews. Like, if you're not 4.5 or higher, like, that's your focus. That should be your only focus till you Don't do anything else until you get that high. And they got those calculators out now where you could literally say, I have this star review, I have 143, and this is how many reviews I need to get to 4.6.

Okay, I need this because we've slipped a little bit and I need to look up this calculator. Google review calculator. I'm Googling it right now so I can look at it after the show.

Yeah, I don't know. I'll give you exactly what I got. I got it from that presentation in San Diego. But yeah, so I looked at it. So that's one thing I'm kind of working on right now. It's like, all right, we're at 4.6. I need 178 to get to 4.7, and I'm literally going to present to our board like, listen, I'm going to roll this out to everybody. If everyone gets 3, we go to 4.7. And that could be, uh, you know, and then it puts you out that far ahead. I've always had the mindset with Google reviews of I want people to look at how many we have and be discouraged and not want to try to chase me. Like, so I always stay out just enough ahead of that.

Love it. Yeah. Google reviews is a never-ending topic of discussion in our industry. It's It's a big challenge. All right. So I think we'll wrap with this question around selling. So you're one of the larger independent property management companies at this point. There's famously a lot of VC groups and private equity-backed groups hoovering up property management companies nationwide. Are any of these folks in your backyard? How has it been to compete with them? And I'm sure you've had probably many, many dozens of offers at this point. How do you How do you think about that? Is it a hard no? Do you look at the number? Have you gotten informal pricing, anything like that?

The human side of me is I really start thinking about hard when I see somebody I know that starts going through it. It's like, "Oh man, he's doing it. You won't have to deal with that next week. You won't have to deal with that. Should I be considering it?" So there's that, what's it, FOMO kind of that comes over me whenever I'm close to a conversation about someone else selling. A couple of my closer friends sold here in Chicago to some of these bigger names and just kind of asked them questions. It just makes you kind of drill down, I think. A lot of the other companies are not rushing in too fast to Chicago because we're very blue and very heavily regulated. And unless they're going to buy us as an operator, they find a hard way to roll us into that. But we have the commercial side too, so a lot of people are like, "Hey, we don't want the commercial." So that might So that might be what we end up doing after we sell. But yeah, I don't know. It's always, you know, you build to sell, right? That's the whole mindset where if we're ready to, if someone, the right opportunity comes, then you consider it and you do paper, rock, scissors and you go for it.

Fair enough. All right, Mark, this has been fantastic. I appreciate you joining me in conversation today. For folks who want to follow along with your journey, where's the best place to do that?

Well, you got, you know, I always tell people, listen, everything I've gotten from my website, I've stolen from somewhere else. So feel free, unless you're in Chicago, market, you know, check out us at GCRealtyInc.com or straightupchicagoinvestor.com, which is I think the bigger part that we really didn't touch on is the, is the podcast, that kind of community that we've grown here last few years.

Yeah. Okay, perfect. Thanks again, Mark. This has been fun.

Yeah, for sure, man.

Thank you for listening to Owner Occupied. I hope you have enjoyed this episode. If you like the show and want to get connected to the community, You can follow me on Twitter @PSLohmann and subscribe to my email newsletter on my website PeterLohmann.com. I try to share as much valuable property management content as I can on a regular basis. Thanks again for listening and have a great week.