Monday, July 30, 2012
Interview with Aron Susman, TheSquareFoot
If you're an entrepreneur or small business owner, you might have figured out already that trying to find an office for your firm is slow, antiquated, manual, and something which is absolutely not online. That's what TheSquareFoot (www.thesquarefoot.com) is trying to change. We spoke to Aron Susman, one of the co-founders of the Houston company, to hear about the firm's quest to make finding commercial real estate as easy as it is finding a home for sale or an apartment rental as it is now for consumers.
What's the TheSquareFoot:
Aron Susman: TheSquareFoot is a commercial real estate platform, geared towards small businesses and entrepreneurs. I had a small business, and was looking for office space, but found that--as a company of six people--there were no tools online to help us. We spoke with brokers, but we were really too small for a broker to really want to help, because the commissions were not large enough, and we found there were no tools geared towards people like me, only people who could understand industry jargon. So we set out to become the Zillow or Trulia of the commercial space. Our goal is to become a one-stop shop for prospective tenants, to help them search and go through the process, and figure out the jargon, and ultimately set them up with anything else they need related to that space, whether that's a move, finding a space planner, or an architect. We ultimately want to connect them with everyone in the industry, from landlords, to brokers, to third party vendors. Our goal is to connect tenants with the resources they need to get into a space.
What's your background and how did you get interested in this?
Aron Susman: I'm actually a CPA, and went to the University of Texas. I worked for Deloitte and Touche, because I thought that was what you're supposed to do as a CPA. But, I figured out I had an entrepreneurial itch. I joined a healthcare IT company in California, and I was randomly tasked with finding space for the six members of that firm. I went online, Google "Orange County Office Space", and found nothing helpful. I ended up talking with my co-founders here, who are both in commercial real estate. They gave me the verbatim pitch, told me what I needed to understand, and how a broker wouldn't help me. Between the three of us, we figured out we had a market opportunity, particularly with my background in the finance and startup world, helping build companies, and Justin and Jonathan with their commercial real estate background.
Where are you now?
Aron Susman: We launched in Houston two weeks ago. We now have over 1500 properties, and are facilitating deals. The site is up and work, and obviously, we're constantly iterating it. We've also recently hired a CTO out of Austin who used to work for OwnLocal, the Y Combinator company, to start our Austin presence. Our goal is to roll out to Austin and San Antonio by the end of this year.
Can you talk about what the difference is between what you do, and others might in the commercial real estate area?
Aron Susman: There's a couple of differences. In the residential market, there is the MLS service. That doesn't exist in the commercial world. There is no one aggregator of listings. That makes it very difficult. In addition to that, the industry itself has been focused on the larger deals, of space 10,000 square feet and above, which translates to fifteen employees or higher. That's where the big money is made, and where the big commissions are. Plus, commercial real estate does not adopt technology very quickly, and they're usually slower to adopt. We hear all of the time that commercial real estate is five to seven years behind residential. Trulia launch five to seven years ago, so we think it's a natural evolution now. It's hard, because you have to contact the brokerages directly to get accurate data, and you have to make sure the properties on your site are accurate and true representations of pricing. We've had to do that in the beginning on a one-by-one level. Our goals has always been to bring on larger landlords, people with properties throughout Texas, so that when we bring on additional cities, we can tap those landlords for that supply.
Has it been difficult to get those commercial property owners to sign up?
Aron Susman: It runs the gamut. Any time there is change, there is resistance. I don't think online lead generation that has been proven to date. Some people have tried, and done certain things. We're a little different, and we talk about the experience of cars. It used to be that with lead generation in cars, you'd fill out a form, and they'd blast your information to a thousand car dealers, who would harass you to get you in the door. Now, you have TrueCar-type models, where they provide good quality leads. That part has been difficult, but at the same time, we realize that the whole world is coming online, and in just about any other walk of life, you can buy a car, buy a house, or rent an apartment, all online. There's also a perception that small deals are now looking online. If you're the CEO of a thirty or forty person shop, you may have a broker on board, but you also may want to understand the information and have the ability to go out at eleven or twelve at night, and get a landscape of the market. That's pretty powerful.
As a startup, what's the biggest thing you've learned so far from the process?
Aron Susman: That's such a hard question to answer. However, I learned that just because something makes sense in your head, it doesn't mean it will be adopted. You can walk into somewhere, tell them that for $20 a month you can save 20 hours a month of their time, they're just not interested. We've learned to go out there and practice MVP - minimal viable product, a lean process, and talk to people and really understand what they're willing to adopt. You also have to try to roll out the smallest thing at the least cost, and see if users will use it, and if so, build it out. That's hard to do at first. But, if you try to release a perfect product, it might not be worth your time, because you never know what features will and will not be popular. You've got to test everything, and test the minimum level of what's taking hold and what you need to build out.
Finally, what's the next big thing for you guys?
Aron Susman: The next thing for us, is continuing to roll out tools on the site. We don't want people to just manage the search process on our site, we want them to manage the actual tour process as well. Just like anything, we want you to be able to do a search, narrow things down, tour spaces, and help manage the process of saving favorite listings and searches. Eventually, we'll schedule tours online, and tap into other things like signing leases online, to help take the entire process completely online.