Amenities

Mayank Agrawal: Finding Your Zen In A Noisy World

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Finding a quiet, comfortable and private technology enabled workspace on the go is no easy feat. Zenspace CEO Mayank Agrawal discuss the challenges of finding your zen in a noisy world and introduces concepts to help solve this problem, as well as maximizing use of underutilized space.


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Mayank Agrawal, Founder & CEO, Zenspace

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VIDEO TRANSCRIPT:

This video was filmed at a Peerspace, the leading online marketplace for meeting and event spaces. Click here to Learn More.

Hi everyone My name is Mayank Agrawal. I'm the founder and CEO of Zenspace. Today I want to talk about finding your zen in a noisy world. Zen to us stands for that quite, private comfortable moment that you need to conduct your business. It's the place where you can actually go and meet someone, take a video conference call or just focus on what you are doing but without the distraction of noise. Building on that, I'm gonna establish in this presentation through statistics, why is this a big need at this point in time. I will also talk about the lack of quietness or like lack of Zen spaces in public spaces like airports and conventions. I will also talk about what is Zenspace doing to address that need.

This was my life last ten years, working in a technology sales for last almost a decade. I used to go to conventions almost every quarter and now after 3 o'clock when I'm tired my legs give up this is what I used to do, find a little quiet little space where I can sit and do some work. I used to take my conference calls with my boss who wants to do a sales review when I'm traveling inside a car by turning on my hotspot and also at the airport. As you can see I mean whenever I travel I mean I have two hours waiting for the next United flight. Even at the open office layouts it's very interesting in the last decade. We talked about that the offices should be more open. There should be more collaboration and open office layout became the cool thing. But it's a paradox, suddenly the new research and new studies from Harvard and from many of the big magazines they are actually talking about the lack of privacy in open offices.

But what can the facility managers do now that they have invested billions and billions of dollars to set up those open open offices but there is a lack of privacy for taking a phone call taking a even topic to a remote workers which are outside the country switching onto some staggering numbers and some statistics which are my favorite while doing research for Zenspace. We came across this number - Global Business Travel in 2017 alone was $1.33 trillion. It's been growing at a rate of 5 percent on an average for the last seven years after we came out of the big dip. And it's growing faster than ever. By 2022 it will hit $1.7 trillion almost the size of a big country. On the other hand. Flexible work space is growing. We all know what is the valuation of we work today. We all know workspace as a service is actually evolving. How can you actually refactor your space so it's flexible is reusable? It's not an office space where you have a permanent office but it's reusable by another other companies simultaneously.

That's what flexible work space is all about. JLL did research as in 2017 five percent of the work space has already been converted into flexible thanks to companies like Regus and WeWork the trend will continue and it will become 30 percent in future. We are talking about trillions of dollars of commercial real estate here. The third number which I would like to establish is remote workers in North America 40 percent of employed Americans last year alone work either in part time or full time outside their offices, remote workers. 3.9 million employed Americans work full time outside their office. They did not have dedicated offices and these are freelancers consultants. These are photographers, videographers, architects, these are sales executive, C-level executives of large companies. We call them digital nomads. Digital nomads are those people who don't have a dedicated office but they work outside. And how do the work is what we are trying to address at Zenspace. Most of the time you have some privacy and quietness there. But when they go out in coffee shops and conventions and airports that's where the big problem is.

There is space. Space is not a problem, we talk about real estate being prime. We talk about you know, how can we actually create more space out of space? There is space out there, and we actually did this while setting up Zenspace. We did research of top 10 airports and convention centers across the world, and staggeringly, 40 percent of that space is underutilized. When I call them underutilized, they look like this.  They’re the the lobby, the patios, the hallways. Las Vegas commercial center as you know, the convention capital of the world, where you have consumer electronics show and shows like anybody, 4 million square feet 2.2 million square feet of which is actually exhibit halls and we're just the remaining of that is hallways lobbies and bodies. What do you do there actually? What can we do to convert those spaces? What can we do to convert those spaces without a huge transformational construction cost? What can we do to convert them into private workspaces?

We actually combined three experiences. We started with the on demand ubiquity aspects of Uber that my care is available within five minutes of me pushing that button. Wherever I am. Then the concept of WeWork which is workspace as a service. Workspace as a service meaning, how can you you reuse the existing space and share it with people? One of my favorites is Starbucks. The consistency of experience attribute which comes from Starbucks. When I'm outside of my home and office and I don't know where to go. I search for Starbucks. I search for Starbucks because I know that there is a Starbucks within 15 minutes of wherever I am. I also know that I will get free Wi-Fi, I also know the coffee I want to order and I have my space there so that to me is my Zenspace until we have enough Zenspaces and that's the consistency of experience, that consistency and guaranteed experience is very important. Uber does not offer that vehicle does that but it's not pervasive enough. Starbucks is pervasive. We combine those in our product called Zen Pod.

What is a Zen Pod? Zen Pod is quite comfortable and private technology enabled workspace which can be set up and as small as 10 square feet the size of a phone booth. And we have three different form factors for one person to person and four person and can be can be set up in less than two hours. Costs are really less than half of what you would spend on construction of a room and they are private, there are tech enabled that can be operated with a mobile app. You can actually download the Zenspace app and book that little room for yourself, pay for it and open the door yourself. It also offers a huge opportunity for generating revenue out of underutilized spaces. Through micro leasing and advertising it’s a big source of revenue. These are some visuals of how a looks like we play is what we have on offer boards upcoming in fairly large shopping mall in San Francisco where we are doing a pilot one of our parts has been placed in a coworking space as you can see here and we the biggest success we actually see and biggest need, we talked about conventions and this is where actually where we had this in one of the big events in Las Vegas. This is hard to find. The Zen moment is hard to find. And so we exist to solve the business traveler and remote workers problem. That's about Zenspace. Thank you so much.

David Sullivan: Solving Rental Evictions

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David Sullivan, CEO of Till illustrates why tenant evictions occur and the myth of landlord “late-fee revenue.”


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David Sullivan, CEO, Till

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VIDEO TRANSCRIPT:

My name's David Sullivan, I'm the CEO and Founder of Till. I'm here to talk today about why evictions suck. The underlying problem that creates eviction risk on our portfolios and how we can use innovative financial products to improve both the residents lives and ability to pay rent but also your portfolio's performance.

So each year 900,000 evictions occur. Many more occur in the shadows and we as landlords use different tax to get residents out of our portfolios who aren't paying rent. So why do evictions occur? Well the Rent Is too damn high, we've all heard that story and that's true. Affordability challenges are affecting all of us as landlords in finding residents who have the right ability to pay rent. We have serial skippers and professional residents who squat. We've all faced in battle those. But more importantly I believe that the cash flow challenges within our resident base. Drive almost all of the evictions and default we see in our portfolios and place eviction risk on an even broader set of residents.

So let's go down another level. Why do our residents face eviction challenges and cash flow risk? Well we have median household income of about forty five thousand dollars and that is really representative of stats that we all know. We've had stagnant wage growth with rising costs rent being the primary cost that we replace on the resident base. In a similar demographic, half of Americans see 25 percent month to month income volatility. Our resident bases are working multiple jobs, they're paid hourly, they're part of the gig economy. This makes their ability to budget and to pay rent challenging.

Most people in the country also have limited savings. Half of the country has less than four hundred dollars in accessible savings to actually weather a financial event Then finally we as landlords are placing a constraint on the resident base ourselves. We're putting a cash timing constraint by charging rent on the first of the month which makes it hard for the resident who is having to pay 30 to 50 percent of their income to us as landlords on that day.

So okay if a resident can't pay rent, what do they do? What current options exist? We have the family bank, family and friends, asking mom and dad or cousins or relatives for help. That works but people are embarrassed to do it and the capital base is inherently limited. We have banks real banks. The reality is many of our residents, especially in the workforce housing space, are under banked. They have limited access to the right capital and credit solutions that can stabilize their financial ability and means to pay rent on time.

We have new online peer to peer banks popping up, these are offering more personalized lending solutions that can help solve this problem but many have principal requirements that are above what the resident actually needs. We have payday and title lenders. These are real. Many of our residents are using payday and title loans to finance rent payday and title loans are giving their residents two to four weeks to pay them back and charging them three to 700 percent APR’s. As a side note, there are three times as many payday lenders sitting in our rental communities as there are McDonald's in the country. So they are a very real capital source for our resident base. And what's what the worst part is about are residents using them as a credit solution is that they are increasing the long term default risk on the resident base. The average payday loan will be refinanced eight times. And once that borrower is hitting that eighth borrowing cycle they are likely in default to both the payday lender and to use the landlord.

Finally, I want to highlight the landlord us. We are landlords. We as landlords offer credit to our consumer base our residents but it is not a effective credit. We do this in two ways. We have payment plans. We have a good resident they'd been with us for a few years and they hit a cash timing problem. We give them a payment plan because we don't want to lose them and we understand the cost of the eviction.

But more prevalent is the second form of financing we're offering them. We're giving residents a form of financing called a late fee. The late fee in most jurisdictions is 5 to 10 percent of rent for that month and we usually give them two weeks to pay. So what happens if they don't pay? We then file eviction and charge them eviction fees and them if they don't pay that we put them on the street. So let's just look at the initially late fee. The initial late fee is let's say 10 percent and we give them two weeks. That is a over 200 percent APR and we are not giving the resident any adequate time to solve the problem that they're facing.

Fair housing makes custom rental payment solutions challenging. And we as landlords are under resourced to deliver this type of credit. We are not re underwriting them. We can't read underwrite them. We don't actually know what the residents credit risk is at this point of need.

So I want to dispel a myth that I hear all the time from our landlord partners and people that we work with. So I talked all the time to landlords and they say well, we like our late fee revenue. I want to challenge that. Late fee revenue is a lost center. At best, it is a breakeven value proposition. I want to quickly talk you through why I believe that and why we as landlords are really bad at delivering credit.

We as landlords look at our income statements and there is an explicit line that says late fee revenue that makes us feel good. I ran a portfolio that had 1 million dollars in annual leave fee revenue that made me feel good. Well some residents might not pay but we made a million dollars. That is not true. We pulled it apart and the challenge in understanding late fee revenue is understanding the costs that drive and are associated with the doing quinsy and the collection effort. I challenge you to go look at your portfolios and actually pull apart these costs to see whether you're making money. And I would hands down bet that you are not. The challenge is we have five different items sitting in three different sections of our income statement. They create a loss center. We have bad debt that's easily tracked it sits in revenue. We have excess vacancy due to longer turnover for an eviction than a regular turnover. That also sits in revenue but it's harder to understand. We have our collection teams costs we have an eviction filing cost hidden in property management expenses. We then have materials and labor to turn a turn over. We all know our evictions cost us more. We have materials and labor to turn on eviction. Turnover beyond a normal turnover that are hidden somewhere. Ideally we shove them into Cap X but are also hidden in turnover and maintenance costs. The portfolio I was running I did this exercise a million dollars in annual revenue off late fees. We were spending one point four million dollars on those items we were losing 400,000 dollars a year charging our residents over 200 percent APR is giving them two weeks to pay us back and still evicting many of them.

The worst part is the resident is the biggest loser in this equation.

So even if they aren't evicted they face the stress of eviction month to month. But the ones that are evicted we are damaging their confidence, we are destroying their credit scores and we're destroying their ability to find housing in the future. Many families who are evicted are forced into transitional housing with family or friends homeless shelters or hotels, children are ripped out of schools and there's just an overall loss of community. Parents who are the breadwinners of these families who face the cash instability or the cash uncertainty, are then distanced from their job opportunities making it harder for them to actually earn income to rent a home from us again.

I want to talk about two solutions. We have a suite of financial products that we're delivering into and specifically designed for the multifamily and single family rental housing industries. We have a core rental loan that is meant to weather a financial emergency. It is a three to six month loan. We underwrite the resident on their ability to pay. We want to make sure that they have the ability to pay us back and the ability to pay you as a landlord in the future. We partner with landlords to deliver this product is a B2B to see model. This is another tool that the onsite property managers have to offer their residents who are struggling to pay rent. We underwrite them. We take the entire default risk away from the landlord and we pay you the landlord directly on time and in full. Every resident's balance that borrows from us goes to zero when we pay you. We also have a short term rental loan that is meant to solve intra month cash timing issues. So as I said earlier 30 to 50 percent. of our residents income is spent on rent.

We have designed as landlords a very inflexible system allowing our residents to pay rent when they have a challenge and we use sticks with late fees to hurt them to get them to pay on time. The short term loan allows us to pay you as landlords every single month on time and it gives the resident ultimate flexibility over that month's time period to pay us back. They can pay us back on their pay cycles, they can pay us back weekly, they can pay us back daily whatever improves their ability to pay you rent to lower their ultimate default risk and costs you as a landlord.

So I am very passionate about addressing the affordability challenge with innovative financial solutions. I believe that alternative credit specifically designed for the rental industry can do good and do well, that we can improve the financial stability of your resident base while improving your portfolio's performance. Thank you.

Elena Ashkinazy: Building And Selling A Smart Apartment

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Time Equities Director of Sustainability, Elena Ashkinazy walks us through her smart apartment case study showcasing each component and sharing the amazing returns she garners.


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Elena Ashkinazy, Director of Sustainability, Time Equities

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VIDEO TRANSCRIPT:

Just imagine, thirty nine million people already have Amazon Alexa or Google Home in their apartments. Real estate companies can take advantage of it and start to create value for the customers of new generation who want to just move in to their apartment, plug in their Alexa and be able to control everything with their voice or with their phone. At Time Equities we always strive to be technologically up to date and innovative. So last year, we successfully completed the first smart apartment on the Upper East Side of Manhattan. So we did it in pre-war apartment and when you think about pre-war buildings, a pre-war apartment you would probably never expect to see anything smart, but we did it. The project was so successful it was featured in The New York Times. This apartment was scheduled for renovation so we still have to buy switches, bulbs, kitchen appliances. Now we spent an extra $10,000, however we were able to sell this apartment for $120,000 above similar apartments just one flight down. So in this slide you can see green screen from Zillow.com two apartments, one is in the second floor and smart apartment on the third floor. And the difference in the prices was about 10 percent and the first apartment was on the market a couple of months before our smart apartment. So we sell it quicker and for a higher price. And today I'm going to tell you about all devices we installed and their features and benefits for residents.

One of the main challenge and actually it's become our value proposition for the customers was that old devices can be controlled through one application so the customers don't have to hassle between different apps. Of course we'll also estimated that the smart apartments can be super Energy-Efficient so customers can save up to 20-30 percent on their electric bills. And of course it's all about convenience. You can control everything with your voice. You can say what you want and you get it. And all with your phone. The first thing we installed was smart door lock. So you still can use your traditional keys, however, you don't need to. You can open and close your door from anywhere anytime. So imagine you're standing in a traffic and your guest came early. So now you can just open the door from anywhere. You can see when the door was opened, was closed and you can give access to your housekeeper, dog walker. So people love it, it's so convenient. We’ll also install smart lighting systems throughout the apartment. And before I started to work on this project I actually bought a lot of stuff for my place and I have to tell you it's amazing. I don't touch my switch anymore. Especially when you're tired. You lay down in bed and before my husband told me, “Elena, can you go around and turn off the lights?” And now I just said Alexa turn off all lights and she's like OK your wish is my command. So people definitely love this convenience.

We also install smart color lighting so you can pick any color you want. So for example we have open house for this apartment and a couple came and the lady was pregnant. So we ask, “do you know what's going to be, boy or girl? She's like it's going to be a girl. And we like Alexa make all lights pink, and of course she did it. And that just create this wow factor that you can also use even when you just show an apartment to potential clients. We also install smart shades in the bedroom so first you can open and close them with your voice but you also can schedule and automate them. So if you want, for example, you wanted them to be open Monday through Friday at 6:00 a.m. when you wake up and on the weekend youu want them to stay close until 12:00 p.m..

We also install smart kitchen appliances. So this is a smart refrigerator. This is what a game changer for the customers. First you can see what is inside of your refrigerator while you do shopping. Also your refrigerator will start to track expiration dates. You know we all have some stuff in our refrigerator. We have no idea how long it was there. So now your refrigerator will take care of it and will send you a notification when the milk is about to expire. Also it has a big screen on the door. So instead of putting stickers like we used to, now you can send pictures, voice messages, just messages to your family straight on the fridge door. You also can mirror a TV, play music and even do food shopping from your door. Other kitchen appliances are smart too.

So we have smart range. It's a gas range. So for safety reasons you have to start to cook while you in an apartment and set up a timer. But then again control it remotely. So you can change the temperature where you can turn off range completely. Also you can check the status so if you're worried that you forgot to turn out the gas you always can go on the app and check of that everything is OK. And we have smart dishwasher that sends you a notification when the cycle is over or when there's not enough dish soap. We installed smart outlet. So any appliance you plug into that outlet becomes smart automatically. So in this apartment we know we bought kettle and we teach Alexa when we say Alexa good morning, she started to boil your water tells you the latest news, the weather outside, the traffic situation on your way to work.

We also put that motion sensors in this apartment. So motion sensors can help you to create different scenarios. So for example, you have a scenario like the late snack time at night. So if you want to go after 12 p.m. to get a snack, you don't want to be blind with all these bright lights so you can schedule if some someone enters the room after 12:00 p.m. the lights will be dimmed maybe blue. We also brought some technologies to the bathroom. So we have this shower head with LED lights . So now you don't have to wait to try water and see if it's hot, you just can see if the water is hot, it becomes red, if it's cold, it becomes blue. And especially it's nice when it's a hot summer, you can get blue shower and when it's cold winter you can get a warm red shower. Also kids will appreciate it and love it.

Of course people love to control climate. So this is must have to have a smart thermostat and smart AC. Of course we will see a lot of benefits and opportunities to incorporate smart technologies in multi-family sector. First, it's a great competitive advantage. It's a great marketing tool for you. Also statistics show that you can increase either its rent price or sales price on average by 5 percent. And it's also energy efficient. So if you’re a building owner who’s paying for heating costs you will benefit from this as well. So what I want you to do, what I recommend you to do think where you can start. So for example, renovation is the best time to incorporate smart technologies or if you have a vacant unit so you can pilot. You can see feedback and then scale and roll out across your portfolio. Thank you so much. It was great to speak to this audience and if you have any questions I'm always open. Thank you.

Marshall Cox: Intelligent Residential Heating

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Marshall Cox, CEO of Radiator Labs discusses the problems with steam heat. He explains how using heat data can solve for comfort and lower cost.  


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Marshall Cox, CEO, Radiator Labs

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My name is Marshall Cox, the Founder and CEO of Radiator Labs and I’m going to tell you about steam heat which is always a super exciting topic. So first of all steam has a lot of problems. We all know this we we've lived in an apartment or a house in New York City in particular. And the problem isn’t with steam. Steam is actually a pretty awesome technology that has been in these building since they were built often a hundred years ago, decades at least and they’re super overheated. The problem is that it's very hard to control where steam flows from that building and you can try to do that and they were really well balanced when they were built. But then the biggest change that we've we've seen is that we've invented nearly universally retrofit, windows with a double pane insulating glass and that completely changed the balance of our buildings. And now you have apartments that are cold and need a lot of heat and people who are super hot and open the windows as a result.

Obviously people are really uncomfortable because of this so it's a problem for tenants. It's a problem for maintenance staff because these things are hard to maintain. But it's an enormous financial and ecological disaster about seven billion dollars is wasted every year in the 10 percent of the U.S. residential housing market that uses steam as a primary source of heat. in New York City alone it's one point two billion dollars and you can imagine literally taking one point two billion dollars of fuel and burning it in the streets that's essentially what we're doing every year.

I want to get some perspective on this problem so steam has been around for a long time. It's been around for a approximately the same time as the phones. This is Alexander Graham Bell invented the harmonic telegram which is here. And think about how many changes have gone through that technology in the past hundred years. We all have supercomputers in our pockets now. The amount of change is dramatic and contrast that with steam, it's not necessarily a fair comparison. We have new better heating technologies but the radiators that have been in these buildings haven't really seen anything happen in the last 100 years and this is particularly relevant here because this Alexander Graham Bell standing next to a radiator and I can guarantee you that that building is probably still here and that radiators are probably still there. These things have been stalled for literally a century sometimes more than a century and they still work which is amazing but they have a lot of issues. So I got my P.H.D. at Columbia University. I invented this technology there. My research had nothing to do with steam or radiators but I lived in a unmitigated hellhole apartment. I was super hot. The technology worked really well. We went to compete at the MIT Clean Energy Prize, won that which was amazing and was essentially the beginning of our company. We developed a full building system and iterated over the past few years and most recently NYSERDA has supported an evaluation of that technology in a bunch of buildings and I'll talk about the results later. It was very good and we were really excited about what we're doing.

Briefly, what are the things you can do to solve this problem and overheating and buildings? Most people have tried to address this from a plumbing perspective but steam is a hundred degrees Celsius gas. It's a very caustic when it condenses into water and you're talking about a two phase distribution problem that's really hard to control that kind of distribution system with a valve or other kinds of plumbing solutions doesn't really work. We've approached it from a different direction. We actually control the area around a radiator and thermodynamically manipulate the steam flow within a building by doing that. Has the benefit of being easily installed you don't have to have any contact with plumbing is especially nice not to have to mess with 100 year old pipes and it works really well. Every one of these systems says a wireless radio we communicate data in real time to the cloud that lets us learn how buildings heat up and cool down and optimize that heat generation on a building by building basis. It also lets us connect this data to people's cell phones so they can control their temperatures even setting setbacks and different time based things you can do with a normal thermostat. This is a level of control that these buildings have never had in their entire history. So it's a pretty big deal for the people who live in these buildings.

These are those results I told you about from NYSERDA. Seven buildings of the past five years. We found 25 percent average savings maximum savings was forty five percent. And I just want to point out the minimum savings over there 15 percent. That building is a LeFrak building out in Brooklyn. It is now the most efficient single pipe building in all of New York. So even in buildings that start out very efficient we can still save a lot of energy. There's a lot of waste here. To put into perspective for income for for a portfolio, if you can save 30 percent of your heating costs that translates into a net operating income increase of 10 percent because 30 percent operating costs are often in heating the building itself. So that's a big deal for for portfolios.

Now I want to transition to talk about data. The first thing, the most obvious thing is what can you do with data in real time in a room? We take temperatures and we obviously feedback that temperature into our system is pushing down to a room when it's needed that allows us to do away with the drastic overheating under heating that you get in these kinds of buildings. This is real data. You basically turn an apartment into a flat lined temperature at your set point. It's a very important and nice change. My apartment obviously has these installed.

You can get a little deeper into the data as well. So in most bigger buildings you have what's called the two pipes steam system, and every radiator has a steam trap at that point and when we installed in buildings we typically find that about 25 percent the steam traps are blown and malfunctioning which means that steam is flowing into the that line being wasted. Every broken steam trap wastes about 200 to 400 dollars a year. So you can see how this adds up very very quickly. We can use the data that we're gathering to analyze steam trap health in real time and you can imagine that maintenance programs and buildings. It's hard to measure this stuff because it's in someone's home. We can just do it in real time remotely and tell people when things break and they need be fix which increases dramatically the maintenance efficiency of portfolios.

Very quickly looking dig digging deeper into the data there are some really interesting things here. If you can look at this and the left is these are two buildings top and bottom on the left is before we installed an app on the right is after we installed each one little block in these graphs shows a apartment that's been categorized by temperature. So the red blocks are apartments that are Saunas above 80 degrees. The blue blocks are apartments that are freezing below 62 degrees and you can see that before we retrofit is a pretty even distribution of very hot apartments and very cold apartments where you'd imagine sitting in a building. After retrofit if you could see the screen here, we've dramatically increased the number of green building the green apartments. So most of the apartments now are comfortable. Of course there's still outliers on the hot side. So this is on first level to point out that our technology is awesome, it works really well but this is a very rich data set. Of the apartments that are still hot. Why are they still hot?

It turns out that we can do some some interesting cluster analysis and apply algorithms to this data to figure out what characteristics those apartments share. So maybe they're on the top floor and the roof is uninsulated maybe on the bottom floor and there's infiltration problems but they're all on on the north side and don't get sun. You can essentially figure out what's wrong with these buildings. Then no one even knew existed. And that's interesting because you can take that data. We control the boiler we know how much fuel you'll save additionally if you fix that problem. And then if you know how much that problem cost to fix you can calculate a pretty efficient pretty accurate return on investment. And that basically will unlock a significant amount of capital. People want to fix their buildings. But the capital to do so is not really available because no one knows how long they're gonna take to pay back. No one knows how much it’s going to cost to fix. No one even knows what the problems are. So what we're trying to do here is take the data that we're gathering to figure out what those problems are to go how much going to cost to save and unlock that capital to fix the big problems in our infrastructure which is primarily located in our older buildings that no one has the time or money to evaluate properly. We have a big grant from the National Science Foundation to do this. So we're pretty excited about we're doing. Thank you so much.

Landon Tucker: The Future of Residential Connectivity

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Landon Tucker, CEO of Honest Networks helps us navigate the current state of multifamily connectivity. He touches on how 5G is changing the connectivity game and the notion of connectivity being as ubiquitous a utility as water and electricity.


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Landon Tucker, Co-Founder & CEO, Honest Networks

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VIDEO TRANSCRIPT:

My name is Matt and tucker with honest networks and I'm here to discuss the future of residential connectivity. Really exciting time for connectivity because we are at the epicenter of two trends. The first is accelerating shifts in consumer behavior, how consumers are consuming content and we are also in the midst of the very early stages of 5G technology. The ability to use wireless technology that's becoming very efficient to effectively recreate and build on the incumbent business models and do it in a much more efficient and friendly way.

For real estate owners and managers the key is not only will there be new service providers that have a lot more new innovative business models, but what we're also going to see is a real opportunity for differentiation in terms of residential connectivity. What we're seeing is that property owners and managers are looking to use connectivity to drive relative positioning with the new and and existing tenants are using connectivity to really differentiate their product and drive pricing and value. They're also using it to improve tenant satisfaction. In terms of consumer behavior, what we're seeing is that there's an accelerating shift in terms of cord cutting that we have. More and more Millennials and Gen Xers are getting rid of cable. In fact, 94% of 18 to 29 year olds are primarily streaming and they're not doing it for price. They're doing it because they see less perceived need for a cable television package. And what's really interesting about that is when you have this massive cord cutting you see a transition in connectivity. Internet is no longer complementary to a cable television package.

It's actually a utility in and of itself for building owners. It's as ubiquitous and as important as water and electricity. So what's actually happening though is that consumers aren't really happy with what they have now. They are being pushed to bundle product. They're being trained to have an internet solution in their building that's built on promotional offers. And because these companies in your buildings today, the larger cable companies and the telcos, they haven't had to build a really great customer service culture because they've been effectively monopolies. What's really exciting is this is about to change in a dramatic fashion. And what we're able to do now with the combination of fiber optics and 5G technology is to effectively build and improve upon and recreate what the cable companies and the telcos have done in building out a new great Internet network over the air and in the streets. And if you deploy internet networks in this way, it's a massive improvement in terms of efficiency. It's an incredibly capital efficient way to build out networks and it's also a very timely way to add connectivity to your building.

You can be installing new internet networks in days or weeks not months or years. You all have internet in your buildings. So the question you might be asking is, Is this better or is this the same or worse than what I already have in my building? Let's go back to what we said before which is if internet is becoming a utility how do we think about valuing the utility of a utility. We think about the speed.

This is Honest Networks we're the fastest residential internet provider in the country. We offer only gigabit. One to ten gigs of capacity, fastest speeds in the world. Ultralight connectivity for fifty dollars a month or less than half of the cost of the incumbent providers. And because of the way we architected our network at ultra low latency which means there's essentially no delay in which tenants request service and then receive it. And so we're becoming an alternative option in multi-family properties and seeing amazing customer transactions and uptake in the buildings. If you see here tenants have been really excited by having an alternative choice in the building effectively saying they are blown away by the service, the price, the quality of the network they're getting. And when you have a product it's becoming utility. As a real estate owner or manager, how can you take advantage of this? How are you going to use this innovation and connectivity to differentiate your buildings? The number one differentiation opportunity we see, and this is from mom and pops with with smaller multifamily buildings all the way up to the largest developers in all of Manhattan, is performance. People want to say you come into this building and you have the fastest residential internet in the entire country because we have Honest Networks.

Imagine you have a 300 unit building. You're seeing about 140 of those units turnover every year. Take out seasonally adjusting you're looking at 12 different conversations you're having with the existing tenants who are thinking about moving out and going to a competitor. You have 12 conversations with new residents that are looking at a wide variety of buildings. If just a few of those say oh you have the fastest Internet in the entire country and you're able to convert them into your building and drive occupancy and drive rate, that's a homerun for you considering that we're actually free for building owners were just another option in the building. Another great opportunity for differentiation is on Wi-Fi. We see a massive gap between ubiquitous Wi-Fi which we believe Millennials and Gen Xers are looking for. There's a massive opportunity for instance when we bring in ubiquitous Wi-Fi into common areas, into fitness centers, rooftops because all of that is complimentary service. Because our goal was to improve tenant satisfaction in the building. Working with a new innovative provider you can have it such that internet is on. It's like water when the tenant shows up. It really drives the tenant experience having unprecedented connectivity visibility in your building could be great in terms of dealing with tenant issues.

We have a connectivity dashboard where we have API integration with all of our connectivity data so that you can know over the past 24 hours or even 24 months the speed reliability and performance of each one of the buildings in your portfolio. And then finally on the left side if you want to give your residents more choice more affordability they can often save a lot of money every month by switching to an Internet product and streaming versus sticking with the incumbent bundled product. And then some final considerations for real estate professionals are future proofing your building when you can for instance at honest we bring fiber into the vertical riser into every building we go into that future proofs the building in terms of giving you outstanding capacity and performance. But it also improves the resident experience when you have great infrastructure in the building and it increases the value of the building to you. So if you can do that and you're thinking about bringing another provider, ask about how they're wiring up their building because you want to make sure that when you're working with a new provider they're future proofing your building and really adding value to it if you're giving them the opportunity to sell into the residence. Second is aesthetics make sure you understand what equipment is going into your building. All providers have a wide variety of equipment they use and there is really great small form factor aesthetically pleasing installations that can be done now where the resident doesn't even really notice the equipment. That's something that we'd be happy to touch on more. And then finally I.T. and security.

Increasingly I know many of you are looking to get more data out of your buildings so you're looking to use IoT BMF system security systems. If you're backing that information up to a public cloud computing provider or you're using the public internet, often times if you work with a provider you can get secure, direct cloud connectivity access which prevents any risks of a security threat to your building. If you have any other questions feel free to reach out to myself or any other member of our team.

Thank you.