Nestio shakes it up

I met the entrepreneur and team behind Nestio at Techstars about two years ago.  I liked the team immediately although was not totally sold on the concept. I became a mentor to the team.  I eventually invested in them too. 

They began as a site with a consumer product for the renters market.  It was all about using technology to make the process easier.  Think of it as you own a fantastic excel sheet on all the apartments that you were looking at to rent with pertinent information to the neighborhood. 

The feedback from the market was that many of the listings were inaccurate.  So they dove deep to figure out why.  The reason was pretty clear.  Listings were managed by landlords and brokers with technology delegated to a stick-it note.  Nothing was up to date and in turn nothing ended up being entirely accurate.

That is when Nestio started to rethink their model.  They began to build a system for an archaic outdated system that would bring modern, centralized technology to the rental industry. 

The team spent thousands of hours with landlords and brokers to understand the industry and through this they were able to pinpoint the problem.  They realized that everyone that they spoke with appreciated technology but there was just not a modern solution for their business.  A perfect example is Caren Maio, the entrepreneur behind the business, met with a landlord who had his Macbook air in one hand and his Ipad in the other.  He tells Caren that in order to track his buildings and listings he uses a whiteboard and a fax machine in his office.  This was in 2012.  He could not figure out how to apply technology to his business.  That is the void in the marketplace that Nestio has fixed and filled. 

Nestio has built a platform that gives landlords and brokers real time information.  That information also provides data for them to be more profitable and manage their business easier.  How do you really know that your business is transforming an industry?  When every owner and agency starts to use the product, when you walk into an office and see Nestio up on every computer, and when every owner and President of an agency whispers in your ear after integrating the product into their day to day business and leans in to ask "Are you raising any money because I'd love to invest". 

Enhanced by Zemanta

Comments (Archived):

  1. takingpitches

    i read 15% of landlords in Manhattan. That is amazing if accurate.Another New York recent rental play that is riding a hype wave (not sure how it works) is Urban Compass. Big story here:

    1. Gotham Gal

      thanks for sending. fascinating who funded them. 2 guys?

      1. takingpitches

        reffkin is a super-talented guy, common friends tell me. there are four male cofounders. i think they have a staff of 60 or so now.essentially, they are tech and salaried instead of commission brokers. a lot of the old guard says that there is a reason that brokers are paid on commission; one needs to attract a hungry sales person given the large number of no-sales.Not sure whether this is a statement of reality or the statement from an about-to-be disrupted incumbent.i think tech is a huge opportunity in rentals; don’t think the margin reduction is enough though. while stated is 15%, i have never paid more than a month’s commission to a broker.There is a lot of flexibility given the margin.

    2. JLM

      .The big thing in the Urban Compass offering is their compression of fees. This is a huge and way overdue development.The pricing of leasing commissions is an archaic model.Ask Charles Schwab about this.JLM.

      1. takingpitches

        Totally agree that margin compression is a huge opportunity and development.Compare equity commissions to derivative or fixed income commissions.Makes a big difference where you have a transparent market where orders can be matched electronically.

        1. JLM

          .The Charles Schwab algorithm is based upon the actual electronic cost to execute rather than a percentage of a deal.Same work, same fee. Particularly when it is digital rather than personal.This is the direction the world is going.JLM.

          1. takingpitches

            Great point.That’s why I love Dwolla over debit card payment fees.

          2. JLM

            .Proof! Well played!JLM.

  2. Lisa Abeyta

    Addressing real world pain points will make the difference between a good idea and a profitable company. Kudos to the Caren and her team!

  3. JeremiahKane

    Go Caren – there are few industries that are as archaic as real estate

  4. Erin Newkirk

    Go Caren and Nestio! Big fan!

  5. Tereza

    This is awesome. It takes guts, and supportive investors, to go quiet and heads-down for a year to get it right. We should all follow her example.

  6. Deirdre

    Great story. I love it.