Intro: [00:00:00] Welcome to the Stacey Salyer Show, the podcast for property management leaders ready to think bigger about growth. I'm Stacey Salyer and the only acquisition strategist in this industry who sat on all sides of the m and a table. I've been the buyer acquiring a 370 door competitor during CO using seller financing.
I've been the seller building and exiting a seven figure business. And I've been the corporate evaluator as director of acquisitions, assessing over hundreds of companies nationally. That means I know exactly what you're thinking, what you're missing, and what actually works when it comes to buying and integrating in this space.
On this show, we dig into acquisitions as a real business tool. Not luck, not someday. You'll learn positioning, strategy, numbers, and integration from someone who's actually done it all. Let's go.
Stacey Salyer: Dana. It is so good to have [00:01:00] you. I know. We talked recently and I wanted to have you on my show because I found your company super fascinating and I would love to learn more about it. And I know we're gonna be talking about acquisitions a little bit and, uh, so yeah, I would love for you to introduce yourself and tell us more You and all the things. Great.
Dana Dunford: Hi everyone. It's a pleasure to be on the show today. My name is Dana Dunford. I have, gosh, over 15 years of experience in property management. Also real estate investing. I live in San Francisco, so I run a technology platform for property managers and real estate investors.
But I'm a huge proponent of networking, knowing people outside of just your area. A lot of us here in San Francisco, or what I refer to as tier one cities will invest in tier two and tier three just based on the growth there. And so I've worked multiple years just [00:02:00] helping improve property management operations.
Primarily focused on technology and ai. So it's a pleasure to be on the show.
Stacey Salyer: Thanks for coming. I know. I love, but, and I forgot that you're on the same coast as me. How exciting is that? Yeah. Yeah. The best coast. Yeah, the best coast, the west coast. I know. It is beautiful. For sure. Okay, so tell me, 'cause in your intro you kind of mentioned like tier 1, 2, 3.
Tell me more about that. What does that mean?
Dana Dunford: Yeah, so when you think about, uh, investing, and this is just for real estate investors. We connect them very often with, with property managers who are, who are using hemley, using their services. In tier one cities are the San Franciscos, the New York's, the Seattle's, the LA's, the Miami's of the world.
In those areas, you really can't get cash flow. Right off the bat. So you have to really believe in appreciation as the [00:03:00] game. I have a ton of friends here in San Francisco who are investing here and actually do it very well and have tax incentives and all sorts of things that kind of justify what their, their purchases are.
But I've seen more frequently real estate investors say, Hey, we want to invest elsewhere. We wanna go ahead and invest in Nashville. We wanna invest in you know, uh, Austin now that you might consider a tier, tier one city or going there, Houston, Dallas, Jacksonville you know, Jackson, uh, Mississippi, all, all, all throughout the US Memphis.
And the real question is, what is the right. Strategy for that investor. Every single city is different. And then on top of that, how do they get the cash flow and a bit of appreciation as well off of it. And then through that saying how can they manage their properties, uh, better get the rate on ground team.
And so I think that's gonna [00:04:00] become more of interest. And I actually wouldn't even say it. I think that it's just these other cities outside of the tier one cities. I actually think suburbs are also going to be a huge factor, especially with self-driving cars. People will live probably farther from the metro area 'cause it's easier for them to get there.
And they're not having to drive a car to get downtown. It's not expensive to park their car. And so, I think kind of looking holistically at. Not only trends that you see today, but trends that you'll see four to five years and what is the right decision to make from an investment perspective is a really fascinating one.
And that's kind of lunched the way for me to meet really cool property managers who built businesses over 20 years and decided to sell 'em or those looking to grow their business and meet more real estate investors and actually be able to grow their business. And then obviously I think the other cool [00:05:00] trend that I've seen most recently that we've definitely tapped into is the accidental landlord because people are locked into mortgage rates and they say, my mortgage is now actually an asset because it's a 3% fixed rate.
Let me go ahead and keep that. I'd love to be a move up buyer and, and buy another property, but I kind of wanna keep this one as well. And. That's also been a, an ex, an interesting trend. And I think that's what's exciting about being in property management. I think today is the most exciting time to be in property management.
And I probably wouldn't have said that, you know, four or five years ago. Right. But I think it is the most exciting time, especially with the wave of AI and technology to help businesses. And so, yeah, I'm just, uh, very excited to be in this, in industry and very excited to be here.
Stacey Salyer: Yeah. No, that's awesome.
Yeah, you said a lot of really cool things. So let's back up a little [00:06:00] bit and if you wanna tell everyone more about Helene and, and what you guys do and what you offer, and then then I wanna talk about some other things that you talked about. Yeah,
Dana Dunford: yeah. We're a technology platform for property management.
So think of us as not only your software, so replacing your AppFolio or your buildium or your real page whatever software you're using to manage your properties. We replace that in all of the add-ons that it has. So we do the self-guided tours, whatever technology you need. We have that, but we also have the tech enabled services.
And so. Really elevating you from managing the day to day to being an owner of your property management company. We come in and have 24 7 repair coordination. So dispatch of service professionals, all of that. We do all the accounting and billing eliminating the trust accounts for between you and the owner.
We'll go ahead and be able to pay bills and stuff like that directly from the accounts we have on [00:07:00] file. So just a lot of technology to make your day easier. You know, five, 10 years ago when all of this technology wasn't there, you only had like, you know, 20% of it. But today, now it's so much easier to run a business even though tenants today expect.
Instant gratification, they expect you to respond right away. It's much easier because technology is now finally catching up with everything from self-guided tours to really quick dispatch responses. Right. I'll talk a ton about ai. I'm sure we wanna talk about acquisitions and ai like the two, right?
The two as today. Yes. So I'm, I'm happy to talk a lot about that, but the, the property managers who are going to make it and really be able to scale their businesses follow a very clear structured process of this is how everything works and this is why we do things this way and with a level of [00:08:00] quality that's unparalleled to others.
And if you have those two things, you're gonna win in your market. And you can expand to other markets. Like the property managers we work with will suddenly expand to a place that's.
Stacey Salyer: Right.
Dana Dunford: 30
minutes to an hour outside of what they would normally do, because now suddenly they don't have to be visiting the properties every day.
They can visit every other week or whatever it may be. And so, that's been really cool as, as part of it as well.
Stacey Salyer: Yeah. Yeah. So, yeah, let's kind of chat a little bit about acquisitions. So do you see a lot of your clients, like when they're coming to you, I guess like when they're transferring to Hem Lane, so like, let's say they're coming off a buildium or something and they're transferring to Hem Lane, does it then all of a sudden shift them into a whole different realm of being able to like open up the operator?
Yeah. They, they can
Dana Dunford: manage more. Yeah. And typically they, they come to us, especially when they're acquiring a property management company. They're like, shoot, I now have [00:09:00] 300 more doors to manage. Or even if it's 40 doors. We've had folks come to us with 40 doors and say, I need to hire someone to do this.
And every time I hire, I'm hiring, I'm firing, I'm dealing with more people. And we say, great, actually run a lean, lean operation. We can get the people, we have someone who's gonna pick up that phone, and I guarantee they're gonna be more delightful and more educated on repair coordination. Or if they're rental assistant or if it's rent mediation, whatever department it is, they're gonna be so much more in touch and in tune and be dedicated to you and know everything going on.
Much better than anyone you could train. And so that's kind of the, the concept of it is like you don't need the person physically there to be able to. Very quickly, uh, troubleshoot you know, uh, a pipe that's burst or something like that. Right? In fact, the person who's probably in your town is not picking up at 2:00 AM but we guarantee we have a subject matter [00:10:00] expert who will Okay.
So yeah, they usually come to us during acquisition. Acquisition has been crazy over the years and for those who don't know, like there's been so much of it has to do with macro trends, and I don't think that a lot of property managers at like in your city understand how much that has influenced.
So let's go back to 2017, 2018 when interest rates were low. What basically was happening there is that money was what I would call cheap. Right? Right. Yeah. And so you had a ton of money going into venture capital. Like so, uh, VC backed companies, so those would be technology companies. Me in San Francisco, I was, that was kind of sitting here, still sitting here with my popcorn watching all of this go down.
But what you saw was a lot of venture capitalists saying, oh, property management, that's an interesting industry. [00:11:00]
Stacey Salyer: Mm-hmm.
Dana Dunford: Let's
go ahead and give this company $25 million, a hundred million dollars, and. The valuation, the valuations these companies were getting are based on something called net present value.
Mm-hmm. And, and net present value is saying, what do we think the company is gonna generate and what their revenue is gonna be in five years? Bring it back today. And that's what it's valued at. Well, when you have the market climate we had in, you know, all the way up until, uh, 2022, when you have that market climate, suddenly all these companies valuations got just inflated so much that everything seemed worth more.
And so what it was is something called arbitrage, and no one talks about this. Yeah. So Stacey, let's just say that you own a property management company in Seattle. Yep. Okay. If you go to sell your property management company to another [00:12:00] property manager and you city, so in Seattle. They're willing to say, Hey, if I get a bank loan and I go through the whole process, I'm willing to pay probably three to five x ebitda, maybe one to two x revenue.
There's multiple different benchmarks we can use, right? And that's what they're willing to pay for it. But, okay. Now Stacey, let me say, I'm one of those companies in San Francisco who has venture capital money funding me. Yep. I go to you, Stacey, and I say, you know what? These venture capitalists, every revenue dollar I bring in, they're going to, they're valuing it.
10 x. Not one to two x, they're valuing it 10 x. So I'm gonna come to you, Stacey, with some uh, uh, some cash and say, Stacey, I'm gonna buy this. And suddenly they could pay a lot more per door or per revenue generated per door than any small mom and pop. Okay? And what they would [00:13:00] do is they would go to these venture capitalists.
So if I'm the founder of this. You know, property management company, I would go to these venture capitalists and say, look at, I brought this revenue in and this is tech revenue. 'cause I'm gonna tech enable it and I'm gonna make it worth 10 x. Right? Right. And, and they kept doing that. And so what you found was there was almost this.
Crazy time period of a ton of these venture backed technology companies acquiring traditional PM shops like the, the Seattle Property Management Company, right? The problem with a model is it doesn't work, and it only comes back to haunt them because as you can imagine, any of us in property management know this.
Property management is a localized scheme. It's personalized. You need to know your market. You need to know your tenants. There are certain things that you can say Helene will do better, [00:14:00] like picking up those repair calls, troubleshooting, dispatching, but the actual physical on the ground, knowing what doing.
You still need the broker, right? The, you know, head of your operations there on the ground. And so what happened was these venture backed, like tech companies went out with tons of wads of cash, purchased all these. Property management shops got these huge valuations overnight because of that arbitrage of saying, Hey, a tech company's worth 10 x revenue and a traditional PM's worth one to two x revenue.
Right? They use that as a way to grow, but fast forward 3, 4, 5 years what you saw happen was retention was incredibly challenging, right? Because if I am a landlord in Seattle, I own rental properties, and it's some company elsewhere that this person is not [00:15:00] born, raised, knows Seattle so well, right? Knows everything about it, and is just using technology.
The first question from the property manager is like, or the landlord is like, can I just do that myself? Right. Right. Like what they, what they're, what they are hiring a PM for is that local expertise. And so what you saw is churn and retention really go down. And then here in, in San Francisco, what we see is a lot of venture capitalists, almost kind of anti property management tech companies because of that.
Because they said, Hey, that model didn't work. And so I really think that like when you look at the industry in four to five years, you're not gonna have this nationwide property management company and think that it's gonna do it better than a, a local property manager. But what you will see is the local property managers who are using tech [00:16:00] companies really well, right?
And understanding what is EQ versus what is iq. 'cause IQ all goes to ai, EQ goes to people, and the ones that understand that are really, really gonna win. And so, you know, then what we saw in 20 22, 20 23 and, and now is suddenly a softening where there's a pullback on a lot of those kind of venture backed companies looking to purchase PM shops.
And if they do, they have their baselines, they're like, actually, I can't purchase for as much as I did before because of retention. Is now something that I have to factor into it. And so what I've seen more recently and looking at these benchmarks is actually like if I, if you're a property manager, Stacey, I'll just say Seattle again.
Yep. Close to you, you actually may take the other local, [00:17:00] you know, competition in your area and decide to sell to them right over. The venture backed company that is in New York or in San Francisco, because actually the numbers are even better for you. And so that is that's something I don't think people talk enough about.
But I'll give one caveat with it. Yes. Private equity. Yes, today private equity loves and private equity is a smaller growth play. So the companies are valued at less than what a venture, uh, backed company is based on multiples and growth, right? It's not grow at all costs, but a lot of these private equity guys will come in and say, great, I'm gonna take a traditional property management business and make it that much better.
Right? Today where I'm seeing the conversation is a lot of these private equity companies coming in and saying, let's us go buy traditional PMs and kind of do like a rotor router model [00:18:00] type, where we scale it all up and have this consistency. Again, I think that so much of it goes down to how the motto's played out, because you still need that local person on the ground where they own it.
They're, they are incentivized to say, I know everything about this market and people are hiring me for that differentiation. Because if it becomes, if these private equity companies that are coming into it try to standardize it too much and say like, Hey, it's cookie cutter. You don't ever talk to someone in your region.
You're only talking to corporate. The problem is, is it's gonna be the same thing we saw with VC 5, 6, 7 years ago and history repeats itself. And so it's been exciting because of ai. I think private equity has gone into property management more, but I don't know if that's a Winnie model. I still think owning and operating your own property management company, super [00:19:00] localized referral based is like definitely the way to go.
And so anyways, that's kind of my long history of, of looking at the financing and acquisitions on, uh, property management.
Stacey Salyer: Well, I think that was really good explanation and I think, you know, being in the field myself, you know, over 20 years we don't talk enough about kind of the last like 10 years or so.
Yeah. You know, 'cause I've been part of that. I mean, I sold my business at the very beginning of 22, and then I stayed on with that company actually for a couple years. So we kind of, you know, very different. Well we were private equity money, so not VC backed. Yeah. And a lot of times people don't even know the difference between VC and pe.
Like Yeah. They combine them, they're like, oh, they're the same. And I'm like, well, they're not actually, private equity and venture capitalists are very different as far as the money goes. I do believe it can work, but you have to build with intention for sure. Mm-hmm. And I think it's really helpful, you know, if you're gonna build.[00:20:00]
So, you know, you have your own company, right? And I work with a few different clients that have plans and goals to build multi-market and multi-state. I think if you come from the industry or you have people on your team that come from the industry and can build with intention and keep the, like local flavor and flare, if you will, I think they'll be okay.
But I think it goes to what you said, like if you do two cookie cutter, if you're just like across the board, like, you know, use McDonald's for example, right? It's like the cheeseburger's the same no matter where you go. But if you don't keep a little bit of the natural, like, I don't know, flare to the, the company, like, you know, keep it Seattle, like Seattle and Charleston are very different, right?
So Yep. Keep it, keep it a little bit more local, like, you know, Pacific Northwest, like. You wouldn't wanna do like a, across the board dress code. 'cause like in the p and w, like I can show up, [00:21:00] you know, wearing jeans and my tattoos to like a new client meeting and that's fine. Like, I may not be able to do that in New York City.
Right? Yeah. So, yeah. Yeah. So, yeah, so I think it, I think it can work. But with really good planning.
Dana Dunford: Yeah. Where it will work on the private equity side. 'cause they are, they do, they don't expect growth to be grow at all costs. 300% year over year. And much more stable and much more aligned with how pm traditional PM is run.
But the one thing I will say is that the PM the private equity companies that win in this space are the ones who give enough of a revenue share or an ownership stake to someone local. Yeah. Because the thing, the difference with, okay, so with Uber and with McDonald's. What they have in common is that you can get consistency and always a right [00:22:00] answer in both cases.
So in Uber's case, it's going from point A to point B and getting there without a car crash and like a speeding ticket or running out a gas. Right. Like a very consistent experience with McDonald's. Like you said, it's, I go to McDonald's in Rome and I have the same burger that I was expecting to get in Kentucky.
Right. Same, same experience with property management. It's a people business. A hundred percent. You don't have the same experience. It is, and this is where AI. AI fails is AI is really good when there's an answer, a right answer. Right. That's why it's so good with engineering and math and iq when you know, you started with Watson so long ago, could answer every jeopardy question.
But what it's not good at is eq. A hundred percent. And on the EQ side, that is where so much happens with property management, where you have some random [00:23:00] weird situation with a case and someone there. Yep. You need someone physically there to go down and talk to the tenants. Yep. And be able to have that conversation.
And so that's where they are. To your point, McDonald's versus property management are totally separate and that is something that, won't change that EQ side. Right. And so I always say when, when we come in and talk to property managers, I say anything that doesn't require that eq. We are putting AI on automation workflows, but anything that's like, Hey, 2:00 AM there is no heat in the house and there's a baby crying in the background that is.
Person with really freaking high eq that's gonna make them feel like they just had the best experience of their life despite a terrible situation. Right. They're getting heaters from Home Depot to make sure, like the baby's [00:24:00] okay during the evening and all of that. And so, yeah, I think I think all too often people take parallels of other industries and toss 'em into property management, and that's where you get into these situations.
Like a lot of these BC companies that had $300 million valuations that literally went to zero overnight because someone was like, oh, this doesn't work. Right. Right.
Stacey Salyer: Yeah. No, and I, I love the, I love all those analogies because the IT people by people yeah, they don't, they don't. Necessarily by and, and I think a lot of times we lose sight.
I mean, again, been in the industry forever and you know, I can rattle off numbers and you know, operations, no problem. I could probably set up a PMC tonight like. My eyes closed, but at the end of the day yeah, it's all about the, the people. I mean, you know, we're providing housing, and housing is one of the most emotional things for people.
Mm-hmm. In fact, it's on, I [00:25:00] think when they like, manage or uh, measure people's stress levels. Moving is one of the highest stress levels that you can experience in your life. And. You know, we tend to lose sight of that. Like when we've been in the business for such a long time, we just kind of get used to like, oh, well we do this, we do that.
But housing is such a like, personal thing that it's really important that we have like people on the ground.
Dana Dunford: Yeah.
Stacey Salyer: Build that relationship. Because I a hundred percent agree AI should handle all of the like boring minutiae. You know, if you wanna call my office and is that house, you know, on, you know, sixth Street still available, AI can answer that all day long.
But the minute my client is going through an eviction or somebody hasn't paid rent, or there's some major emergency, a hundred percent that needs to be a human.
Dana Dunford: Yeah. And it also reduces anxiety of the client when you're like, Hey, I just drove by the property. Here's exactly what I see going on. Here's this and that.
Like [00:26:00] suddenly there's almost this. Oh, okay. But you can't focus as a property manager on. All of those high touch areas that you need because you're focused on so much of the administration. And I see that too often that I've had some property managers be like, we don't wanna work with a tech company 'cause you'll take our jobs.
And I'm like, well, we're gonna take the jobs for everything where we should take the jobs for. But there's certain things you're gonna do. And if you think technology is gonna replace you, by the way, technology will a thousand percent replace you. But the best PMs that are growing and scaling their businesses know exactly what we cannot replace on the tech side and exactly where they fit in.
And those are the best PMs out there and they're the ones growing their doors. High retention because they're using technology to work with 'em, not against 'em.
Stacey Salyer: Yeah. Yeah. No, absolutely. So as far as that goes, I would say, you know, 'cause [00:27:00] one misconception I hear from a lot of people is that they don't believe that they can buy in their market because they think they're competing against like, all the big guys.
I always tell them that that's not true, that they can definitely buy in their market. Uh, what do you think based on your experience?
Dana Dunford: My experience is sometimes you think you can't compete against the big guys because of the dollars that they have in their pocket. Mm-hmm. I would say today is the best time to compete against the big guys because with interest rates where they are, the big guys don't have as much money because they're looking at the numbers saying, shoot, I've got a high interest rate on anything.
The other thing I would say about it is do not underestimate structuring of the deal a hundred percent. Far too often. People focus on this valuation of like, this is the value of the PM company and acquisition. And if I don't pay that, then I'm [00:28:00] not gonna get this pm. I'm not gonna buy that company and someone else will buy it.
Most of the times, and I learned this I think a little bit too late, 'cause I was like, why are all these companies, it would be like a tech company getting like this huge valuation. And I'd be like, why did they get such a big valuation? And then I'd go and I just asked the founder to go to coffee and I'm like, oh, they didn't actually get that valuation.
That's the valuation they get if they meet 5,000 different criteria and revenue numbers and this and that. But otherwise the valuation is down here. Uhhuh and the tech companies and the big guys are very good at structuring. They are much better than the traditional small. Mom and pop at structuring because that's what they do for a living, right?
They bring in some business development guy who's very good at structuring stuff and in acquisitions uh, manager on that. And so what you have to think about is, okay the local PM in my area, I know and they trust me 'cause they know I've got strong [00:29:00] reviews, strong retention. They know their clients are gonna be happy with me much more so than the other.
That is to my advantage. Yep. Okay. What do they want and how are they thinking about their valuation? Far too often a property manager will go and know that so-and-so's retiring and selling, and they'll be like, great. The person will say, how much would you pay for it? It's like, well, first of all, what are your expectations for how much you're gonna sell it for?
By the way, everyone who wants to sell their company, I've known this from like thousands of these. Whatever they start at as what they expect is never what they get. Right. Okay. So like they always have a much higher price. Yep. And then the question is, okay, that's your price. How did you come up with that
Stacey Salyer: Uhhuh?
Yep.
Dana Dunford: Where did
this come from? What are the benchmarks? Let's go ahead and do that. Okay, great. Let's sign an NDA.
Stacey Salyer: Yep.
Dana Dunford: You just want an NDA. You're not gonna sign a letter of intent quite yet. Just an [00:30:00] NDA, just to do research. Get to know each other. But that is the next question of, okay. What, how did you even come up with this?
Because if you can understand how they think and then where their benchmarks come from, a lot of times they don't actually have that many benchmarks for it. Or they heard of one company which is outlier, that was way in some other city that potentially sold for this price and that is what they're basing off of.
And so then the next part of it is really to align with them of like, okay, we want you to get to that number that you want. How can what I am doing get you to that number? And that becomes the conversation. 'cause sometimes these deals are structured where it's like, Hey, if you can help me grow this business and double the revenue year over year.
Then I can get you that number, right? I can hands down get you that number. And actually now we're aligned because you're helping me grow [00:31:00] your business. Right? And it's not, it's not a turn, it's now actually. And so sometimes these deals are structured with like a 10% payout right upfront or 20% payout. And they might not get the next 50%, 75% like the rest of the payout unless they hit certain benchmarks.
And so it's really understanding like, hey, who are you? Where you wanna be? And then how do I help get you to there? And maybe we meet somewhere in the middle if they say, Hey, that's impossible to double my business growth. Okay, well then should we reduce the price? Right? And at targets that are reasonable because here's what I've seen as benchmarks in the area of what something has sold for.
Here's what I've seen on SDE multiples. And usually you wanna give 'em a revenue and SDE and in EBITDA or I guess net income right. Multiple. And with that, they all should be around the same price and say, here's what I'm benchmarking as a low and high case for your [00:32:00] company, but I understand you want this.
Let's try to get you there. Right? 'cause often they will take that deal in hopes of getting that higher number and being able to help grow the business or whatever, versus taking a lower offer just so they can say they sold it for the price they wanted. Right. And so I think structuring, structuring is a huge part of it.
And it's a song and a dance, and there's no right answer. I mean, everyone has asked me like, do you have a template of some of our PM partners? Do you have a template for like what this should look like? And it's like, that's. Not it, you need to understand this person. You need to go to lunch with 'em, dinner with them, you need to get to know their family, everything.
And then structure around what makes sense for them based on their urgency, timing, you know, what they need and want. And so there's all of that that goes into it.
Stacey Salyer: Oh, yeah. Yeah. It's, it's complicated, but not complicated, I guess. Yeah. Like I, I like to tell people that, and I, and it's one of the reasons I decided [00:33:00] to focus my business on teaching people acquisitions from, you know, start to finish.
Because you see all the time online, people are always just, they're always concerned about, well, what, what's the valuation like? What's the valuation? She's like, well, it doesn't really matter. I mean, there's so many. Yeah, there's so many other pieces to it. And first of all, even just finding the seller you know, yeah, you can do cold calls.
I mean, I did close deals off of cold calls, but those cold calls were not. Cold in the way that people would think they are. Right. Like I built, built relationships. Like it wasn't just a, you know, one phone call and then Yeah. Move to the middle and then close it up. I mean, that's a long-term, you know, question and ask like, what are you looking for?
You know, all that, all that kind of good stuff. And yeah, the structure is a huge, huge piece of it. 'cause it's, it's the same transaction. It's kind of like real estate sales. Like you have the boilerplate, like it's all the same. Yeah. But every single one is different because again, it involves humans and you know, [00:34:00] it's a relationship.
So, yeah.
Dana Dunford: I have a question for you, Stacey. Yeah. I'm very curious to see how you answer this. Okay. If you were buying a PM shop, would you rather be the only one bidding on it or have multiple offers in yours chosen? Oh,
Stacey Salyer: that is a good question. If I was buying one, I think, well personally since I've gone through it, I would be fine with multiple offers.
'Cause I feel like at that point then I would be, I don't know, I guess that is a really good question. I'd be fine with multiple offers, I think, because at that point then I know that I'm getting what I really want.
Stacey Salyer: but I would also be very realistic in my offer. I wouldn't be, you know, like the crazy time COVID buyer, like when the real estate market was super hot, you know, like waving every contingency and, and whatever.
So making sure that it's still an [00:35:00] intentional and very purposeful purchase. I would be okay with multiple. Yeah, yeah.
Dana Dunford: Yeah. I used to. Think, Hey, I need to find the company and this is good for those of you looking to acquire a PM shop. I used to think it's really good to be the only one who is bidding on the PM brokerage.
'cause I've got no competition. Right. And all of that. What I found with those deals is one, they take a while to close. Mm-hmm. And then two, the buyer might always be like, Hey, what if I had something else? Or what if I got something else Right. And I find those deals to be more delayed nowadays. I actually much more prefer with our partners if we have someone else come in and bid on it too.
Yeah. Because the seller is actually. So much more excited Yes. To basically be like, wow, you guys were the offer I chose. Right? And almost feel, felt like, okay, [00:36:00] great. This, these are the people I'm gonna work with and structure things with. And the deals get done so much faster because there's some sort of there, there is some sort of on everyone's side, Hey, you need to make a decision by this date, right?
So we can roll those ones faster. And so oftentimes. Uh, property managers who are using our tech and they're growing their businesses and they're like, oh gosh, no, they're gonna have so many offers and they're talking to someone else. I said, let them talk to someone else, right? Because what you need to do is sell them on how great you are and how great you're gonna be for their clients, and how we're gonna structure this to be a win-win.
And we're gonna be able to close this deal a lot faster than Joe Smo, who's only looking at you, not really doing a process. And it might take him 10 years to sell this thing. Yep. And this is gonna take us 10 years too long to buy this thing. And so a lot of times now I've like, kind of changed that mindset over the years that it's actually better to go in on something that might have multiple [00:37:00] bids than uv the only one.
Stacey Salyer: Yeah. Yeah, I would agree. And I think the seller also understands the process better if they're talking to multiple people or have gotten multiple bids. Versus just like the one kind of, to your point, they take forever and, you know, it's, yeah. It's just a different process for sure. So, yeah. That's a good question.
I like that one. So, yeah. what else should we talk about as far as do you want to talk a little bit more about Helene and kind of what you guys do and,
Dana Dunford: yeah. The, the last thing I would talk about kind of related to Helene, 'cause we, uh, we are your tech partner is one of the most interesting ones that I see where financially you do so much better is on self-guided tours.
Yes. And that is a big one that I've had as we bring, we used to have this criteria that. In order to be one of our partners or or our partner where we refer business to [00:38:00] you, you have to use our self-guided tours. Right. Okay. And now it's interesting, there's a lot of PMs where we're partnering with them, but they're not quite there on the self-guided tours.
Yeah. And that always to me is like you're not gonna change someone's mindset until they experience it. Yeah. So like, let them come in and then let them experience it. That is where your time is so valuable. And I a thousand percent agree with being out on the property, being on site, knowing what's going on at all times at the property.
But. At the same time, having to go out and to the showings is not the best use of your time. Yes, you should meet the applicants before the official approval and the lease signing, maybe doing the move in walkthrough to make sure everyone's aligned, all the terms, et cetera. But having to do all of those and responding to all the inquiries and setting up the showings and prequalifications, all of [00:39:00] that should be done through a team that's just focused on qualifications or just focused on, I know everything about access entry and I'm gonna be on the phone with the tenant as they're walking through the place, but that shouldn't be the broker owner of the PM shop.
And so, I think that's one of the big efficiencies that like I've seen, if you look at your. P and l is a property manager. That has been a big one. And it's really that whole process of like, how do you automate that whole thing and there's no one even in your office focused on that. You should be focused on, here is an objectively qualified applicant.
First come. First serve. Here they are, go ahead and review them and go through. So, yeah, that's been, that's been a huge one. I think if you're not doing it today, you definitely should do more research on it. That will be really huge for your business.
Stacey Salyer: Yeah. Oh, I a hundred percent agree. So I will tell you that when I had my [00:40:00] PMC, that was the last
thing
that we, I ended up pulling the trigger on.
I mean, I was a very, when I opened my PMC, it was 2016, so it was like, as prop tech kinda started to come on. Yeah. I raised everything. I was like, the only constant is change. My first employee was a global talent person in Mexico. Yeah. When I sold my company, I had more remote team members across the globe than I did in Washington State.
But the self showing was one of the last things, and I was like, no, no, no. You know, it's like a one time to like be human. Yeah. But I finally pulled the trigger and the only regret that I had was that I didn't do it sooner. Truly like it was so funny. I was like, oh my gosh, I didn't follow my own advice. I should have, I should have done it sooner.
And I think what really sold it for me was, number one, we were actually providing much better service because now seven days a week, you know, [00:41:00] during daylight hours if somebody wanted to go see the unit, they could go see it. Like we didn't have to, you know, do around people's work schedules. I was spending way less payroll.
My team was spending way less time in the car. 'cause that's like super wasted time. And then what really was a huge kicker was when I was getting my reports and taking a look at them. We had four people go view homes on Christmas day and then we ended up renting them. So. Who, like, there's no way, like a human number would've met them on Christmas day.
Probably not on Christmas Eve, probably not even the day after. So that would've been like, what, three or four days that like nobody would've done anything. And, uh, yeah, huge game changer. I would say, you know, really, if A PMC isn't really looking into doing that, I highly recommend it. And then utilizing global talent.
So, or you know, like a company like yours, we didn't have anybody in the office doing admin work. If, if it was admin [00:42:00] related, you did not live in Washington
state. Yeah,
because it, it wasn't needed. I mean, I needed the people in Washington. I needed to be boots on the ground and the face-to-face relationship builders.
That's
Dana Dunford: all exactly
Stacey Salyer: right.
Dana Dunford: Yeah. I, I love that Stacey, so much. I couldn't agree more. And then also with the and the showings and stuff that you mentioned, it's like, uh, it is really important. One thing I have to say is like. We know everything about this attendee when they're going in mm-hmm. And everything about the property.
And we're on the call with them, still talking to them as they're going through and making sure that we know when they walk outta that showing did they like the place. And we have qualification of questions of like, did you like it? But you're considering other options? If so, why?
Stacey Salyer: Right.
Dana Dunford: You didn't
like it.
Okay. But why? Right. And like, all of that and getting that back to the pm then the PM is, is can, can basically look at the numbers in our reports to [00:43:00] say, okay, this is a hot property. I don't really care that that person didn't like it. 'cause I've got three more showings today and tomorrow. And this is gonna be off market or, oh shoot.
This has been on market for 10 days. We've called texted and emailed through Hem Lane, like every single inquiry. The only thing we haven't sent is a a, a carrier pigeon. This is the one showing that we have. And like they said that they didn't like the carpet in a room or something. Okay, let's jump on a call.
Let's figure something out. Let's like, let's actually try to get this to close as quickly as possible. And so, you know, then you can spend more time on those high EQ things that you mentioned, Stacey, of like on the ground. Let's go tour with a person again. Let's try to close that. And, and you're focused on the things you need to be focused on versus the admin, the global team's.
A really interesting one. Stacey. Where do you think is the best, best talent? I'll, I'll tell you 'cause we've done so much [00:44:00] research. Uh, where do you think is the best talent?
Stacey Salyer: So I had my talent lived in Mexico, South Africa, and Philippines. Okay. And. Honestly, I loved my team. Like I team, they're amazing. So I guess I'm kind of partial, but I mean, I, I built a really good team from Mexico, South Africa, and Philippines.
I've met other, you know, remote team members from other like South America countries. Those are always really good. I think it kind of depends on what you're looking for, but again, it really just boils down to the person. I guess I approached it a little bit different. I didn't necessarily approach it based on the country.
I hired based on the traits needed for the job and the traits. Yeah. Possessed. So I don't know. I'd be curious, what, what about you guys?
Dana Dunford: Yeah, I think some of, kind of like my general high levels is we have offices and we really develop the talent. So like this will be a, the best person with fair housing [00:45:00] and and they're only responding to exactly what's in the, uh, description stuff.
Like they're not going off of that script. But we've done, we've done global talent and one of the biggest mistakes I see property managers make or companies make is they look for the cheapest. Oh, in other words, they look for, Hey, I'm looking for global talent and so I'm gonna go to the place that is the cheapest place to hire if you have to micromanage someone.
Yeah, you are not doing it right. And so always what I say is like, if we have global talent like our, our biggest office is in Nicaragua, Mexico was actually a phenomenal place. I was in Monterey, Mexico yesterday. I'm back in San Francisco, but I was in Monterey, Mexico yesterday with a couple of entrepreneurs and they all have started super successful businesses there.
Like Mexico City is actually the place to be. Monterey, Mexico, not as much that's much more [00:46:00] industrial. A very well functioning city, higher GDP per capita than most cities. In the US It was like 97,000 US dollars, like very, very high up there. But, when you look for your global talent, I think far too often people look for someone who's just gonna follow a process, right?
And we, we look differently. We look for someone who will build that themselves, like they are smart enough to say, I'm on a call doing this, boom, boom, boom, boom, boom. And I actually can talk to this person and have that eq and I understand that I don't just follow this one script. And that if you can get to there and then be kind of in the middle from that perspective of not the cheapest person that's $2 an hour, but you know someone who is seven or $8 an hour, it will change your business significantly.
Yep. Because if you're gonna hire someone who is, you know, two, $3 an hour and you're micromanaging [00:47:00] everything, or they're just responding to messages in the most mundane way, my argument would be like, well, why didn't you just implement AI for that? That's, that's a perfect use case for
it.
And so, yeah, yeah.
Stacey Salyer: Oh no, for sure. Well, this is probably why you and I get along so well, because I, so I, I did not hire people just because it was cheaper labor. I mean, obviously that helped me build up a bigger team than if it was just in Washington state. Yeah. But my, I hired humans and that was always my thing. Like, these are human beings that will contribute to your business and they it doesn't matter where they live, it's really about building that whole culture in that team.
So, like my like I had Gabby who lived in South Africa, she ran my entire leasing department. I mean, literally like, and. She had conversations with applicants residents, clients, nobody would've known that she even lived in South Africa, except she had like the most pleasant, amazing accent. So if anybody was ever [00:48:00] mad, we would send them to our South Africa team because nobody could be mad once they were like talking in the lovely accent, but because they were just part of our team.
Like they weren't just a person. Like, but yeah, to your point, I mean, if you just want a mundane like task thing, then that's ai. A hundred percent. Yeah. Yeah. No matter where your human lives, they need to be, have that emotional connection, be able to be trained be able to have those conversations, you know, be empathetic.
Like, I'm so sorry that you had this, like, flood in your home. Like, let's, let's get you, you know, moving on this or whatever. And obviously still follow processes, but yeah, really treated like a teammate.
Dana Dunford: Yeah. Yeah, exactly. And the teammate thing is really important because you want to break barriers with anyone you hire on your team.
And I've seen it where we've gotten talent where I'm like, how was this person let, like how, not that they were let [00:49:00] go, they came to us, but like, why did that company ever let this asset leave? Yep. Right. And they said, well, I felt like I had, I hit a peak at my last company because they told me I had to be in the US to get to the next level.
Stacey Salyer: Mmmmmm,
Dana Dunford: and it wasn't that it was that person, it was such a big, large run company that I don't think they knew what was going on. But they had US team members who were like, for our own jobs, like, we are not gonna let other talent. And when we tell peoples, you can be whatever you want. Yeah, as long as you are the top and you are your own CEO and you can build your own things and you delight every customer every day.
So yeah, I couldn't agree more of like treating everyone like your team with that development. It will go so far because I think far too many companies don't do that with the top performers. And by the way, with global talent, you have [00:50:00] to shift through. A thousand times more people than you would have to elsewhere.
But once you get a good team and a good recruitment process in place, you'll find that it's a lot better. Also if you go through a company to do it, one thing I would say is ask how much they're taking. Because usually if you go through a call center, we don't. 'cause we build everything our own and train our own staff in Exactly, you know, how we want things to be done.
And, and fortunately we're larger to do that, but in most of these cases, what you'll find is the person is only taking home 25%.
Stacey Salyer: Mm-hmm.
Dana Dunford: And
75% goes to the call center, which means your talent is not as good as they otherwise could be. And so it is something for you to think about in the remote age of going direct to the person and getting a contract set up with them.
Stacey Salyer: Yep. Yeah, a hundred percent. Yeah. Mine toward the end, were direct hire. Yeah. And it did make a huge difference and I used some different personality type testing and yeah, again, really focused [00:51:00] on what traits were needed for the position and then what the traits that the person possessed. And I had an amazing team.
I mean, we were able to output a ton of work and really, you know, I mean 400 plus doors and one person running that, you know, just in leasing that's, you know, pretty good.
Dana Dunford: Yeah. Way,
Stacey Salyer: way different than what I see out there, so. Yeah. Well, I am so happy that you decided to come on today. I've really enjoyed our conversation.
We could probably talk for hours, I'm sure. Totally. I know. Is there anything that you want to promote that you guys are working on in 2026 that you wanna talk about?
Dana Dunford: Biggest things we're working on, honestly, is more of the process like tenant led towards an app. We've o obviously partnered with all of the inspection companies out there, bringing in an app, AI to help with that.
So like they only take a video when we create the inspection reports and verify them, move in and move out. All that kind of cool stuff is coming up. So, [00:52:00] we just, we continue to love the industry of property management. If anyone has any questions about like, scaling, even if you have only 10 units or 20 units, it's never too early to get started.
Those are honestly my favorite to start with because you start with 10 units and then like. Before you know it, you're at 500 because all you're doing is being out there and talking to owners and business development, everything that you're great at. And so, if you do have any questions about technology, where that's going in the industry and kind of how to think about it, we think of ourselves as like Bo both software and service uh, together like in a platform and becoming tech partners, which I think is the future.
I think SAS in our space, like software as a service is, is pretty much gonna be dead. It's a commodity at this point. I think really the future is working with the best tech players who don't just think about software, but think about solving people's problems. How do I reduce days on market?
How do I reduce delinquency weight [00:53:00] rates and SaaS won't get you there, but a technology partner will.
Stacey Salyer: Yeah, I love that. I love that. Well, that's cool. Well thank you so much for coming on. I really appreciate it. I had a great conversation and I hope to see you again soon.
Dana Dunford: Likewise. Thanks so much for having me, Stacey. Yeah, you're welcome.
Outro: Thanks for listening to the Stacey Salyer show. Here's the deal. You can read about acquisitions anywhere, but you can't learn acquisitions from someone who's done it the way I have as a buyer, a seller, and from the corporate side evaluating hundreds of companies. That's why I need you to subscribe and share this with someone in your network who needs to hear it.
And if this episode landed, leave a five star review. It's how more PM owners find the only acquisition expertise in the space that comes from all sides of the table. And while you're at it, grab my Acquisition Readiness checklist on my website at staceysalyer.com. Then when you're ready to move from Growth Thinking to Growth Building, [00:54:00] explore the Built to Acquire program.
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