24-yr old app entrepreneur hits gold in rental market
24 year-old entrepreneur Sam Ovens knows a lot about what it takes to make a successful startup, because his first few businesses were not successful. He realised that his failure to address a specific problem was where he went wrong, but with persistence and critical thinking, he has finally hit gold.
Sam, 20 at the time, dropped out of university in his third year when he decided he wanted to be his own boss. His first 3 companies were admittedly unsuccessful, although they were very valuable. They may not have generated a profit, but they taught Sam lessons that money can’t buy; what makes people give you their money for your product, and how to deal with failure.
That figurative gold Sam has hit is SnapInspect, the top property management app in the market available for iPhone, Android, and iPad. It allows real estate professionals to inspect their properties using their mobile devices instead of a carrying around a clunky clipboard, paper and pen, and digital camera.
“All the stuff I built in the past, people had said, ‘Hey this is really cool, but I just don’t need this,’” Sam said. “So I figured out that people have to need what you have in order for them to buy it from you and for you to have a successful business. Instead of thinking of ideas, I switched my whole focus to finding problems that people have.”
Looking for a problem to solve, Sam picked the real estate market and began cold calling a list of 50 property management companies that he had found through Google, asking them on the phone what the most painful part of being a property manager was.
“I just started having all these chats,” he said, “and then after about 10 calls it was just so clear and obvious that property inspections were the most painful part.”
The first version of SnapInspect was built offshore, coming with a price tag of $10,000. Sam raised that money by giving 12 property managers a lifetime discount, if they bought a three month subscription in advance at a cost of $150 month.
Sam approached an Indian development company with his $10,000, but soon learned that, despite being cost-effective, offshore development has its challenges. “We got the job done, but it was a bit of a nightmare,” Sam said. “You’ve got different timezones, and there’s sometimes a communication barrier. They’re not getting paid very much so they’re always trying to take shortcuts and cut corners.”
Despite its drawbacks, the product that was developed was sufficient to get the service into the marketplace, and in hindsight, Sam doesn’t think he would have changed anything
The second and current iteration of the service has been built by in-house developers who have completely rebuilt the entire application, scrapping every line of original code.
The biggest obstacle Sam has encountered with SnapInspect is the difficulties involved in scaling a business. He says that it’s fairly easy to build a company that makes a little bit of money – like $5,000 or so a month – but as soon as you try to scale it, all the internal processes within it break.
“You’re going well, you’re economical with so many customers a month, but the second you try to turn up the volume a bit, everything inside the business crumbles. So I think scaling, taking it from a small business to a big business, is what’s hardest,” Sam said.
SnapInspect became profitable 2 years ago, and has been breaking through that scalability barrier consistently on a daily basis.
Companies pay a certain amount to use the service each month starting from around $49 per user. SnapInspect has a range of clients all over the world from small one-man property management businesses in rural areas of New Zealand, to entire real estate chains such as CBRE, to big American banks and hedge funds that have over 1,000 users and billions of dollars worth of properties under management. Government organisations also find SnapInspect useful, with the Texas government, Plunket New Zealand, and the DHB all buying a subscription to the app.
“Anyone who owns a large portfolio of properties that need to be checked on from time to time and have some sort of reporting as to the condition of their property is an ideal candidate for snap inspect,” Sam said.
The company is currently exploring as many verticals as possible, such as management for vacation rentals, residential properties, and commercial spaces. They will continue to do this over the next 3-4 years, Sam says, and after they have established a solid foothold in the marketplace they will begin looking at creating other products for property managers.
Additional editing by Charlie Ferris