SaaS Interviews with CEOs, Startups, Founders
Virtual Leasing Tour SaaS Hits $5m Revenue, Sells 60% at $34m Valuation Bringing on New Strategic Partner
12 May 2021
Chapter 1: What funding round did Realync recently complete?
So we did a $22 million round with Susquehanna Growth Equity this past fall. We didn't put a full $22 million on the cap table. We did some cap table cleanup, liquidity event, things like that for some of the prior investors, but big equity partner. And we're very excited about what they mean to the business.
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Hello, everyone. My guest today is Matt Wyrick. He's the co-founder and CEO of RealLink. Having founded the company over nine years ago, Matt's on a mission to make multifamily touring, leasing, and communication real and transparent. With their video leasing solution, the company has helped teams all across the United States increase their lead-to-lease conversion rates.
and decreased sales cycles. The company is partnered with many of the nation's largest property owners and managers and is actively being used in over 220,000 units today. The company's multifamily leading virtual leasing and resident engagement platform enables live video tours, live virtual open houses, and do-it-yourself pre-recorded videos of properties. Matt, you ready to take us to the top?
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Chapter 2: What inspired Matt to start Realync?
Yes. These are big. These are big, big. Okay. Interesting. Okay. Very cool. Take us back to day one. So you mentioned your problem in 2011 when the move happened. Did you start coding and building this thing immediately? When did you guys write the first line of code? Yeah, definitely didn't.
So I actually, when I was moving to Chicago, I was starting my career as a consultant at Accenture doing management consulting. And I was on the road for... three years straight doing consulting. And so I kind of sat on the idea for a minute and couldn't get out of my mind and couldn't get out of my mind because as a consultant on the road every week for three years straight,
I saw that pain point iterated time and time again of not physically being able to be at the property to tour it or physically being there, but cramming it all into a weekend and exhausting yourself over a weekend trying to tour properties. And so it was a pain point I saw reiterated time and time again at Accenture.
And so finally, I was at a work event and one of my then colleagues, my now co-founder, Ani, him and I were talking about what's next, what's life after consulting look like. And he was a part of a startup at Northwestern when he was in college and wanted to do something entrepreneurial. So I pulled the idea out of my back pocket, pitched him on it.
And the very next weekend we were in my apartment, whiteboarding, laying the foundation. What year did you guys launch that? So that was 2013 when we first started scoping and speccing out and running focus groups and all of that. And we brought on a chief technology officer along with us because neither of us had extensive background.
Did you have to give them equity or did you just pay them a lot of money? No, equity. Yep. There's really like three of you guys that own the majority of the business. Exactly. And then we, so we started Speckinit in 2013 and then we launched our MVP in 2014. 2014. Okay. And then did you get your first customers in 2014? You could call them that. Yeah.
We had our first people on the platform using it. And when we first launched, we were actually focused on the residential for sale side of the industry. So we were partnering with Caldwell Banker, Keller Williams, Century 21 and brokerages like that working on the for sale side of the industry. But We realized very quickly that was not a B2B go-to-market strategy.
Brokerages did not want to pay for technology for their agents. And so we had to sell agent by agent by agent. And it just was not an easy or feasible go-to-market strategy for a startup. And so we got our first multifamily client in 2015. And then in 2016, we really made the decision to go all in multifamily, put the residential for sale side behind us and
full steam ahead and here we are half a million units later and so were you guys basically free revenue living off savings in both 2013 2014 until that multi-family client in 2015 yeah so we did a friends and family round of funding uh end of 2013 i believe it was uh we raised 130 000 so very small 130 uh 330. So we made that stretch much longer than it should have.
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Chapter 3: How does Realync's platform streamline the leasing process?
That'd be a $6 million run rate? Absolutely, yeah. We actually had bigger goals than that for this year. So 2020 was quite the year of growth. We grew over 400% in 2020.
And we're not looking to repeat 400% growth in 2021, but looking to really ride the tailwind and all the attention on virtual leasing as we settle in as an industry with what this new season looks like of digital plus physical and the combination of everything in between as markets are opening up, properties, leasing centers are opening up and all that.
And so just to capture the 400% year-over-year growth from 2019 to 2020, what was the growth from 2020 to 2021? You're doing $400,000 a month today. What were you doing a year ago? So we actually hit 1 million ARR in January of 2020, which was a huge milestone for us. And then we ended the year at 4.5-ish, give or take. Holy cow. I mean, that's crazy growth in one year. What happened? COVID.
Yeah. The second leasing centers shut down because of shelter in place and quarantine and all of that, they had to turn to virtual leasing to keep business running. And they were using our platform offers, do-it-yourself pre-recorded video creation, live video tours and things like that. And so
we were perfectly primed and positioned to allow these leasing teams to continue leasing and managing their properties without any physical in-person. Wow. Wow.
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Chapter 4: What pricing model does Realync use for its services?
$1 million in 2019, $4.5 million in 2020. Now today, about $5, $5.5 million run rate. What do you think you can finish the year at? The goal is eight. So we're pushing hard. We've got a good... Good trajectory for 2021 and feeling pretty bullish about where we're going as a team. We've more than the crazy thing about it. January of 2020, we were a six person team and now we're a 35 person team.
So how many engineers on the team? So when we add our engineers in, we were at four and now we're at 15. 15 engineers out of the 35. So heavy tech. This isn't someone that's not a tech company calling themselves a tech company. You actually do have some real tech there. How many sales reps that carry a quota? So now we're at six. I used to be one third of our sales team.
So it feels good to have a sales team beyond myself. What did you set? There's always a tricky question for SaaS founders. What did you set the quota for your first sales hire that wasn't you, the founder? So her first quarter, we were very flexible on it. We set goals, but not necessarily a quota. We wanted to see what she could do.
Stepping in, we transitioned some of our accounts over to her so that she could farm and work on growth of those enterprise accounts. And then from there, we really based it off of... realistic activity levels and what we think they could produce on a quarter over quarter basis.
We, so far, all the reps that have joined the company, we've handed them a book of existing enterprise clients to grow that business. And so we're trying to set them up for good, quick win success, getting their feet wet. And so we've really settled of a goal quota of around 180 properties per quarter, give or take. What does that mean in terms of the new ARR per quarter per rep?
Per rep, so if they're adding 180 properties, rough math, we could expect them to do about 600,000 ARR? A quarter. Yeah, that's aggressive. So you basically have a quota target of 2.4 million of new ARR per rep per year. I mean, if you can make it work, that's great.
I mean, typically the ratios you see there are something related, you know, it's like a million dollar quota target with a full OT of 200 grand or something like that. Right. Exactly. And this is the first year we're feeling it out. We're shooting for the moon. Um, and we definitely recognize there'll be some settling in with the new team and sales org. We brought on, uh, a
heavy-hitting industry leader, Christy Picker, to come on and lead the sales org. She's been in the multifamily space for 20-plus years and knows it inside and out. Making a lot of shifts, a lot of changes as we settled into having a sales org. It's one of those things, the land and expand, the farming and that growth for us has typically made up about 75% to 80% of our sales.
Expansion revenue is 80% year-over-year. Exactly. And so early, multiplying those early numbers obviously are easier, but 80% expansion is great. What's gross revenue churn? So very low. Thankfully, we're at less than 10% annual. That's great. So your net dollar retention is going to be like 150, 160 right now? Yep, exactly. That's great.
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