How to Scale a Short-Term Rental Management Business Without Sacrificing Quality

Welcome to the SDR Data Lab. Hello and welcome to the SDR Data Lab. I'm Jamie Lane, chief economist at AirDNA, and we've got two returning guests. Uh we have Joe and Max Bachmeire. uh they come back as uh winners of a new award. They are were our 2025 uh AirDiren best property managers uh last year the number one rated property manager uh in the country. Uh this year they come back still in the top five. Uh but their new award was fastest growing. Uh so 12 months later uh they've gone from roughly 120 listings to 260 listings. Uh and they are still in the top five in the nation on guest rating. So essentially they've doubled the company and we're still able to maintain their top tier rating. So I am so excited to figure out how they did it.

Joe and Max, welcome back.

Thanks for having us Jamie. We're excited to be here. Uh Max and I were talking. Uh didn't think we'd make this podcast again this year, but here we are. We're standing and we're we're so proud to be here.

So I uh maybe just let's start with the growth roughly doubling. Like that is crazy. Uh can you tell us a bit about where that growth came from? Was it organic? And you guys talked about how you weren't going to open up new markets. Did you expand to new markets? I also loved last year you talked about the sort of sending a dollar bill in the mail like any new uh techniques you guys sort of garnered to sort of drive drive this growth.

It's just been consistency um with with many things in life if you're if you're consistent and you're doing it every day it it pays off. So there hasn't been any uh any crazy secrets. The the dollar mailer uh we didn't do another one of those but we u we still get calls on it. anyone that didn't less than last time, we mailed a dollar to every owner in our market um as their first owner payout and and we're still getting calls from that mailer, which is cool. We have been consistent with mailers. Um we started a referral program, you know, reaching out to realators um and our owners and and kind of nodes in the market and offering incentives on that. We wrapped a couple of our vehicles. Um so it's it's not one specific thing. It's it's consistency.

It's hitting them a bunch of different ways. Um, and it's having our reputation, you know, precede us with with obviously our AirDNA ranking.

Yeah. And that and then I'll add to that bit AirDNA ranking, you know, the accolades that you gave us last year. Uh, we've screamed it from the mountain tops. I mean, that that I think has carried a lot of weight with some people that that do know the industry and and our operators. uh and for a lack of better words, you know, we call ourselves professional hosts, but there are also hosts out there that own a lot of different properties and uh and want the best property managers in their region. And so we've gotten phone calls from all different markets and and you've touched on it Jamie like we have had to push away markets um because we want to maintain that that that high quality you know no matter how many properties we have we have this mentality that we are always this small family business and and that's the operation we want to run and that's the operation we want to continue to run and continue to make sure that our guests feel it, our owners feel it and that our team feels that as well.

So, Max, that was one of the and your sort of lessons of advice for people was I'm coming out of last year's episode was stay lo local. Don't spread yourself too thin. Keep it in your backyard. So, how local have you guys kept it? Because I I'm sure and you're now getting asked in an expanded area like is it still just in Franksburg or have you guys expanded a bit beyond that? Yeah, we we manage about 90 I would say 90 I I haven't done the math on it, but I would say about 98% Fredericksburg. The uh second largest market we operate in is Austin. And then a few markets sprinkled in there that actually we've uh we're involved in those markets because we've been involved since day one. You know, we were a lot more friendly uh taking on properties in markets that were a little bit further from us. Uh if it was essentially doing an owner a favor, right? Maybe an owner already has a property that we manage in Frederick, they say, "Hey, would you manage this property out in Kingsland for us?" And and you know, of course, with some of those, you know, incredible owners, we we it's hard to say no to.

Uh however, we've we've we've been able to pretty much consolidate it to Fredericksburg and Austin for the most part. uh and and and consolidate, you know, continue to consolidate and operate and putting more focus into growing uh within Fredericksburg and Austin, which may be one of the most profound pieces of that information, right? Because you talk about all this growth, but you're like, "All right, well, how many other markets have you entered?" The answer is virtually none. Uh Fredericksburg and Austin is our bread and butter and and that's, you know, that's that's kind of that's our backyard. Um we we feel most confident operating that market and and uh we love the people in this market. We love the guests we get. We love the owners. Uh it it's just you know if you got something good you know why let go of that. So we we've we've we've been able to maintain uh you know uh growth within those core markets and and we've you know we plan to continue that.

As long as we can maintain that quality we're we're happy campers. So Joe, may maybe let's talk about that sort of moment of uh last year you talked about how you guys tapped the brakes around 100. You're looking to optimize. You're looking to make sure the quality that you've really built what you're able to maintain at that sort of 100 unit mark. Uh and and now clearly you guys have taken the brakes off and pushed on the accelerator again. So, what was that moment and and how has it been sort of moving back into gross days?

Yeah. Um, we we kind of realized there's there's three C's that our owners care about. There's cash, there's care, and there's communication and we focused on that. So, cash, how much money are they making through our pricing, through our listing optimization, through owner take-home. So, we focused on the cash. uh the care is is how are we taking care of their property? Well, we have a 4.94 superhost ranking. We have a number five ranking in the US, you know, based on your scores. Obviously, we care about the properties. Um and then the communication, um how are we communicating the owners? How are we responding to owners when they have a problem, when they have a question? Um and then also how we communicating with the guests. So we found, you know, once we hit that 100 mark, um, and we said, "Let's pump the brakes. Let's evaluate that." We we kind of found those three areas. Um, we said, "Okay, how do we focus on those three areas?" And Max and I can't do it all.

So, uh, we hired, we we grew, we expanded. We have the same core team that started with us six years ago, which is awesome. Um, but now we're at, you know, we're at 16 uh, team members, and each of those team members understand our core values. they understand we are review first. We focus on the guest review. If you can get a good guest review, everything else is gonna going to work itself out. Um so identifying that uh working with the employees to share our vision for this company. We can't be at all 260 properties every day, but our team has to be. So communicating that and empowering the team. Um that that's been the sauce for us and it's and it's been working. So I I remember what if it was either during the interview or afterwards like you sort of picked up your phone and were looking at it and like that been one of the longest times you had been like not responding to messages uh in a while.

So I mean over this past year have you guys been able to remove yourselves out of more of the day-to-day or do you still find yourself like looking at and all sorts of owner communication, guest communication? Are you guys still I in the business as they'd say or have you been able to pull pull out a little bit?

We we've been on the beach. I mean, we just showed up for this interview and we'll go back to the beach next week. You know, I I'll answer it quick and I want to hear what Max thinks, but we sat down uh probably two months ago, Max and I, and we evaluated all of our team. And one of the things that we're coming to realize as we grow is in order to promote somebody, you need to fill their position. They basically need to train their replacement. So we we evaluated each department and we said, if this person doesn't exist tomorrow or gets promoted tomorrow, who's going to take that role on? And a lot of the answer was like me or Max. And we're realizing, hey, that's that's not the way to to grow this. So, so what we've been working on is hiring the right people and and letting everyone on our team, the core people that have been around from day one, level up and back fill and under and that that's been that's been amazing to free our time up and to focus on, you know, building building the business rather than working in it every day.

Yeah, I couldn't agree more. The way that I sort of look at things nowadays is I don't know if you've ever heard of the that fourburner theory, right? and and you have your you have your family, you have your friends, you have your health and work. And I I think about it maybe a little bit differently, but all similarly with Bach Bros, except we have three burners and our burners are guests, owners, and and our team. And so, you know, we've been incredibly guest focused. Uh as as our review ratings can show, you know, we'll bend over backwards to make something right. Um but if you're not careful, you can keep one burner blazing and accidentally turn another one down. So you can provide unbelievable guest service. I if your team is is is burnt out um delivering it, that's not sustainable, right? And so if if if your owners don't feel appreciated, communicated with, and cared, or the three C's, as Joe had mentioned, you know, that's not sustainable either.

So our focus is keeping all three of those burners hot. A and the cool thing is that if you if you do it right, they can begin to feed each other. So, a great team takes, you know, better care of the guests. A happy guest creates stronger properties. Stronger properties create happier owners and happy owners allow us to continue investing in in our people. Yeah, it it's funny when I interviewed one of the founders of Vicasi almost explained that in reverse of like the cycle that also happens like if you're getting bad reviews of like this sort of downward spiral of owner retention, revenue and ability to grow and and you guys clearly on the I'm right side of that cycle and where everything's can sort of feed into each other. I was gonna add, Jamie, sorry. One one thing that we did this year which I really loved uh was uh we sent our owners just an appreciation gift. Uh we sent our owners this.

It's called Spoonful of Comfort. There's a free plug for them. Uh it's basically a a perishable package of soups, uh cookies, dinner rolls, a keepsake ladle, and like a personal message, uh that we had written. and we we we sent them out to to all of our owners, uh, some local vendors as well, some tradesmen, plumbers, and and someone that we really rely on. And, uh, it it it wasn't it wasn't like some massive gesture, but just the response that we got was so incredible. Um, and we it just it just made us think like sometimes, you know, the highest ROI investment we can make isn't necessarily like hiring a new person or adding a new software. like it sometimes it's just reminding someone uh how much we appreciate them because at the end of the day, you know, relationships those relationships compound as well. So, uh that was a fun thing that we did this year that I I'd love to get into the into the habit of doing at least on a yearly basis.

Yeah, I I love that you talked about and the the three burners and that's a great sort of intro to my next question was around like as this past year progressed because I can't assume that everything worked perfect when you double your inventory, but interested in you guys's opinion like what broke like is it and certain systems was it certain teams And what did you end up having to hire for? Like what did you see? I need more support as as I you you scaled your inventory.

I I think realizing that we can't we can't be everywhere all the time. Uh is a is a tough thing for a founder and an owner to to realize things that that were really stressed. I'd say guest communications. Um we were operating with like two people on a guest communications team with over 200 properties. around the clock, seven days a week, by the way.

Yeah. And t and talking with other brands, you know, at Verma and and at other events, like some some brands and some companies, they're they're operating, you know, 9 to5 is when they're communicating to guests and then they go to like an overseas answering service or whatever, and we we just refuse to do that. Um, so we probably burned out our guest communications team just handling that. Um, so we hired there. you know, we've now got four people on guest services and we are now using a really cool technology to help us um handle that.

I'll piggyback on that. One of the biggest things that we've that's helped us evolve this year is is being much more intentional about uh not only the hiring the right people and putting putting putting individuals in the right roles, but uh but but then then providing our team with the tools that they need to succeed. uh and that specifically uh for us was technology right and and more specifically AI uh and machine learning. So the three areas where where we've really been ma able to deploy it most successfully uh and we're still in the early stages in in all three of these areas but as Joe was mentioning on guest services uh on the overall operations of the business um helping with SOPs uh you know creating processes and and uh best practices around the business and then as well in our revenue management side and um and so you know the common theme is is is kind of is simple, right? Because it's it's like identify things we we otherwise would have missed, turn information into systems, and help our people make better decisions with the tools they have available to them.

And and so that to me has been one of the bigger bigger initiatives that we've taken this year, and it's it's it's helped us be a lot more efficient and effective with with our time.

Yeah. I I'm interested in in digging in a little bit there because I know the podcast this past year, it's been a a big theme of like digging into a lot of these new AI tools and and how property managers are leveraging them and and a lot of the feedback or a lot of the worry from property managers has been and sort of removing humans from the equation when the humans from the equation are being part of the equation is what makes I so great, right? And I think people would be maybe excited to hear that at someone for someone at your level of quality in terms of guest care that you're able to introduce AI and pieces of the equation while still maintaining those high quality levels. So I'm interested in and how you guys think about let me let's start with guest communication and then you go into operations but how do you think about where you can bring AI in and where you just like where where's where does the buck stop and like we're not bringing AI into this piece of it.

AI has has just has come I mean so far and we were kind of trying to be early adop we were we were early adopters like trying it like oh this would be great like help with guest communications probably two years ago um and it wasn't it was bad and we we stopped it. What I'll say is I agree that was one of my concerns is like I don't want an AI chatbot responding to guests and upsetting guests and and replacing employees. what what I've seen it has been able to do for our company, it has answered over 50% I think 60% right now of guest messaging that is just taking up time from our team outside of focusing on the real problems and issues and providing better uh customer service experiences. So, guests that are, "Hey, thank you so much for the stay or hey, what's the address?" or "What's the door code?" or very, "Where's the Wi-Fi?" or very simple things that like have bogged down our team and took our response rate close to an hour.

Um, has now helped free up our team to to deal with the problems and the issues and provide a lot better guest experience and better guest communications and services than we ever have been able to provide before.

Yeah, it's it's I I'll I'll piggyback on that. It's it's um 80% of those guest messages tend to be as Joe mentioned, you know, where's the door, what's the door code, you know, where do we put the trash? These are repeatable questions that we we know the answer to, but for whatever reason it didn't get documented or or maybe it lives in someone's head and and we we kind of remind our team if we could figure out a solution for a problem and then document it, you don't have to ever solve that problem again, right? So let's not fall down that rabbit hole of continuing to solve the same problem over and over again. And that's that's where techn the tools that we are deploying are helping us you know refine and and create more operational efficiency. Uh and and and what we've noticed is 80% of of guest inquiries tend to be those those very simple inquiries or guests that don't reach out at all.

Whereas uh the 20% of guests, those are the ones that are going to have more complicated issues during their stay. They may need uh a maintenance technician. They may need a cleaner to stop back by. They may need something that just couldn't been been easily handled or easily answered. And by us reallocating our resources to focus on that 20% that are that are actually facing issues that may that that may have uh you know the most opportunity to improve review score. Right? You you we're focusing more of our time on guests that would have otherwise left us a maybe a two star or three star review. But since we're able to allocate almost 100% of our resources to those problemat, you know, those those guests that are experiencing those problems and issues, uh, we're we're able to turn those those those lower review scores into into fours and fives.

And and so really, I think that this is this is what's very exciting because I think that what we're going to start seeing is an improvement to our review rating or a continuation of the improvement of our review rating. whereas I felt like at one point we almost maybe plateaued and now we're excited to see how how that shifts based on the tools that we're using to to kind of improve our communication with with not only guests but then also extending into into just internal communication operations and then out to revenue management which is probably my most exciting.

The other thing on on the AI piece that I think is like where are we going with this? What's the ultimate goal? I heard a zero question guest stay. And if you think about it, most guests, they don't want to ask questions. They want to check in. They want to enjoy their their experience. They shouldn't be needing to message us. So, if we can use the AI to figure out what are the questions that guests are answering, let's answer that up front. So, they don't need to reach out. Of course, if they want to reach out how beautiful the property is or send us pictures of their their stay, love that. Um, but if we can get to that zero question guest stay, that means we're doing our job as property managers to provide all the information a guest needs.

And the way that the system helps us do that is bubbles up escalations. So, I mean, we can see I mean, Joe and I can look back at a report for the last seven days and and and know that, hey, 700 times last week or or, you know, 300 times last week, you had guests that were reaching out about early check-ins or same day early check-ins. and and this is our biggest snag. Uh so so hey, how can we put a system in in place that allows us to answer those guests a lot quicker and get them an answer and and and allow them to to check in early without any bottleneck.

So in talking with a lot of property managers like obviously and communication goes up pretty linear in terms of and as you're adding more listings, right? like more guests, more communication, you're able to solve that. It sounds like more employees, more um and use of AI. A lot of times I hear that the operational complexities can really compound on a on an exponential rate though because there's and so many more homes to get people to there's and what happens on laundry when you've got and double the homes your old systems might not work. And I know you guys and and before talked about how you had an inspections of every home that was a separate team that would go in and that were you doing that. So can you talk some about the operational side how that's sort of evolved over the past year and what you're doing to and make sure that that scales efficiently.

We're still doing it. We're still checking every house before every guest comes in. Um, it is a pain in the neck, but it is the best thing that a property manager can do because cleaners finish on a Sunday, stuff goes wrong Monday, Tuesday, Wednesday, you have a guest Thursday, they come in to a plumbing leak, HVAC's not working. Checking that property before the guest comes in is so important. Uh, we had a last week, we had a squatter. We found a squatter in one of our houses in Austin last week. And if we didn't do that check before the before the guest came in, guess what? The guest was walking into a squatter in our house. Um, and our team caught it and saved it. It's it's staffing. I mean, you you have to hire.

And then you can't just hire the same way we hired. You need managers. You need people in charge. You need the the core team that has been with you from the beginning that knows the system and the process to to to help the next person up. And that's that's been this that's been what we've been doing.

Yeah. So, and and you mentioned the word managers. So, that was something that I sort of hear over and over again is once you have to start putting in the management layer into your business and it brings you further away from the guest, it brings that manager further away from the guest and it does make it a bit harder to stay on top of and what's happening uh on the day-to-day to the business. So, has that complexity and have you felt it and do you feel just as connected to what's happening or how has that worked out so far?

Uh, can I shamelessly plug Guestie because Max and I get every single message on our phone still and uh and when a guest starts sending photos that's usually, hey, let's check what's going on. So, you you got to be on it. You got to be you have to be. You can't not be.

Yeah. So, you haven't used that as an excuse to not be looking at every message that comes in.

No, I'm crazy. I'm I'm out of my mind. Um I can't respond to every message, but I I can I can quickly scan through and see and and Max is really good about like actioning items. I think when when you have a problem, when you're at this level, you can't just like quickly solve the problem and move on. You have to first you have to solve the problem, but then you have to look back and be like, "Okay, what's the what's the SOP? what's the what's the procedure? Why did we get here? And let's implement something to solve it in the future. Um, and that's where the managers come in and that's where the team comes in to say, "Hey, let let's figure this out. Let's solve this going forward. Let's use AI. Let's use technology. Let's use what we can do to fix this from happening again."

Yeah. Max, last year when we talked, you sort of explained how how competitive the market was getting. Uh and Fredericksburg is I would say one of our most competitive markets uh in terms of and share of uh uh operators that are using property management systems that are using revenue management systems that are and clearly optimizing their listings to show up in search and and be able to compete on the OTAAS for business. So interested in your vantage point on sort of how the market's evolving and and sort of your position within the market.

Yeah. Uh that's a great question and uh how I would answer it is the secret is out. Uh um you know there are some markets like Austin which we've had properties for a while and and that's been a very it's it's very very known of how to operate a successful STR in in Austin, right? Uh there's so many more listings. There's a lot of discrepancy between how they're staged and how they're run. But in Fredericksburg specifically, uh the the the vast growth that we've had growth that we've had over the last couple years, uh I think you know two three years ago, you could have bought nearly any property with an STR permit, furnished it with IKEA furniture, and you would have been sitting pretty happy. Uh nowadays, it's just not the case. It's incredibly competitive. I mean, every listing now is upgrading interior. Um, exterior amenities. Um, I mean, a hot tub amenity is like one of those things where, you know, if someone brings up, hey, should I add a hot tub to my Airbnb?

I'm like, that should have already been on order since day one. That's like that's like like if you're asking that question, like we need to have a larger conversation. Um, there are some really outstanding interior design companies that have popped up. Uh I'm sure you're aware I'm sure most operators are very aware uh that lean very heavily into into SDR design and we've we've swore by it. Uh we actually did a little case study on a property that Joe and I own uh here in Fredericksburg and very similarly uh two years ago we had it uh performing you know above market and then over the last year we noticed uh some plateau and and the property was nicely designed. I would say it it was a we we had actually an STR designer or sorry not an STR designer we had a uh interior designer design it. However, it was just standard interior design. So, it have been a nice house to move into if you know you were moving into a house.

However, it didn't have that STR flare. And I'm talking about like like hot tub, uh, uh, sauna, you know, cowboy pool, karaoke lounge, like funky wallpaper, accent walls. And so Joe and I put a little budget together and we said, "Hey, let's update this property. Like, this property is plateauing on on owner revenue. let's see what we can do to just spice it up. And you know, we put a couple thousand dollars together and we made some strategic adjustments. Uh redesigned three bedrooms with with some fun, funky wallpaper. I've got to give Joe's wife a a a plug here. Uh Nadia, his Joe's wife has cheeky wallpaper and she is an like incredible wallpaper mir muralist here in town in Fredericksburg. she um she's been able to help us, you know, in a in a lot of different with a lot of different properties, but uh this property in particular, she she she installed wallpaper and and the three bedrooms.

Uh, we turned the gray doesn't know what it wants to be game room into a just full out karaoke lounge. All pink walls, disco balls hanging from the ceiling, a karaoke setup, a neon light with, you know, a fake shrubbery and uh, it just turned around. Joe, do you have the numbers on that? I mean, that was really quick.

Yeah, I do. Um, we invested $28,000 in it. Um, and our revenue went from $35,000 a year to $52,000 a year. So, we saw a 49% increase in revenue. Um, which is like a a I'm looking at the flyer that we send out to owners right now. It's a 1.6 1.6 years pays itself back. Uh, so when we get an owner that reaches out and says, "Max, why are you not pricing my property right? What? Look at this. Look what AirDNA said I should do." um we send them this and we say, "Hey, look at our property. We put $28,000 into it and we're now making $17,000 more a year on it. So, do this and you'll be successful." And and we've seen we've seen the impact. We've seen such a major impact with, you know, top tier amenities, but um also top tier design. I I think it's it's one thing that slept on uh quite a bit was uh you know people were adding pools and hot tubs and wow look at all my great amenities but the interior needed a refresh and and it needed to really uh it it really needs to uh you need to lean into one demographic one key demographic.

I've noticed if you try to keep it too broad, you know, oh well, I want to I want to appeal to, you know, um, couples, but also

everyone in Austin should be able to

every everyone in Austin. I'm like, go pick your demographic and go with it, you know, own it. And and so we've we've we're really proud that we were able to show some results for that. like we now are sharing that story with other owners and and trying to help connect the dots and like hey here's here's here are resources you can you know at your disposal like when you're ready to put a put put a little budget aside to to really take this to the next level you know it's it's just the nature of the the the uh the industry right it's very competitive and so uh if you're not doing it your neighbor across the street is going to be doing it and that's going to change you know that's going to change the dynamic and and ultimately your your comp set as well. So, uh that's a very important piece to it all, I think.

Yeah. So, Max, uh on the revenue management side, how have you seen AI impacting and and how you're sort of analyzing the market, how you're working with owners? Like, how has that changed on your your side? Yeah. So, revenue management is probably one of the it's probably one of the clearest examples of how technology has helped us operate differently as we've scaled at 260 properties now. uh portfolio averages can hide a lot you know uh uh occupancy ADR booking pace like they all look one way at a portfolio level and then you know while individual listing level uh they can could tell you a completely different story. So the bigger we get the easier it becomes for those averages to you know the the averages to hide what's actually happening underneath them. And so the tools that we now are putting in place give our team a much bigger field of vision and and so we can surface listing level trends, anomalies, opportunities that would have been incredibly difficult uh I think to to identify with the naked eye.

And so that's what's really to me that's what's really exciting um about the the entire like not only how we're utilizing it but the industry as a whole. I mean AI is and machine learning is like helping us or helping us start to unlock capabilities that just weren't available to us before. And I think every industry is experiencing some sort of version of that. And we talked about it before the before the podcast had started, right? Like AirDNA um adapt is a really great example of that as well. like you guys are clearly leaning into where this is going and and trying to push AIdriven revenue management forward where where I think it it like is incredibly exciting for the industry and even though I haven't had the chance to to use it yet which I I I'm very excited to but even conceptually I think it's it's a prof it's it's profound because it's it shows us where revenue management is headed and the next generation of revenue management isn't just going to be about having more data.

It's going to be about having better tools to interpret that data and surface what matters and help operators make better decisions. And um so for us that's a reminder that we can't get too comfortable with any one system, you know, and that and that's a that's a difficult truth to swallow, but we have to keep watching what's coming to the market, testing it, doing our due diligence. Like that's the big a big responsibility of Joe and I that that we're we're not we're not settling, right? We're we're continuing to see what hits the market and what's what's becomes available and how it could help the team even though it may be a a headache in the near term. Um and so asking whether there's a better tool that that can help us operate with more precision um is incredibly important and and and that's where the the foresight piece becomes really really exciting. We we don't want to just react to what happened last month.

We want to understand what's happening now and what what it could mean three months, six months or nine months from now. The best example I could use is when we were reviewing uh our latest revenue management meeting that that occurred last week. You know, we've identified some really incredible early 2027 uh pickup on our portfolios, particularly in comparison to the market. So January and February is a slower month in Fredericksburg. So for us to be able to think 10 steps ahead and and get out ahead of the the market on on months like January and February are really that's where you're going to make up the biggest difference. Um you know so if we can we can identify a change in booking behavior or demand months and months earlier you know we have much more time to respond intelligently. And then what's the saying? It's like I'd rather identify the smokes six months out than discover the fire 30 days out.

So, um yeah, I mean ultimately it's yeah, it's about giving, you know, giving giving really good people better information to make better decisions. That's that's my biggest like

So, how have you been thinking about it? Are you guys sort of relying on existing vendors out there to build the tools for you or are you guys taking an approach of and you're going to use the tools, you're going to use the AI and build out the systems you need to run your your revenue management?

You know, it's it's been a bit about it's been a bit of both right now. I think right now we're in this period where we're like having to piece together the different whether it's large language models like cloud or JBT and then and then using our our pricing software um and our revenue management system and kind of really piecing that information together. We're very eager to kind of get our hands on on a tool like like similar to what ARDNA like is building out. So that's what is very exciting to us. And so very much we're piecing it together right now and using different tools to to get what we need to get to. But uh but I think I mean we're going to be having the same conversation a year from now and we're going to say, "Oh my gosh, look at all the tools and all the different technology we have available to us, right?" And I think Jamie, you said earlier,

just hang out on the beach. That's all you

Yeah. Yeah. That's right. We'll get there. But you said it earlier, uh which I really liked. like hey there's a lot of fear uh that is like hey like well is AI replacing us or you know and I I'm very cautiously optimistic when it comes to to it but uh I think I keep telling people this I said I think in five years you're going to walk into a doctor's office a CPA's office you know a law office and if they're not using some sort of AI or machine learning to help them do their job better uh to provide a better service to you turn around and walk right back out the other Okay. And and find someone else that is because it's it's the competitive advantage that that you're neglecting if you're if you're not exploring uh the you know the vast amounts of technology that we now have available to us and tools uh and figuring out what works and what doesn't. So I do want to pivot a little bit and talk about marketing uh because this is an a topic that comes up over and over again especially as companies are scale are scaling like whether they've got a direct booking playbook they've got a website that can scale with them that they can continue to market to guests and whether those existing listings are just getting diluted by the new properties in terms of the ability to and drive direct bookings to those listings are whether now with the scale you're able to get more and more and repeat bookers and it's a flywheel that feeds the business.

So, how have you guys seen and sort of channel distribution play out over the past year or two?

I think direct bookings are they're like gold and if you can get them they're very important. So, um I think last year when we were on this call we had about 3% two to 3% direct bookings. we're we're hovering close to 15% now. Um so it it comes from a many different ways. Um but repeat guests are very big. So figuring out how you how you offer that discount code. So we have uh offered repeat guest discount codes to come back stay for cheaper. Um included QR codes and and now we're printing little cards uh that go in each of the units they can take with them and and stay next year with us. We collect as many emails as we can through a check-in form. Um, so when guests come stay, we say, "Hey, tell us a little bit more about you so we can tailor your stay and include your email." So we can collect that because obviously the channels don't always give you that information. Um, retargeting them with with email blasts.

Um, hey, come come stay. Here's a discount code. Uh, and then of course, you know, search engine optimization. How is your website? How is your checkout process? Like is it difficult for a guest to book with you? to make it as easy as possible. Um, and then we have started doing, you know, we've gone heavier into social media. We've done pay-per-click campaigns with with um with Google, uh, Google paid ads. Um, and back to AI, um, we're starting to get leads from AI. Like AI is now recommending us because we are giving it the right proper information. And so we got our first owner lead uh from an AI uh chat prompt that he asked for the best property manager and we popped up. So there it is back to AI.

It's kind of roll everything I guess. But

that's awesome. Uh and then on the and sort of guest side uh and still has sort of the scale impacted like and with the OTAAS so Airbnb verbboing like your ability to and optimize whether it's and for their ranking whether it's leveraging any of the promotions or tools that they offer like I know and and the platforms have changed a not and just over the past year or so have you seen that helpful hurt and what have you seen there?

Yeah, we've we've we've deployed a couple of different uh or we've changed quite a bit of our strategies to to experiment on on several platforms. Booking.com was one of them that we we did spend quite a bit of time uh on uh specifically because there's a lot of optin, right? uh a lot of different discounting that you can do whether it be through mobile or uh repeat guests or or what have you.

Genius like that.

Yeah. Genius. That's right.

15 different programs you can

prefer. Genius like

Yes. And and we've done the same thing with Verbbo. One exciting partnership that Verbbo and Guestie made or not so much a partnership but integration was that Verbbo didn't have uh discounts that we can uh we can use reliably on on guest and now they do. So we're running early bird specials last minute specials and uh uh mobile rate uh and so that's that's exciting. Um, Airbnb has been um we've we've kind of we've revised our our our strategies on how we're using those length days, those last minute and those the early bird specials. Uh, and and we we have like we we have begun refining them. We're always using that new listing uh promotion. That's another one that was added to Verbbo uh and we are now utilizing it on Booking.com as well. So yeah, we've we've definitely built out uh more of an infrastructure for using those, whereas like maybe just a couple years back, we were only using the the generic ones.

You know, new listing uh for Airbnb is probably the one of one of the most important ones for us uh that we've noticed, but um we've got we've we've become a lot more diverse in the way that we're using those. And and so I I do know that at one point Airbnb was only allowing strikethrough pricing. uh with a 20% discount threshold. Now they've dropped it to 10, which I'm like, thank the Lord. All right. So, so now pretty much like most of our listings were able to to qualify for that. You know, the difficult thing that people don't realize from professional hosts uh that are using or even not even professional hosts, but hosts that are using pricing software. The big thing that they don't realize is discounts may be happening on your pricing software, but that's not feeding directly down to your OTAA or through your PMS. So, you may be discounted 30 40% for any particular night. And the guest has no

not getting credit for it.

They're not getting credit for it. So, you kind of have to be a little strategic about that as well from, you know, an OTAA perspective. If you have a PMS, you you do have a little bit more flexibility to be creative with how you're advertising your your rates or how you're pushing rates to to to guests. But uh but yeah, it is it is funny when you get a message from a guest uh one night before their stay and they're like, "Hey, you know, could you offer me a discount?" I'm looking in, you know, in my pricing software. I'm going, "This is discounted 40%." I don't think we have that that much more wiggle room. otherwise I'm gonna get an angry owner call. So, we've definitely continued to refine them, you know, and I think one one thing that we're we're excited about as of recently, I don't know if it's available across the board in in various PMS's, but uh Gestie had just introduced uh dynamic fees.

So, we're super excited to hear more about that, how if that's applicable to all fees, including cleaning and and and and other fees. Uh I I believe it is. And I I I'm really looking forward to kind of doing a deep dive on that and seeing how we can fold that into into our infrastructure here because I think it's I think that's a that's a important piece where it's like if you have a onebedroom and the cleaning fee is a h 100red bucks but the nightly rate's like 150, you know, you have a guest that books and it's inflating that rate. Now on Airbnb they're not advertising the cleaning rate anymore. So you look at Airbnb and you see 250, you're not, you know, and so that's what the guest is seeing. Uh so being able to be dynamic with that is is clever and I I'd love to see how we can we can continue to deploy those those strategies and those tools that that uh whether it's the OTAAS or whether it's the PMS that that are unlocking those things for us.

I know my my team will be laughing you mentioned ding fees the number of times we've talked about it it's been

long time coming right

there's a lot of dependency on the PMS's and channels to support it though too

oh I imagine I imagine

so I we we talked about it last year but I want to ask you guys the same question and and you guys said it last year you were going to grow uh and you did so next year if we come back and chat like are you guys going to be doubling again? Are we going to be up over 500 listings? Are you guys going to be multimarket? Like what what do you see as the sort of growth trajectory? What are you guys have in your crystal ball?

I'll speak to that first, Joe. Joe will probably have the better answer, but we we we are using our team as our northstar. If our team could handle it, we'll press forward. Um, and and if owners are getting the same level of care, guests are getting the same level of care, we still we consistently show up on this podcast every year and we're in the top 10 rankings, then the show goes on. Uh, but but that's our read on it. you know, we have to make sure that our team is equipped, they have the resources they they need, they feel strong about continuing to grow, uh, and that owners and guests are receiving the same level of care um, and attention, not only the same level of care, but but but better that we're taking that to, you know, even a step further. And so that's our that's our that's my read on it. And and that's our that's our north star.

I I' I'd echo what Max said. I am a person of consistency. So, uh, my wife hates it. I get the same exact thing at every restaurant I go to. I have my favorite thing on the menu and I get it every time because I'm consistent. Um, if we can keep the consistency, we'll keep going. And we we lean on the team. We do. I mean, I I pick up the phone for every single lead that comes in. I tell them how great we are. I tell them what we can do. Um, and if we can continue to provide this level of of customer, you know, service and guest experience and hit those three C's that owners care about, who knows next year where we'll be. I just hope we're in that top 10. That'll be that'll be our goal, you know.

Yeah. So, I'm number one goal is is top 10 on Aaron's uh top property manager and and if your team can support more growth, I'm it'll come. Is that what I'm hearing? If we make the top 10 again next year, we just want you to wear a tuxedo on this on this. You know, Luke looks so good and you just need to match him. So, if we do that, that's our

and we want an in-person podcast next.

No, if you guys make top 10 three years in a row, we might be able to make an in-person interview uh happen.

Uh

maybe a free trial on AirDNA Adapt. There you go. Oh, every everyone gets a free trial.

Well, I thank you guys. And uh maybe one last question for each of you and putting on your respective hats and you've got a manager at 100 doors. I'm looking to expand and to that next phase. uh you guys have now done it and I've talked to so many property managers say I the path you guys have taken from 100 to 250 plus is one of the hardest scaling ways to go like it's and once you get over 150 like systems start to break it feels like you guys were really focused on getting those systems in place before you sort of made that process. So yeah, I mean any sort of words of advice for property managers looking to take that next step?

Grow smartly. I'd say it's it's easy to get excited at the shiny object. I think make sure that your team is ready to do it. Set realistic expectations. You know, often I meet with an owner, um they call and and I want to get the listing live. I'm like, "Hey, let's go, Max. Let's get this thing live. Let's pump the brakes a little bit. Let's get the listing up right. Let's do it smartly. And then let's let's really, you know, underpromise and overd deliver for that owner. Those three C's, you know, cash, care, and communication. Figure out what the owner cares about and focus on laser focus on that for that specific owner. It's going to be one of those three buckets. The sooner you can identify each of your owners and put them in a bucket, their their main area, the the better job you can do. Um, and and don't be Superman, you know, hire hire smart. Uh, put pe smarter people than you in jobs that you're doing that you shouldn't be doing.

Um, and you're going to be more successful because of it.

Yeah, I would say I would echo that and say your your most important thing especially at that phase at that at that stage is building an incredible team focusing on the people. I mean, one good person can do the work of three. Uh, it's I've seen it before. We've seen it before. Um, I would say 60% 60 70% of the team that we have now was the team we had on day one. Like your team is incredibly important. Making sure that they feel part of the vision, making sure that they feel um they're growing with you, they're growing with the company. Uh, that's that's going to be your your most important asset is is your team. And uh and the second piece to that would be and this is I feel like has been a big piece to to our success is deliver a farmtotable experience uh to your guests and to your owners and and by that I mean local local like like keep your recommendations local keep your operation local if you can right um don't grow beyond uh where you're comfortable right you're going to be able to operate the best in your backyard if you can get in your car and drive to any one of your properties and be there in 10 minutes, there's no question you're going to be able to deliver a excellent exper experience for guests as well as for owners.

If you can if I can if I can we can close this podcast out at 2 p.m. and I can run over to a property and meet an owner in 10 minutes, it's a gamecher. Uh so, uh people value that, you know, people value presence. people value you showing up and and so I think that's something that Joe and I have always done. It's our it's in our nature. Uh and it's funny uh you you tend to attract people that are similar to you and I think that is a big reflection of our team. Our team is is is just like they're they're little clones of us. you know, they they they think they they think similar in a similar way and they they have this expectation of I mean, when they see a review come in uh that's four stars, you would you would laugh because it's just it tears us up, you know, and we we want to do everything we can uh to provide that fivestar experience for for for our guests and our owners and and so they they they share that same those same values with us and and so, you know, making sure you you build that team, that solid team.

It doesn't have to be, you know, 10, 15 of them, just five solid people at at that level. I think at 100 properties, five solid people, including yourself, um, that that you can op, you know, you can operate and your business with and drive to that same goal and and staying local, staying as local as you possibly can. Being accessible, very important in this industry. So,

awesome. Well guys, this has been fun yet again uh talking with you guys. I I hope we do get to talk again in a year. Uh and if Are you guys going to be a Verma this year?

We we plan I I I plan on it.

I'll speak for myself.

I'll see you there. Uh thank you. Uh if people want to find you, if either want to reach out to you, what's the best way to do it?

Abrospropies.com. Reach out. uh you know, send us a message, follow us on Instagram, follow us uh follow Jamie Lane, check out all his fun updates on Instagram. Uh what's going on in the industry and and we we really appreciate this.

Awesome. Thanks, guys.