First of all, how are you and your family doing in these COVID-19 times?
Ethan Lieber: Starting out of the gate hot! That’s a loaded question, but I’ll keep it short. We’re physically healthy, so that’s more than I could ask for, but COVID times have been a mental and emotional rollercoaster. As if running a startup isn’t difficult enough, COVID-19 has made the highs even more euphoric, and the lows even more terrifying.
I live with my dog and my fiancé in a 400 square foot studio in San Francisco. Probably not the first visual that pops into your head when you think “CEO of a venture backed startup.” I’m often on sales calls or team meetings while she’s teaching a 2nd-grade class on Zoom. Tension can run high, but our dog, Momo, loves every minute of it.
Tell us about you, your career, how you founded Latchel.
Ethan Lieber: Let’s start with a quick snapshot of Latchel, my company. Latchel provides concierge services to residents in rental properties and acts as a maintenance coordination platform for the property managers. Property managers work with us because we help them increase their revenues while fulfilling their maintenance operations. This allows them to focus on growth using our platform to scale coordination fulfillment. Okay, now we can get to the company’s founding, and this will start to make more sense.
I met my co-founder, Will Gordon, in college. We went to UC Berkeley. We were roommates for all four years and always talked about starting a business together. After college, Will went into supply chain management and worked his way over to Amazon building their Prime delivery networks. Amazon logistics have a surprising amount in common with maintenance coordination, so my co-founder’s experiences were a natural fit for building the operations atLatchel.
I went into product management after college. I worked with a couple of different companies before I found my way into a lead generation company where I managed mobile and web apps that connected contractors to homeowners. You can imagine how this component was extremely relevant for building a service that coordinated maintenance in rental properties. While working at this lead gen company, I also started a passive income business selling private label products on Amazon through the FBA (Fulfilled by Amazon) platform. It was beautiful. I worked full time and still built a business on the side that generated $1MM in revenues in just 18 months. I was able to do it because Amazon managed all the fulfillment. All I had to do was worry about marketing and product sourcing. I bring this up because my work building that e-commerce the company inspired me to see Latchel as a platform play that could take over service fulfillment for property managers and allow them to focus on growth.
Okay, so at this point, my co-founder and I had all the ingredients needed to build Latchel, but we were missing the knowledge that resident service and maintenance fulfillment was even a problem for property managers.
By a stroke of luck, my co-founder’s grandfather decided to retire from property management (at age 92!) Will got stuck helping run the maintenance side of the business while his father handled the rest. Will was already working 80 hour weeks at Amazon, and now he was dealing with maintenance calls for the management company. That’s when he called me for help. After doing a lot of research, we realized this was a common problem every management company deals with. Latchel became the solution to this maintenance fulfillment problem. We just had to find the right product format so that we (A) created a scalable maintenance platform for managers, (B) increased the resident experience, and (C) did it in a way that created revenues for property managers rather than becoming a cost burden.
How does Latchel innovate?
Ethan Lieber: Our most important cultural principles are Customer Obsession and Continuous Improvement. So for us, innovation starts with understanding the customer. We first need to understand their goals and constraints. For Latchel customers, the goal is growth, and the constraint is very tight margins. Our products need to solve for this.
When we go one level deeper, we think about the things that will never change about what Latchel customers want. They want their resident services to be (1) caring, (2) convenient, (3) transparent, and (4) affordable – or even profitable for the manager. So whenever we’re building something, we need to make sure it addresses these 4 needs.
Any new features or new products we look at have to solve for the above. I’m talking mostly about our product here, but innovations happen in other places, like our sales and marketing processes. So the last thing I’ll say is that we innovate by experimenting quickly. We take a Bias for Action, implement experiments fast, learn, and then adapt. Much of this mentality comes from our experience during Y Combinator running growth experiments on 2-week cycles.
How the coronavirus pandemic affects your business, and how are you coping?
Ethan Lieber: We’re fortunate that we’ve been a 100% remote company since April 2019. We didn’t have to worry about adapting communication processes. That said, employee mental health has become top of mind. It is tough for everyone. We’re all socially isolated right now. If you’re on social media or watching the news, there are a lot of negative languages and a lot of doom and gloom. We’ve had to put a lot more focus on helping employees maintain sanity. It means a lot of 1:1 time and creating space to socialize as a company. We can’t be all business 100% of the time. We need that personal interaction, and we often expect to get that from our colleagues.
On the business side, things are going well. Like most folks, our pipeline froze up between March to May. Nobody wanted to make big business decisions at the height of the pandemic. Property Management is a robust industry, though. When June rolled around, the business was popping for Latchel and our customers.
One of the ways we protected the business during COVID times was to pivot the product. In April, we launched video-based tele-maintenance to continue supporting residents while maintenance technicians were in lockdown.
Did you have to make difficult choices, and what are the lessons learned?
Ethan Lieber: We make difficult choices all the time. When COVID-19 hit, we had to protect the business, and that definitely meant cost-cutting. We just didn’t know what was going to happen. We got lucky, though. We wrapped up a raise in February 2020, right before COVID hit. We didn’t have to make as many cuts as other startups.
We also had to make a difficult decision on how to move forward with sales. Our growth rate was flatlined in March. What could we do?
We decided to pivot our marketing and focus on property managers segments that we had never approached before. For us, that meant marketing to association managers and very large multi-family enterprises. In June, we rebalanced with more focus on single-family residential.
Move quickly and then adapt. That’s the lesson. You’ll fail a lot, but that’s okay. Knowing what not to do is a win.
How do you deal with stress and anxiety? How do you project yourself and Latchel in the future?
Ethan Lieber: Another culture principle at Latchel that we follow is called Ego is the Enemy. We took it from Ryan Holiday’s book of the same name. At Latchel, we take it to mean that you need to separate your identity from the outcome of the work you do. When you stop beating yourself up about a bad sales month, or a string of bad months, you can actually focus on how to move forward. You are not the input of the end result. Rather your actions are the input to the end result. So if you’re not getting the results you want, just change the actions.
When you frame things this way, there is little reason to be overly stressed or anxious. You come to realize that you just need to try more things and experiment. Tackling a list of experiments is a lot less stressful than tackling a list of your personal flaws.
And the best way to build a great company for the future has nothing to do with being a great seer. Take your ego out of the equation; you can’t tell the future. Instead, build a company that can move quickly so that you can pivot and innovate when the time comes.
Who are your competitors? And how do you plan to stay in the game?
Ethan Lieber: If you asked a savvy property manager who we compete with, they would probably name close to 20 different companies that we’d be a good replacement for. Yet none of these companies would be a good replacement for Latchel. That’s something I’m very proud of. It is why our retention rate is upwards of 98% month over month.
If you want to stay in the game, stay customer Obsessed. That’s all that matters.
Your final thoughts?
Ethan Lieber: Here are just a couple of thought exercises to get the brain juices flowing.
1. Move fast. Speed is a massive advantage for any company. How can you cut the launch and development timelines in half?
2. Think in terms of scale. How can you 10x your growth next month?
3. What are the things that will never change about what your customers want?
4. What are the cultural principles that are core to making your team effective?
Top of the month
Resources10 months ago
TOP 105 Niche Sites to Submit a Guest Post for Free in 2021
Resources5 months ago
A Complete Guide on How to Start a Fintech Startup in 2021
Lifestyle3 weeks ago
How Long Does it Take to be Good at Piano?
Resources3 weeks ago
Chromecast with Google TV vs. Amazon Fire TV Stick 4K: Which is the Best Streaming Device?