Matt Slepin, host of Leading Voices in Real Estate, sat down with Colin Wiel, CTO and co-founder of MYND Property Management in early December. Wiel discussed his tech background, the “small residential” real estate industry and how MYND got its start in Oakland, CA.
Here are some highlights from Wiel’s interview with Slepin. To listen to the entire podcast, download Leading Voices in Real Estate.
Question [Slepin]: Talk to us about the rental business.
Answer [Wiel]: MYND is a full stack, tech-enabled property management company focused on the small residential industry, which includes single-family rentals and multifamily buildings with up to 49 units. It’s a $430 billion industry, and rent rolls are twice as big as the hotel industry. Yet, it’s highly fragmented. There are over 30,000 companies that provide property management services, and the largest one has one-seventh of 1% market share. But nobody’s operating at scale, and nobody’s really applying technology.
Q: How did you get here? One of headlines is you’re a technologist.
A: I went to Cal, where I studied mechanical engineering. I got a dream job at Boeing writing algorithms for automated control systems on airplanes. It was Nirvana for me. At Boeing, I invented a new way to control anti-lock brakes for airplanes. I worked in AI and created patents for this technology that Boeing still holds to this day.
Q: What was your next move?
A: I always wanted to be an entrepreneur, so I became an independent software consultant. In 1996, I spent a year at Netscape, where I became one of the first Java programmers in the world. Eventually, I started a software consulting company that grew to 35 people. I got to experience the dot.com boom firsthand. Luckily, I sold that consulting company when things started to unwind in 2000.
Q: So, you had some money saved, and you put into real estate?
A: With a friend of mine, I invested in a mobile home park and storage facility. It was highly reliable income because residents never seem to leave mobile home parks. I am always looking for inefficiencies in a marketplace, and what the masses are getting wrong. If an idea is counter what most people think, all the better because that’s where the opportunity lies.
Q: Why did you decide to co-found Waypoint Homes?
A: In 2008, I was looking at what was happening in certain San Francisco Bay Area communities in the East Bay like Antioch and Vallejo. Homes in that region had lost 70% of their value from the peak. But rents weren’t off at all, or maybe down slightly. Along with Waypoint Homes co-founder, Doug Brien, who is the co-founder and CEO of MYND, we ended up buying 25 homes in Vallejo, Antioch and Pittsburg. We were buying houses for under $100,000, with cap rates between 8% and 9%.
Q: How do you work with MYND co-founder Doug Brien?
A: Doug is more of an operationally minded person than me. He ran all of the property management operations at Waypoint (which was acquired by REIT Invitation Homes.) I realized there was a much bigger opportunity at play: to own the entire property management space for small residential. And I was excited to launch another company with Doug. The opportunity to start MYND was so compelling that we had an easy decision.
Wiel and Doug Brien
Q: When you’re with the right people and you take a concept and iterate it over a period of time, it’s an amazing experience. Describe your even bigger opportunity (at MYND).
A: When we were at Waypoint and had 17,000 homes under management, over 500 employees and a robust tech platform. We kind of nailed it with our technology. But we felt we could have managed a lot more properties. The small residential sector…is an old-school industry with lots of mom-and-pop third-party managers. Most people self-manage, and they’re not leveraging technology like we were at Waypoint.
If you look back at the industries in America, at some point, they became larger, institutionally managed industries. For example, before the 1950s, there were thousands of convenience stores nationwide. Then 7-Eleven started in the 50s. They found they could more efficiently control the supply chain and distribution of goods. They were able to benefit from the economies of scale. Similarly, taxis were disrupted by Uber and Lyft. Technology eventually disrupted all of these industries.
Q: Tell us how MYND was built.
A: MYND provides complete end-to-end property management service. We are competing with incumbents that are disrupting the real estate industry. Small residential is one of the largest industries in America, which hasn’t been disrupted by technology yet. But there is no reason it shouldn’t be now. Everyone has access to technology: cloud computing, mobile tech and SMS. There are much better ways to manage properties using technology.