BFM: Open For Business, Speedrent

Podcast link: http://www.bfm.my/open-for-business-wong-whei-meng-speedrent.html

On Air date and time: Sep 2, 2015, 10AM

Speedrent is a mobile property classified app that caters specifically to property owners. The app empowers landlords to lease their property easily and speedily. Speedrent services encompass the entire renting process- from obtaining property information to signing digital tenancy agreements. We speak to Wong Whei Meng, founder of Speedrent, about this game changing business model.

In conversation: Freda Liu (BFM), Wong Whei Meng (Speedrent)

Freda: Welcome Whei Meng. First question, had you make a lot of agents angry?

Wong: I think a lot of agents would not be happy that we’re coming in, taking their lunch.

Freda: Why did you came up with these whole concept?

Wong: It was basically my personal encounter back then. I sms 50 agents and only 2 came back. It was to my surprise. I believe many owners out there have the same experience where they are not getting a good service from agents.

Freda: I was just went through this process recently as well. Was to post ads on a popular site, and then from there, the agents will come back to me. Is this what you did as well?

Wong: Back then, I was tried to post on 2 popular sites, but they do not accept landlords postings. So, I was very surprise, but not sure whether they had changed now. I wanted to rent it out myself, but with the 2 sites not allow, i will blocked for a lot of visibilities. So therefore I look for agents to rent out.

Freda: Well. Please take me through the first in Speedrent app. As someone looking to rent and also as a owner.

Wong: It’s very simple. You download the app and you post your ads on the app. Then you snap photos of your house and then is online ! So, any tenant who is interested in your house, they will just tap chat button and chat with you directly real time in the app. All of these are without phone calls. Once everything is good, you want to meetup, just schedule an appointment through the app, so everything is done through the app.

Freda: Tenants asked a lot of queries but in the end viewing need to be done. So, I still need an agent  in that sense. So, what do you have to say to that?

Wong: I think that’s a perception issue. First of all, if you are really too busy and you do not want to have too many viewings, there’s a way to go around it. Probably you can set a Saturday or Sunday then you get everyone to come in at one time, let’s say 3pm-5pm. But, there’s another perception that agents are taking care of the viewings. I think for Malaysian property owners is a blessing and at the same time a curse. Blessing in the sense that we can engage as many agents as we want, and we pay based on whoever rent it out and get the commission. But because of that, the curse as well. It doesn’t make sense for me to duplicate 10 keys or 20 keys to the agents for bringing tenants to show the house. So, in the end it fall back to the same thing. Agents would call owner to make an appointment and owner have to show every single viewing as well. So, the perception that agents is helping you to do viewing, I don’t think is very true. It’s a very perception thing. But to be fair, to very busy people, or if owner have specific good agents that owner can trust, and trust with the keys to hand over, then that’s the exception that owners don’t ever have to meet the tenants at all.

Freda: What do you think agents have to do or to change? Because when I look at Speedrent, as a property owner, I think is a blessing. But I also wonder. For example, When Taxi app comes in, taxi drivers get angry, somethings come in. Airbnb comes in, hotel and property owners get annoyed. At the end of the day, is that what the customers want. So, what do think needs to be change or for the agents up their game?

Wong: Property rental is a very transactional based. Agents can up the value. Good agents would still have good markets out there. Good agents would keep in touch with you, keep you updated with all the status, what’s going on. Most of the time, when we deal with agents, they just go silence for sometime and suddenly  just turn out and ask whether your property is still available. So, is not really that kind of experience. I think agent is a relationship business. You need to keep good relationship with the customers. In the end of the day, we are just paying 1 month commission. If agent help me rent it out, give me a good service, I don’t mind paying it. So, it’s really a relationship and keeping good service, keeping up to date, keeping your customer happy is the true thing.

Freda: I’m just thinking. If I have a lot of properties, I probably will have that relationship with one agent anyway, at most 2 agents that I feel is doing a job. And I’m just looking at 1 property that I have beens rented out and i haven’t been using an agent for a long time.

Wong: Exactly. I think rental is a very simple transaction. It’s just look at the house, if tenant is happy, then just sign the tenancy agreement. That’s nothing much involve. You’re not buying your RM500,000 house, you’re not making a huge decision here. So, it’s very simple transaction where the landlord and tenant can just deal directly without layers and layers of stuff.

Freda: I guess it’s different from sales of property.

Wong: Ya. I think for agents have keep in touch with a lot of property investors. From that point of view, when they want to sell property, they can blast your property to their investors. In that, they bring a lot of values, it can speed up the transaction because they have the network. For rental point of view, I don’t think agents would keep in touch with renters. When talk about rental, the value of agents is kind of diminish. Because they just post online and then wait for phone calls to come in. So, is a very passive job in rental point of view.

Freda: Ya. They probably call you one year later and ask you whether is for rent again. That kind of relationship right. So. In that case, what’s your business model, where do you earn the money?

Wong: I think classified is a very 2000s business model. So, it’s free to list on our app. We want to provide value and charge with value. One of the things that we notice is when the landlords want to try to do it themselves, when they seal deal, will need the tenancy agreement. A lot of them would hesitate, so this is where we want to come in. In coming 2 months, we will release our updated version of app where we allow them to sign tenancy agreement electronically in the app without any paperwork at all.

Freda: So, that’s where the money gonna comes in.

Wong: Yes, so we charge RM99 for that. At the same time, we go further. When we think about tenant, after signed the deal, what did the tenant have to do?  They will have to look for cleaning services, they need to move their house and sign up for broadband and even Astro. So, right now they have to go to different parties to do that. We are thinking why not just sign up all through the app? We can take care of the entire user journey all within the app electronically.

Freda: And there’s probably where you earn a fee down the road.

Wong: Ya, that’s a kickback commission. Consume doesn’t give us extra. For example, when they sign up for broadband, telco would pay us commission. So this is where we get our revenue from. So, it’s totally free for tenant point of view.

Freda: So this started at March this year. How’s the response so far?

Wong: Because we don’t do the tenancy agreement right now, hence we can’t track the entire thing. But we would say about 30-40 transactions go through our platform. We had one closed last week that he posted for 3 days and closed a deal in 3 days. So, it was fast.

Freda: When will your other part of the service be introduced?

Wong: I believe the tenancy agreement service would be release in two months time. So, the rest of the services would be come in three to four months time. We will roll it out in phases.

Freda: is this something that is just popular in the Klang Valley?

Wong: Ya. We are very focus in Klang Valley but we have users in Penang, but that’s not really our core focus right now. We are just very focus in Klang Valley.

Freda: Do you plan to expands Speedrent to buying and selling properties in the future?

Wong: Well. The first thing is that we’re just started out, we need to be focus. So we are focus in rental. But down the line three years, who knows.

Freda: Setting this app up since March. What was the issue happen in between and leading the app since then?

Wong: It started with development. We need to build the app and release our first version of the app, and we found that many of our users are confused on how to use the app. So, we try to learn the user behaviour. The other thing is building a team. I can’t recall how many i had fired. People thought join in was an easy job but for us is a startup and is really hard. Right now, we have a very strong team to go full force.

Freda: In terms of funding, are you looking for external funding?

Wong: Right now, I’m self funding it. But obviously, when we want to expand regionally, we definitely need serious funding.

Freda: So this is just to making sure it works in Malaysia first. And then you start pitching. Had you pitched Speedrent to angel investors or VC? What’s their feedback?

Wong: A lot of them are concerned about the business model. Because it’s very new. But interesting is that we are solving real problems here. Right now, I’m self funding it and not really urgent in need but most of them say get more traction and come back.

Freda: Since you have the digital tenancy agreement service, do you have a legal team onboard?

Wong: We engaged with a lawyer to review all the agreements. Once it done, it basically is a template and everyone just fill in their names and other details then is ready to go.

Freda: In terms of closing transaction, how many had you manage to secure in the last couple of months?

Wong: Since our launch, as we didn’t track via tenancy agreement, unofficially would be 30-40.

Freda: So that would be important to have the tenancy agreement, that would be ready very soon right. So right now, been a lot of people giving you feedbacks.

Wong: Being a new app, build functionally that people want. We are catering that.

Freda: How do you think that this is easily duplicable?

Wong: I believe as an app, a lot of things are not cutting-edge technology but is really about a service. It’s duplicable easily but at the same time, we are looking to scale regionally. I think execution is very important.

Freda: When you look at developing this app, it was very owner-driven oppose to classified sites are agent-driven. When I look at it, when someone looks at the app, they look at it at owner perspective as well as renter perspective.

Wong: When we looks into classified sites, most of them are dealing with agents. So, we differentiate a lot when tenants use Speedrent, will dealing with owners. Owners make decision, agents don’t make decision. So, you deal with the owners would be the best way to rent a house.

Freda: Do you plan to have it on the website? Because right now you just have a mobile app.

Wong: Right now, we are very focus into just mobile. Down the line, 6 months, we may have a simple website. So far, there’s not much complaint that we don’t have a web and still comfortable with mobile app. I think that’s the new behaviour where people feel phone is the first encounter to get online.

Freda: In terms of marketing, how have you been marketing this app?

Wong: We are doing a lot of online campaigns, but moving forward. What’s we going to do is once every listing come online, we send owner a banner to hang outside the house. We have the mentality of helping owners to rent out.

Freda: I think as an owner, the more the channels, the better. To them is like, the fastest of whoever get my deals faster, better can get tenant directly, why give money to an agent.