Technology in Short-Term Rentals with Jesse DePinto
Jonathan and Justin are thrilled to have Jesse DePinto join them on this episode of Selling Derby City. Jesse dives into how technology is beneficial for more streamlined processes in short-term rental businesses. By integrating technology and automation, you will be able to focus on the services that you can perform the best.
About Jesse DePinto
Jesse DePinto is a growth-oriented, serial entrepreneur with a passion for product, user experience, and technology. Jesse is the Chief Product Officer and Co-founder of Frontdesk, a leading tech-enabled short-term rental brand and solutions provider. Jesse is a champion for all-things growth at Frontdesk, which includes leading the technology, sales, and marketing teams, while also nurturing key strategic relationships for the company. Jesse is also the Co-Founder and Chief Product Officer at Levr Solutions, which is the complete software solution for automating and scaling your short-term rental business. Jesse is a proud husband, a father of three boys, and a complete nerd at heart.
Jonathan and Justin's Interview with Jesse DePinto
Before we begin, Jesse gives a brief overview of what Frontdesk is, his role there, and how technology is incorporated into it.
"Frontdesk is a leading number one fastest-growing travel company, based on the Inc Magazine last year. And so we offer short-term stays in the best cities and in downtown urban apartments ranging from one night to many months at a time, really catering to the new generation of young professionals, remote workers, and other types of travelers who were looking for a place that feels more like home. So all of our units at Frontdesk come fully furnished, stacked with full kitchens and everything you would have at a short-term rental. What's really unique about our experience is it's tech-enabled. So mobile first self-check-in and hundred percent online incident bookable. And number two is that we're in a downtown urban multi-family, luxury apartment building. And so all of the amenities you would expect in the most walkable parts of town. Frontdesk started about five years ago with Kyle Weatherly and me. We started in Milwaukee, Wisconsin, where we are headquartered and where we live. Now, flash forward five years and we have about a thousand units across 35 markets and we're checking in about 15,000 guests every month. And so, we're incredibly proud of what we’ve built. What's incredibly exciting is Levr, the business that you mentioned, is actually a spin-out from Frontdesk. So it's the same team, it's all part of the same company. It is simply another product line and it happens to be our fastest-growing product line of providing software solutions for third-party operators to realize some of the same success that Frontdesk and our management, branded hospitality business has experienced." -Jesse DePinto
Message Jesse DePinto on LinkedIn. Mention Selling Derby City for a Friends and Family discount code to stay at one of the Frontdesk locations!
Click HERE to check out the 1,000+ locations across 35 locations that Frontdesk has to offer.
How did you take that love of technology, find that niche and short-term rentals, and really use that to scale your growth?
"Kyle Weatherly, the CEO, came at this as a traveler and I came at this as a technologist. And we sort of came together and realized there's an opportunity in the short-term rental business. A. to create a great brand. People still thirst for that authentic but also a consistent branded experience where you know what you're going to get every time. And so the conveniences and comforts of a hotel that short-term rentals lack today. And so the need for a branded experience was number one. And number two is that technology could solve a lot of those problems. Smart home technology is one of the ways that, it's not just nice to have, but it's necessary when you're doing short-term rentals." -Jesse DePinto
Where is home automation right now with short-term rentals? Is it too complex for the average user? Can it worsen the experience for the guests?
"I definitely think we can make it too complex. We learned in the hotel space that you can't move too fast and break things. People generally like the user experience above technology for technology's sake. There are too many tech companies trying to solve problems that don't really exist. So there is a good balance there. smart lights are a great example. Anybody can flip on and off the light and it's almost more work to educate them on how to speak into the Alexa device to turn off the light. That's more gimmicky than anything. Smart thermostats, on the other hand, save the owner and the operator a lot of money. Smart locks that prevent the need to facilitate key exchanges." -Jesse DePinto
In agreeance, Jonathan says, “Technology, if you're not careful, can sometimes add complexity to your business that doesn't exist today. That night might not be something that the average person can do, but you know, if you have just four properties, you can set up notifications to be notified whenever a sensor goes off and then just reach out to the guest. Of course, if it's midnight, 1:00 AM and the average host is asleep, then you might miss one every once in a while. So, having that alert, having the information is only as good as what you're going to do with it, what the rest of your operations look like. And sometimes that's a benefit of hiring a management company.”
Justin also adds, “Jesse brings up a really good point, which is something that we've driven home in episodes before. Our motto is we are good neighbors first and good hosts second. So all the things that you're talking about, our neighbors and our neighborhoods, if people are against us then we're not going to thrive. We're not going to have an opportunity to have our short-term rentals here.”
What are the baseline technologies that you suggest to have?
"The Airbnb ecosystem is very nice. You don't have to worry about payments. You don't have to worry about background screens. You don't have to worry about pricing unless you really want to. So if I had to say, one to five units, if you're in the US market specifically more urban tilted markets, stay on Airbnb as long as can last. And when you start to feel the need to optimize, then maybe 10, 15 units, start looking into a property management system. Start looking into dynamic pricing algorithm. Start looking into access control and smart lock solutions." -Jesse DePinto
What is your favorite smart lock?
"We like Yale keypad, deadbolts. In our arsenal, we focused on the August locks and the Yale locks. Every door is different, so you can't just use one lock, you have to have kind of an arsenal of locks, right. But what we found is the keypad, people love keypads. As much as locks love to sell you on the premise of a smartphone, Bluetooth-based, open and closed experience. It's never that easy and nobody's going to download an app for a one-night stay. So nothing better than a keypad that you can change the code after every stay with." -Jesse DePinto
Shop Yale Services and Products HERE
Choose from popular August Smart Locks HERE
What is the difference between Airbnb and VRBO? Why do you think Airbnb is more prominent?
"They're very similar. Where the differences are is really a function of how they got started. So VRBO was first. They got, to my knowledge, at least they made a name for themselves in the ski and beach sorta destinations. They were big in single-family rentals. Whereas Airbnb sorta came on the scene post housing crash in ‘07, ‘08. And in this new, urban era of short-term rentals, they really pioneered the urban short-term rentals, in the apartments, the condos. Airbnb tends to get more bookings in the urban, areas and VRBO tends to get more in the non-urban areas." -Jesse DePinto
Jesse goes on to mention a few new platforms in the market for short-term rental listings that have noticeable growth rates. Platforms such as:
Other platforms for short-term rental listings that Jesse mentions are:
Jonathan mentions niche markets for short-term rental listings:
Jesse goes into talking about when listing on multiple Online Travel Agencies (OTA), “there's really good evidence to do that if you're in this business and you're a professional operator and you're trying to out-compete the market. You need multiple channels. There are clear studies out there that say the more channels you have, not surprisingly the more revenue per unit you're going to get. If you're an owner and you're interviewing management companies, the first question you should ask is where are you advertising? Because if they're only advertising on Airbnb, they're going to make 20% less roughly than the competitor down the street who's on VRBO, Marriott, Hopper Homes, all of the other channels."
Tell us about your top property management systems and online travel agency integrators for small, mid, and growing operations.
For small to mid-range operations, Jesse recommends Hostaway and Smartbnb.
For larger operations, Jesse recommends Guesty for urban areas like Airbnb. He suggests Streamline for single-family, beach, and ski destinations like VRBO.
What are your favorite systems for automation?
Jesse’s top 3 are Beyond Pricing, Wheelhouse, and PriceLabs.
“PriceLabs is good for if you want a little more configuration and if you want a little more hands-on on the dynamic pricing configurations. Beyond Pricing and Wheelhouse are really good in terms of just user experience and a small learning curve.” -Jesse DePinto
Is there are future in the short-term rental business for artificial intelligence? Or is that too far-fetched for what we have to do?
“There are applications and I think it's similar to like, metaverse. It just gets over-hyped, just the word artificial intelligence. Where really there's artificial intelligence happening behind the scenes every day. Most dynamic pricing algorithms are AI-driven. Their self-learning, machine learning. AI is nice if you throw it in a pitch deck to get some venture capital funding.” -Jesse DePinto
Before wrapping up the conversion, will you tell us what Levr is, what you do, and what is in store for the future?
“Levrsolutions.com is the website. So Levr is the complete solution for automating and scaling your short-term rental business. And so it's an all-in-one property management system that encompasses all of the different facets of the technology stack that we discussed today. Property matters, channel management, the calendar sync, pricing, algorithms, revenue management tools, access control, background screening, ID verification, and the operations and cleaning management suite, as well as the guest experience platform.” -Jesse DePinto
Thank you for joining us. We are so grateful to have Jesse DePinto join us. We hope that you learned some great tips on how you can integrate technology into your STR business.