March 6, 2025 • 52 mins
Melissa Sharone shares her insights on how to effectively grow a property management business, emphasizing the importance of focus on quality over quantity in terms of clients. Understanding the target client profile plays a crucial role in aligning services with client needs. Transitioning ownership is discussed as a framework for sustainability, acutely focusing on maintaining company culture and employee satisfaction in a growing business structure.
- Explores the idea of growth as efficiency rather than just numbers
- Discusses the significance of company culture in driving success
- Describes the process of transitioning ownership and the complexities involved
- Outlines the traits of an ideal target client profile
- Highlights the need for system-driven operations to reduce complexity
- Examines leadership roles and their evolution through business growth
- Shares lessons learned from experience in property management and NARPM
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Transcript
Episode Transcript
Available transcripts are automatically generated. Complete accuracy is not guaranteed.
Speaker 1 (00:00):
We also are not scared to fire owners that
aren't okay with this.
We've cleaned out quite a fewin the last few years for
different reasons.
But growth to us isn'tnecessarily a number.
It's about your profits, aboutyour efficiencies.
Are your employees happy?
There are other ways to growyour company and be successful
than simply saying I have athousand doors or 2000 doors,
(00:20):
because a lot of times moredoors brings more headaches and
more employees and all that comewith that.
Speaker 2 (00:26):
Welcome to the Property Management Success
Podcast, where we interviewleaders in the industry to
uncover the secrets toprofitability, efficiency and
achieving true freedom.
Whether it's your time, moneyor lifestyle.
I'm your host, tony Klein, andI'm here to help you build a
wildly successful propertymanagement business.
Let's get to it.
Welcome back to another episodeof the Property Management
(00:48):
Success Podcast.
Today, I'm super excited tohave Melissa Cherone on with us.
Melissa is the president ofFirst Rate Property Management
out in Boise, idaho, and a pastpresident of the National
Association of ResidentialProperty Managers, or NARPUM.
Melissa welcome.
Speaker 1 (01:09):
Thanks for having me, Tony.
Speaker 2 (01:11):
Yeah, absolutely.
I'm excited to have you on.
I know we've known each otherfor a long time and we've both
taken some unique andinteresting paths to get where
we are, and so I'd kind of liketo give the audience an
opportunity to get to know you alittle bit.
So if we could talk about youentering property management and
then where you are now size ofyour company, just so they have
(01:33):
some context of the discussionthat we're about to have.
Speaker 1 (01:36):
Sure, I love.
I love sharing my story.
I think it's a unique one and Icontinue to share it, not to
say look where I've come, but togive hope to those people that
have been once in my shoes.
I started in 2010, just workingfor first rate property
management here in Boise, idaho.
At the time, tony Dross ownedit, which I'm sure a lot of you
(01:57):
are familiar with that name.
I was a showing agent.
I showed properties, came intowork every day, did my job.
I was that always asking whyperson that maybe a lot of the
office didn't like, but Tonyloved it and just slowly worked
my way up in the company and myhusband and I had an opportunity
to take over First Rate forTony back in 2021.
(02:19):
So we've almost in May.
We have owned it for four years,so a really different, unique
journey, something that I neverimagined myself doing.
But it's been a blessing in somany ways for me personally and
professionally and my family andmy husband and all of the above
, and we are continuing on thesuccesses that he started.
(02:42):
But putting our own uniquetwists in our business Husband
and wife team brings its ownchallenges some days, but for
the most part it works reallywell for us.
We manage about 1100 doors herein the Boise area, so we're
fairly large.
We also run an in-housemaintenance team and we look to
grow in the right areas.
And when I say that we don'tjust look to grow.
To grow, it's got to be theright fit, the right opportunity
(03:05):
, and so we're good about whatareas can we do that in.
That makes sense for us.
So that's a little bit about myhistory and where I'm at.
I'm also a big part of NARPUMjust got done serving as
president, have enjoyed thatride as well and all that it's
done for me.
Speaker 2 (03:26):
I want to get into the process or the transaction
that you did where you took overthe company, but you mentioned
something that I want to diginto first and then we'll circle
back around that.
You mentioned that you want togrow, and you want to grow in
the right way and you want tomake sure that the people are a
good fit.
One of the things that I talkabout a lot in our coaching
program is really identifyingwhat I'll call the target client
profile and identifying thetype of property, the location,
(03:47):
the type of owner, just reallygetting clear on who your
company is built to serve andthen getting clear on the
messaging and the pain pointsthat you need to communicate to
attract those people.
I'd love to get your insightson what you mean by it's a good
fit.
How do you you mean by it's agood fit?
How do you guys determinewhether it's a good fit or not?
Speaker 1 (04:10):
So we're pretty picky .
We've been allowed to be pickybecause of how the company was
started and set up.
We are really geared towards, Iwould say, investor mindset,
more than an accidental landlordor a single family, and in fact
our portfolio is probably 75%multifamily, and when I say
multi I mean small multi.
We're not managing anythingover 65 units in one space, no
(04:34):
onsite management or anythinglike that, and we have a unique
perspective, which can be a goodand a bad, of 1,100 doors but
only about 300 owners.
So we're servicing clients thathave larger portfolios and
continue to grow.
We pride ourselves on being theexpert in this area and we're
process driven and alsodepartmentalized, which is not
(04:56):
as common, I wouldn't say, inour market as I see.
You know other PMs that wetalked to at NARPM or people
trying to go to the hybrid orthe pod style.
We've always been that way.
We've believed in the system ofefficiency and getting the job
done well, and so the client hasto.
The right fit for us back toyour question is they've got to
(05:17):
fit in with our model.
So you have, they have to beokay with they're not going to
talk to just one person theirentire time where they have a
rental right, we have experts inaccounting, we have experts in
leasing and experts inmaintenance and, while we have a
management team that overseesthat, for an owner to reach out
to if they do need to talk toone person.
But we're very communicationfocused and so we don't find our
(05:37):
owners reaching out to us veryoften because we're giving them
the opportunities to reply andthey know who to reply to.
So the right fit for us issomebody who views us as the
expert, allows us to be theprofessional fits within the
process-driven system that wehave and is hands-off.
We also are not scared to fireowners that aren't okay with
this.
We've cleaned out quite a few inthe last few years for
(06:00):
different reasons.
But growth to us isn'tnecessarily a number.
It's about your profits, aboutyour efficiencies.
Are your employees happy?
There are other ways to growyour company and be successful
than simply saying I have athousand doors or 2000 doors,
because a lot of times moredoors brings more headaches and
more employees and all that comewith that.
Speaker 2 (06:20):
I love the fact that you're focused on the, the end
result, the output versus theinput.
You know we can add in an extra200 doors this year, but if it
doesn't change the output, whatwe put in our pocket or the
impact we're able to make or thetransformation that we go
through either in our businessor what that growth allows us to
(06:41):
do personally, then it's reallyjust busy work.
It's really just you'retreading water.
Then it's really just busy work.
It's really just you'retreading water but you're not
really going anywhere.
And I love the fact that you'vegot that clear audience
identified and then you're notafraid to stick with it and if
somebody falls out of alignmentwith that, you're okay with
cutting them loose.
Speaker 1 (07:00):
Yeah, it's.
We ask our employees every yeartop three owners they want to
get rid of, and it's usuallypretty common and so they get.
They get on the chopping block.
I mean we have we have tocareful consideration, we go
through a process and how bad isthis going to hurt or is it
worth it?
And obviously it's jim and i'sultimate decision.
But we value our team and whatthey think and if it fits within
(07:22):
our company and our mission andvision and our core values,
then they're allowed to providethat feedback for us.
Speaker 2 (07:29):
I want to dig just a little bit deeper on this
because I think it's fascinatingthat everybody runs our company
a little bit different, but yetwe all seem to follow some
similar the successful companiesseem to follow some similar
patterns.
You mentioned process-drivenand I think that's really
(07:50):
important, but I think settingyour processes up to serve that
target client profile is moreimportant.
Right, it's not about havingprocesses, it's about having the
right processes designed andtailored to your company.
A lot of companies that I talkto, a lot of people I interview,
a lot of my clients they reallyfocus more on that accidental
(08:10):
landlord simply because there isjust more of them.
Statistically, there are morepeople who own two or fewer
properties in the single familyspace than own a larger
portfolio.
And I'm interested to get theinsight from you what you
believe the difference is inbeing investor-minded, focused,
versus dealing with the issuesfrom somebody that used to live
(08:33):
in a property.
They know the neighbors.
Can you really put a goodtenant in there?
Because I don't want myneighbors calling me, I don't
want people parking in front ofmy neighbor's house and going to
my property Like they're justall the little emotional issues.
Right, those can be differentthan and I'm not saying
investors can't be emotional,but they're.
They're concerned withdifferent things.
(08:54):
What do you think are some ofthe bigger concerns that your
clients have, specificallybecause you are more investor
minded?
Speaker 1 (09:01):
Um, you know, I I want to go back to how our
business is focused.
We're focused on the end result.
We just talked about right Um,that part is a challenge, I
think, on their end and and onour end.
Um, sometimes and we'll talkabout the economy now prices are
higher, right Um, cost cost ofmaintenance is higher and so a
(09:21):
challenge I think our clientssee, when we're investor
mindedminded, focus is sometimesthey're only looking at the
bottom line.
Sometimes that's all they'refocused on, and we also have to
remind them that aninvestor-minded person a lot of
times the short-term gain isn'tout there, especially in
property management Come fromfirst rate was built that way.
Tony was an investor.
(09:42):
My husband and I are nowinvestors ourself, and so we
have that mentality of we'rereally open when we chat with
them, onboarding or taking themon, like, what's your plan for
this?
Is it a short-term hold and youjust need us to do the best we
can Do?
We need to soup up yourproperty to get to sell it in a
couple of years, because that'syour plan.
(10:02):
Are you in this for the longhaul and willing to ride the
waves of higher rent, lower rent, higher costs?
But that's where we come in asa business and an expert.
What can we do to combat thosechallenges?
How can we help reduce costs?
That's one reason we startedin-house maintenance.
We can offer that as a lowercost, but it's still profitable
for us.
But our owners are happy and wecan control the quality, so it
(10:24):
was like a huge win-win for us.
So what else can we do in ourcompany?
That's combating the challengesof affecting that bottom line,
because a lot of times that'swhat they see, and sometimes
it's just a matter of this isthe market.
I'm not in control of that.
Right, I can only tell youwhat's out there and what we can
do to help you, but I'm not incontrol of the market, and so
let's talk about ways that aregonna make you feel more
(10:44):
comfortable.
Speaker 2 (10:45):
Mark Brower and I just in a recent podcast episode
that we recorded, he was tryingto convince me that we should
be transitioning from beingproperty managers to asset
managers and being somebody thatis more investor-focused.
I'd love to ask you thisquestion Do you think that,
because your clients are moreinvestor focused like they
(11:09):
intentionally bought into theseproperties to be an investment
do you think they're looking formore information?
Are they trying to get a betterdashboard to get their
information whenever they want?
Or are they looking to have youexplain information?
Or are they just saying Ibought it, you manage it and in
five years I'm going to makesome money on this thing, like
(11:30):
what are most of theconversations you're having
around?
Speaker 1 (11:33):
I would say I don't know Our with my clientele and
our market, I would say they'renot necessarily looking for us
to give them more information.
Now, I say that lightly,because if there is an end game
and we're coming upon the endgame and they're old enough to
sell their properties and retire, or we have, for instance, a
lot of kids that are taking overtheir parents' portfolios that
(11:56):
we've had 30 years right, theymay be looking for a little bit
more because they don'tunderstand what it's done all
these years.
However, if they were to cometo us and say I need to sell or
I need to do this or we need toget an update plan, whatever,
we're happy to assist in that.
But to me that is a lot of ourclients, I don't know.
(12:19):
I'm not a big.
I'm not a big asset manager faneither.
So I'm on your side because Ifeel like property management,
regardless, is still arelationship business and they
wouldn't have any of theseassets if we didn't take care of
tenants in the proper way orvendors in the proper way and
with an asset manager mindset.
I don't believe you can deliverthe customer service to all
(12:41):
three of your clients whenyou're only thinking about the
bottom line right.
So I think it's a healthybalance and I think both is
needed and I think when you findthat and provide a touch of
information that may be helpfulmarket updates or trends you're
seeing or a new service you'rewilling to offer to help them
that's enough, at least in myexperience, to be considered
(13:03):
helping them with their asset,but not being an asset manager.
Speaker 2 (13:07):
Well, I appreciate your insight because you are
definitely more focused on theinvestor set than I was.
So even though I have myopinion in it, it doesn't hold
as much weight as yours.
So I appreciate that feedback.
Okay, let's circle back aroundnow and talk about the
transition.
I remember when you were lookingat buying the business from
(13:30):
Tony and we had a few texts orFacebook messages I can't
remember, but back and forth wemay even had a phone call or two
, some of the stickiness of itand just and I think there were
some complications in it.
And so help the audienceunderstand did we buy the
(13:52):
business or did we buy thebusiness assets?
Did you take on all previousliability?
Just kind of walk us throughwhat that looked like at the
time, because there are a lot ofpeople out there that are like
I would love to grow throughacquisition.
So whether they already have abusiness or they are looking to
get into the industry to buy abusiness, I'd love to give them
(14:13):
some insights so that they canskip over some of the things
that tripped you up.
Speaker 1 (14:19):
Yeah, so I think our story serves a couple of
purposes.
I also love sharing it becauseI think it's a really good exit
strategy for people out therethat want to keep it going but
want to be done.
If you have a trusted personlike this is a very viable
option that people, I think,just don't take into
consideration.
It's got to be well thought out, it's got to be a long-term.
(14:41):
I mean this didn't just happenovernight, right, it was a four
year in the making.
I had randomly heard the storyabout Melissa Prandy, who's a
NARPA member, who bought who inthe same shoes as me, and I had
gone to Tony and I said hey, ifyou ever consider doing this,
let me know.
You know my husband and I mightbe interested.
I had a.
My husband at the time wasworking retail tons of hours a
week.
We were newly married, havingkids.
(15:03):
It was.
It was wild.
So we jumped on the bandwagonand said we're going to figure
this out, run it together, andwe had an opportunity to bring
my husband on sooner than wethought.
So that kind of sped up theprocess a little bit.
Um, and he's very operationalminded, and so that helped us
get to where we needed to be anddo some things that made the
business look good, you know,for Tony and for us and vice
(15:23):
versa.
Um, we were also.
A unique situation is we bothhad the same end game.
We had the same goal in mindand so we worked together.
For the most part, we used thesame attorney, which I know
people were like, oh my God,don't do that.
And I would still advise westill had an outside attorney,
look at the final contract, justto protect ourselves as well.
(15:43):
But it was a well-builtrelationship with the same
common goal in mind, ready forhim to step away, and I was
eager to step up and run thecompany that I had been really
running for the last severalyears.
So some of the challenges we had.
The first challenge I'll say Idon't feel like anybody in this
(16:04):
world, and when I say that I saymaybe banks or loans.
So we chose to go the SBA route.
We knew we didn't want to do anowner carry.
We wanted to purchase thebusiness like we would any other
acquisition, whether it wasthrough a loan or through cash.
We knew there would need to besome down.
But our first big challenge wasnobody.
We felt like nobody really knewhow to truly value a property
(16:26):
management company.
Some, you know some would sayoh, these contracts are worth
everything.
Here's your, here's your value.
Others would say the value ofthe contract.
Yes, you have a contract, butit's not really, because if they
don't pay rent, you're notreally getting money.
And it was wild, Tony wild, thesame I can't think of the word
the same guy that did the veryfirst evaluation to kind of get
(16:48):
us a rough idea of what it wasworth, valued it at one point
and a year later it was likeless $800,000, $900,000.
I mean, it was crazy.
And it's like you're the samedude that looked at this.
What changed right?
So I don't know who was in hisear.
We did a stock purchase, so wedidn't want to have to change an
(17:08):
EIN number.
We didn't want to have to fireall the employees and rehire
them back.
We wanted to keep the same bankaccounts, all the stuff that
was in first rates names.
So that's how we chose to do it.
I thought it worked really well.
We have a stock certificate, wehave a purchase sale agreement.
We started with one bank.
They couldn't make it happen,so we ended up with another one
and they made it happen and ittook about a year.
(17:31):
This also happened during COVID.
We started this process so wewere also like, oh my God, we
can't buy a company.
During COVID, what if nobodypays rent?
And then we looked at eachother and we're like we're going
to be successful regardless.
We can do this.
So we just pushed forward.
So evaluation was a challenge.
What else was a challenge?
Some original documents were achallenge, like having original
letter of, like your tax IDbeing issued to the corporation.
(17:55):
When you do a stock purchase,you have to have that stuff.
So we had to figure out how toget those.
Some of the conversations werehard.
Right, I really value theopportunity that Tony gave me
and I'm forever grateful for thementorship that he's given in
my life, Like I said, personallyand professionally, with First
Rate and with NARPA.
But we had to have some hardconversations about you know
(18:16):
what's going and what's leavingand what are the assets and the
price.
We also were in a uniqueposition where we worked it out
prior to me selling, where I wasable to get some equity.
I was not willing.
I shouldn't say not willing.
It was really hard for someonein my position to continue to
build the company, knowing thatI was going to pay for my own
(18:38):
work, so.
But he was really fair andoffered that, so that was
deducted from the overall saleprice.
I'm trying to think what otherchallenges we had.
Speaker 2 (18:47):
Let me.
Let me ask you this on thepurchase price, because I do
hear it's not super common, butit's fairly common that somebody
on the team is the one that'sgoing to step up and purchase
the business.
And you're right.
You've been working there,you've been putting in your
effort, you've been compensatedfor the work that you're doing,
(19:09):
but you're also moving thatpurchase price a little bit
further down or making it alittle bit higher, because the
more value you bring now, themore valuable the company is,
the more you have to pay becausethe more value there is.
So tell me about theconversations Was it easy to
come up with that final price?
I know you had multiplevaluations, but was it easy to
(19:30):
come up with that price?
Or did it create any frictionbetween you and Tony?
Where he wanted?
Obviously he wants to maximizehis return on the asset that
he's selling and you want to beable to make sure that you can
pay the price but still continueto carry on.
It's not just about purchasingit, but it's about keeping it
alive after you bring it intoyour portfolio and then also
(19:54):
being able to cashflow it andnot run out of money or need to
do something personally on theside because you're not making
any money.
So how did those conversationsgo?
Speaker 1 (20:04):
No, it wasn't hard for us.
We knew before we even enteredin the value, like I said, the
start and we started the wholeequity.
I got a little bit of a profitshare, you know, because we
originally started talking.
We were talking about maybeI'll just let her buy 20% or 30%
, and that just came with awhole slew of issues that I
think we both agreed on.
That was really just reallymessy.
You know, we're both married.
(20:25):
What if we get divorced?
What if something happens?
What if it just becomes reallymessy?
And so he's like here's analternative.
I think we'll make you happy,and it did Our.
Our situation's really unique.
We again both had the same endgame.
He was not looking for the verytop dollar, because that wasn't
his end game.
Had that been the case, hewould have sold to somebody that
(20:46):
would have paid the very topdollar.
Right, I was a solution for himto be able to get what he
thought was fair, to be able toexit this company and, mind you,
he does real estate too.
So they fed each other and Iwas looking to purchase
something.
But it had to be enough for meto understand that it was
something valuable and on his 25years of hard work was was
(21:08):
worth something.
Right, you're not going to getthat for free.
So I don't feel like our hardconversations were about the
purchase price.
We were pretty honed in on thatfrom the very beginning because
I knew we were getting somethingreally good.
Now don't get me wrong.
There's times when you're like,oh my God, I can just start my
own for free, right, that's justas easy.
And we weighed those options.
(21:29):
When times got harder, you'relike, oh my God, this is taking
forever.
Or you're frustrated becausethe bank or whatever came at us
that week.
But ultimately we knew this iswhere we wanted to be.
And again, we were workingtowards the same common goal and
together we got there.
So I don't know if you hadtalked to me during, I would
have been this optimistic aboutit, but I know it was it what
(21:52):
was best for both of us and it'sworked out really well.
Speaker 2 (21:55):
How big is the team now?
Speaker 1 (21:57):
We have 25 employees and that includes our
maintenance techs, so really wehave four of them.
So there's 21 of us includingJim and I, so 19 people
servicing our company.
We have one, two, three, fourremotes.
One is stateside, the other outof the United States.
We have one gal who used towork for us and then had to
(22:19):
transfer back East because ofher husband and we finally
switched over to RentVine wherewe were online and could do
stuff virtually and hired herback.
So it's been amazing.
We're again departmentalized.
So I have a management team.
I have an operations person onmy side with an accountant, and
my husband has an operationsperson on his side that runs the
(22:39):
maintenance side, and then hehas an assistant, or really our
strategic operations guy, whotakes all of our new crazy ideas
and runs with them.
He's like the implementer, withthe help of the rest of us.
And so our operations peoplerun their departments and we
give them the freedom for themost part to do what's best for
first rate and find ways to beinnovative and different.
(23:00):
And even though I'm not veryold they're all younger than me
and they do a far better jobwith all of this new stuff than
I even do.
Speaker 2 (23:07):
So I want to talk about your team a little bit,
because we've talked in the pastand you've provided me with
some information about thementioned.
You're a system driven companyand you have your process
process driven and there's beena big push in the industry to
automate your processes anddocument your processes.
And I talk to a lot of people,whether they reach out to me for
(23:30):
coaching or just in casualconversations.
They are talking about somechallenges they have and
ultimately it comes down towe've started to automate our
processes or we've started toput our processes into some
software and they get stuck andthey either don't follow the
process or the process justdoesn't work because they
overcomplicate it, or theprocesses, which is the
(23:53):
step-by-step of what we do,isn't based on our policies,
which is what we do and why wedo it.
And for a team that big, I'vegot to assume that you guys have
gone through some challengesbut figured it out.
On the other side, what do youthink is most important when
you're creating this process orsystem driven company in putting
(24:18):
those together?
And then also, how do we trainour team on that?
Because it's one thing to havea tool, but if the team doesn't
know how to use it, then is itreally worth doing.
Speaker 1 (24:29):
Right.
So we're a combination of both.
We have some automation andsome tools, aka companies, that
are helping with some of that.
You know softwares are catchingup with that, things like that.
We live and die by ourchecklists and a lot of them are
online, right so?
But I just use the formchecklist because people know we
(24:51):
really believe strongly in ourcompany that success anybody can
do what we do and with theproper training and the proper
processes if we have for them,they can be successful.
Why we love the process drivenand why we believe in this is,
you know, when there's a hole inthe system, every time we ask
ourself is this a processproblem or is this a people
(25:13):
problem?
So is there a hole somewherethat we need to identify?
Because they chose they didn'tyou know the checklist, exactly
what we gave them and the messup still happened, or are they
choosing not to follow theprocess?
So, while people think we have25 employees and that's hard to
implement things and processdriven, I feel like we are
successful because we have thechecklist that they need to go
(25:37):
by for every single task in ouroffice we have a 300 page
policies and procedures manualthat talks about the why and how
we do it and then, literallystep-by-step, we actually just
got done updating it since we'veswitched software and it's been
complete.
Just last year.
That was our big goal for ourcompany to get that done, to get
their bonuses.
But it also allows us to neverdrop our ball in service,
(26:00):
because if I have four peopleout in accounting because
they're all sick, anyone shouldbe able to open the page that
says how do I do itemizeddeposit statement?
And here are the exact steps todo it.
So while we don't hope that onanybody, we know that with our
processes and what we've created, that our level of service will
(26:21):
never drop because anyoneshould be able to step in and do
it.
So with a team that big, theredoes come challenges because not
everybody will take it asseriously as the person sitting
next to them.
So we play to people'sstrengths.
We try to divide tasks intothings that either motivate them
(26:41):
or that they like doing withintheir realm, and if we create
processes, we also are reallybig on inviting them to be a
part of creating the process.
If you don't like it, tell mewhat you want to change and why
it matters, and when they're apart of that they have some
buy-in and then they have someownership and they take pride in
not messing that up goingforward.
Speaker 2 (27:00):
I think that's a really key point that we are in
alignment on, and that is,people support what they help
create, and so it's really hardfor somebody on the team to turn
around and say this processsucks if they were involved in
helping define how we go aboutdoing that.
(27:21):
And one of the reasons why Iseparate the policy from process
is I say the policies are therules of the game.
They're how we win propertymanagement at your company, and
that is up to you, as thebusiness owner, to define what
winning looks like.
But then we bring our team into help us with the step-by-step
(27:43):
.
Here's what we want toaccomplish.
You tell me you're closest tothe front lines.
You tell me what we should bedoing to adhere to or uphold
this policy and, of course, youstill have veto power.
You still get to make the finaldecision.
We're not just handing and say,okay, you guys run with it.
But it does make a bigdifference, because I remember
(28:06):
there were many times in mybusiness where I'm like, well,
you know, somebody would be outand I would fill in or something
, and I would assume that we'restill doing it the way we did it
three years ago, but they'vefound better ways to do it and
they would tweak things and andI would look at you know the way
I was doing it before and itwas just totally, just not the
(28:27):
right way.
It was so unproductive to do itthat way and they found a
better way and so including themin and making their way a part
of the official process I thinkis really smart.
Speaker 1 (28:38):
We also like it because it sets clear
expectations.
So they're never guessing whatthey're supposed to be doing,
what's right or what's wrong,because it's right in front of
them.
And back to that.
Is it a people, process, peopleproblem or a process problem?
If they're choosing not to dowhat's in front of them, that's
a they problem and then thatbecomes an employee behavioral
issue that we deal with and ourcompany knows we don't.
(28:59):
We don't put up with that Likewe've made it very easy for you
to do your job and if you'rechoosing not to do it, then you
might not be a good fit for us.
So expectations are reallyclear and I like that because it
takes the subjectiveness out ofif we do have to let somebody
go.
There's clear reasons why,rather than the so-and-so just
doesn't like them.
Speaker 2 (29:19):
I frame it a little bit differently, but we
accomplish, we end up in thesame spot.
So you say, is it a processproblem or a people problem?
And I frame it as, anytimewe're not hitting a KPI or we're
not performing the way weshould, I look at it as I'm the
business owner.
It's ultimately myresponsibility to make sure that
we deliver the service that I'mcommitted to delivering.
(29:40):
I may have to do it through adifferent person, and if that
person's not doing it, I mayhave to do it through another
different person, but it's stillmy responsibility.
So I look at it as it's either asystem problem meaning I
haven't provided them with theright system to do the job but
if we can agree that they havethe right system, they have all
the tools and resources theyneed then I look at is it a
(30:04):
training problem?
Have I given them the rightsystem but I haven't trained
them on how to use it properly?
And so if they can agree thatwe've given them the right
system and we've given them theright training, then it comes
down to if it's not a systemproblem and it's not a training
problem, then it's a performanceproblem.
And what I like about that is Itake ownership of two-thirds of
(30:27):
that equation.
And what I like about that is Itake ownership of two thirds of
that equation, and so it makesit easy for them to say look,
here's why I'm not able toperform.
If we could just tweak thisover here, I can hit my KPIs and
I can do the things you'reasking me for, and so I don't go
in whenever we miss a KPI andautomatically assume that it's
the person the performant.
Now, a lot of times it is, butI always take ownership of the
(30:51):
whole flow first.
That way they're open with ourconversation, versus backing
them into a corner and makingthem defensive right out the
gate in the conversation.
Speaker 1 (31:00):
I love that.
I love it, we also tell them.
We also tell them uh, we're onthe subject real quick, don't be
part, don't just presentproblems Like don't be a problem
presenter, be a problem solver.
Don't come ask a question abouta process or something that's
not going right unless you havea suggested solution.
Speaker 2 (31:18):
Um, and that helps get that, that mindset going to
that your company is fairlylarge compared to, statistically
, compared to most companies inproperty management.
Most companies are smaller thanwhere you're at, but it doesn't
matter.
In every size company we'regoing to have turnover.
We're going to have teamturnover right, not necessarily
(31:41):
property churn, but we're goingto have people that join the
team and get us to a certainplace and then they're not able
to carry us any further.
They're not able to contributeto the vision of where we go, or
they just don't buy into itanymore, whatever, or they find
a better opportunity that bettermatches their personal goals
and they move on.
We need to bring in a new teammember and especially on the
(32:04):
smaller size, I see a lot ofbusiness owners they think I've
gone through the interview.
I hired somebody, I checked thebox, I'm done.
Now I'm back to my other thingthat I was doing, and onboarding
is so important to the successof the company.
It 100% makes sense to me whypeople think they're done when
(32:29):
they hire and maybe do a day orthe first week's worth of
check-ins and then after thatit's kind of like, well, this
person's not performing and it'sall their fault because they
just didn't get it.
How do you?
How do you?
Well, or do you have an issuewith onboarding and or turnover,
or do you just have the samestaff that's just glued in place
(32:50):
, like tell me a little bitabout, um no, we definitely have
issues with turnover.
Speaker 1 (32:55):
Um, to some degree, we're obviously larger, so we're
dealing with more.
So the pool the likelihood ofme getting 25 rock stars that
stick around forever is unlikely, right, because people that are
great at their job want to keepprogressing and making more
money and doing great things.
Right, just as I was in 2010.
So I feel like we're more atrisk there.
(33:18):
The employee if you ask me as abusiness owner, having
employees is absolutely thehardest part of my job, but I
also know it's the.
They are the single mostimportant asset that we have.
Like we would not be able tofunction without them and I'm
grateful for each and every oneof them.
We are big on culture in ourcompany, and that involves my
husband and I.
We choose not to work from home.
(33:39):
I say that I'm home today.
I work from home two days aweek for the sake of you know,
my kids and some other thingsthat I've worked hard to get to
this place in life, but we're inthe office.
We didn't close during COVID.
We have some remote workers andwe can work remotely if need to
, if we have a bad snowstorm andpeople can't go to work or
whatever, but we believe in thepower of team.
(34:00):
We're really sports-mindedindividuals and we believe that
we work best when we're alltogether.
It doesn't mean we can't, butthat's just the culture we've
built.
People enjoy havingconversations with each other
every day.
We enjoy doing things outsideof work with each other here and
there.
We're really big on buildingthat culture and that starts
with onboarding, I feel like.
(34:20):
So we definitely involve ourmanagement team in the hiring
process, because they're theones that have to manage these
people.
So I want them to feel likethey have the power and the
authority and to set theexpectations from the beginning.
But I also don't ever and thisis a part of my husband's doing.
He comes from corporate America, so he never wants to be that
corporate business where you'rejust a number.
(34:40):
So we're still involved.
We do the interview process, wecheck in, we help train when
needed.
Now, as we get bigger, will Isay I'm not as close to my
employees as maybe I used to bewhen we were at 15, 16 employees
when we first took over.
There's also a reason for thatas we continue to grow and set
(35:00):
these boundaries, they have tobe healthy ones.
So we are extremely, extremelyclose to our management team.
We do lots of things together.
We're collaborative.
We're very different.
We all support each otherinside, outside of work, and
that's kind of where ourboundary stops.
We know our other employees.
We do nice things for them, wethrow parties, we go camping
(35:21):
together.
You know these things that wedo as a company.
But we're not as personallyclose with them.
But my management team, who areover these people, are very
close with their team becausethey've seen the buy-in that
they get from Jim and I andthey're trying to replicate that
to their team.
So I think it's a good mix of ahealthy boundary.
They do a great job ofonboarding and making them feel
(35:43):
welcome.
In fact, we just hired I'llshare this we just hired a new
remote person and she juststarted this week and we had our
standard is to send out anemail saying welcome, so-and-so.
Whether they're remote or not,we include them in everything,
and everyone responded with,like, something nice to say or a
meme, or you know, we don'trequire that.
That's just what happens whenthey send that email out.
And we got an email from thenew employee today saying oh my
(36:06):
God, I have never felt sowelcomed in a job that I've ever
had in my life than I did inthis moment, and it's like those
little things matter right, andwe don't make them do that, but
they do it because theyunderstand the aspect of a team
and that they're all importantpart of the puzzle that we
create.
Speaker 2 (36:23):
The things that we talk about in our company and
with some of the coachingclients that I have, is is
building that culture and I talkabout I love the word culture
because the first part of it iscult and I really think that as
a business owner, as a leader inyour company, you really need
to think about your building acult.
Now, obviously, you know I'mtrying to build a healthy one,
(36:46):
but a lot of the reasons thatcults are successful is because
they have certain ways to bringpeople in, make them feel
welcome.
They have certain rituals thatthey go through, and I think
that as we grow, sometimes asbusiness owners we can get so
focused on the spreadsheets thatwe forget the people aspect of
the business, and you mentionedthat culture is really important
(37:07):
to you.
You just gave us a greatexample of that.
What do you think, as a leader,now that you've moved into a
leadership role where you havewhat I will call mid-level
managers and then there's staffunderneath them?
What do you think yourtransition now, your
transformation, looks like fromwhen you bought the company to
(37:28):
where you are now, to where youwant the company to go?
Because I assume that as yougrow and step further and
further away from the frontlines of the business.
You're stepping into unchartedterritory for yourself, so there
can be a little bit of thatimposter syndrome.
I don't know what I'm doing.
(37:48):
Am I leading in the rightdirection?
How are you navigating thatwith expanding and transforming
into the type of business leaderthat you want to be in the
business you want to have?
Speaker 1 (37:59):
Yeah.
So I feel like I've had apretty easy transition into that
role and I I will attest thatto NARPUM I knew that I wanted
to be NARPUM president one dayand I knew that it takes a lot
of time and so my transitioninto I've got to build trust and
have somebody that can reallytake care of our company.
(38:20):
Not that my husband's not there, right, but when I'm gone doing
these things he then becomes MrMom.
We have three kids, you know,on top of owning a business and
a dog and all these things, andthose are the responsibilities
that I usually take care of morewhen I'm here, and so we shift
that right.
This is a step we took longbefore I was even on NARPA
(38:41):
National, in fact in the verybeginning, because we wanted to
give people some opportunity.
So we invested in creating,rather than like a one time, one
person that's like yoursecondhand man, no matter how
large you are, like the next inline.
We've never gone to thatmentality.
Part of the reason is because Iused to be that person and
people get burnout.
Property management is adaunting job, right For anybody,
(39:02):
and if you're not the owner,reaping the benefits of owning a
business in this a lot of timesit's not worth it, right?
You go through those momentswhere you're like I can't do
this, no amount of money makes.
It makes me happy about goingto my job today.
So we took it, we took a chanceand we invested and at the time
it was six individuals.
We knew it was a little bitheavy and we've narrowed down to
(39:23):
four.
We could use one more, butwe're good where we're at now
because we have such a good team.
I don't want to disrupt it.
We took that one job that youknow you would pay someone
really good money and we splitthat in between six and we still
paid them decent money.
But they're not burnt out andthere's someone else to help
them and everyone feels likethey can take their time off.
It's also allowed us in thistransition phase to really work
(39:45):
on the business.
We get to have time to justexplore how are we going to do a
in-house security depositoption.
Business owners don't have timeto do that because they're
they're helping where they're inthe front lines, like you said.
So I've had a little bit easiertransition because I was gone
all of last year for the mostpart, or busy with NARPUM.
I've also really enjoyed it,believe it or not, it's.
(40:06):
It's kind of a weird feeling.
I have time to be a mom.
I have time to choose to go onvacation when I want.
I have the ability to work fromhome when I want.
I've gotten over the mentalityof oh I, you know, if I buy a
new car, if I build a house ordo this, like what, are my
employees going to think aboutit?
And it's like no, I've workedhard to be in the position I'm
at and I should enjoy it Now.
(40:28):
My husband, on the other hand,loves to work in the business.
I think he will literally dieworking.
That's just his mentality.
He likes it, he likes numbers,he likes money, he all those
things.
And so, while I don't know that, he loves being and he's not in
the front line, but I think hewould like to get to a little
bit higher level.
But I think he also came intoit later than me and so he's.
(40:50):
He's really just eight yearsinto property management where
I'm 15.
So I think he's still adjustingto what happens.
I mean, you know, you seethings differently every single
day and he's getting comfortablewith.
Okay, I have to trust the teamand I'm doing this and they're
going to do their job.
And he's very I say thislightly like culture.
We love our culture, right, butI'm very much the people person
(41:12):
of us.
That's what I bring in our duoand he's very the process here's
, here's how we're going to doit.
Let's just get it done.
Not that he doesn't care aboutpeople, he does, but he likes to
work and he likes to seeresults.
And so his transition intoleadership.
I feel like it's a little bitdifferent and when he's ready to
take that break, you know,hopefully he will, but I've
really enjoyed it.
(41:33):
I'm actually having to get backinto it now that I'm not
president a little bit more thanI was used to, but I'm enjoying
it.
My team knows that I'm therefor them and we're always there
to help.
And if we've always said this,you know, if we have to show a
property or go do a turnover orwhatever, even as owners of the
business, that's what we do,cause if that's what the team
needs at the time, then that'swhat we're willing to do.
Speaker 2 (41:53):
You mentioned something that made me think of
a situation that a lot of myclients, when we coach them out
of being in the business and wetalk about them becoming the
least important person in theday-to-day operations of their
business so that they can focuson that strategic big picture
thinking, doing the things thatwill move the company forward,
(42:15):
versus going and showing aproperty to fill in and I'm not
saying that that's not important, but if I'm spending time
showing a property that somebodyelse on my team could do, that
means I'm not doing the thingsthat only I can do, which means
nobody is doing that, whichmeans I'm actually letting the
team down, Because if I'm theonly one that can do that big
(42:35):
picture thinking and set thecourse of the company and I'm
not doing it, it just meanswe're adrift, we're just going
wherever.
And so we we spend a lot of timeworking with clients to pull
them out of the day to day andmake them so that they don't
have a lot of things that theyhave to do on a regular basis,
(42:56):
and some of them experience alittle bit of, I would say,
depression, identity crisis,because they've been so tied in
their identity has been I am mybusiness.
I am the face of the company, Iam the one that is bringing on
(43:16):
new clients or whatever, and allof a sudden we help them build
this team where they are notnecessarily needed anymore and
they have to reinvent theirpurpose and their mission
personally of what they aredoing, either in the company or
using the company as a vehicleto do something bigger and
better in their life.
I know as you stepped out ofbeing so busy in the business
(43:39):
you almost were able to fillthat vacancy with becoming
important at NARPUM.
Now that that's gone away, haveyou experienced any of those
same like what's my purpose herenow?
Or have you been able to kindof get right back into it.
Speaker 1 (43:57):
I'm not experiencing that yet and I'll tell you why.
Narpum is such a hard thing todo.
Right, I loved every bit of it.
Um, I, I have zero regrets.
It was like one of the bestyears of my life, um, but it was
also really, really draining,um, and so I've.
(44:19):
I'm finally feel like, and herewe are January right, but it
kind of slows down.
You get, you start todecompress after national
convention because you have afew more things.
But and I still play a role I'mstill a past president on the
board and we're heavy andchanging things with NARPM 2.0.
So I'm busy with that still,but I feel like I'm finally
getting to the point where I'vedecompressed enough that I'm
(44:41):
still just enjoying not being socrazy, if that makes sense.
I don't know that I'll ever getthere either.
I don't know that I'll feel likeI'm depressed or not don't have
a value again, because I stillhave young kids at home, so I'm
needed more than anything.
I have one going off to college, so that's a big adjustment for
us that we're getting ready,prepared for she's a senior this
(45:01):
year, so we're doing lots ofthings with that.
And then my other, my middleone's, heavy in sports, and my
younger one probably too.
So we're busy elsewhere, that Idon't feel like I have time,
that because my purpose of beinga mom is just as important to
me as running a business.
So I don't know that I'll evernot feel like I don't have a
purpose.
But I'm not there yet.
I'm just enjoying life.
Speaker 2 (45:23):
I love that you're using the business as a vehicle
to be able to find the purposein things that are truly
important.
I think that's the reason whywe all have businesses in the
first place is to fuel ourpersonal goals and things that
are important.
I just want to give you onelittle bit of advice.
When you go and drop your, it'syour daughter that's going off
(45:44):
to college my oldest is adaughter when you go and drop
your daughter off for college,make sure you take some tissues
with you, because allergies arevery strong that day and you
want to make sure you have.
Speaker 1 (45:55):
I was just telling my husband this story.
I have a sister, and so my poorparents had to take us to
college in the same weekend andwe went to different colleges.
So we drove clear to Portlandall the way home.
My mom cried all the way home.
Then they drove me clear toTwin Falls and then my mom cried
all the way home from there.
My poor dad man, I don't know.
Yeah, it's an emotional.
Speaker 2 (46:14):
It's a big change.
It yeah, it's an emotional.
It's a big change.
It's a big change.
But you know, all my kids havegone through that.
Come home Now they're allhaving babies and it's a great
transition.
Speaker 1 (46:24):
That's the best part.
Speaker 2 (46:25):
Yeah, yeah, I want to close out a little bit with
talking about NARPUM.
You had some really uniqueperspectives being the president
.
There's only been 36 nowpresidents or 36 years worth of
presidents.
Speaker 1 (46:39):
Yeah, and some of them did double.
So maybe not quite that many,but somewhere around there.
Speaker 2 (46:43):
Yeah, so in that period of time, there's only
been a handful of people, orslightly more, that have had
that same perspective as you.
What did you learn, or what wassomething that you didn't
expect about?
Not necessarily theorganization of NARPUM, but you
got insight into propertymanagement at a scale that most
(47:05):
people don't get.
Is there something that you canshare with the audience of?
We saw this, we learned this.
This was unexpected, anythinglike that.
Speaker 1 (47:16):
I'm trying to think I will say people underestimate
the intelligence that is in thisgroup.
I continually tell myself whatam I doing?
Why am I leaving thisorganization?
Why am I in this room with allthese people that are a thousand
times smarter than me, LikeTony?
It's crazy, and they each bringtheir own unique perspective,
(47:38):
but I think that's what makesNARPUM special.
I'm trying to think if there'sanything else that we learned.
Speaker 2 (47:43):
Did you get any statistics on company size?
Or I know they did the NARPUMaccounting standards?
I know they've done just someother surveys and things and I
know you were busy working.
Are they the regional vicepresidents or regional RVPs?
And then they work with theindividual chapters.
So I know you're not probablytraveling around to every single
(48:06):
chapter, but you did get toconnect in ways that most people
don't.
Speaker 1 (48:10):
Yeah, I'm more of events, I would say, in the time
that I've been, you know,president, elected president, I
think it's been really eyeopening how much statistics play
a role, and that's what, youknow, our members were wanting.
That's what we want as businessowners and some of the
adaptability that we know as anorganization and or as a company
(48:31):
or business owners that we haveto do to create, like we talked
about KPIs or statistics ornumbers out there, or sharing
with each other without givingaway everything to help
collectively make all of us movein a better direction.
Does that make sense?
Like I know, narpum is such anopen sharing forum that we don't
(48:51):
really combat thecompetitiveness, so to say,
right, most of us are prettyopen that way.
But I think we've adapted andwe've seen how numbers don't lie
and that's a crucial piece ofanyone being successful, whether
it's a board, an organizationor a business owner, and so I
think there's a lot of thingscoming from that research and
(49:11):
what we've seen and heard peopletalk about very good.
Speaker 2 (49:15):
Will we see you at the broker owner conference?
Speaker 1 (49:18):
yes, I will be there, I can't wait.
I know people are like what ifit snows?
I'm like, oh God, you'll all befine.
Speaker 2 (49:24):
I was just down there .
On Wednesday I went down there,Pablo Gonzalez from Vendoroo
and I.
We went down there just to kindof scope out the layout.
And it's at the Broadmoor.
It's a beautiful hotel.
It's a beautiful hotel.
Speaker 1 (49:37):
It's a historic hotel , it's amazing Built in the
1890s.
Speaker 2 (49:41):
I can't wait.
Beautiful hotel Lake there,right there in the middle of the
grounds.
So we shot a little content andit was a little bit chilly, but
by March we should warm up alittle bit.
March is our second snowiestmonth.
Speaker 1 (49:53):
I have snow on the ground right now.
Speaker 2 (50:00):
So chilly it doesn't scare me.
Yeah, I'm looking forward toconnecting with you when we're
out there.
So thanks so much for hoppingon and sharing your insights and
wisdom with our audience.
I really appreciate it and yeah, I'm looking forward to
connecting when we get out tothe event.
Speaker 1 (50:10):
Yeah, thanks for having me, it was great.
Speaker 2 (50:11):
Thanks for tuning in to the Property Management
Success Podcast.
We'll be back with anothervalue-packed episode to help you
level up your propertymanagement game.
If you've got somethingvaluable out of today's episode,
please share it with a friendor colleague, and don't forget
to subscribe and leave a reviewso you never miss out on future
insights and strategies andtactics.
Until next time.
(50:32):
Here's to your success.
We also are not scared to fire owners that
aren't okay with this.
We've cleaned out quite a fewin the last few years for
different reasons.
But growth to us isn'tnecessarily a number.
It's about your profits, aboutyour efficiencies.
Are your employees happy?
There are other ways to growyour company and be successful
than simply saying I have athousand doors or 2000 doors,
(00:20):
because a lot of times moredoors brings more headaches and
more employees and all that comewith that.
Speaker 2 (00:26):
Welcome to the Property Management Success
Podcast, where we interviewleaders in the industry to
uncover the secrets toprofitability, efficiency and
achieving true freedom.
Whether it's your time, moneyor lifestyle.
I'm your host, tony Klein, andI'm here to help you build a
wildly successful propertymanagement business.
Let's get to it.
Welcome back to another episodeof the Property Management
(00:48):
Success Podcast.
Today, I'm super excited tohave Melissa Cherone on with us.
Melissa is the president ofFirst Rate Property Management
out in Boise, idaho, and a pastpresident of the National
Association of ResidentialProperty Managers, or NARPUM.
Melissa welcome.
Speaker 1 (01:09):
Thanks for having me, Tony.
Speaker 2 (01:11):
Yeah, absolutely.
I'm excited to have you on.
I know we've known each otherfor a long time and we've both
taken some unique andinteresting paths to get where
we are, and so I'd kind of liketo give the audience an
opportunity to get to know you alittle bit.
So if we could talk about youentering property management and
then where you are now size ofyour company, just so they have
(01:33):
some context of the discussionthat we're about to have.
Speaker 1 (01:36):
Sure, I love.
I love sharing my story.
I think it's a unique one and Icontinue to share it, not to
say look where I've come, but togive hope to those people that
have been once in my shoes.
I started in 2010, just workingfor first rate property
management here in Boise, idaho.
At the time, tony Dross ownedit, which I'm sure a lot of you
(01:57):
are familiar with that name.
I was a showing agent.
I showed properties, came intowork every day, did my job.
I was that always asking whyperson that maybe a lot of the
office didn't like, but Tonyloved it and just slowly worked
my way up in the company and myhusband and I had an opportunity
to take over First Rate forTony back in 2021.
(02:19):
So we've almost in May.
We have owned it for four years,so a really different, unique
journey, something that I neverimagined myself doing.
But it's been a blessing in somany ways for me personally and
professionally and my family andmy husband and all of the above
, and we are continuing on thesuccesses that he started.
(02:42):
But putting our own uniquetwists in our business Husband
and wife team brings its ownchallenges some days, but for
the most part it works reallywell for us.
We manage about 1100 doors herein the Boise area, so we're
fairly large.
We also run an in-housemaintenance team and we look to
grow in the right areas.
And when I say that we don'tjust look to grow.
To grow, it's got to be theright fit, the right opportunity
(03:05):
, and so we're good about whatareas can we do that in.
That makes sense for us.
So that's a little bit about myhistory and where I'm at.
I'm also a big part of NARPUMjust got done serving as
president, have enjoyed thatride as well and all that it's
done for me.
Speaker 2 (03:26):
I want to get into the process or the transaction
that you did where you took overthe company, but you mentioned
something that I want to diginto first and then we'll circle
back around that.
You mentioned that you want togrow, and you want to grow in
the right way and you want tomake sure that the people are a
good fit.
One of the things that I talkabout a lot in our coaching
program is really identifyingwhat I'll call the target client
profile and identifying thetype of property, the location,
(03:47):
the type of owner, just reallygetting clear on who your
company is built to serve andthen getting clear on the
messaging and the pain pointsthat you need to communicate to
attract those people.
I'd love to get your insightson what you mean by it's a good
fit.
How do you you mean by it's agood fit?
How do you guys determinewhether it's a good fit or not?
Speaker 1 (04:10):
So we're pretty picky .
We've been allowed to be pickybecause of how the company was
started and set up.
We are really geared towards, Iwould say, investor mindset,
more than an accidental landlordor a single family, and in fact
our portfolio is probably 75%multifamily, and when I say
multi I mean small multi.
We're not managing anythingover 65 units in one space, no
(04:34):
onsite management or anythinglike that, and we have a unique
perspective, which can be a goodand a bad, of 1,100 doors but
only about 300 owners.
So we're servicing clients thathave larger portfolios and
continue to grow.
We pride ourselves on being theexpert in this area and we're
process driven and alsodepartmentalized, which is not
(04:56):
as common, I wouldn't say, inour market as I see.
You know other PMs that wetalked to at NARPM or people
trying to go to the hybrid orthe pod style.
We've always been that way.
We've believed in the system ofefficiency and getting the job
done well, and so the client hasto.
The right fit for us back toyour question is they've got to
(05:17):
fit in with our model.
So you have, they have to beokay with they're not going to
talk to just one person theirentire time where they have a
rental right, we have experts inaccounting, we have experts in
leasing and experts inmaintenance and, while we have a
management team that overseesthat, for an owner to reach out
to if they do need to talk toone person.
But we're very communicationfocused and so we don't find our
(05:37):
owners reaching out to us veryoften because we're giving them
the opportunities to reply andthey know who to reply to.
So the right fit for us issomebody who views us as the
expert, allows us to be theprofessional fits within the
process-driven system that wehave and is hands-off.
We also are not scared to fireowners that aren't okay with
this.
We've cleaned out quite a few inthe last few years for
(06:00):
different reasons.
But growth to us isn'tnecessarily a number.
It's about your profits, aboutyour efficiencies.
Are your employees happy?
There are other ways to growyour company and be successful
than simply saying I have athousand doors or 2000 doors,
because a lot of times moredoors brings more headaches and
more employees and all that comewith that.
Speaker 2 (06:20):
I love the fact that you're focused on the, the end
result, the output versus theinput.
You know we can add in an extra200 doors this year, but if it
doesn't change the output, whatwe put in our pocket or the
impact we're able to make or thetransformation that we go
through either in our businessor what that growth allows us to
(06:41):
do personally, then it's reallyjust busy work.
It's really just you'retreading water.
Then it's really just busy work.
It's really just you'retreading water but you're not
really going anywhere.
And I love the fact that you'vegot that clear audience
identified and then you're notafraid to stick with it and if
somebody falls out of alignmentwith that, you're okay with
cutting them loose.
Speaker 1 (07:00):
Yeah, it's.
We ask our employees every yeartop three owners they want to
get rid of, and it's usuallypretty common and so they get.
They get on the chopping block.
I mean we have we have tocareful consideration, we go
through a process and how bad isthis going to hurt or is it
worth it?
And obviously it's jim and i'sultimate decision.
But we value our team and whatthey think and if it fits within
(07:22):
our company and our mission andvision and our core values,
then they're allowed to providethat feedback for us.
Speaker 2 (07:29):
I want to dig just a little bit deeper on this
because I think it's fascinatingthat everybody runs our company
a little bit different, but yetwe all seem to follow some
similar the successful companiesseem to follow some similar
patterns.
You mentioned process-drivenand I think that's really
(07:50):
important, but I think settingyour processes up to serve that
target client profile is moreimportant.
Right, it's not about havingprocesses, it's about having the
right processes designed andtailored to your company.
A lot of companies that I talkto, a lot of people I interview,
a lot of my clients they reallyfocus more on that accidental
(08:10):
landlord simply because there isjust more of them.
Statistically, there are morepeople who own two or fewer
properties in the single familyspace than own a larger
portfolio.
And I'm interested to get theinsight from you what you
believe the difference is inbeing investor-minded, focused,
versus dealing with the issuesfrom somebody that used to live
(08:33):
in a property.
They know the neighbors.
Can you really put a goodtenant in there?
Because I don't want myneighbors calling me, I don't
want people parking in front ofmy neighbor's house and going to
my property Like they're justall the little emotional issues.
Right, those can be differentthan and I'm not saying
investors can't be emotional,but they're.
They're concerned withdifferent things.
(08:54):
What do you think are some ofthe bigger concerns that your
clients have, specificallybecause you are more investor
minded?
Speaker 1 (09:01):
Um, you know, I I want to go back to how our
business is focused.
We're focused on the end result.
We just talked about right Um,that part is a challenge, I
think, on their end and and onour end.
Um, sometimes and we'll talkabout the economy now prices are
higher, right Um, cost cost ofmaintenance is higher and so a
(09:21):
challenge I think our clientssee, when we're investor
mindedminded, focus is sometimesthey're only looking at the
bottom line.
Sometimes that's all they'refocused on, and we also have to
remind them that aninvestor-minded person a lot of
times the short-term gain isn'tout there, especially in
property management Come fromfirst rate was built that way.
Tony was an investor.
(09:42):
My husband and I are nowinvestors ourself, and so we
have that mentality of we'rereally open when we chat with
them, onboarding or taking themon, like, what's your plan for
this?
Is it a short-term hold and youjust need us to do the best we
can Do?
We need to soup up yourproperty to get to sell it in a
couple of years, because that'syour plan.
(10:02):
Are you in this for the longhaul and willing to ride the
waves of higher rent, lower rent, higher costs?
But that's where we come in asa business and an expert.
What can we do to combat thosechallenges?
How can we help reduce costs?
That's one reason we startedin-house maintenance.
We can offer that as a lowercost, but it's still profitable
for us.
But our owners are happy and wecan control the quality, so it
(10:24):
was like a huge win-win for us.
So what else can we do in ourcompany?
That's combating the challengesof affecting that bottom line,
because a lot of times that'swhat they see, and sometimes
it's just a matter of this isthe market.
I'm not in control of that.
Right, I can only tell youwhat's out there and what we can
do to help you, but I'm not incontrol of the market, and so
let's talk about ways that aregonna make you feel more
(10:44):
comfortable.
Speaker 2 (10:45):
Mark Brower and I just in a recent podcast episode
that we recorded, he was tryingto convince me that we should
be transitioning from beingproperty managers to asset
managers and being somebody thatis more investor-focused.
I'd love to ask you thisquestion Do you think that,
because your clients are moreinvestor focused like they
(11:09):
intentionally bought into theseproperties to be an investment
do you think they're looking formore information?
Are they trying to get a betterdashboard to get their
information whenever they want?
Or are they looking to have youexplain information?
Or are they just saying Ibought it, you manage it and in
five years I'm going to makesome money on this thing, like
(11:30):
what are most of theconversations you're having
around?
Speaker 1 (11:33):
I would say I don't know Our with my clientele and
our market, I would say they'renot necessarily looking for us
to give them more information.
Now, I say that lightly,because if there is an end game
and we're coming upon the endgame and they're old enough to
sell their properties and retire, or we have, for instance, a
lot of kids that are taking overtheir parents' portfolios that
(11:56):
we've had 30 years right, theymay be looking for a little bit
more because they don'tunderstand what it's done all
these years.
However, if they were to cometo us and say I need to sell or
I need to do this or we need toget an update plan, whatever,
we're happy to assist in that.
But to me that is a lot of ourclients, I don't know.
(12:19):
I'm not a big.
I'm not a big asset manager faneither.
So I'm on your side because Ifeel like property management,
regardless, is still arelationship business and they
wouldn't have any of theseassets if we didn't take care of
tenants in the proper way orvendors in the proper way and
with an asset manager mindset.
I don't believe you can deliverthe customer service to all
(12:41):
three of your clients whenyou're only thinking about the
bottom line right.
So I think it's a healthybalance and I think both is
needed and I think when you findthat and provide a touch of
information that may be helpfulmarket updates or trends you're
seeing or a new service you'rewilling to offer to help them
that's enough, at least in myexperience, to be considered
(13:03):
helping them with their asset,but not being an asset manager.
Speaker 2 (13:07):
Well, I appreciate your insight because you are
definitely more focused on theinvestor set than I was.
So even though I have myopinion in it, it doesn't hold
as much weight as yours.
So I appreciate that feedback.
Okay, let's circle back aroundnow and talk about the
transition.
I remember when you were lookingat buying the business from
(13:30):
Tony and we had a few texts orFacebook messages I can't
remember, but back and forth wemay even had a phone call or two
, some of the stickiness of itand just and I think there were
some complications in it.
And so help the audienceunderstand did we buy the
(13:52):
business or did we buy thebusiness assets?
Did you take on all previousliability?
Just kind of walk us throughwhat that looked like at the
time, because there are a lot ofpeople out there that are like
I would love to grow throughacquisition.
So whether they already have abusiness or they are looking to
get into the industry to buy abusiness, I'd love to give them
(14:13):
some insights so that they canskip over some of the things
that tripped you up.
Speaker 1 (14:19):
Yeah, so I think our story serves a couple of
purposes.
I also love sharing it becauseI think it's a really good exit
strategy for people out therethat want to keep it going but
want to be done.
If you have a trusted personlike this is a very viable
option that people, I think,just don't take into
consideration.
It's got to be well thought out, it's got to be a long-term.
(14:41):
I mean this didn't just happenovernight, right, it was a four
year in the making.
I had randomly heard the storyabout Melissa Prandy, who's a
NARPA member, who bought who inthe same shoes as me, and I had
gone to Tony and I said hey, ifyou ever consider doing this,
let me know.
You know my husband and I mightbe interested.
I had a.
My husband at the time wasworking retail tons of hours a
week.
We were newly married, havingkids.
(15:03):
It was.
It was wild.
So we jumped on the bandwagonand said we're going to figure
this out, run it together, andwe had an opportunity to bring
my husband on sooner than wethought.
So that kind of sped up theprocess a little bit.
Um, and he's very operationalminded, and so that helped us
get to where we needed to be anddo some things that made the
business look good, you know,for Tony and for us and vice
(15:23):
versa.
Um, we were also.
A unique situation is we bothhad the same end game.
We had the same goal in mindand so we worked together.
For the most part, we used thesame attorney, which I know
people were like, oh my God,don't do that.
And I would still advise westill had an outside attorney,
look at the final contract, justto protect ourselves as well.
(15:43):
But it was a well-builtrelationship with the same
common goal in mind, ready forhim to step away, and I was
eager to step up and run thecompany that I had been really
running for the last severalyears.
So some of the challenges we had.
The first challenge I'll say Idon't feel like anybody in this
(16:04):
world, and when I say that I saymaybe banks or loans.
So we chose to go the SBA route.
We knew we didn't want to do anowner carry.
We wanted to purchase thebusiness like we would any other
acquisition, whether it wasthrough a loan or through cash.
We knew there would need to besome down.
But our first big challenge wasnobody.
We felt like nobody really knewhow to truly value a property
(16:26):
management company.
Some, you know some would sayoh, these contracts are worth
everything.
Here's your, here's your value.
Others would say the value ofthe contract.
Yes, you have a contract, butit's not really, because if they
don't pay rent, you're notreally getting money.
And it was wild, Tony wild, thesame I can't think of the word
the same guy that did the veryfirst evaluation to kind of get
(16:48):
us a rough idea of what it wasworth, valued it at one point
and a year later it was likeless $800,000, $900,000.
I mean, it was crazy.
And it's like you're the samedude that looked at this.
What changed right?
So I don't know who was in hisear.
We did a stock purchase, so wedidn't want to have to change an
(17:08):
EIN number.
We didn't want to have to fireall the employees and rehire
them back.
We wanted to keep the same bankaccounts, all the stuff that
was in first rates names.
So that's how we chose to do it.
I thought it worked really well.
We have a stock certificate, wehave a purchase sale agreement.
We started with one bank.
They couldn't make it happen,so we ended up with another one
and they made it happen and ittook about a year.
(17:31):
This also happened during COVID.
We started this process so wewere also like, oh my God, we
can't buy a company.
During COVID, what if nobodypays rent?
And then we looked at eachother and we're like we're going
to be successful regardless.
We can do this.
So we just pushed forward.
So evaluation was a challenge.
What else was a challenge?
Some original documents were achallenge, like having original
letter of, like your tax IDbeing issued to the corporation.
(17:55):
When you do a stock purchase,you have to have that stuff.
So we had to figure out how toget those.
Some of the conversations werehard.
Right, I really value theopportunity that Tony gave me
and I'm forever grateful for thementorship that he's given in
my life, Like I said, personallyand professionally, with First
Rate and with NARPA.
But we had to have some hardconversations about you know
(18:16):
what's going and what's leavingand what are the assets and the
price.
We also were in a uniqueposition where we worked it out
prior to me selling, where I wasable to get some equity.
I was not willing.
I shouldn't say not willing.
It was really hard for someonein my position to continue to
build the company, knowing thatI was going to pay for my own
(18:38):
work, so.
But he was really fair andoffered that, so that was
deducted from the overall saleprice.
I'm trying to think what otherchallenges we had.
Speaker 2 (18:47):
Let me.
Let me ask you this on thepurchase price, because I do
hear it's not super common, butit's fairly common that somebody
on the team is the one that'sgoing to step up and purchase
the business.
And you're right.
You've been working there,you've been putting in your
effort, you've been compensatedfor the work that you're doing,
(19:09):
but you're also moving thatpurchase price a little bit
further down or making it alittle bit higher, because the
more value you bring now, themore valuable the company is,
the more you have to pay becausethe more value there is.
So tell me about theconversations Was it easy to
come up with that final price?
I know you had multiplevaluations, but was it easy to
(19:30):
come up with that price?
Or did it create any frictionbetween you and Tony?
Where he wanted?
Obviously he wants to maximizehis return on the asset that
he's selling and you want to beable to make sure that you can
pay the price but still continueto carry on.
It's not just about purchasingit, but it's about keeping it
alive after you bring it intoyour portfolio and then also
(19:54):
being able to cashflow it andnot run out of money or need to
do something personally on theside because you're not making
any money.
So how did those conversationsgo?
Speaker 1 (20:04):
No, it wasn't hard for us.
We knew before we even enteredin the value, like I said, the
start and we started the wholeequity.
I got a little bit of a profitshare, you know, because we
originally started talking.
We were talking about maybeI'll just let her buy 20% or 30%
, and that just came with awhole slew of issues that I
think we both agreed on.
That was really just reallymessy.
You know, we're both married.
(20:25):
What if we get divorced?
What if something happens?
What if it just becomes reallymessy?
And so he's like here's analternative.
I think we'll make you happy,and it did Our.
Our situation's really unique.
We again both had the same endgame.
He was not looking for the verytop dollar, because that wasn't
his end game.
Had that been the case, hewould have sold to somebody that
(20:46):
would have paid the very topdollar.
Right, I was a solution for himto be able to get what he
thought was fair, to be able toexit this company and, mind you,
he does real estate too.
So they fed each other and Iwas looking to purchase
something.
But it had to be enough for meto understand that it was
something valuable and on his 25years of hard work was was
(21:08):
worth something.
Right, you're not going to getthat for free.
So I don't feel like our hardconversations were about the
purchase price.
We were pretty honed in on thatfrom the very beginning because
I knew we were getting somethingreally good.
Now don't get me wrong.
There's times when you're like,oh my God, I can just start my
own for free, right, that's justas easy.
And we weighed those options.
(21:29):
When times got harder, you'relike, oh my God, this is taking
forever.
Or you're frustrated becausethe bank or whatever came at us
that week.
But ultimately we knew this iswhere we wanted to be.
And again, we were workingtowards the same common goal and
together we got there.
So I don't know if you hadtalked to me during, I would
have been this optimistic aboutit, but I know it was it what
(21:52):
was best for both of us and it'sworked out really well.
Speaker 2 (21:55):
How big is the team now?
Speaker 1 (21:57):
We have 25 employees and that includes our
maintenance techs, so really wehave four of them.
So there's 21 of us includingJim and I, so 19 people
servicing our company.
We have one, two, three, fourremotes.
One is stateside, the other outof the United States.
We have one gal who used towork for us and then had to
(22:19):
transfer back East because ofher husband and we finally
switched over to RentVine wherewe were online and could do
stuff virtually and hired herback.
So it's been amazing.
We're again departmentalized.
So I have a management team.
I have an operations person onmy side with an accountant, and
my husband has an operationsperson on his side that runs the
(22:39):
maintenance side, and then hehas an assistant, or really our
strategic operations guy, whotakes all of our new crazy ideas
and runs with them.
He's like the implementer, withthe help of the rest of us.
And so our operations peoplerun their departments and we
give them the freedom for themost part to do what's best for
first rate and find ways to beinnovative and different.
(23:00):
And even though I'm not veryold they're all younger than me
and they do a far better jobwith all of this new stuff than
I even do.
Speaker 2 (23:07):
So I want to talk about your team a little bit,
because we've talked in the pastand you've provided me with
some information about thementioned.
You're a system driven companyand you have your process
process driven and there's beena big push in the industry to
automate your processes anddocument your processes.
And I talk to a lot of people,whether they reach out to me for
(23:30):
coaching or just in casualconversations.
They are talking about somechallenges they have and
ultimately it comes down towe've started to automate our
processes or we've started toput our processes into some
software and they get stuck andthey either don't follow the
process or the process justdoesn't work because they
overcomplicate it, or theprocesses, which is the
(23:53):
step-by-step of what we do,isn't based on our policies,
which is what we do and why wedo it.
And for a team that big, I'vegot to assume that you guys have
gone through some challengesbut figured it out.
On the other side, what do youthink is most important when
you're creating this process orsystem driven company in putting
(24:18):
those together?
And then also, how do we trainour team on that?
Because it's one thing to havea tool, but if the team doesn't
know how to use it, then is itreally worth doing.
Speaker 1 (24:29):
Right.
So we're a combination of both.
We have some automation andsome tools, aka companies, that
are helping with some of that.
You know softwares are catchingup with that, things like that.
We live and die by ourchecklists and a lot of them are
online, right so?
But I just use the formchecklist because people know we
(24:51):
really believe strongly in ourcompany that success anybody can
do what we do and with theproper training and the proper
processes if we have for them,they can be successful.
Why we love the process drivenand why we believe in this is,
you know, when there's a hole inthe system, every time we ask
ourself is this a processproblem or is this a people
(25:13):
problem?
So is there a hole somewherethat we need to identify?
Because they chose they didn'tyou know the checklist, exactly
what we gave them and the messup still happened, or are they
choosing not to follow theprocess?
So, while people think we have25 employees and that's hard to
implement things and processdriven, I feel like we are
successful because we have thechecklist that they need to go
(25:37):
by for every single task in ouroffice we have a 300 page
policies and procedures manualthat talks about the why and how
we do it and then, literallystep-by-step, we actually just
got done updating it since we'veswitched software and it's been
complete.
Just last year.
That was our big goal for ourcompany to get that done, to get
their bonuses.
But it also allows us to neverdrop our ball in service,
(26:00):
because if I have four peopleout in accounting because
they're all sick, anyone shouldbe able to open the page that
says how do I do itemizeddeposit statement?
And here are the exact steps todo it.
So while we don't hope that onanybody, we know that with our
processes and what we've created, that our level of service will
(26:21):
never drop because anyoneshould be able to step in and do
it.
So with a team that big, theredoes come challenges because not
everybody will take it asseriously as the person sitting
next to them.
So we play to people'sstrengths.
We try to divide tasks intothings that either motivate them
(26:41):
or that they like doing withintheir realm, and if we create
processes, we also are reallybig on inviting them to be a
part of creating the process.
If you don't like it, tell mewhat you want to change and why
it matters, and when they're apart of that they have some
buy-in and then they have someownership and they take pride in
not messing that up goingforward.
Speaker 2 (27:00):
I think that's a really key point that we are in
alignment on, and that is,people support what they help
create, and so it's really hardfor somebody on the team to turn
around and say this processsucks if they were involved in
helping define how we go aboutdoing that.
(27:21):
And one of the reasons why Iseparate the policy from process
is I say the policies are therules of the game.
They're how we win propertymanagement at your company, and
that is up to you, as thebusiness owner, to define what
winning looks like.
But then we bring our team into help us with the step-by-step
(27:43):
.
Here's what we want toaccomplish.
You tell me you're closest tothe front lines.
You tell me what we should bedoing to adhere to or uphold
this policy and, of course, youstill have veto power.
You still get to make the finaldecision.
We're not just handing and say,okay, you guys run with it.
But it does make a bigdifference, because I remember
(28:06):
there were many times in mybusiness where I'm like, well,
you know, somebody would be outand I would fill in or something
, and I would assume that we'restill doing it the way we did it
three years ago, but they'vefound better ways to do it and
they would tweak things and andI would look at you know the way
I was doing it before and itwas just totally, just not the
(28:27):
right way.
It was so unproductive to do itthat way and they found a
better way and so including themin and making their way a part
of the official process I thinkis really smart.
Speaker 1 (28:38):
We also like it because it sets clear
expectations.
So they're never guessing whatthey're supposed to be doing,
what's right or what's wrong,because it's right in front of
them.
And back to that.
Is it a people, process, peopleproblem or a process problem?
If they're choosing not to dowhat's in front of them, that's
a they problem and then thatbecomes an employee behavioral
issue that we deal with and ourcompany knows we don't.
(28:59):
We don't put up with that Likewe've made it very easy for you
to do your job and if you'rechoosing not to do it, then you
might not be a good fit for us.
So expectations are reallyclear and I like that because it
takes the subjectiveness out ofif we do have to let somebody
go.
There's clear reasons why,rather than the so-and-so just
doesn't like them.
Speaker 2 (29:19):
I frame it a little bit differently, but we
accomplish, we end up in thesame spot.
So you say, is it a processproblem or a people problem?
And I frame it as, anytimewe're not hitting a KPI or we're
not performing the way weshould, I look at it as I'm the
business owner.
It's ultimately myresponsibility to make sure that
we deliver the service that I'mcommitted to delivering.
(29:40):
I may have to do it through adifferent person, and if that
person's not doing it, I mayhave to do it through another
different person, but it's stillmy responsibility.
So I look at it as it's either asystem problem meaning I
haven't provided them with theright system to do the job but
if we can agree that they havethe right system, they have all
the tools and resources theyneed then I look at is it a
(30:04):
training problem?
Have I given them the rightsystem but I haven't trained
them on how to use it properly?
And so if they can agree thatwe've given them the right
system and we've given them theright training, then it comes
down to if it's not a systemproblem and it's not a training
problem, then it's a performanceproblem.
And what I like about that is Itake ownership of two-thirds of
(30:27):
that equation.
And what I like about that is Itake ownership of two thirds of
that equation, and so it makesit easy for them to say look,
here's why I'm not able toperform.
If we could just tweak thisover here, I can hit my KPIs and
I can do the things you'reasking me for, and so I don't go
in whenever we miss a KPI andautomatically assume that it's
the person the performant.
Now, a lot of times it is, butI always take ownership of the
(30:51):
whole flow first.
That way they're open with ourconversation, versus backing
them into a corner and makingthem defensive right out the
gate in the conversation.
Speaker 1 (31:00):
I love that.
I love it, we also tell them.
We also tell them uh, we're onthe subject real quick, don't be
part, don't just presentproblems Like don't be a problem
presenter, be a problem solver.
Don't come ask a question abouta process or something that's
not going right unless you havea suggested solution.
Speaker 2 (31:18):
Um, and that helps get that, that mindset going to
that your company is fairlylarge compared to, statistically
, compared to most companies inproperty management.
Most companies are smaller thanwhere you're at, but it doesn't
matter.
In every size company we'regoing to have turnover.
We're going to have teamturnover right, not necessarily
(31:41):
property churn, but we're goingto have people that join the
team and get us to a certainplace and then they're not able
to carry us any further.
They're not able to contributeto the vision of where we go, or
they just don't buy into itanymore, whatever, or they find
a better opportunity that bettermatches their personal goals
and they move on.
We need to bring in a new teammember and especially on the
(32:04):
smaller size, I see a lot ofbusiness owners they think I've
gone through the interview.
I hired somebody, I checked thebox, I'm done.
Now I'm back to my other thingthat I was doing, and onboarding
is so important to the successof the company.
It 100% makes sense to me whypeople think they're done when
(32:29):
they hire and maybe do a day orthe first week's worth of
check-ins and then after thatit's kind of like, well, this
person's not performing and it'sall their fault because they
just didn't get it.
How do you?
How do you?
Well, or do you have an issuewith onboarding and or turnover,
or do you just have the samestaff that's just glued in place
(32:50):
, like tell me a little bitabout, um no, we definitely have
issues with turnover.
Speaker 1 (32:55):
Um, to some degree, we're obviously larger, so we're
dealing with more.
So the pool the likelihood ofme getting 25 rock stars that
stick around forever is unlikely, right, because people that are
great at their job want to keepprogressing and making more
money and doing great things.
Right, just as I was in 2010.
So I feel like we're more atrisk there.
(33:18):
The employee if you ask me as abusiness owner, having
employees is absolutely thehardest part of my job, but I
also know it's the.
They are the single mostimportant asset that we have.
Like we would not be able tofunction without them and I'm
grateful for each and every oneof them.
We are big on culture in ourcompany, and that involves my
husband and I.
We choose not to work from home.
(33:39):
I say that I'm home today.
I work from home two days aweek for the sake of you know,
my kids and some other thingsthat I've worked hard to get to
this place in life, but we're inthe office.
We didn't close during COVID.
We have some remote workers andwe can work remotely if need to
, if we have a bad snowstorm andpeople can't go to work or
whatever, but we believe in thepower of team.
(34:00):
We're really sports-mindedindividuals and we believe that
we work best when we're alltogether.
It doesn't mean we can't, butthat's just the culture we've
built.
People enjoy havingconversations with each other
every day.
We enjoy doing things outsideof work with each other here and
there.
We're really big on buildingthat culture and that starts
with onboarding, I feel like.
(34:20):
So we definitely involve ourmanagement team in the hiring
process, because they're theones that have to manage these
people.
So I want them to feel likethey have the power and the
authority and to set theexpectations from the beginning.
But I also don't ever and thisis a part of my husband's doing.
He comes from corporate America, so he never wants to be that
corporate business where you'rejust a number.
(34:40):
So we're still involved.
We do the interview process, wecheck in, we help train when
needed.
Now, as we get bigger, will Isay I'm not as close to my
employees as maybe I used to bewhen we were at 15, 16 employees
when we first took over.
There's also a reason for thatas we continue to grow and set
(35:00):
these boundaries, they have tobe healthy ones.
So we are extremely, extremelyclose to our management team.
We do lots of things together.
We're collaborative.
We're very different.
We all support each otherinside, outside of work, and
that's kind of where ourboundary stops.
We know our other employees.
We do nice things for them, wethrow parties, we go camping
(35:21):
together.
You know these things that wedo as a company.
But we're not as personallyclose with them.
But my management team, who areover these people, are very
close with their team becausethey've seen the buy-in that
they get from Jim and I andthey're trying to replicate that
to their team.
So I think it's a good mix of ahealthy boundary.
They do a great job ofonboarding and making them feel
(35:43):
welcome.
In fact, we just hired I'llshare this we just hired a new
remote person and she juststarted this week and we had our
standard is to send out anemail saying welcome, so-and-so.
Whether they're remote or not,we include them in everything,
and everyone responded with,like, something nice to say or a
meme, or you know, we don'trequire that.
That's just what happens whenthey send that email out.
And we got an email from thenew employee today saying oh my
(36:06):
God, I have never felt sowelcomed in a job that I've ever
had in my life than I did inthis moment, and it's like those
little things matter right, andwe don't make them do that, but
they do it because theyunderstand the aspect of a team
and that they're all importantpart of the puzzle that we
create.
Speaker 2 (36:23):
The things that we talk about in our company and
with some of the coachingclients that I have, is is
building that culture and I talkabout I love the word culture
because the first part of it iscult and I really think that as
a business owner, as a leader inyour company, you really need
to think about your building acult.
Now, obviously, you know I'mtrying to build a healthy one,
(36:46):
but a lot of the reasons thatcults are successful is because
they have certain ways to bringpeople in, make them feel
welcome.
They have certain rituals thatthey go through, and I think
that as we grow, sometimes asbusiness owners we can get so
focused on the spreadsheets thatwe forget the people aspect of
the business, and you mentionedthat culture is really important
(37:07):
to you.
You just gave us a greatexample of that.
What do you think, as a leader,now that you've moved into a
leadership role where you havewhat I will call mid-level
managers and then there's staffunderneath them?
What do you think yourtransition now, your
transformation, looks like fromwhen you bought the company to
(37:28):
where you are now, to where youwant the company to go?
Because I assume that as yougrow and step further and
further away from the frontlines of the business.
You're stepping into unchartedterritory for yourself, so there
can be a little bit of thatimposter syndrome.
I don't know what I'm doing.
(37:48):
Am I leading in the rightdirection?
How are you navigating thatwith expanding and transforming
into the type of business leaderthat you want to be in the
business you want to have?
Speaker 1 (37:59):
Yeah.
So I feel like I've had apretty easy transition into that
role and I I will attest thatto NARPUM I knew that I wanted
to be NARPUM president one dayand I knew that it takes a lot
of time and so my transitioninto I've got to build trust and
have somebody that can reallytake care of our company.
(38:20):
Not that my husband's not there, right, but when I'm gone doing
these things he then becomes MrMom.
We have three kids, you know,on top of owning a business and
a dog and all these things, andthose are the responsibilities
that I usually take care of morewhen I'm here, and so we shift
that right.
This is a step we took longbefore I was even on NARPA
(38:41):
National, in fact in the verybeginning, because we wanted to
give people some opportunity.
So we invested in creating,rather than like a one time, one
person that's like yoursecondhand man, no matter how
large you are, like the next inline.
We've never gone to thatmentality.
Part of the reason is because Iused to be that person and
people get burnout.
Property management is adaunting job, right For anybody,
(39:02):
and if you're not the owner,reaping the benefits of owning a
business in this a lot of timesit's not worth it, right?
You go through those momentswhere you're like I can't do
this, no amount of money makes.
It makes me happy about goingto my job today.
So we took it, we took a chanceand we invested and at the time
it was six individuals.
We knew it was a little bitheavy and we've narrowed down to
(39:23):
four.
We could use one more, butwe're good where we're at now
because we have such a good team.
I don't want to disrupt it.
We took that one job that youknow you would pay someone
really good money and we splitthat in between six and we still
paid them decent money.
But they're not burnt out andthere's someone else to help
them and everyone feels likethey can take their time off.
It's also allowed us in thistransition phase to really work
(39:45):
on the business.
We get to have time to justexplore how are we going to do a
in-house security depositoption.
Business owners don't have timeto do that because they're
they're helping where they're inthe front lines, like you said.
So I've had a little bit easiertransition because I was gone
all of last year for the mostpart, or busy with NARPUM.
I've also really enjoyed it,believe it or not, it's.
(40:06):
It's kind of a weird feeling.
I have time to be a mom.
I have time to choose to go onvacation when I want.
I have the ability to work fromhome when I want.
I've gotten over the mentalityof oh I, you know, if I buy a
new car, if I build a house ordo this, like what, are my
employees going to think aboutit?
And it's like no, I've workedhard to be in the position I'm
at and I should enjoy it Now.
(40:28):
My husband, on the other hand,loves to work in the business.
I think he will literally dieworking.
That's just his mentality.
He likes it, he likes numbers,he likes money, he all those
things.
And so, while I don't know that, he loves being and he's not in
the front line, but I think hewould like to get to a little
bit higher level.
But I think he also came intoit later than me and so he's.
(40:50):
He's really just eight yearsinto property management where
I'm 15.
So I think he's still adjustingto what happens.
I mean, you know, you seethings differently every single
day and he's getting comfortablewith.
Okay, I have to trust the teamand I'm doing this and they're
going to do their job.
And he's very I say thislightly like culture.
We love our culture, right, butI'm very much the people person
(41:12):
of us.
That's what I bring in our duoand he's very the process here's
, here's how we're going to doit.
Let's just get it done.
Not that he doesn't care aboutpeople, he does, but he likes to
work and he likes to seeresults.
And so his transition intoleadership.
I feel like it's a little bitdifferent and when he's ready to
take that break, you know,hopefully he will, but I've
really enjoyed it.
(41:33):
I'm actually having to get backinto it now that I'm not
president a little bit more thanI was used to, but I'm enjoying
it.
My team knows that I'm therefor them and we're always there
to help.
And if we've always said this,you know, if we have to show a
property or go do a turnover orwhatever, even as owners of the
business, that's what we do,cause if that's what the team
needs at the time, then that'swhat we're willing to do.
Speaker 2 (41:53):
You mentioned something that made me think of
a situation that a lot of myclients, when we coach them out
of being in the business and wetalk about them becoming the
least important person in theday-to-day operations of their
business so that they can focuson that strategic big picture
thinking, doing the things thatwill move the company forward,
(42:15):
versus going and showing aproperty to fill in and I'm not
saying that that's not important, but if I'm spending time
showing a property that somebodyelse on my team could do, that
means I'm not doing the thingsthat only I can do, which means
nobody is doing that, whichmeans I'm actually letting the
team down, Because if I'm theonly one that can do that big
(42:35):
picture thinking and set thecourse of the company and I'm
not doing it, it just meanswe're adrift, we're just going
wherever.
And so we we spend a lot of timeworking with clients to pull
them out of the day to day andmake them so that they don't
have a lot of things that theyhave to do on a regular basis,
(42:56):
and some of them experience alittle bit of, I would say,
depression, identity crisis,because they've been so tied in
their identity has been I am mybusiness.
I am the face of the company, Iam the one that is bringing on
(43:16):
new clients or whatever, and allof a sudden we help them build
this team where they are notnecessarily needed anymore and
they have to reinvent theirpurpose and their mission
personally of what they aredoing, either in the company or
using the company as a vehicleto do something bigger and
better in their life.
I know as you stepped out ofbeing so busy in the business
(43:39):
you almost were able to fillthat vacancy with becoming
important at NARPUM.
Now that that's gone away, haveyou experienced any of those
same like what's my purpose herenow?
Or have you been able to kindof get right back into it.
Speaker 1 (43:57):
I'm not experiencing that yet and I'll tell you why.
Narpum is such a hard thing todo.
Right, I loved every bit of it.
Um, I, I have zero regrets.
It was like one of the bestyears of my life, um, but it was
also really, really draining,um, and so I've.
(44:19):
I'm finally feel like, and herewe are January right, but it
kind of slows down.
You get, you start todecompress after national
convention because you have afew more things.
But and I still play a role I'mstill a past president on the
board and we're heavy andchanging things with NARPM 2.0.
So I'm busy with that still,but I feel like I'm finally
getting to the point where I'vedecompressed enough that I'm
(44:41):
still just enjoying not being socrazy, if that makes sense.
I don't know that I'll ever getthere either.
I don't know that I'll feel likeI'm depressed or not don't have
a value again, because I stillhave young kids at home, so I'm
needed more than anything.
I have one going off to college, so that's a big adjustment for
us that we're getting ready,prepared for she's a senior this
(45:01):
year, so we're doing lots ofthings with that.
And then my other, my middleone's, heavy in sports, and my
younger one probably too.
So we're busy elsewhere, that Idon't feel like I have time,
that because my purpose of beinga mom is just as important to
me as running a business.
So I don't know that I'll evernot feel like I don't have a
purpose.
But I'm not there yet.
I'm just enjoying life.
Speaker 2 (45:23):
I love that you're using the business as a vehicle
to be able to find the purposein things that are truly
important.
I think that's the reason whywe all have businesses in the
first place is to fuel ourpersonal goals and things that
are important.
I just want to give you onelittle bit of advice.
When you go and drop your, it'syour daughter that's going off
(45:44):
to college my oldest is adaughter when you go and drop
your daughter off for college,make sure you take some tissues
with you, because allergies arevery strong that day and you
want to make sure you have.
Speaker 1 (45:55):
I was just telling my husband this story.
I have a sister, and so my poorparents had to take us to
college in the same weekend andwe went to different colleges.
So we drove clear to Portlandall the way home.
My mom cried all the way home.
Then they drove me clear toTwin Falls and then my mom cried
all the way home from there.
My poor dad man, I don't know.
Yeah, it's an emotional.
Speaker 2 (46:14):
It's a big change.
It yeah, it's an emotional.
It's a big change.
It's a big change.
But you know, all my kids havegone through that.
Come home Now they're allhaving babies and it's a great
transition.
Speaker 1 (46:24):
That's the best part.
Speaker 2 (46:25):
Yeah, yeah, I want to close out a little bit with
talking about NARPUM.
You had some really uniqueperspectives being the president
.
There's only been 36 nowpresidents or 36 years worth of
presidents.
Speaker 1 (46:39):
Yeah, and some of them did double.
So maybe not quite that many,but somewhere around there.
Speaker 2 (46:43):
Yeah, so in that period of time, there's only
been a handful of people, orslightly more, that have had
that same perspective as you.
What did you learn, or what wassomething that you didn't
expect about?
Not necessarily theorganization of NARPUM, but you
got insight into propertymanagement at a scale that most
(47:05):
people don't get.
Is there something that you canshare with the audience of?
We saw this, we learned this.
This was unexpected, anythinglike that.
Speaker 1 (47:16):
I'm trying to think I will say people underestimate
the intelligence that is in thisgroup.
I continually tell myself whatam I doing?
Why am I leaving thisorganization?
Why am I in this room with allthese people that are a thousand
times smarter than me, LikeTony?
It's crazy, and they each bringtheir own unique perspective,
(47:38):
but I think that's what makesNARPUM special.
I'm trying to think if there'sanything else that we learned.
Speaker 2 (47:43):
Did you get any statistics on company size?
Or I know they did the NARPUMaccounting standards?
I know they've done just someother surveys and things and I
know you were busy working.
Are they the regional vicepresidents or regional RVPs?
And then they work with theindividual chapters.
So I know you're not probablytraveling around to every single
(48:06):
chapter, but you did get toconnect in ways that most people
don't.
Speaker 1 (48:10):
Yeah, I'm more of events, I would say, in the time
that I've been, you know,president, elected president, I
think it's been really eyeopening how much statistics play
a role, and that's what, youknow, our members were wanting.
That's what we want as businessowners and some of the
adaptability that we know as anorganization and or as a company
(48:31):
or business owners that we haveto do to create, like we talked
about KPIs or statistics ornumbers out there, or sharing
with each other without givingaway everything to help
collectively make all of us movein a better direction.
Does that make sense?
Like I know, narpum is such anopen sharing forum that we don't
(48:51):
really combat thecompetitiveness, so to say,
right, most of us are prettyopen that way.
But I think we've adapted andwe've seen how numbers don't lie
and that's a crucial piece ofanyone being successful, whether
it's a board, an organizationor a business owner, and so I
think there's a lot of thingscoming from that research and
(49:11):
what we've seen and heard peopletalk about very good.
Speaker 2 (49:15):
Will we see you at the broker owner conference?
Speaker 1 (49:18):
yes, I will be there, I can't wait.
I know people are like what ifit snows?
I'm like, oh God, you'll all befine.
Speaker 2 (49:24):
I was just down there .
On Wednesday I went down there,Pablo Gonzalez from Vendoroo
and I.
We went down there just to kindof scope out the layout.
And it's at the Broadmoor.
It's a beautiful hotel.
It's a beautiful hotel.
Speaker 1 (49:37):
It's a historic hotel , it's amazing Built in the
1890s.
Speaker 2 (49:41):
I can't wait.
Beautiful hotel Lake there,right there in the middle of the
grounds.
So we shot a little content andit was a little bit chilly, but
by March we should warm up alittle bit.
March is our second snowiestmonth.
Speaker 1 (49:53):
I have snow on the ground right now.
Speaker 2 (50:00):
So chilly it doesn't scare me.
Yeah, I'm looking forward toconnecting with you when we're
out there.
So thanks so much for hoppingon and sharing your insights and
wisdom with our audience.
I really appreciate it and yeah, I'm looking forward to
connecting when we get out tothe event.
Speaker 1 (50:10):
Yeah, thanks for having me, it was great.
Speaker 2 (50:11):
Thanks for tuning in to the Property Management
Success Podcast.
We'll be back with anothervalue-packed episode to help you
level up your propertymanagement game.
If you've got somethingvaluable out of today's episode,
please share it with a friendor colleague, and don't forget
to subscribe and leave a reviewso you never miss out on future
insights and strategies andtactics.
Until next time.
(50:32):
Here's to your success.
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