Welcome to prop tech espresso. My name is Mark Harris, the former investment banker and serial startup junkie turned real estate technologist. On each 15 to 20 minute episode you'll hear from leading entrepreneurs and industry experts on the opportunities and challenges for the rapidly changing prop tech sector. Thanks for listening today, grab your favorite beverage and let's learn something new. I guess today is Nate Jones, co founder structurally sales process automation platform for real estate agents. Prior to starting structurally made held GIS s positions at the Iowa Department of Transportation and the city of Clive, Nate attended Iowa State University where he studied city Urban Community and Regional Planning. Nate, welcome to the show.
Thanks for having me on Mark, looking forward to chatting.
Great, well, we will start out with my traditional question here on Prop tech espresso where I asked guests to define what prop tech means to them. And kind of the why this spectrum and the definition exists. So let me let's hear your, your thoughts on this.
Yeah, so I think prop tech is just simply technology that encompasses kind of the full customer journey of someone who has real estate, I guess, in some some form of ownership, rent, buy, invest, whatever. And I think that the full customer journey piece is important. So you know, it can start from anywhere on the very front front edge from lead generation, for real estate agents, lenders, or leasing agents all the way to the back end tomorrow, you know, transaction management, closing software, and even kind of like more behind the scenes data, you know, data collection and aggregation, and other kind of quant quantifiable, you know, behind the scenes metrics to measure up the markets and things like that. So I think of it as a pretty big universe actually.
Absolutely couldn't, couldn't agree more on on on that statement. Before you started structurally, you held several GIS positions, interested to kind of hear a little bit about those roles and how they influenced your perspective on on real estate.
Yeah, so quick definitions. I know some people probably don't know what GIS is, but it's geographic information systems, I always used to like to say that it's like mapping on steroids. It's basically just kind of Google mapping. Your your annotating maps digitally, basically a modern day, cartographer, if you will. So that's something that I studied alongside urban planning. And there's actually a really beautiful blend of real estate and technology, because you have to understand, you know, what, what the actual like, you know, down to earth, what zoning laws apply, what can be built, how Title, titles need to exchange, who owns the deeds on properties, how those people are impacted by regulations, that's kind of the, you know, fun, government, public side of City Planning. But then on the GIS perspective, you're also like layering in that information, layering in where easements need to occur. Where zoning lies in kind of predicting, also like where you want the city to grow in, there's a lot of different kinds of hands at play here. So I think there's a lot of like, stakeholder management to which was really interesting. And you really do have to kind of think about like a city like a business. I thought that was a really fun, fun part of that. Kind of sweet, but there's absolutely no way around doing something with GIS or city planning that you can avoid dealing with real estate, or anyone in the Prop tech route because you need developers, you need builders, you need agents, you need everything in between to make everything kind of work at its core.
Gotcha. Gotcha. In terms of like the the tooling that's out there around GIS, what does what does that look like? What are the kind of common GIS tool sets that lead you're either using in some of your positions or have since then emerged?
It's been a little while since I've looked at these but I would say I remember using the the basically the the Esri ESRI software, I can't I think it was our ArcMap and ArcGIS. Were kind of some of the big ones. I think they have a pretty good stronghold on the majority of the market, but I think it's been increasingly moving towards more kind of web based products to, you know, open source even to with like, I forget what it's called map map box. It's kind of like an open source API map based product that's been around for a while and continues to have really strong adoption. So I think there's a lot more like you can get really into like the web dev side of things with GIS, or really stay more on like desktop type things. I was never much of a developer myself, but always had a lot of interest in it, and definitely saw kind of those paths. Gotcha.
Great. Thank you for that. Let's, let's dive into structurally we'd love to kind of hear about the company kind of the origination story and kind of what what led you to build this sales process automation company?
Yeah, so a lot of it did start in college, when I was studying or planning GIS, I also wanted to dabble in real estate investing with my co founder, but didn't make a lot of sense, then because we had no money and you need money to invest a real estate investor of any kind. But that led to a great learning experience, where we talk to 1000s Hundreds and hundreds or 1000s of real estate agents or people from the prop tech kind of space just to like pick their brain, kind of learn from what they're doing. See if you know, maybe there was an opportunity to get new investing later. But it actually blossomed into them. constantly talking about how lead follow up was a struggle of theirs. Most salespeople in general, especially in kind of real estate, I think, to love the face to face interaction, they love being knee to knee with someone closing the deal learning about someone, but the behind the scenes stuff, updating CRM setting appointment, following up qualifying leads, calling leads, that's the that's tough for them. But is it absolutely vital part of every sales person's life. So we really started structurally to solve that problem. And we wanted to solve that problem with conversational AI. Because I believe we believed at the time, that technology was advanced enough to actually solve this, rather than trying to solve this problem with like, a call center, a human call center, because that's been been done before for probably 20 or 25 plus years. And our belief is that AI is goal long term is to basically kind of reduce the mundane tasks that humans are historically have done, like calling leads getting told to get lost 100 times just for that maybe one person who at least hear you out that kind of qualification process that all salespeople, especially in real estate to go through can be exhausting.
Having spent a good deal of my career in sales operations, I am very familiar with the you know, the, the salesperson mentality resistance to entering information and the lack of follow up on on leads. So, you know, you know, as the and and, and in many of these instances, like it is a numbers game. So like, if you are not following up on these leads, like you're gonna have less pipeline, and you're, it's gonna be a hard, it's a much harder to make your number or in the case of real estate agents to make a living. So I think, you know, tools that can assist in that, that process and allow them to scale. And to kind of do it over an extended period of time, see great value in bringing that to, to the agents so that they can focus on the near term opportunities and actually getting those deals across line because we they are very consuming at that point in time and require attention. So it's not surprising that some of this follow up, does fall through the cracks at that point in time. But to be long term successful, like you need to build that sphere, you need to cultivate those relationships. So you you need to have other kind of tooling in your in your belt to assist with that. So yeah, see, see, see why they could could certainly utilize that but, you know, kind of related. You know, there's this, you know, artificial intelligent designer AI has certainly been a buzzy word. that startups, you know, in many industries have been utilizing, perhaps correctly or incorrectly in terms of categorizing what they're what they're doing and and to attract investment. So, you know, let's, let's hear directly from you like kind of when you talk about AI kind of what it what it means and what it is and what it is not.
Yeah, yeah, I completely agree with that. That AI is a confusing word and probably an abused word. That's kind of a passion of mine that dispel that. But the way I define it, and this is the way I define AI, from the mouth of a PhD in math and stats on staff here studies, AI. And he describes it as simply tasks that historically human has done that a computer can now do. So very simply. But there are so many different aspects of AI, that I think people just kind of throw it at everything. So there's predictive analytics, there's conversational AI, there's, you know, even machine learning, which could be argued is a subset or superset of AI, or whatnot. And then there's deep learning. So they all kind of intersect for sure. And they're all different in their own ways. But they're all very different for a reason. So we focus exclusively on conversational AI, which we talked about as basically the ability for a computer to interpret, and respond to humans, through messaging, at least in our case. And, you know, there's a lot that goes into that there's natural language processing, for example, which is where we focus a lot of our efforts on to be able to understand all the different ways that humans say things, be able to extract all the different information that humans tell us. And to be able to respond to people in a coherent and human like way, that is all a branch of natural language processing, but is combined with other forms of software engineering to basically produce conversational AI. So that's kind of how we think about
it. What are some of the other examples you've seen of companies using AI and proptech. That's not specific to the conversational AI angle that structurally is using.
So to come to mind, one everyone knows of you know, probably raised some feathers, but is very basic, the Zillow, Zillow, Zestimate, uses predictive analytics to predict the price of a house, they, they ingest all sorts of data, and try and predict the value of a property. So Predictive analytics is a form of machine learning, you can kind of get to where it's, you know, possibly a part of AI to at least the majority of the world is coming to see that word. And then the other one, I'm forgetting the name of right now. Like it keeps slipping in and out of my brain. But I know that use software to predict the highest and best use of property. I'll think of the name it's a monk,
perhaps. Could Yeah, could be
there. It's definitely like heavy on the kind of GIS mapping side of the inner proptech space. And that's why I'm so interested or have been so interested in it. But they predict the best and highest the highest and best use of basically, a parcel of land. Could it be developed? Should it stay the same? What's its value? Or maybe city builder? Maybe it's city builder? Yep. Yep, exactly. Right. So I don't know a whole lot about them. That's kind of what I see from the 10,000 foot view that they do. And I've always thought that that's been a really unique angle of machine learning or AI. That's someone is applying to the prop tech space.
Yeah, no, I, I think, you know, certainly land use and kind of the opportunity for, you know, whether it's residential spaces that could be, you know, you can add an adu or, you know, subdivide the property and kind of get more density, you know, certainly in certain areas. That's, that's a big, big consideration or, you know, so I think it's certainly a fascinating area that it's only going to continue to get kind of more more visibility as as folks wrestle with, you know, housing issues, which is definitely a and property use, which is, you know, definitely a topic in California where I live and I'm sure many other areas of The US as well. So, obviously, we've we've kind of been talking a little bit about, you know, sales and AI and kind of helping out in some of these areas to do the to do the follow up. Are there other areas of opportunity for AI in this kind of sales and marketing area? You know, whether it's specific to prop tech or perhaps other other industries where you see adoption?
Yeah, yeah, absolutely. I think there's one that I'm extremely interested in, in the future of I would say, especially sales and marketing, since that's what I think about kind of all day every day, but can also see it being applied to other proptech kind of use cases. And that is around what I'll just generally call generative AI. So currently, structurally, does not use generative AI to form responses, like when we get a response from a lead. And we reply, that reply is structured in a way that we never know exactly what's going to be said. But we allow our users to customize those responses based on how our AI interprets the leads message, so that our users can have some control over what's said in certain situations. And our AI is it isn't just generating things, you know, out of the blue. There's been a lot of study here in the past that's gone bad. So there's been like some Twitter bots and Facebook bots, that their sole purpose was to listen to people, and then kind of spit out messages, phrases, tweets, Facebook posts, in a similar fashion. I think the twitter bot four years ago, three years ago, his name like Tay then became horrible, racist, misogynist, misogynistic, just terrible, because people were trying to break it, telling it terrible things. And it was kind of regurgitating that. But there's been a huge advancement in generative AI in the last few years, specifically around these models called GPT. Two and GPT. Three with GPT. Three is the newest model that's been developed by open AI, which is one of the largest, you know, open source. For the most part, I think they might be for profit now. But we're nonprofit companies, they developed it, and it's basically just the world's, or it's basically a natural language processing model that's been trained on the world's largest, you know, set of words, basically, they scraped the internet, for every written word they could get their hands on, and trained a model to read all of the words and predict the next word. So overtime, it basically developed an understanding of our language and many languages, because it was trying to predict this next word, constantly. And I believe that where we're at today is that technology can be fine tuned now for different use cases, to generate all sorts of content for people. So in sales and marketing, it can be used to generate sales, scripts and marketing content. It's being used constantly now to be to write blogs for people to write emails for people, all sorts of these things. And I think that it can, in the future, even be used to write like legal copy, all sorts of basically anything that's been written before in the world, constantly, over and over, that it can be fine tuned on. It can be used again to basically generate text so you don't have to. And there's so much time spent in all industries where people are just writing, writing sales, copywriting replies, writing emails, writing contracts, documenting takes up so much time of our lives, that I think that generative AI like this is prone to really take a stab out of a lot of the daily kind of mundane tasks that we all do.
I've certainly seen an example of that in Gmail where it is now suggesting and crash crafting my emails, whether they're their work or personal Yeah, but can certainly kind of see your extension in into sales and marketing where you know, you're repeatedly kind of generally answering the same questions or a lot of questions that come come from clients. And to kind of have, you know, a set of kind of generated responses that you you then customize to kind of, to the nuances of the specific situation or individual those responding with certain, like cut down in terms of that generation, I know that it can oftentimes take me a lot longer than I ever expected to craft an email. And, you know, would certainly enjoy speeding up that process so that it's much more efficient in that area.
Yeah, yeah, absolutely.
Cool. You know, we've, we've, we've talked about structurally and it kind of falls into this kind of agent tech space. And there's a lot of agent tech out there interested to kind of get your perspective on, you know, why it's important for real estate agents to adopt technology and use it to their advantage beyond just kind of some of the the time savings that we talked about?
Yeah, I would say, to boil it down consistency to so not only does it give you all sorts of leverage on on time, on resources, but humans are notoriously inconsistent. We're all guilty of it. And that's one of the early things that we learned in building conversational AI was when you kind of compare us to like other human call centers, the feedback that we would always get is, oh, I used this call center XYZ service. And some of the times I would have no idea what these you know, people in call centers are going to say to my leads, there, they sometimes forget to follow up, they say weird things, I have no idea what they're going to say. And even though they've been through extensive training, sometimes doesn't always stick with a computer at all, it always sticks. There's no, there's no getting around it, it will follow up at a pre programmed time, it will say something that you've trained it to do, it will deliver on everything that you give it basically. So I think that one of the in of all traits, unfortunately, salespeople as a whole, but in real estate, especially I think being entrepreneurs, self disciplined self starter types, myself included and guilty of that, sometimes we're not terribly consistent, sometimes we're on the very inconsistent spectrum where we say we will follow up, but we only will maybe only follow up once or twice and then give up. So I think that CRM technology, you know, sales, automation, technology, all of these different tools are in a way there to keep you really consistent. And that is absolutely vital. Because the more consistent it just by being consistent, you're going to get ahead of competition, because there are so many people that are inconsistent in this in this sales game.
Yep, yep. Nice, you know, again, harkening back to sales, ops spent a lot of time, you know, developing, you know, onboarding, training and certification processes and, you know, content to try to get some of that consistency. But certainly, it doesn't mean that it necessarily results in consistency. So do make best efforts to kind of generate a, you know, a way in which, you know, things are sold and products and other things are talked about, but because of that very human element that you were talking about it, it means that it's going to be generally inconsistent. And, you know, can certainly, if done, poorly can can result in sales managers pulling out their hair, when they hear things described in ways that is not how folks were trained up on, certainly, as you're saying in these in these call centers, where you have kind of arm's length ability to kind of provide, you know, to kind of keep your, your, your arms around things you can get wildly off course if if things go go awry. So, I'd like the like the consistency aspect of that a lot too. You know, again, we've talked about sales ops background, and, you know, another aspect of that is his go to market strategy. So, you know, in terms of what you're doing at structurally and the building of kind of inside sales teams to deliver this. We'd love to kind of hear your your thoughts about this what what you guys are utilizing and kind of where you found success?
Yeah. In terms of just kind of, like what's been going well, for us,
let's start the start there. Yeah,
I would say that we've definitely found a really strong sweet spot with like real estate teams. I think that when I kind of think about the real estate sales space, obviously of agents, teams, kind of brokerages, we found our sweet spot teams and I've always kind of asked like, why they kind of run their their business more in a you know, not negative way, but like turn and burn like get leads, send them through, sift out the the gold from the dirt, and let's move on, I'm going to distribute out the leads to my my teammate. So I brought on here to close deals, and let's get things moving. Agents individually, or agents who work with brokers are much more reliant on the broker to provide leads, or them to generate their own from past clients sphere of influence. And there's a healthy relationship kind of between all three, because I'm not saying that teams don't focus on PC Soi. They do. But teams historically, focus more on like new leads, just get them through, eventually there'll be in our database, we'll keep an eye on him if they're not interested now, and we'll close those that are really ready to go. That's where we found a sweet spot because they're sending high volume of leads through our through us, it's exactly what we're set up for, to qualify those leads. And I always like to say, sift the gold from the dirt. That's what salespeople spend so much time doing. One of the things that kind of keeps me up at night and gets me going it structurally is a study done by Salesforce, actually, that said, sales teams spend only 1/3 of their time actually selling. Instead, they spend two thirds of their time not selling. And when you're a salesperson who works on commission, you're saying you're spending two thirds of your time not selling, that's a lot of time that you're not spending making money. And that is like my passion is I want to cut a portion of that out at least so we can flip it, maybe hopefully, and say that salespeople are actually spending two thirds of their time at least selling and then hopefully, closer and closer to 100% of their time. And that is really where like, my vision is every day structurally, his vision is for years to come. And where I think people are resonating when we're talking to them on demos, discoveries, etc. But they don't like know it. They're saying things like, I want to increase conversions. I want to increase appointments, I want to see good leads from bad, but in reality, they just want their salespeople or themselves spending more time actually closing.
Yeah, yeah. No, increase that size of the top of the funnel for sure. And, you know, the the, you know, the the overhead and those those non productive points in time, you know, is issues that, you know, certainly departments outside of sales also deal with, but I think certainly, I've I've been in organizations, where would they? If they were doing it as selling a third of the time then that was exceptionally good. There's there's some organizations that with a sword things going on, like it's even less productive, less less time to focus on on on sales, obviously really hard to scale a scale of business and generate that kind of sales momentum if there's so many things that are distracting and kind of preventing engagement with prospective clients.
So, in terms of where structurally goes from here, what any, any kind of new new things you guys are focusing on or any kind of roadmap items that you can can share with this group. We'd love to
hear about it. Yeah, yeah, absolutely. comes from what I said earlier about generative AI. I think that's a place where we're extremely bullish on and that comes down to, we've kind of got a blessing and a curse instructionally and that we've built a very customizable product, you can customize almost every aspect of the script in any conceivable combination of questions and answers. and responses you can think of you can kind of do through our product. But that's really overwhelming when you're thinking about mapping out a conversation. I believe that there is opportunities to use that whole new suite of tools like GPT. Three, to actually generate scripts for you. So if you want to say something simple, like write me a script that qualifies a luxury buyer, it would just kind of spit something out, or at least spit out suggestions that represent kind of a typical flow. And our product is not, you know, so rigid that it has to follow every flow, like we have no idea what our product will say, at any given point, it depends entirely on what the lead says at any given point in the conversation. But we still allow for scripts to be customized to reply in certain ways. That's still really overwhelming for sales and marketers to write in our product. Because you have to think about every possible turn in a conversation. And that's nearly impossible for anyone to do. But it's possible for generative AI who's seen billions and billions of pieces of text written in billions of different ways. So we have a kind of a pie in the sky idea of grand vision where we think that generative AI can kind of write these scripts, messages, emails, and texts for you. And then the conversational AI that we have today can actually take it a step further and have those conversations for you. So again, really trying to take a chunk out of that two thirds time not spent selling, because we're pretty passionate about it.
Awesome, awesome. Well, I, you know, COVID continues to be a theme in real estate. And we've, you know, we're to, if then surely entering three years into this pandemic. You know, from your perspective, how have you seen kind of COVID impact, kind of real estate and the transaction process and any kind of, you know, positive aspects that have emerged that you think will be here for the long term?
Yeah, I think everyone's kind of pretty aware that it's affected the residential real estate market quite a bit, obviously, kind of all real estate markets obviously affected the commercial real estate market as well. But in residential, which we kind of look at every day, we have a really good pulse on lead volume of the market, which indicates like really high level demand in the market. Some of it is you know, you have to put an asterisk by because everyone loves looking at properties in real estate. So it's kind of a national pastime. When we see lead, lead inquiries kind of fluctuate up and down. We know that the markets probably pretty good, which we've seen consistently now for pretty much the entirety of the pandemic. And I don't think that's a surprise to anyone knowing how hot the market is. But you know, immediately when we kind of didn't know what was happening next two or so years ago, lead volume plummeted, like nothing coming through, but then it spiked up pretty quickly. With obvious obviously, the change towards remote work and all that. Everyone is kind of just looking at properties, which is kind of multifaceted here. Because you have a lot of you have a lot of looky loos now in the market, which makes it more paramount to have a process or product like ours in place to kind of sift through that dirt. But ultimately, you have more at bats. I think you get more people in your database if you can take it take advantage of that. So I think the the market is pretty Bountiful, I guess for for many people in the Prop tech space. Yep. Yeah,
no, no, for sure. It's been a it's been a wild ride for sure. And I think, you know, again, all sorts of areas experiencing kind of different aspects of these, these trends that you're you're describing. So one last question. I want to try and squeeze in here and in terms of kind of predictions for 2022 That, that you kind of see out there. Where are these? What do you see out there that you know your crystal ball? Kind of let you know about?
That's a tough question. I've been thinking about it a lot lately. And I it's just like, you don't know I've seen people who you know started the year with like, oh, the markets just as a whole are doing great. We're way up on the air in their real estate stocks, whatever portfolio but now, things are low down here. And even as of today that I don't think anyone knew was kind of coming or maybe really smart people did. But yeah, I think my only prediction for 2022, unfortunately, is I think it'll be choppy. I don't know if we really know what, what's coming. I think that what we're focused on is just owning what you can own. There's going to be a lot of changing pressures at play, I think throughout throughout this year. But if you can focus on kind of your one differentiating factor, the one little niche that you own the one great, the one thing that you're great at, that's where we're focused on the one thing you can control, whatever that may be, I don't know what it is for you. But we have our own things here and myself personally. That's That's what I think maybe 2022 holds for us is we we have to hold on to that one thing that we control pretty closely, because it might be too wild, otherwise.
Awesome. Awesome. Well then need and firstly need to draw a conversation today to an end. It's been really great hearing the destruction of the story and your your background. So thank you for sharing that. Hopefully, we can have you back in the future and kind of talk more about these, where where AI has continued to go and in real estate, but, but for anybody that's looking to contact you today, what's the best way for them to reach you?
Yeah, I always like to say if you want to learn about structurally and kind of get a hold of us regardless, go to test your AI assistant COMM And you can actually test the product out yourself as if you were a lead. That also gives us your phone and email. So someone will be in touch that way myself sometimes included. Otherwise, my emails just needed structure calm. If you have any questions, feel free to reach out.
Awesome. Well, appreciate your time. Thanks for talking to us about structurally and we'll we'll all go and give that a try and begin our AI journey. Yeah,
absolutely. Thanks, Mark. Cheers.
You've been listening to an episode of Prop tech espresso. Be sure to subscribe to the podcast on Apple podcasts, Google podcasts or wherever you listen to podcast. To learn more visit heuristics comm backslash podcast. Thanks for listening and we'll be back soon with a new episode.