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Favor founders’ foray into real estate tech yields serious questions

(TECH NEWS) As Favor’s founders launch Sunroom, we have unanswered questions that will reveal the company’s intentions once answered.

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Popular delivery startup, Favor, was acquired by Texas grocer HEB in February for an undisclosed sum, freeing up the founders Ben Doherty and Zac Maurais up for their next venture. Enter Sunroom which makes property rental tours on-demand.

Sunroom seeks to improve the property rentals process – renters can search available properties, select the addresses they’d like to tour, and then order a “tour guide,” which is a licensed Sunroom agent that is paid an average of $20 per hour, kind of like Uber for property rentals.

The company currently serves Austin but has expressed publicly that they intend to expand.

Property managers pay Sunroom if a qualified tenant is placed, and renters never pay for the app (just like apartment locators, a common practice in Texas). At launch, the company differentiated itself as a tech contender with a $1.5M round of seed funding from heavy hitters like Tim Draper of Draper Associates, and Joshua Baer of Capital Factory.

Maurais told AustinInno, “We knew we wanted to do something inside of the rental market because it’s so massive and affects a lot of people. I’ve had bad landlords in the past and have been renting for the past decade. So I understand first hand.”

He also said that renters can keep application info saved in the app for their next rental experience, “almost like you’re building out your renter’s resume.” Perhaps the long game is building an alternative credit rating for renters? Now that would actually be interesting.

Technologists are inquisitive by nature – put a bunch in a room for a weekend hackathon and with technology, they’ve solved a problem that they hadn’t even thought about prior to the weekend. Thus, the industry is prone to inherently believe they have the answers to everything, and they’re accustomed to make decisions quickly and move nimbly which is something I personally admire.

But if you go to any tech meetup (we’ve hosted one monthly for 10+ years), and mention real estate, their beautiful brains flip into action mode, and there is an instinct that they can fix real estate. As a whole. What sucks about real estate? Not sure, but they know it sucks, and they can fix it.

That combination doesn’t mean they’re stupid or evil, just that they’re fixers. But it also means that endless attempts at “disruption” come from technologists rather than industry insiders with technology experience. And most efforts inevitably fail. Or they pivot into a modified version of the traditional model they sought to innovate in the first place (like Redfin).

Speaking of Redfin, that’s what first comes to mind when we see Sunroom (regarding how they potentially pay agents). But what also comes to mind is the model the founders created with Favor (compete with a national brand locally where they have a soft spot, seek acquisition by a large company to suit their tech needs).

So the future of Sunroom relies heavily on the answers to the following questions that we have sent to them multiple times, without answer:

  1. The 8 agents you have licensed under your broker, are they the only agents on demand?
  2. Who gets the commission on the rental, and what is the split for the $20/hr agent that showed the property?
  3. Do consumers sign any locator representation agreement with you?
  4. Are the agents on salary, hourly, or commission with a bonus of hourly pay for touring properties?
  5. Ben and Zac are now licensed agents – do either of you intend on being the broker when eligible? How’d you find the current broker? What’s the plan there?
  6. Do you guys intend on expanding beyond Austin? Which cities are next, and what does the growth plan look like?
  7. Has Redfin’s model been of inspiration for your model?
  8. What am I missing in why you’re so disruptive?

Further, what does the fiduciary relationship look like? Does Sunroom represent the renter or the property manager, or are they attempting dual agency? Are the agents employees or do they remain independent contractors? See how things can get hairy?

We’ve seen a bajillion startups come and go where outsiders try to get a cut of a commission via a slick app that implies representation, and even more than that seeking to manage the contract portion of rentals, and even MORE that offer showings on demand, but where I see disruption is in the pay model for agents (and the potential to cut agents out of the rental market), but until Sunroom answers basic questions, we simply won’t know.

Stay tuned – they’re either the first exciting disruption to hit the real estate market in so many years, or they’re another group of technologists that see a profit opportunity.

Lani is the Chief Operating Officer at The American Genius - she has co-authored a book, co-founded BASHH and Austin Digital Jobs, and is a seasoned business writer and editorialist with a penchant for the irreverent.

Tech News

Australia wants Facebook and Google to pay media royalties

Australia seeks to require Facebook and Google to pay royalties to media companies for use of news content on their platforms.

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Australia is in the process of requiring tech giants, Facebook and Alphabet, to pay royalties to Australian media companies for using their content. Australian Treasurer Josh Frydenberg announced the move the day after the US Congressional antitrust hearing that put the CEOs of Facebook, Alphabet, Amazon, and Apple back in the regulatory spotlight.

In addition to the pressure from the United States investigation into market control by these companies, global leaders are calling for similar regulations. Though none have been successful, media companies in Germany, France, and Spain have pushed for legislation to force Google to pay licensing fees to use their news content. Some companies have been pushing for this for years and yet, the tech giants keep dragging out their changes, even admitting their actions are wrong.

In 2019, the Australian government instructed Facebook and Google to negotiate voluntary deals with Australian media to use their content. The Australian government says the companies failed to follow through on the directive, and therefore will be forced to intervene. They have 45 days to reach an agreement in arbitration, after which the Australian Communications and Media Authority will create legally binding terms for the companies on behalf of the Australian government.

Google claims the web traffic that it drives to media websites should be compensation enough for the content. A Google representative in Australia asserts that the government regulations would constitute interference into market competition – which would be the point, Google!

According to a 2019 study, an estimated 3,000 journalism jobs have been lost in the last decade. The previous generation of media companies has paid substantial advertising fees to Google and Facebook while receiving nothing in return for the use of its news content. Frydenberg asserts the regulatory measures are necessary to protect consumers and ensure a “sustainable media landscape” in the country.

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Onboarding for customers and employees made easy

(TECH NEWS) Cohere enables live, virtual onboarding at bargain prices to help you better support and guide your users.

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Web development and site design may be straightforward, but that doesn’t mean your customers won’t get turned around when reviewing your products. Onboarding visitors is the simplest solution, but is it the easiest?

According to Cohere–a live, remote onboarding tool–the answer is a resounding yes.

Cohere claims to be able to integrate with your website using “just 2 lines of code”; after completing this integration, you can communicate with, guide, and show your product to any site visitor upon request. You’ll also be able to see what customers are doing in real time rather than relying on metrics, making it easy to catch and convert customers who are on the fence, due to uncertainty or confusion.

There isn’t a screen-share option in Cohere’s package, but what they do include is a “multiplayer” option in which your cursor will appear on a customer’s screen, thus enabling you to guide them to the correct options; you can also scroll and type for your customer, all the while talking them through the process as needed. It’s the kind of onboarding that, in a normal world, would have to take place face-to-face–completely tailored for virtual so you don’t have to.

You can even use Cohere to stage an actual demo for customers, which accomplishes two things: the ability to pare down your own demo page in favor of live options, and minimizing confusion (and, by extension, faster sales) on the behalf of the customer. It’s a win-win situation that streamlines your website efficiency while potentially increasing your sales.

Naturally, the applications for Cohere are endless. Using this tool for eCommerce or tech support is an obvious choice, but as virtual job interviews and onboarding become more and more prevalent, one could anticipate Cohere becoming the industry example for remote inservice and walkthroughs.

Hands-on help beats written instructions any day, so if companies are able to allocate the HR resources to moderate common Cohere usage, it could be a huge win for those businesses.

For those two lines of code (and a bit more), you’ll pay anywhere from $39 to $129 for the listed packages. Custom pricing is available for larger businesses, so you may have some wiggle room if you’re willing to take a shot at implementing Cohere business-wide.

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Smart clothing could be used to track COVID-19

(TECH NEWS) In order to track and limit the spread of COVID-19 smart clothing may be the solution we need to flatten the curve–but at what cost?

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COVID tracking clothing

When most people hear the phrase “smart clothing”, they probably envision wearables like AR glasses or fitness trackers, but certainly not specially designed fabrics to indicate different variables about the people wearing them–including, potentially, whether or not someone has contracted COVID-19.

According to Politico, that’s exactly what clinical researchers are attempting to create.

The process started with Apple and Fitbit using their respective wearables to attempt to detect COVID-19 symptoms in wearers. This wouldn’t be the first time a tech company got involved with public health in this context; earlier this year, for example, Apple announced a new Watch feature that would call 911 if it detected an abnormal fall. The NBA also attempted to detect outbreaks in players by providing them with Oura Rings–another smart wearable.

While these attempts have yet to achieve widespread success, optimism toward smart clothing–especially things like undershirts–and its ability to report adequately someone’s symptoms, remains high.

The smart clothing industry has existed in the context of monitoring health for quite some time. The aforementioned tech giants have made no secret of integrating health- and wellness-centric features into their devices, and companies like Nanowear have even gone so far as to create undergarments that track things like the wearer’s heart rate.

It’s only fitting that these companies would transition to COVID assessment, containment, and prevention in the shadow of the pandemic, though they aren’t the only ones doing so. Indeed, innovators from all corners of the United States are set to participate in a “rapid testing solutions” competition–the end goal being a cheap, fast, easy-to-use wearable option to help flatten the curve. The “cheap” aspect is perhaps the most difficult; as Politico says, the majority of people have a general understanding of how to use wearable technology.

Perhaps more importantly, the potential for HIPPA violations via data access is high–and, during a period of time in which people are more suspicious of technology companies than ever, vis-a-vis data sharing, privacy could be a significant barrier to the creation, distribution, and use of otherwise crucial smart clothing.

There is no denying that the Coronavirus pandemic has accelerated, among other things, technological advancement in ways unseen by many of us alive today. Only time will tell if smart clothing–life-saving potential and all–becomes part of that trend.

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