We’ve checked a lot of boxes in a short time here at the no BS short-term rental podcast, and today we’ve checked another.
We’ve been blessed with a sit-down with the one and only Simon Lehmann. Are we official now?
With a resume that reads like a vacation rental dictionary, we chat industry beginnings and his trajectory to where he is today with AJL Atelier Consulting.
For most, adding Industry Consultant to your title is a sign of not being able to land the gig you really want… Simon proves this theory wrong and dives into his current ongoings overseas and his upcoming trip here to the US for VRMA.
We’re stoked to have Simon share his knowledge with us as we discuss business models that are working and the ones that will ultimately fail.
Listen up and suck in all you can. Simon puts it all out there even though he wasn’t wearing his signature red shoes for our show.
The No BS Short Term Rental Podcast brings the right people to the table at the right time, giving their audience an inside view and real take on the industry like no other.
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Profitable Conclusions With Featured Guest Simon Lehmann
I’m super excited about our guest. We have the one and only Simon Lehmann. How did this happen? This is amazing. Simon, how are you?
I’m very good.
To all those out there reading who don’t know who Simon is, we are blessed to have the CEO and Cofounder of AJL, an industry icon. I don’t want to go into the adjectives on it because there are many ways to describe you in a positive way in terms of what you do. There are probably only three people out there who don’t know who you are. You have been the face of the industry and a thought leader in this space for so long. I’m not going to read your resume because I want to get into your background. You and I have been very cool for a while and have similarities in our background outside of the hospitality space.
You are always someone I have looked up to, learned to, and had great conversations with. You always give it to us straight. That’s why it’s such a blessing to have you on the show because while we bullshit sometimes, you are good about keeping the bullshit to a minimum when we are talking business. Getting straight to the point is one of the things I love about you. It goes without saying, part of the reason our industry is seeing such a resurgence in professionalism and success is through a lot of what you have been able to help drive through the industry. We will get into a little more back down the line, but without further ado, Simon Lehmann, welcome to the show. It is great to have you.
Thank you for the amazing introduction. I’m flattered. I appreciate that. One thing that connects us all is passion. That’s what it’s all about. When you ask me, “Do you want to come on board?” I say, “Of course.” We like to talk every now and then as well. It’s part and parcel of our industry. You mentioned professionalism. It is super important. We have a long way to go still.
We see ourselves as advocates to push that. It’s been a challenging time. I remember our last conversation very well. We were on a boat in Amsterdam. You and I are on a cruise. It’s been a while, but it’s always good to throw around some ideas and thoughts about our industry and doing it together with passionate people like you and John. It is an absolute blessing. Thanks for having me.
It’s our pleasure. Thank you so much for coming on. Let’s dig right in. How has 2022 been for you? I see you are doing tremendous things with AJL. You have got your hands on a lot of different projects. Talk to us about where you are and let’s go backward. Let’s look at where you are now versus where you got into the industry. Your success through a pandemic is nothing to shake a stick at.
It depends on the way you look at it. I look at the last past, in terms of timing. In March 2020, we were on a riverboat in London, celebrating the Shortyz. Months later, I was happy to win the Shortyz myself which I’m very proud to say publicly.
I was glad to be invited to the show and that was exciting.
It’s been an absolute rollercoaster. Either you got out with nothing or you got out stronger. We got out a lot stronger while the timing was very hard. We could have been the most successful consulting firm in a vacation rental, but nobody wanted to pay us for it. That was a bit of a challenge because everybody needed consulting and help how to navigate through this crisis. Several months forward, we are seeing some light at the end of the tunnel. We see some stability. The industry has been very flexible. We adapted to different demand gen and more domestic business when vacation rentals went through the roof.
[bctt tweet=”During a crisis, you either get out with nothing or you get out stronger.” via=”no”]
While it’s been a pretty dull time for tourism in general, I couldn’t be happier to be part of vacation rental because I got asked by the press about what’s happening to the vacation rental vertical. I say, “I’m the least worried about this travel vertical. It will rebound the fastest against every other vertical,” and it has. I went through 3 or 4 crises myself in the past 2008 financial crisis. We saw 9/11. We saw quite a few crises and nothing of the magnitude that we have seen now, but the vacation rental rebound the first because people still want to travel. Post the lockdown, everybody is happy to jump in a car and go somewhere else from where they were, especially in Europe.
For us, it’s been a great opportunity to create more attention to the industry. We create a lot of free content. We created our own conference and we were busy. We are building a Hotel.school/VacationRental. We said we want to push the educational piece. We are super proud to build Hotel.school. I believe that vacation rental needs education and then the M&A came. I think about the craziest IPO ever in the world that happens during a pandemic. This is surreal, then we see a turnkey acquisition, and then the IPO for cuts around the corner.
All that is incredible. It shows how resilient and interesting this industry is that we are in. We have a lot of stuff to talk about. We built ourselves a very strong network in the financial world where we have a lot of analysts, especially from the US who call us. We educate them about vacation rentals because the financial industry knows very little about the vacation rental industry. Now they have seen some trigger points that they want to understand, and then they call experts like us and we explain to them what vacation rental is all about, what are the unit economic drivers, and what are the growth opportunities. We help dissect investment presentations.
You have been doing this for a long time. How long exactly has a consulting aspect of AJL been established as your main focus?
It was February 2018 when I left Phocuswright as a CEO. That’s when the first mandate was working for a private equity firm to acquire vacation rentals in Europe, which then was acquired by Platinum Equity. That was the start of AJL. We were still called AJL Consulting at the time, but we felt consulting has a bad connotation.
This isn’t meant to be a bad thing to you, but any Joe Schmoe that gets out of a certain spot, they are in here doing their thing. They are like, “Screw it. I’m going to start off a consultant firm.” Truly, not many of them make it because they put consulting at the end of their name, last name, or whatever focus they want to do but they don’t have anything built behind it to support it, which is a big difference between what you are doing. There’s a lot of failed consulting that you see.
You can tell if you fail. You failed your corporate career so you end up as a consultant. That’s in a nutshell what you are saying. That did not happen to me at all. To the title of your show, I didn’t want to deal with the corporate bullshit anymore. It is simple as that. I was close to turning 50. I got a tremendous opportunity to run this project for a super large private equity firm, which taught me a ton. I was on this mandate for five months, then either I had the opportunity to become the CEO of this business, which did happen because we didn’t acquire it. The Platinum Equity acquired it.
I said, “I will continue to do this.” On the other side, one thing that I love about my job is that I can leverage 30 years of experience as a CEO. This is not just consulting, “I tell you how to do a better job. I have social competence and emotional intelligence.” In most cases, my consulting mandates go in a totally different direction than what they mandated me for because I can read people. I can understand conflicts within businesses.
I can coach people. I can tell the owner, “You need to be careful here because you have some problem with certain people.” We have a totally different way because I have 25 years of CEO experience that I can bring as a consultant. I’m not just an industry stupid expert that thinks I know how vacation rental works. I have many more facets. I can share stories with startups. I have seen failures and successes. I have been around for a while.
The push for professionalism within the industry has been what we hear all the time like, “Who’s pushing for that professionalism? What does it look like?” From my short time within this industry, I have seen a lot of push and people who are experts or claim to be experts in this space and claim to be helping. Especially on the private equity side who didn’t know shit about what the short-term rental industry was doing. The deals that we have done show that in the past deals. How is this going to look different moving forward?
I have an idea, but I think you can speak to this better than anyone else. How are the deals smarter now than they were even years ago in terms of what’s going to come out of this with the new age in which we are and the new world we live in? A lot of money is still being thrown around and lots of M&A deals still happening. What’s going to make this any different? What’s going to set these companies up for success where these private equity firms and others failed before?
I don’t think not lot is going to change, to be perfectly honest because 1) Fragmentation will not go away. 2) One thing that has become very clear and obvious, is that the investment world in the United States is looking at this industry a little bit differently than in Europe because the valuations are out of sync. I don’t want to go deeper here for the moment. We will keep that for my interview with Matt in San Antonio. We can already give a preview of that. Let’s summarize that.
What have we seen? We have seen the first and largest transaction ever in vacation rental was when HomeAway was sold to Expedia in 2015 for $3.9 billion. It was when HomeAway raised $500 million from a technology crossover venture to buy RBOs. That was the starting shot for a vacation rental to come on the scene in the financial world. Everything before was considered secondhand cargo dealership and Tupperware parties.
This industry has not been known as very professional and everything else. It’s been around forever, even older than hotels. We can be proud of that. We haven’t done a lot out of it because we don’t own it. It’s very hard to manage assets that we don’t own which will remain our biggest challenge for many years to come. Then we have seen a few other transactions. We have seen heavy fundraising by Vacasa.
We have seen a Wyndham vacation rental that started to consolidate and then sold when the vacation rental Europe for $1.3 billion in 2019, which was the second largest deal ever then Livingbridge sold Sykes cottages for $500 million from one private equity to another. Very successful but it has its reasons because it’s a domestic market, 100% supply and demand from the same country is pretty impressive and protected.
Brexit came at the right time when nobody was allowed into the country. That case was a great one. Now, we have seen Airbnb IPO which then broke any record, and has put a lot more investment interest onto the market and industry. We have seen the SPAC with Vacasa at a $4.2 billion valuation. We are still on go at $1.2 billion. If that is a justified valuation, we are not dwelling on that, but I question a lot of that. Therefore, valuations, if you look at it, how big is Vacasa now is worth $4.2 or Wyndham vacation rental Europe had 100,000 units. It was highly profitable and was sold for $1.3 billion. Find the mistake here. I don’t understand it.
In terms of where this goes, first of all, I think the investment industry has realized that the challenges we have in our industry are not going to go away fast. What is that? That is supply ownership. Supply ownership is private and will remain private at large going forward. 95% or 98% of world supply is going to be in private hands and not institutional hands even though you are now seeing business models like Daydream Apartments from Iconiq Capital, which is now called Sentral, or others who are now starting to own their assets, which is the aftermath of the master lease arbitrage. We are seeing some changing business models. We see some REITs in terms of these real estate investments funds
They’re going to happen, but are they going to happen at large? While money is cheap, it’s great to do something like that. If interest rates are back at 5%, good luck to you to create a return investment capital when you then have higher interest rates instead of a master lease. I’m not sure if that at large can solve all the problems and the chances we have in a vacation rental. I don’t think there are going to be many massive deals going to happen, to be perfectly honest. This is like a mushroom business. When you cut a mushroom of five new ones will grow.
This is the beauty of it because people will start and property management knows a few people. You saw the churn rate that certain companies have. There are plenty of opportunities to pick up a new business. The next one is Steve Milo. I wish him good luck. Congratulations on his $250 million. That is driving valuations to the roof and these smaller companies are expecting massive valuations. I’m not sure if this is healthy and can you create value for an investor if you pay these high multiples to buy vacation rental companies? Can you create more equity value as you roll it up? I think that’s going to be very challenging.
I put my card on the luxury rental. That’s where we will see a lot of activity. In the mass market of vacation rental, I don’t think that is interesting for private equity if it’s not a large enough deal because the large private equities want to deploy $500 million and more in terms of acquisition and look at how many deals are out there, not many or none anymore.
How are they looking at the path to profitability? That’s one thing you pointed out. I don’t want to skate over that either because you are talking about the deal prior to the Vacasa and with that valuation. The difference in that delta in what they were evaluated versus what Vacasa was evaluated. At the end of the day, what is their timeline in terms of whether are they even looking at path profitability and what that window encounter? I don’t see it. Maybe I’m not in the room or not around.
Is Airbnb profitable?
I’m not shaking a stick at that one. We know the answer to that. They don’t care. They are not playing a path. How do we determine value in that space? As someone that’s looking at it from the outside in, from our vantage point, where is the value then? Is it the marketing engine? Is it keeping the ship running and floating? At a certain point, you have to be able to make money.
There is a clear path to profitability. That’s a clear strategy that Vacasa has and will need to have, Without a doubt. Vacasa is not a brand on the demand side. It is inexistent because everybody books through the OTA. That’s something that has been very dangerous in the United States. There’s no brand value whatsoever for these companies because they are relying on third-party channels and in relation to demand. There needs to be a clear path of profitability that is unit economics, unit density in markets to have high enough unit density so you are able to operate profitably. That will mean that you clean up certain destinations where you don’t reach a critical mass of supply in order to scale your operating costs.
Without a doubt, there are many different drivers. Occupancy is one. Revenue management and cost management also. We have a good enough unit density in markets to push profitability. For a company like Vacasa and our classical operator in our business needs to happen. This is why we at AJL put this conversation of APS out there into the world and said, “We need to start talking about the profitability and not the revenue.” This is something we are preaching and adamant about.
We feel we are in a very good spot to do that because nobody else has picked that up and said, “Profitability comes before revenue.” That’s where a lot of the smaller ones can learn a lot. It’s not all about growth. It’s about unit economics. Understanding when there’s a unit on a booking level created, positive contribution margin. We need to talk about this far more than what we have until now because otherwise, we are building bubbles. You have situations where people don’t do proper trust accounting, play with the cash of the guests and the owners, and then it gets super messy.
[bctt tweet=”It’s not all about growth; it’s actually about unit economics.” via=”no”]
How many times have we seen, “To rob Peter to pay Paul.” Everyone knows profitability is what true profitability is. It makes a successful business but if that’s not built into the foundation of your business. We saw the result of that over these past couple of years. How many houses of cards have fallen? Who fell? Who didn’t? Who’s here? Who’s able? Either you were able to build another house of cards, get more money, and are stabilizing. At some point, it has to stop being a hustle and be a bottom line which is a unit-based revenue model that is profitable, not this, “Don’t look over here and look over here,” type of business that a lot of people have raised a lot of money on.
“This is a beautiful idea. It’s a beautiful picture. How does it work at the end of the day?” I don’t think that’s been asked enough. Kudos to you for driving that because I think that’s what’s going to solidify us in this space, especially in this ever-changing world of hospitality. That’s my next question because I know you also got experience in the hotel space and we talked about who did well and who didn’t. Where do hotels go from here? How do they play into this equation?
We have to plan our way of thinking about it in our own thesis. In 2008, we started to talk about convergence when the first large property management company, such as the one that I was running at the time was integrating with Booking.com we helped the OTAs educate them about vacation rentals where they only had hotel supply in the past. Then we started to talk about convergence because they were able to mix hotel and vacation rental supply to their customers when they were booking they did an excellent job with that. The consumer got educated, “There are other things than hotels as a vacation rental.”
Before it was only a minority of people who used vacation rentals always knew about it but the large majority still booked hotels. They were not even aware of the category. The OTAs helped to transport that message for us as an industry to the consumer saying, “There are apartments and villas you can rent as well instead of hotels.” They did that very smartly but they created a lot of dependencies. On the other hand, especially in the US, hotels have been able to create incredible brands like Hilton, IHG, and Marriott group and created incredible consumer brands, which no one in our industry has even been close to.
Our brands in our industry are worth nothing because nobody knows them. They have been doing that. It’s interesting to see that now we can talk about convergence because 1) Hotels have understood these phenomena called vacation rentals are not going to go away. 2) A lot of people want that product as well. We need to be able to offer that. 3) The result of it for me is a mixture. The convergence now is not happening on the demand side in terms of booking different types of hospitality products. The convergence is now finally happening on the product side.
[bctt tweet=”Hotels have understood that this phenomenon called vacation rental is not going to go away.” via=”no”]
Now you are seeing companies like numa which is formerly COSI. We call that Hospitality 2.0 and on the supply side, it is a combination of hotel-like service and amenities, larger rooms, and SDR-like accommodation. That’s something we will see. In Barcelona, half of the three-star hotels are on sale. They have suffered tremendously. We clearly believe that business travel will not come back to its level ever again in 2019. Things will change. Hotel supply will change. We will see a lot more hotel groups sniffing around our industry and trying to see how can we convert our customers to that product, but how can we also control that product? That’s something we are going to see.
You can see that here in the US for sure, like these loyalty brands that you mentioned, the VR side has not done a good job in building that brand recognition. You can see in the remodels and the new builds with hotels is they are essentially building SDRs remodeling all hotels to have maybe even a third of the amount of rooms in the hotel. They are all set up like little miniature suites. They are taking notes of what has been successful and they are building this pretty amazing hybrid model here.
They are still offering certain amounts, but they all have whole brands now that are focused on that. It’s pretty amazing to see the transition. They have that clientele, the Marriott Homes & Villas and IHG that you have mentioned. It’s pretty impressive, at least taking the notes and cues that they see and what they are doing with it.
I don’t think they got a ways to go. From my spot, it’s interesting because I think there is a company that can brand short-term rentals or alternative hospitality in a way like a W or under a brand. I think that’s going to be something that we haven’t seen, that we don’t know what that looks like. We know what it could be. We could say, “This is how it could work.” I don’t know who’s going to do that. I don’t know who’s going to take that on. That’s going to be interesting because there is no dominant brand within the space. To put it out, it was like, “Sonder and Vacasa.” My immediate thought was like, “Who’s stronger? Who’s the brand within this space?”
I’m like, “It’s got to be Vacasa because they have a path to profitability and they know what they are doing from the management side.” I don’t what their operation looks like now, but I know Sonder’s operation was very much heavy in certain areas where Vacasa was lighter. They also play in different markets. Sonder is not playing in destine. Sonder’s not playing in traditional vacation rental markets.
Where Vacasa got strongholds. In the opposite side of that coin, Vacasa is not huge in a lot of the US domestic markets like bigger city markets which are more valuable and profitable. I have my opinions on that. I’m going to leave that there. At the end of the day, it begs the question like, who’s that brand going to be? Is it going to be someone we know or is it going to be someone new?
It’s going to be somebody new and somebody we know because one of the things that everybody makes the same mistake is they don’t accept the facts of the market environment. The market particularities are not being accepted by the facts and everybody has tried to do it again and again, but not understanding what certain things you cannot change that you need to accept to build your business model around.
One is the business is hyper-local, we all agree, but it’s a fact and you cannot break that. 1) If you don’t have somebody on hand who knows the destination better than everybody else, you are not going to succeed. 2) The industry is built on trust and not on assets. The trust is the only asset that we ha have in vacation rental because at large, 98% of our supply is secondary home ownership. These people have worked their lives to build a second home and it’s their castle. That’s not an easy rental. That’s what people underestimate. It’s not a commodity for the individual loan owner.
For an investor, rental contract or a commodity, “How many rentals do you have? What’s your churn? What’s your net churn? What’s your gross churn? How many new contracts are you going to sign in the next twelve months?” Then when you go down on the level of sitting down with Mr. and Mrs. Smith at their dinner table to rent out their mansion, to have in Florida for five years in the family for $2 million, that’s a different conversation to be had and build that trust. That is not going to go away. You have other challenges that are individually owned. That means setting standards is very difficult.
Setting standards on how it’s equipped and furnished. The curtains, couch, and kitchen is different in every house. That’s what our guests love and what we love about our industry, but we also would like to set some standards. The homeowner thinks, “My pink couch is very nice,” then you say, “A dark one would do better for our guests. Screw them.” This is the discussion we will have forever.
These particularities are something that we love about this industry. We are passionate about it, but to scale these three facts is very difficult. This was what we have seen with the churn rates of the acquisitions that have happened, you lose local heroes and brands where the owner is comfortable with the property manager that he used for the last many years. If you break that, you can’t scale.
The question is, there will be different models for getting these together. One of which is most probably going to be franchised or hybrid. I’m saying what we need to do while our RBO or Rent By Owners, gets better educated by the day, we need to take a more hybrid approach to our industry. When you go to an American supermarket, as a European and I go to the cereal aisle, I’m killed because I have 600 different types I can choose from cereals. That’s a pain in the ass. We are being educated as consumers to have a choice. A vacation rental is the same thing. We want a choice. If a property manager comes and says, “I need your contract exclusive and I want this that.” “I have had the same cleaning lady for the last many years, forget about the cleaning. I’m going to do that.” You can do the distribution. If you don’t do a good job, I will let you do the cash payment as well, this and that.
We need to be hybrid in the way we go off this market. We need to build solutions to serve our customers’ needs. The owner, we need to build solutions that accommodate their needs to drive loyalty to them loyalty is driven by occupancy and distribution. These things we need to accept and then build our businesses exactly focused on those market facts. You can be very successful, but we need to be flexible. As human beings in this DNA, being flexible is not our strength, but on the other hand, we want choice. This is something we need to put together.
That’s both the side of the property manager and the homeowners being flexible and for it to work. Those are excellent points. Looking at the models that we have going forward, what’s going to fail? What business model that is is moving now? You don’t have to go and say, “What brand?” What is not sustainable? What’s not going to make it for the next years? What are we going to see change?
It’s the business that is not profitable that is going to fail in the long run. It’s not all growth. It’s unit economics and its profitability. I believe in that. As soon as we see an economical downturn, everybody who goes for growth will be imploded immediately and it will get worse because once we have a downturn, then you cannot sustain your business. No matter which business, it’s a great question. I wouldn’t even pinpoint it in a different model. We can talk about master leads, ownership, and distribution only can evolve. All of these have the potential to fail, but also have the potential to succeed. For me, maybe it is more because I’m European or we deal with our cash a little bit more carefully, in Europe we only have 1 credit card instead of 50.
Money is money, and it depends on what you do with it. To answer your question, it’s the model itself and how you want to run your growth strategy. Look at this master lease thing. Before March 2020, it was everything the best in slice bread. Everybody was going after it. Have you seen how fast all of them, unfortunately, who did a great job like Jordan from Stay Alfred and others passionate Joe and Andrew from Wheelhouse all passionate about their businesses going out there saying, “We bring a new product out there.” They got literally wiped out within 24 hours because the debt that they had on their balance sheet to finance the master lease was not sustainable.
The higher your risk appetite is as a business, no matter which model, the more risk you have to fail. Especially, where we are going to see economical downturn recessions and interest rates rising again. At the moment, money is cheap. The government is pumping money to keep the economy alive, that’s dangerous. You need to be careful in building your business and think about how much can you leverage it, “How much debt can I carry if certain things go wrong?”
[bctt tweet=”The higher your risk appetite is as a business, no matter which model, the more risk you have to fail full stop.” via=”no”]
I will give you a little example. If you want to buy a house in Switzerland for a mortgage, you need to be able to sustain a threshold of interest rate of 5% next to your income in relation to what you from the bank. In Switzerland, you can lend 80%. The 20% is downpayment cash. You need to show your salary. If you can’t maintain a 5% threshold, you are not going to get the mortgage. The actual interest rates are at 1% at the moment.
We are paying a 1% to 1.2% interest rate at the moment on our houses. You can imagine, it’s beautiful, but to the bank, I need to show I can handle 5% before I’m going. That’s a risk corridor of 3.8% that I’m under leverage to manage my mortgage. That’s a smart thing because my salary can go down. The value of my house can go down. At the moment, it’s not going the other way. I think this is something we need to be mindful of.
Something that backs in ‘08 and ‘09 in the predatory lending and that’s where everyone got into trouble, is that you are not keeping that threshold and giving a loan to mortgage to absolutely anybody. Everyone’s buying way above their means. You got to be able to sustain it and that makes a lot of sense.
You also don’t build a business that profits off of the failure of people in the United States. Subprime lending in subprime markets contributes significantly. We will go down that road another time. One thing I want to bring out is a huge part of what changes are in hotel education. I want you to talk about what you did in that space. You what you created through your hotel school because it’s not just the tips and tricks of how to be a better hospitality provider. It’s how to be a business owner within the specific hospitality space.
We brought some of the brightest minds together to create a platform that is hugely beneficial to anyone that chooses to come and educate themselves around this. This is just the beginning. I think we are going to start seeing this growing up in schools as our industry continues to grow and mature as other business verticals do. How did you get to this space and what is your goal with the hotel school that you have? I want to talk a little bit about that.
Have you ever used an Uber?
I have.
Have you asked the driver if you had a driver’s license ever?
No. I trusted the app.
This is my answer. At the end of the day, you are lying in someone’s bed, but you have no clue if the guy knows what he’s doing or not. When you sit in a taxi, you presume the guy has a license and he knows what the hell he’s doing. Now in our industry, we have absolutely no clue. Now we are letting people on Airbnb become hospitality experts. We are doing a disaster for the guest experience.
You cannot learn this job of becoming a company, property manager, or host. That’s brutal and that’s wrong. You have the best hotel schools in the world and in New York. You have hotel schools in Switzerland, the best in the world. None of them have a vacation rental on their tutorial. This is an industry by error because you have a place to rent so I start doing it, but we are still doing a crappy job.
We said, “We need professionalism. We need education.” In all the conversations that I have with all my great friends like Dave Krauss from Rent Responsibly with the associations, everybody talks about education. It will become even a regulatory issue eventually where you need to show some education of what you do, and then goes into health and safety and many different areas that you can be a professional host. This is what we wanted to do.
We wanted to push the envelope of offering education, professional education, done by the brightest minds and subject matter experts in this industry like Sarah Fransen, who did our distribution piece, and Susan Tormollen, ex-HomeAway software did the marketing piece. We had Cliff Johnson and Michael Richard doing technology and data. We had the brightest minds in this industry to tell the world how it’s being done.
You did a couple of of those too, not just everyone else. As I was on the Shortyz, I received the ability to go ahead and do one. My dumbass, I signed up, started, and I didn’t realize I had such a short window. I was busy with work that my time ran out. I need to go back in and redo it. I was super excited to do the course, but I got started and then I got busy with work. Unfortunately, I never finished the course.
Which one did you do?
One of yours. I can’t remember.
I did operations, strategy, and revenue management.
It was the more in-depth one. We had talked about it briefly. It was amazing. It was super in-depth. I was loving it, but then I had to shelf it for a couple of weeks because I was super busy with work then when I went back, I’m like, “I don’t even have any time to finish this.”
We are in deep conversations with associations because we want the people to start adapting to it. Trust me the following, selling education is hard because people think the internet is free. That’s a shame and the quality differs massively. We need to do more work. We need to have the right stakeholders for education, but we are definitely working on that. We are going more off the corporate because I believe if I would run a property management company, I would make sure that every new hire will have to go through these 150 mini-courses within the first year of them being employed.
[bctt tweet=”Selling education is hard because people think the internet is for free, and that’s a shame. The quality differs massively.” via=”no”]
The problem is that the guy who does that knows ten times more than the boss. That’s going to be a problem. This is something we can talk a lot about, but we are passionate and we all need to support education in a vacation rental. It’s important because one thing that we should never forget, we still only address about 40% of travelers and 60% have not yet chosen a vacation rental over a hotel. Even though they want hotel amenities and services, but they don’t feel safe in our homes. How crazy is this? We still have a lot of work to do. The more we educate and the more we professionalize the more addressable market is there to get people into our industry that have not yet rented. That’s 60% of the travelers. It’s massive.
I wouldn’t think it’d be high, but you are the numbers guy.
It is huge. In certain markets where it’s more traditional and older like Europe, it might be 50, but not much below that.
Are there any last words of wisdom or anything you’d like to leave to our audience?
First of all, I want to thank you, John and Mateo, for doing this and putting this together. It’s great to have this show and also do it with a different approach. On top of that, I got my travel permit to go to the United States. We can do the BS talk at the bar in San Antonio, which I’m extremely excited and I’m looking forward to being in the United States. That’s great for the audience to know. We will be there, hopefully, to catch up in person. I wish everybody to stay safe, stay healthy, and hope to see you all very soon.
I’m excited to see you. It’s been far too long. We are looking forward to meeting you in person, not just virtually. I know there are a lot of things going on and you are doing things with VRMA if you want to talk about those things because we are about to plug our VRMA part. If there is anything you want to put out there, feel free to say it.
I have the honor and the pleasure to do all the fireside chats. It’s pretty much all the movers and shakers in our industry, which is Matt Roberts from Vacasa. I have been able to get Carl Shepherd, the Cofounder of HomeAway, motivated to drive from Austin to San Antonio. If all goes well, he has a special friend in his car as well, which would be tremendous. I have the honor to interview Jennie from Marriott International. We have delegates Jeff Hurst from Vrbo, which I’m looking forward to every year speaking to. It’s going to be absolutely awesome.
You don’t disappoint. We are open here. We love your Red Shoes Podcast. That’s the other thing that we have all missed is seeing the red shoes moving, shaking, and getting the Red Shoes Podcast around.
I can finally pack my red shoes again.
Mateo, before we get out here, why don’t you go ahead and tell us about One Push VRMA stuff?
Thank you, readers. Simon is definitely going to be coming back. We will be bringing him back soon. Thank you for coming on. One Push VRMA October 3, 2022, if you are coming to our workshop, we are doing a D&I workshop prior to the conference starting. We have a fantastic speaker, who will be announced next episode.
John and I are circling back and hosting our panel, D&I or Diversity and Inclusion with the original panel with a couple of extra guests. It is going to be from the main stage. We will be pushing out that schedule, letting everyone know when and where that will be, and hope you will come to join us for this discussion. It’s going to be a great one about the culture and where we are a year later in the industry in terms of D&I.
We are super excited about it. We are commemorating it. We got a five-person panel. We are super stoked. We can’t wait to continue this conversation with you all, until the next episode.
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