Buildium, Boosted by Real Estate Bust, Sees a Big Mobile Future
[Corrected 4/16/12 10:30 am. See below.]It’s not often that you hear an entrepreneur say his business grew through the real estate crash and economic downturn.
But that’s indeed the case with Buildium, a Boston-based, maker of online software enabling landlords and small property managers to track rent payments, receive maintenance requests from tenants, manage leases, and market rental listings. “There are a lot of accidental landlords as a result of real estate market imploding,” says Michael Monteiro, Buildium’s co-founder and co-CEO.
By accidental landlords, Monteiro means people who would have wanted to sell their homes, but were forced to hold and rent them out because of a weak housing market. Real estate investors have also gotten into property management as a way to supplement their income in the downturn, he says. And the renters market is now booming. Buildium has gone from 500 customers in 2008 to 5,200 as of first quarter 2012.
Buildium’s story actually goes back about 12 years, when Monteiro and two other then-Sapient co-workers and friends decided to buy a four-family investment property in Providence to rent out to college students. A couple years and two more properties later, they had trouble keeping track of who paid rent and who didn’t, especially when each college student in an apartment wanted to pay his portion of the bill separately.
“That was the straw that broke the camel’s back. We had 10 rental units and no idea whether anyone owed us money,” Monteiro says.
He and his partners looked into technology to fix the problem, but only found expensive desktop software targeted at property managers with thousands of units. So in 2003 Monteiro and co-landlord Dimitris Georgakopoulos built the first version of the Buildium Web platform for themselves. It allowed tenants pay rent online and landlords to see exactly what they were owed. A year later, they formed an LLC and added features like income and expense tracking, and maintenance request management.
By 2007, Monteiro and Georgakopoulos had about 50 customers for Buildium, which was still a side project atop their other jobs. “We decided if this thing was going to go anywhere, we’d have to build it full time,” he says. [An earlier version of this paragraph incorrectly stated Monteiro and Georgakopoulos were still at Sapient at this time. They actually left the company in 2004 and were working on other ventures at this point. We regret the error.]
Since then, the company has been nabbing customers and adding new features, like the ability to push a rental listing out to Craigslist or do an online credit check of prospective tenants. The software starts at $25 per month, and comes in three different flavors, for landlords, property managers, and the heads of condo associations. The price goes up depending on the number of properties a user is managing.
Buildium just released its iPhone and Android apps, which “is the first phase in a larger strategy to be available on any device anywhere,” Monteiro says. For now, landlords can access the software on their phone when visiting a site, to do things like document needed repairs or see their properties on a map. The company plans to add features that allow prospective renters to submit applications via a tablet on the spot after viewing an apartment, or sign lease agreements electronically.
Buildium has raised no outside funding and has been profitable for the past two years, taking the “slower, organic growth path,” says Monteiro. The 35-person company has customers in more than 30 countries, even though its software comes in English and is focused on the U.S. A new financing round could help it more intentionally expand into those new markets, by adding new customer support services and the like, Monteiro says.
Property managers and landlords are arguably not the most tech-savvy customers, but Monteiro has big goals for Buildium. His hope is for the company to take on the property management software space the way Salesforce has in CRM.
“There is no dominant player in our space yet, but there will be,” Monteiro says. “That’s the real opportunity.”