For our latest interview in the 10 Questions series, we spoke to Mario Peng, co-founder and CEO of PropertyScout, one of a new breed of online property marketplace in Southeast Asia...
What is the problem that PropertyScout solves?
I founded PropertyScout (formerly Flexstay Rentals) 2 years ago. Together with my co-founders Salita Kamnerdsiri and Marco Barth, we are making residential rental transactions in South East Asia more transparent and professional.
If you compare the simple and quick process of booking a hotel room on Booking.com or Airbnb with the cumbersome process of renting or buying a property - this is the pain point that we have set out to solve.
In a bit more detail: Thailand and other Southeast Asian countries’ real estate marketplaces are plagued with property listings that are not available, have wrong or missing information, or are simply fake. As a result, consumers have zero transparency about which properties are actually available and at which price. They end up in 1-1 chat messages with 10+ agents trying to identify suitable properties and attractive prices. In addition, agents often lack professionalism as there are no license requirements and an oversupply of agents, which breeds a vicious cycle of low agent productivity, high agent churn and inconsistent service quality.
What is PropertyScout’s USP?
PropertyScout is building a tech platform that connects all market participants (potential tenants and buyers, owners, and agents) and fosters collaboration between them using technology, artificial intelligence and our own internal property consultants.
Over the last 12 months, we’ve become the leading residential rentals agency in Bangkok, marketing more than 30,000 properties and servicing close to 1,000 potential tenants this month.
We aim to eventually offer the largest supply of available properties with great content (property information, image, videos, 3D virtual tour) for the consumer to effectively find and rent or buy the most suitable property at the best price.
What is PropertyScout’s biggest challenge?
The biggest challenge is to recruit, train and retain property consultants. We have spent an extensive amount of time in the past few months building a scalable recruiting and onboarding system and driving up our property consultant productivity. We believe we have now achieved both robust processes and a very strong value proposition to attract and retain property consultants.
How many employees does PropertyScout have?
We have over 50 employees at the moment and are growing at around 10+ employees every month.
How has Covid-19 changed the landscape for PropertyScout?
We went live with our current product offering during Covid-19 and have experienced consistently strong growth ever since demonstrating that rental transactions continue strongly throughout the pandemic and that the market is large. We learnt from other market participants that the agents' productivity is currently about half of what it used to be before Covid-19. Thanks to our tech stack our financial metrics have worked even during Covid-19. We are looking forward to Covid-19 passing and we expect our agent’s productivity to increase nicely when it does.
What is one thing our readers might not know about but would probably find interesting about the rental market in Thailand?
First of all, Thailand is often underestimated as a business environment. With a population of 70m people and around 50k property agents making an estimated USD 1.5bn in commissions annually, it’s a hugely attractive market.
As for how the market works: Similar to other Southeast Asian markets, the residential property market is one with non-exclusivity on properties, no central property database, no publicly available transaction data and no property agent license requirements. The lack of those frameworks and rules leads to a non-transparent, none-effective residential property market. We believe only a transactional platform can solve these issues using tech, AI, and humans. One needs all those ingredients. If you miss one it will make it impossible to solve the issues.
Where does PropertyScout’s inventory come from?
We are working with property owners, property developers, property management companies, and partnering with real estate agencies to rent or sell residential properties.
What is PropertyScout currently working on?
On the product and tech side, we focus a lot on enhancing the quality of our listing portfolio, using both our dedicated supply-side team and our increasingly smart technology platform.
Additionally, we frequently gather feedback from our agents on where they spend the most time and build tech features to increase the agent’s productivity. Other than that our main focus is hiring, onboarding and retaining the best and most service-oriented property consultants in the market.
What is the most common request from clients?
In general, consumers want a property matching their needs at the best market price. In Bangkok, they most often are looking for a 2 bedroom condo close to public transport below USD 600 monthly rental price. The first question they often have is whether the property is still available, whether we can provide more pictures and whether the price is negotiable.
For landlords, they face a market with very competitive prices and an oversupply of good condo units. They want an agent who services them fast, without the hassle and gets their property rented out to a good tenant as quickly as possible.
How do you see the market evolving and what will you be doing to be ahead of the curve?
We believe consumers will move more of their property search and pre-selection online and will demand better and more accurate content such as detailed property and building information, professional images and 3D virtual tours, truthful videos, and honest reviews. And last but not least they expect the advertised properties to be available and have transparency about the price. We are working hard on all of those topics with our tech team and our property consultants. We are already allocating relevant resources to this objective and will increase our investment into tech after our next fundraising round.