As a Forbes 30 under 30 who led marketing teams at AirBnB and is now Head of Growth for HomeRoom–a room sharing app–Mike Tich knows a thing or two about marketing places to live.

Here we discuss how to better advertise your listings so that the homes you list have more exposure, higher sales price, thereby giving your prospective clients more reasons to choose you over the competition.

We’ll also be curious to learn more about room sharing and what this will do for property values and investor opportunities.

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Justin Stoddart 0:01
So the big question is this. How do we those of us in the real estate industry with crazy amounts of ambition? How do we think bigger than the building of our own empires? How do we simultaneously see success and significance, income and impact? My name is Justin Stoddard. And this is the Think bigger Real Estate Show. Wouldn’t it be nice to be able to have deep expertise on how to get the most amount of eyeballs on your property as soon as it were listed, giving your clients maximum dollar, as well as giving you more listing opportunities inside of that neighborhood? today? We’re going to talk exactly about that. So stay with us for just a minute.

All right, welcome back to the Think bigger Real Estate Show. I’m your host, Justin Stoddard, very excited to be here today with Michael Tich. He is the co founder and chief marketing officer should say of homeroom, which is a company that actually gives you the ability to, very similar to Airbnb, to rent out individual rooms inside of your home. So before I get to that topic, I’m going to be thinking about what that might do for property values. If all of a sudden you could be renting out individual rooms inside of a room excited to introduce him to you today. We’re also going to talk about what I promised before, which is how to maximize the exposure of your properties using his deep expertise from Airbnb where he worked prior. And now as a Forbes 30, under 30, where he now drives the growth of homegrown Michael, it’s such a pleasure to be with you today. Thanks for joining us.

Mike Tich 1:50
Yeah, no problem. Thanks, Justin. Yeah, so Yeah, funny. You mentioned the Forbes 30 under 30. thing. And he that’s like the best like, number one piece of advice. Just do good PR. So a good PR person? Yeah, right.

Justin Stoddart 2:02
Yeah. Good. So you started off. When we first met? Not that long ago, you told me a story about a property that you acquired? Yeah. That you went looking for it for one particular reason? Would you tell us that story? I think that’s just like a hilarious story. That’s very insightful. For all the agents out there that that may think that they’re doing a good job marketing their own listings.

Mike Tich 2:24
Yeah, yeah. So this was back maybe four years ago in San Jose. So I am a small time like real estate investor and buying in the Bay Area is like, incredibly difficult. So one thing we would do is just try to find places that don’t look all that great, or like marketed incredibly poorly. So it had just like weird pictures. They refused to show us the like granny unit of the house. And they also had like an eclectic band in the backyard and people cooking in the front yard. And it was just like, I think it was only like three offers, which for the Bay Area is like abysmally low. So we ended up getting the place for like a pretty good deal. So don’t do that.

Justin Stoddart 3:01
And what was your assessment as to what, what people who are coming to the house actually thought of that?

Mike Tich 3:05
Oh, yeah, I think they thought they were like the tenants or something. And then like, somehow, they thought that, like, people were still living there. So then, like, what family’s gonna buy this place? And they also told like, yeah, we’d also like there was an unpermitted issues in the back that we that we figured, but it was like, way better, like we would have just told the truth about it would have been like, 50 times better, because like, we assume that would have been like, way worse.

Justin Stoddart 3:26
So So yeah, like moral, the story is sometimes the marketing efforts that we put out there actually backfire. People don’t actually interpret the fact you’ve got people making breakfast up in front, and a band playing in the back there. Like who would ever buy the hood are like want to rent this place this zoo around here. Whereas the agent themselves are like, Hey, this is a great way to get a lot of attention on the property. So so

Mike Tich 3:47
it was weird, because the agent inside they didn’t know who they were. This is the owner that went behind the agents back and did all this. So I mean, great, great, great, great client to have, right?

Justin Stoddart 3:58
That’s right. So with that being said, obviously you spent time at Airbnb really building helping to get a lot of attention on their properties, right, looking for investors. So let’s get into that first. That’s good. I think again, kind of our first topic here, which is how do we get a lot of eyeballs on a property quickly? Yeah, right. So that again, you number one, get a higher price point for the sellers number one and then number two, you get to maximize the opportunity for other homes in the neighborhood to say boy that that agent did a great job marketing maybe we should interview them maybe we should hire that right?

Mike Tich 4:31
Yeah, I mean, I mean, I’m obviously not a real estate agent. I like to take the classes a few years ago for fun so but yeah, I know a lot of it when I was in I was an Airbnb host for seven years right I think just having like really strong like pictures visuals being really creative, right like all of our listings on for homeroom like we have like the full like 3d tour with Matterport and everything else. It does a good job of like just making sure people can like see everything in the Bay Area. It’s a big thing to like listen to market price to like really generate demand. I don’t know if that works everywhere, but like, it’s gotten a bit extreme here. Like we were visiting one house where like we walked in and like they were listing like 2 million and they said they wanted like three and a half. It’s like, but like that place was like, packed, right? Like there was like, at least like 100 people there the sign in sheet. So it’s like a catalog of demand, I think is the idea is like, okay, when you’re there, like, try to clarify some of that. But at Airbnb, we tried not to do that too much, right. Like, we had some we obviously had like the fees associated with the people had the cleaning fees, but like having that load on nightly list price does go to like people through the door and get more people saying it. So it just thinking her conversion rate after the fact. So it’s like, always good to try to, like maintain a balance, though.

Justin Stoddart 5:41
So so obviously, even though the home is going to sell quickly, we know that right? Our goal as a as an agent, is not to just sell the home, because if that’s your value proposition, homeowners are not going to buy it, they’re not going to sell it themselves. So number one is to how do I maximize value on this and you’re saying even if it may not seem sense to invest in professional photography, even if it may not make sense to invest in that, because it’s gonna sell itself. What we’re telling you is that it matters, right? It matters, okay? I

Mike Tich 6:09
think especially if you’re looking to get people to like, start a bidding war replaces, like now, right, like, getting people to like it just a little bit more, I would imagine has a pretty high driver, though. So

Justin Stoddart 6:18
well, and you get people who are able to make a decision without having to come see it, right. So the more people can say, I’m comfortable enough of this house even make a you know, an offer sight unseen per se, right? goes way up. And the more that you can teach them about the property without having to have them actually go physically walk through it when it makes your job a little easier and that of your sellers. But

Mike Tich 6:40
a lot of our buyer partners now like go buy places remotely. So like I was just having those type of things and kind of necessity, right? Because like, a lot of times what we’ll do is like well, like work with them to like basically filming for them or something while the house is still on market to like make sure they have like a decent indication. Okay, this is like a good place to buy. Or like that actually joined the contract for it. And then we’ll like send them all the details and then it’s like, if they don’t like it, well then you’re like you’re back to square one that’s gonna look terrible on you. Right? So it’s like, a big issue that’s there ahead of time. Like you’re just gonna make a lot of people like they’re not gonna look less likely to lowball you basically, I would think

Justin Stoddart 7:14
let’s talk about from from an ad standpoint, do you recommend or let’s say that you were licensed right again, having your deep knowledge and marketing and advertising? Yeah, would you place ads even though you know what’s gonna sell like enough people are gonna see it you know, hit the MLS?

Mike Tich 7:28
Why? I think a lot of part of his ads for personal real estate agents are probably going to generate you potential more leads to right one thing I think we noticed at Airbnb is like, what specifically you advertise for isn’t always what you get, right? So you put a house up an Airbnb, for instance, when we send it out the ads, but 90% of those users would end up converting like a different house. Which is kind of interesting, like getting those people in the network, like maybe they’d be a good buyer for you or something like that. Right? Like, using the house like an intro to your connection, I think we probably would make a lot of sense, like, that’s what I would do if I was a real estate agent, right? Like, running a lot of CPA based ads on both Facebook, probably less LinkedIn, I think it’s going to be hard to find people looking to buy houses, but like, Facebook’s pretty good, right? Because you can get very localized and say like, I want people looking in this area in this area, and like, try to find them that way. And like, Yeah, I know for like, when we try to find tenants, we use a lot of other sites, right? Like that’s, we will be a very diverse. Like for finding investors, we can get pretty good on just like the Facebook and like inside?

Justin Stoddart 8:27
Is there some sort of indicator? And no, this numbers is variable to based on a lot of different factors. But if you were advertising one home, is there a certain amount of is there a certain amount of money that you would dedicate to advertising a particular property?

Mike Tich 8:44
Yeah, so the way I like to handle this is think of it more in terms of like, okay, what is the value? You’re getting out of it? Right. So like, I obviously, it’s gonna make based on like, what your commission rates are, where you are, like in parts of the country, right? Is your house selling for more. But if the idea is okay, like your LTV, your particular transaction is like $10,000, right, like, but you have a 1% conversion rate to there from like we buying a house. Yeah, like, you theoretically should be able to spend at least 50 hours just to get those leads in and still maintain like a to x ratio there. So one good thing about Facebook ads is you can set like, Okay, I want to hit a target cost per additional meeting or those two types of things. To say, Okay, I want to spend $50 per meeting on Facebook have all my creatives to really bother with it. And then take all those meetings, right? And then actually, hopefully convert it down the line. So

Justin Stoddart 9:32
So I love that. Let’s slow it down a little bit for those that may be less familiar with Facebook advertising, if you don’t mind. Okay, so go back and walk us through as if you’re walking us through ads manager, right where you go in and let’s say you have a particular skill. Let’s say that another listing, right, which is maybe your ultimate goal is is going to be worth about $10,000 to you. Okay, so if you sell this home and does a good job, other and you can take that those marketing chops and you can go sit down with another seller in the neighborhood. And you could say, Hey, I was able to get my clients, you know, 5% higher than any other offer in the area because of my specific advertising knowledge of their property, I can do this for you. And they say, Hey, look, you know, what kind of hohem about are, you know, about the real estate agent, we were going to use the fact that you can get us 5% More, essentially washes out your fee are a good part of it. So that makes sense to us. So. So, again, let’s say that the end goal is to pick up another $10,000 commission off another listing in that neighborhood right? Now walk us through the numbers, and specifically what we would be doing inside the Facebook Ads Manager, if we had a particular if we were marketing a particular home hoping to also grab the attention of other potential sellers.

Mike Tich 10:49
Yeah, for sure. So the way I kind of handle it, it’s kind of like this four step. process, right? So I think one is you kind of want to optimize as far down in that process as possible, right? So you’ll have like, if that is like an initial meeting that happens in that first session, like optimize towards that, right? So perhaps on the website, where you collect these meetings, a Calendly link right? relatively quickly to add a like, paid Facebook pixel to there and say, Okay, I want to optimize towards this event. Go into Facebook just make a lot of different creatives, right. So just one thing I noticed with Facebook is like, I have a hard time predicting what’s going to convert. I thought that homeroom would be like a lot of stuff on like, like, just random click Beatty stuff of like, oh, sell your house here. A lot of actually what works is just showing people numbers, right? So just showing people like, some nice, very pretty charts. So like, okay, like, what is like, what are historical cap rate are giving him details of like, what is the amount you can rent per room, and like a bunch of other stuff, like some fairly detailed charts for like a social media site, but like, it actually works pretty well. So pretty good. So yeah, basically, what do we do that we make all these different types of creatives, in terms of what audiences like you would want to pick are people located like relatively close to you. And then you can also like, add in the interest targeting right to people that are like interested in real estate or those type of things, or like, if you already have a customer base, do like a look alike audience based on that I don’t like but use data from your broker, just something like that. And then just okay, you know, roughly what your cost per meeting should be right? $50. So we’ve set that directly with bidding, or just started with auto bid and suddenly move into more of a like, Okay, I want to spend 50 hours per listing and go from there. Okay. Yeah. And then like, step four is just like keep killing off what’s not working and launch new things, and then just try to keep everything as dynamic as possible, right. So if you’re like telling Facebook to do something, it will almost always like do that. But you always want to make it to okay, like, give me as much of what I actually want. And like you have all the liberty of what exactly you do to get that right. So whether or not that’s like moving on the ad formats, and moving to Instagram moving to like WhatsApp ads, right, you kind of let Facebook handle all that automatically. And mostly focus on like giving new creatives up in a new messaging, and everything’s just taking the meetings.

Justin Stoddart 13:04
So here’s the takeaway for everybody listening again, my my crowd typically tends to be people who want to work by referral right? Now, you might be saying, Justin, this isn’t, this isn’t really hitting home. Because this is more about driving ads, here’s I want you to do is to go back and re listen to what Michael just said, There, he gave four steps that you can take. And you can utilize as content inside of your newsletters that you’re sending out to people when you’re having conversations with your sphere with people that are in your referral network. When you’re talking to upstream referral partners, those that follow me and read my book know what I’m talking about. And you can say, look, I give my clients more money by following these four steps, like the reality is the people who you’re talking to, it’s going to go way over their head, and then you can get some expert help to help you actually execute on that unless maybe you’re already pretty knowledgeable. When it comes to Facebook, you can take what Michael just said, and you can go implement that. Okay. But again, the key is we’re looking for ways to differentiate ourselves, even though we have the relationship I’m telling you, folks, that is not always enough, we need to have not only the relationship, we also need to have superior value, because people will go with the relationship for so long. But at some point, if they see superior value, they’re going to leave towards that, especially if that superior value is quantifiable in dollars and cents. And that’s exactly what we’re doing is that we’re grabbing market share, or securing our own market share by having the relationship but but solidifying that relationship with actual quantifiable value. And what Michael just gave us, there’s gold by the end of the night, to our next topic now, which is this, obviously your company homeroom is a is an app that gives people the ability to rent out a room inside of a home that they own right, and gives you the ability to increase essentially the revenue coming in on a particular property. What are you seeing this do for homes that are, you know, from an investor standpoint, for property values right now you’re able to drop, obviously bring in kind of higher rents. So talk to us about that.

Mike Tich 14:55
Yeah, so what normally we’ll do is we’ll take like a four bedroom house, add in two extra bedrooms So now we have sort of a six bedroom house, and then we can help rent that out on our platform. So a lot of us will work with partners, many of whom are real estate agents, right? Like, Oh, I like, I feel like I can make a lot more money, right? Instead of like renting this like one small family, I rented the six individual people, right, so we end up saving the tenants about 50% on rent, and we’ll make about 50% more in terms of the rental return. So generally, that that also helps us back into okay, we’re willing to basically pay a bit more over market, we getting into some of these competitive areas, because we know we can make more on the back end. So

Justin Stoddart 15:32
50%, higher rents is mostly what people can expect to see when they partition the home up into rooms as opposed to renting they’ll like the whole home, as is,

Mike Tich 15:42
generally Yeah. Assuming you add in extra bedrooms and everything and like make it a little more, it can be higher, right? So if we take a three bedroom and like there’s a lot of extra square footage that’s not being used currently, we could turn into a six bedroom and you might be able to like theoretically double it, right. But like it’s, it’s very property dependent. Which is why like, we have a like a fairly large sales team that we go through and identify all properties, which would actually make sense. Only about 10% of like, single family homes really make sense to do this with just because like you need extra square footage, you need to be able to add an extra bedrooms, we need to be able to find the tenants quickly. So you know,

Justin Stoddart 16:17
this, this sharing economy has taken one further step thanks to the innovation of you know, what you’re doing. And there’s no doubt that people in today’s world want to be able to live where they want to live, without having to be enslaved to work 20, you know, for 60 to 80 hours a week in order to pay for it. And I think what you’ve done is really opened up the world to a lot more people just like Airbnb did, right? We’re used to work. Now you can do more people to live where they want to live at a more affordable price. It’s really, really cool. And investors giving them the ability to obviously, you know, have greater returns. Are there certain pitfalls that people should watch out for? Like for example no with with Airbnb, there’s, there’s kind of HOA and zoning restrictions, you find similar things when it comes to room sharing.

Mike Tich 17:02
There is some legal restrictions, it very much depends city by city. So it’s like, like Kansas City, Missouri, has like 300 subsidies in it, each one is slightly different, right? So it’s like, we kind of have a lot of experience, we know which ones to avoid, we have like a very long list of okay, like Cesar Chavez, we don’t go after because it’s kind of a pain. Whereas like some of the other ones, it’s pretty good, right? So that’s why like, I would try to find an expert that understands like that local market. And understand some of the nuances there. Like we’ve hit some issues, but like it is less than 1% of the time we’ll hit some legal roadblocks. And usually, then it’s a matter of like, Okay, we just tried this as a single family home and figure things out, but it is pretty rare.

Justin Stoddart 17:41
Okay, super interesting. I love it. What else would you want people to know about homeroom? You know, I think that there’s, there’s some pretty cool stuff here. That’s just, again, as a professional real estate agent, living in the knowledge economy, being aware of things like this, again, to my people, that are building referral based businesses, right? You may not be investors, you may not be out looking to do this. But simply having a knowledge of this view a more content to stay relevant in front of the people that you do know. Yeah, allows you to be to bring knowledge to upstream key referral partners that give you the ability to, to gain their confidence, trust,

Mike Tich 18:17
for sure. Yeah. So we do have a referral program, if any agents out there have potential people that they want to buy. We work with both like family offices, as well as like investment agents, as well as like we have some real estate agents we partner with. We also real estate agents that have like gone on to raise funds, right to help buy more properties with us. So if you have potential investors that might think want to be able to get higher returns yet, feel free to send them my way, and we can hook you up. I know, you’ll usually get like a check back on some amount of like a follow up rents too. So a good way to just keep bringing continual residual income for your business.

Justin Stoddart 18:51
So yeah, I love it. Michael. Last Last question, actually get two more questions. One is how can people learn more about Homer? Where would you send?

Mike Tich 19:00
Yeah, so just go to live Homer comm slash invest. We’ll just the main page works as well. So yeah, we’ve heard room calm.

Justin Stoddart 19:09
Love it. Alright, let’s go to let’s let’s look now, at my final question, which is this. You’re a big thinker, right? You’ve done some some really great things. Talk to me about what you do to continue to be a big thing or what you do to continue to grow, grow and expand your possibilities.

Mike Tich 19:26
Yeah, so I mean, I, I mean, recently doing all these like random podcast things recently. So it’s been kind of fun. Just to try to meet more people. I always try to do a lot more like random networking events. We’re doing a lot of like, the company’s going through Y Combinator right now and also a lot of that is like, okay, like meeting new people doing a lot more networking events, trying to build up connections. Got some cool books here and reading this like management book. today. It’s kind of it’s kind of a good one. Yeah, yeah. Yeah, it’s I read it like four years ago, but like I had like a pocket like a audio version of it. Now. I’m like, Cool. I guess I’ll read the physical version. is the second of the person who recommended it. So?

Justin Stoddart 20:02
Yeah, it’s awesome. I love it. Yeah. Look, leaders are our learners, right? There’s no doubt about it that if you’re, if you’re leading other people, if you’re leading movements, then you have to be learning. Right? You can’t lead people in a very fast evolving world without constantly improving and evolving yourself. Yeah,

Mike Tich 20:26
I mean, without becoming a Tai Lopez that but yeah, it’s good. Right, good. Yeah.

Justin Stoddart 20:32
Good point. Michael, wanna thank you so much for your time and contribution to us in our audience today. Appreciate what you’re doing homeroom be watching for folks. I think it’s going to change the space and give both people on on both sides of the equation, the opportunity to do more and to have better lives. So

Mike Tich 20:51
thanks, Justin, so much for having me on.

Justin Stoddart 20:53
I appreciate it. Thanks, everybody. And my final request of everyone here is go think bigger. Thanks, Michael, for helping us do that today. Sounds good. I want to thank you for tuning in to this episode of The thick bigger real estate show. If you found value here, I asked three things. Number one, give us a review. Number two, go to Facebook groups search Think bigger Real Estate and apply to join. Here you will find a community of big thinking professionals that will help you grow your income, your independence and your impact. And my third request is go Think Bigger.