After a troubled year, online rental marketplace RadPad is moving in with LandlordStation.
LandlordStation is a cloud-based property management software company that provides its customers with tenant screening and document and listing management, among other services.
After acquiring RadPad, the company unites both ends of the rental market – renters and landlords – under one roof. LandlordStation CEO Copley Broer says he expects this will be a differentiator in a market boasting many players who handle individual pieces of it well.
“We are hopefully going to be the only ones that are really able to drive landlord and tenant users in equal measure,” he told PaymentFacilitator.com.
At the center of that model is RadPad’s marketplace. LandlordStation has always touched both sides of the transaction and some parts of its business have focused on the renter end of the equation, such as providing renters’ insurance and facilitating rent payments.
However, the acquisition of RadPad is its first venture into what he calls the “discovery side,” directly connecting renters and property managers. Broer says he thinks this may be a sweet spot for the rental market.
“A lot of people take a lot of approaches to this, but I think [RadPad] are the ones who really cracked the code first on how this industry is going to behave going forward,” he said. “which is more of a marketplace, less of a SaaS model, less of an e-commerce model.”
He gives the RadPad founders credit for creating the robust technology that drove their business.
“Their technology that they’ve built over this sort of three-year period was really phenomenal and is still far and away I think the best technology in this rental space,” he said.
LandlordStation comes to the acquisition from an established position as a profitable business that drives landlord traffic. This provides it with a firm foundation and the ability to focus resources toward the tenant side, which he thinks will be critically important to the combined company’s continued growth.
“The successful marketplaces figure out which side of the equation is the most important and what the metric is that makes it the most important, and then they just go completely crazy on that point,” he said.
The key to success will be identifying what that critical metric truly is and for RadPad, he said, it likely revolves around how useful its app is to its renter users. One rental unit comprises many transactions and problems to solve, both financial and non-financial.
“If you can make it where the tenant knows if they open the app they’re going to solve that problem, that’s what gets you coming back next time,” Broer said. “Because if they know they can solve their renters’ insurance problem or their rent payment problem in the app, then chances are pretty good when they want to move they’re going to know they can solve that roblem in the app too, because we’ve got a great listing portfolio and it’s easy to apply.”
All these things are long-term issues for Broer, however. Right now, the company is looking to short up the stability of the platform and evaluate the ways the company can use the resources from the combined companies most effectively.
LandlordStation plans to keep the RadPad brand, and users will not notice many changes, Broer said. RadPad had stopped processing rent payments in October, but the company plans to bring back the feature, tentatively during the first quarter of this year.
Pay with RadPad enabled renters to pay by the method they chose, such as debit or credit card, ACH, or Apple Pay, whether the property owner accepted payments through the system or not. RadPad mailed checks to landlords who did not wish to sign up to receive electronic payments.
RadPad’s payments system was powered by multiple payments partners, including YapStone and Stripe, Broer said, and the company is likely to continue relying on partners to facilitate payments for the foreseeable future.
RadPad was founded in 2013. The company had reportedly struggled during 2016, including defending against a lawsuit filed against it by Craigslist. Broer is confident that the fundamentals of RadPad are strong enough to keep it viable going forward.
“Their only problem was that their business model at that very moment in time was predicated on their ability to raise money,” Broer said. He wants to see the business operationally profitable, only raising money if needed to pursue new marketing opportunities.
“We don’t necessarily need to run this in the sense of a business that never raises money or doesn’t have any interest in it, but we do definitely want to run it as a business that can function on its own without raising a bunch of money,” he said.