TheSquareFoot was born in late 2010 in Houston, Texas. Seeing business owners and entrepreneurs struggle through the commercial real estate leasing process made Aron Susman think there must be a better way.
TheSquareFoot is a groundbreaking online platform that helps prospective tenants find the perfect commercial real estate space to lease. Their ultimate goal is to improve the process for the prospective tenant and they have no vested interest in the leasing transaction.
MO: Was there a specific personal experience that led you to create TheSquareFoot?
Aron: Yes, Our concept began about a year ago and I was tasked with finding office space for a small healthcare start-up after moving to Southern California. After calling Justin and Jonathan, who both had commercial real estate backgrounds, it seemed clear there was a gap in the tools available for small business and entrepreneurs looking for, moving, and renewing commercial space.
Businesses looking for commercial space are currently at a large disadvantage because the industry lacks transparency, which results in a large imbalance of information between the landlord and the tenant. Making the problem worse is many prospective tenants don’t understand the value of a tenant broker, the frustrations with online listings, and the complexities of the process on the whole.
MO: How have you managed to cultivate such strong relationships with real estate agents who can guide start ups to the perfect space?
Aron: Luckily, with all three of us being native Houstonians, we have a great network here. Through this network, we have been able to identify the best commercial agents by area and product type. As we expand, we are going to rely on the consumer to crowd-source ratings and reviews to ensure only the best agents are able represent our brand and use our platform.
MO: TheSquareFoot is less than a year old. How much progress have you made so far? What do you hope to achieve next?
Aron: In our short time, we have been able to make great progress, by learning from our users and iterating accordingly. The milestones we have achieved include getting feedback from tenants, landlords, and agents on the problems with the leasing process. We built wireframes and mock ups in order to sign up 15 -20 agents to the service. In September, we launched the prototype and had an additional 50 agents inquire to join the service. We tested online marketing strategies to understand customer acquisition cost, form submission rates, and if we could connect prospective tenants with an appropriate agent. This all culminated in closing our first deal in October.
Currently, we have 20 – 25 active leads searching for space and on average our organic visits to the site are trending up 50 percent per month. We have hired an online marketing firm to drive down customer acquisition cost and improve our online marketing funnel. We are working with our development team to add features as requested by our users, including a building wiki, question and answer forum, and broker profile pages. We continue to acquire additional channel partners, including utilities companies, payroll solutions, banks, and other vendors.
MO: Have you made any big mistakes or has the process been fairly smooth so far?
Aron: We have definitely made mistakes, but we subscribe to the fail fast methodology. We try to continue to push out a minimum viable product and understand what our users do and do not use. Our biggest mistake has been assuming third party agencies (marketing and/or development) would give the same level of passion our founders gave. We learned quickly that there is nothing like sweat equity.
MO: How are you able to offer this great service at no extra cost to the customer? How are you able to make a profit?
Aron: Commercial agents have no way of marketing themselves online. In addition, many consumers either distrust agents or don’t understand their value. We aim to be a thought leader with no vested interest, therefore brokers want access to our community. As such, we charge agents on a closed deal as well as subscription model to be part of the site. However, we do not promote one commercial agent over another and if they have bad reviews they are off the site. Our brand is only as good as the professionals who are affiliated with us.
MO: Would you ultimately like to expand and apply this model to other major cities throughout the US or are you happy to just concentrate on the Houston area?
Aron: Of course! In fact our first closed deal was in New York City. Our goal is prove viability in the Houston market and the replicate the model through the major markets in Texas and eventually the country. This is a local business and our approach is tackle each local market separately. We will learn how to get better at the model on a daily basis and it will make our growth easier to implement into a new city in the future. In addition, we feel the network effort as well as the backend referral tools for the agents will give us a competitive advantage in the market.
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