How Guesty CEO Amiad Soto grew Guesty to $163.7M revenue and 1K customers in 2024.

hello everyone my guest today is amiens soto he's the co-founder and ceo of a company called geste a cal a cloud-based sas platform established in 2013 designed to simplify the short-term property management process with guest's all-in-one solution property managers can operate listings across multiple accounts including airbnb booking.com and others from one centralized dashboard amiado you're ready to take us to the top yeah thank you for having me you bet thanks for coming on so are you kind of uh you know used to be a real estate investor and then you said i want to do software now and that's how it happened or tell us tell us when you launched gusty and how you got there so uh the story was that i was a student uh university student with my uh my brother my identical twin brother and both of us you know we're living in tel aviv where rent is quite expensive and you know our experience was that we were traveling quite a lot and we didn't want to lose the rent uh you know while we were traveling being the poor students that we were so we decided to open you know to try to rent on airbnb and since our experience was too cumbersome we said like there should be a tool that does this for you making it super simple and that's why we created the company and so how is uh so how's gasket different than airbnb yeah so ust is the platform where you put all your properties on uh it's designed for property managers that are on airbnb booking.com uh and their own websites or home away and all the arrests and basically we are connected to all these channels uh like airbnb and we provide them with the inventory and they provide with the guests and reservations they market those properties we provide the tools necessary to manage the business the the the cleaning the owner relationships uh the accounting the reporting everything the automation and so is this a sas platform or is this more like kind of consulting professional service revenue it's a software platform we do have dedicated account managers that provide some consulting services for these accounts but we do our major products is obviously just the software platform it's a it's con it's including like more than 20 different tools in this platform that helps them with their daily day operations and what would a property manager pay on it i know i'm sure you have a bunch of different variables but on average what's the property manager pay you per month for this yeah so um each property manager has different needs and use different amount of products and to different extent and also they have different number of properties so the pricing is percentage based and it depends on how many products they use and how big is their company okay yes give me describe the average customer you have one property manager five five properties that you give me the perfect it goes the average will be 50 properties property manager uh we have as low as five and we have as big as two thousand right so it's we have multiple types of uh different property managers uh but that is in the 50 to 100 okay so let's just i want to really understand that your customer right so let's say a customer property manager with 50 properties uh what would you charge me to manage my 50 properties well again i cannot quote you on anything because each quote is dependent on the on you doing a demo with one of our account executives and choosing your your own products that you want to use and it really depends as we have a scaling figure as you grow it's becoming cheaper for property yeah but i'm asking i mean what i'm trying to understand here we're eliminating these variables so we can get to an average so there's 50 properties so it's not going to be more it's not unless it's it nathan if the point is to get me to quote a prize i would not do it it's not it's not a price but i have no doubt i have no idea if it's a dollar property or 10 000 per property i have zero idea so my audience is going to be completely lost so either help us out or we'll move on okay so it's it's percentage based as i mentioned a percentage of what of rent or of the of the reservation so each each reservation can be a thousand dollars and then you'll pay off somewhere between two and five percent um i mean so just to be clear just to understand this before i move on to more your story so you know typical i think my audience really clearly understands if they own a piece of rental property they might hire a property manager and pay that property manager five to ten percent to do things like renew leases make sure the toilets are fixed things like that you're essentially doing that at scale so um our customers are property management companies to do short-term rentals and the the average uh health for property management companies is about 20 there are some companies that go as much as 35 or even more and these property management companies would use our software and they would pay somewhere along the lines of two to five percent depends on how many products they use and how big their company is yeah again when i'm when i'm breaking i want to go back to the owner of the property and then understand property manager and then understand where you fit in so going back to the property owner the property owner i own real estate i know what i pay i pay my property manager ten percent right of of a thousand bucks it's a long it's long term yeah on short term it's 20 so you would pay your property manager 20 and then the property manager will pay us two and a half percent for example three percent or four percent depends on their size and the products they use okay so let me walk through an example i own a property i make they're going to make me a thousand dollars this weekend i'm going to pay the property manager 200 bucks for that 20 based off your data your numbers of that 200 they're going to pay you 2.5 no so that would be out of the thousands so they will pay us like 25 for example out of the 200 that they made i see i see okay and then for you in terms of in terms of growing the business i want to kind of put this on a timeline to understand history here so when did you launch the company what year december 2013. just okay so it's been a while have you guys decided to bootstrap or you raise capital so we raised capital 25 million to date gosh i mean i liked you i liked you so much and now you tell me you've gone to the dark side and you've raised i don't like you as much anymore apologize i'm kidding why'd you decide your race so we were y company or backed back in winter 14 class and right afterwards we raised 1.6 million as our seed then we raised 3 million as our a and and only now we raised 20 million in in april uh in series b april this year yeah and and where's why why make that 20 million raise why take that dilution how's it going to drive growth um so for us we already had product market fit we were growing pretty rapidly and for us it was just how we can push the gas pedal for scale both in product wise and and you know make our product a lot more uh scalable and a lot more sustainable and also produce new functionality and the second part of it was how can we scale our sales team distribution and get more customers i want to understand more about how you're signing up new property managers right now before i do that they'll paint more of the picture here so a team size today is how many people almost 200 200 folks and based in uh in israel or san fran or where's our own based so our headquarters is tell me of israel okay and uh oh that's your only only location are you guys spread out no we already already have uh three more locations and we're opening six more uh starting next year so we're gonna be at uh atlanta la we already have la which is open way uh we're gonna open in barcelona paris uh rome berlin and why is it why is it necessary for you to take on all this additional kind of office rent opening up new locations so do you have to have feet on the ground to sign up new property managers it depends on what size right so for us there's a lot of property managers who aren't super tech savvy and aren't going online to find their new software provider and and if they're big enough it makes a lot more sense to also meet with them in person and if they're small and getting started they would prefer to meet with someone in person to do a demo and getting you know things like that kicks uh kicked out and obviously until now we were only inside sales so we have managed to grow quite tremendously with having only our sales team here however over time we do believe that they will play out pretty well with our on-site locations and and why did the inside sales playbook work for you if your sales people are connecting with me and i'm a property manager with 50 properties um what does the pitch sound like is it that you're going to help me make more per property so paying you two to five percent is actually well worth it yeah for sure so we not only will help you make more per property we'll also help you scale dramatically so almost all of our customers the average they grow in one year is more than 5x so we will take you on with 15 properties and within a year you'll be at 70. or we'll take you on with 30 properties and a year later we'll look at you and your 120 or something like that so we help a lot...