How REISift CEO Tyler Austin grew to $5.4M revenue and 1.3K customers in 2024.

hey folks my guest today is tyler austin he's a husband father former air force serviceman and a seven-figure real estate investor and also today the founder of rei sift a bootstrap sas company in proptech helping real estate investors scale their sales and marketing he also holds bachelor's degree from florida tech and computer information systems all right tyler are you ready to take us to the top let's do it all right so what got you in i imagine it was your own real estate investing but what got you into real estate in the first place um i got tired of traveling 50 of the year uh for the government basically so i started dabbling in real estate and you know wrote my own scripts because i was a cyber guy by trade um to solve my own problem and that kind of ended up slowly developing into hey other people want to use that basically and so tell me about those people who are your customers today so our customers today is more than what we originally thought out to be was originally uh you know real estate investors uh wholesalers in real estate people who are doing a lot of outbound marketing direct to homeowner um so that's a lot of and i would say probably 80 of our customers are still those types of people but now we also have a lot of real estate agents starting to use this as well and um even companies like roofing companies anybody who who wants to learn more about uh and do more efficiently you know you know direct to homeowner marketing okay and so i imagine tell me about churn there right a lot of people try this stuff when they churn quickly because they just they don't have them you know they don't have a hustle yeah that's dude uh initially it was um it was pretty tough but we're actually at like a five percent churn right now which uh uh with micro smb customers which is a lot of what we have a lot of you know people getting into wholesaling right yeah i want to get into you know real estate let me go ahead and you know throw like 200 bucks at it um and it was a big problem uh initially and we've really went from about you know 10 11 churn down into that five range and sometimes we get about six percent but that's monthly yeah but you know from from uh it makes me feel good because i think a lot of people in our space some of our competing products and uh others that are similar in our space um you know there's floating around you know nine or if not 17 18 so i feel good about it and so what do you charge i mean what are these customers paying on average per month to use your technology so we have a base plan of 49 a month um that has a restriction a lot of restrictions in it and then we have a 99 a month and then a 299 a month when you average that all out what do you say like the sweet spot is uh our sweet spot our our uh average from where our customers are sitting a lot of them are in that professional plan we did some adjustments to get a lot more people in that mid-tier plan at 99 but i would say a good split and spread is uh 25 in essentials um you know 45 to 50 in that professional plan and another you know 25 to 35 percent in that business plan so so make those conversations make those numbers easy for me then the average customer is paying 100 bucks a month oh yeah yeah our poo is about 100 100 bucks a month yeah okay interesting take me back to customer number one when did you guys launch and how did you get the first customer so we i officially called it rei shift in uh like february of 2019 i believe uh our we pre-launched and and i did a youtube video i ended up getting like 50 customers um that paid us before there was any product and so that got us to about 2500 or so mrr um and we officially launched in september of 2019. sorry 2500 or 25 000 an mrr 2500 nmr okay that yeah um and so then uh so that got us uh there uh and then in really our big growth catalyst was in around june of 2020 we launched a challenge funnel essentially and um and that was where we started really getting a lot of retraction to kind of teach people how to really do you know real estate marketing teach us how that works it's very popular on the inner circles but the common sort of staff member does not know what a challenge funnel is yet yeah so what we did is um i realized that a lot of our turn was was because of uh micro smb you know entrepreneurs not being good entrepreneurs so we had to fix the the mindset of the the customer coming into the gate about business not really about our product um so we created a challenge to solve that problem called the auto legion challenge where in the um where we marketed it as hey you have a problem getting leads come in and and we're going to teach you how to get those leads but the first you know week and a half of that challenge is actually how to actually set up your business you know what kind of revenue do you want to make how do you even calculate that kind of information so that gets them adopted and confidence into what they're doing and then we say okay cool now you have the foundations to know where you want to go and you know what to do to get there let's teach you how to actually implement it and we use we teach them how to implement you know generating leads through using our product um which adopts them into you know the product itself and understanding it and how to use it and then at the end of that product we have essentially an upsell or that challenge is an upsell um to put them in sorry what's the challenge though tyler is it how many leads you can get over a 30-day period um no ours actually our challenge structure is two weeks of education on how to how to market how to properly bring in big data and get it managed and then get marketing to it and then the second half of it the second two weeks is um actually marketing to see how many total you can get so we kind of split in half we market it as a 14 day challenge but once they get into we're like psych it's actually a 30 day challenge 14 days of education and 14 days of of actual like doing the work so how many leads did the winner get of that challenge um we do it we do it every single month so we've had people that have come out of it making a hundred thousand you know some even even more than that um closing multiple deals through the challenges and i mean we have we've had like i don't know somewhere around like three or three thousand or so people gone through that challenge since last year um a ton and every every month we have you know it's a rolling challenge now so we basically automated it but here in january uh we do like a reset for the year where we're going to do the challenges live again to bring in a bunch of new revenue from the customers we already have plus bring in some new update the content because as your product updates right and we have a lot of new features we've done since last year um so we need to update the the challenge to get you know more of that feature adoption in so you guys there you have it the question for you is uh what challenge can you launch in january that gets your you know customers excited but also by nature almost by default gets them using your product more to decrease churn so three thousand folks in there now that winter uh tower that might take home a hundred thousand bucks in terms of just revenue from a challenge how many leads is that usually from you know because of the way that we teach how to market in real estate um you know it's a lot different than nutritional norm a lot of times they have to get you know 75 or so leads to get like one deal and a lot of times it might only be you know seven to ten thousand dollars on a deal um the way that we educate we teach people how to find like the one percent of the four percent of people who might want to sell to you right now um so they really narrowed down their marketing and they might you know only generate 10 leads but they get a deal from it so that's a big part of what we teach is is happening so what would that winner do how many leads that winner do the hundred thousand um it just really depends if someone got if someone locked up a real estate contract and they got a hundred thousand dollars from it it could have been their first lead it could have been their tenth or fifth i'm not quite sure what in the scenario of that person but i mean people close deals and enduring the challenge all the time so i see um yeah it's hard to started to pick yeah okay so challenge is working nicely how many customers are you serving now today um right now i actually had it opened up um here we have active customers thirteen hundred okay thirteen hundred so that would put you at what about a hundred thirty thousand bucks in revenue right now um about 140 yeah 140. okay very cool and where were you exactly a year ago uh exactly a year ago let me go back i'll tell you exactly it was probably like maybe 40 or so maybe okay and then go back to 2019 where you get like four or five grand a month in revenue back then so what are we in we're in november right now so july september october november of 2020 we're at 38 and in november 2019. in november of 2019 we were at 3754. very cool all right so with this skill have you bootstrapped or did you raise capital fully bootstrapped dude congrats yeah i love that thank you yeah i i put i at the end of 2019 i had thirty thousand dollars left over from some real estate deals that i had done and i basically instead of paying off some debt i threw it to an account to start rei sift that was amazing so do you 100 of the business yes i do wow who built like the tech do you have a like engineering co-founder or do you code um i coded originally but i know how to break things i don't know how to build things very well um so uh i i ended up into it originally like using some people off upwork and that didn't go very well um and now i have a team half of us are in brazil and half of us are here in the u.s in my office how do you find the folks in brazil um so upwork and just slowly you know talking to the right people essentially word of mouth um got to me to the right back-end developer and after i got that back-end developer um he happened to work at a specific company um that happened to know other people and we slowly kind of you know built our team that's how it works that's always how it works how many folks are on the team today um this year we'll have 10 full-time uh five of which are usw twos and the rest are contractors very interesting okay and so if you look at total headcount expense in november it's december 8th they were recording this what like what'd you spend on just people at last month so salaries and we spent about 40 000 on the dev team product and dev team and then another 12 000 on on uh no they're closer to 16 000 at w2 our total company expenses monthly is about 60 000. okay so you did 140k last month right so so personally i mean this is where you want to okay so um we actually um year-to-date this year revenue-wise right about 2.3 um so we actually have um a good credit system in a bunch of other ways internally that we build revenue so mrr wise 140 but there is about another 60 to 80 000 or so it was like 220 000 last month we did total yeah from selling what like one-time stuff courses trainings um like credit system we have in there for skip tracing what is that right so like um people upload like a thousand dollars and then they'll use that thousand dollars to get phone numbers of homeowners or send direct mail to homeowners so we have a whole like a marketplace internal to the product that's so we maybe call that like pay as you go revenue they're buying credits and using them up yeah to verify a mailing address they want to send a letter to yeah more or less interesting okay cool okay so same question right so you did 220 000 last month your total expense are 60k right so what are you doing with the 160 thousand bucks personally as a bootstrap founder this is where you want to be a lot of profits what do you do uh i put about 40 of it in my tax account um and then i distribute the rest so that a lot of bootstrap founders won and sent 13 but they don't know how to set up a distribution plan yeah so there's a few things so this year um i've kind of looked at my teams and in across the board and i've decided to do raises on all all everybody in my in the company in general five percent minimum uh raises um and then outside of that i i distribute most of it to me personally um because of you know my my objective and where i want to go with the company and me and my own investments in the real estate side um so uh basically the way that i look at it is is uh you know i want to incentivize the team i want to make sure that they're they're feeling committed and that they want it um but what i've also started to do is um gave everybody a tech budget now too as well so we didn't have that original so everybody has a five thousand dollar tech budget that they can use for their home offices and everything else um and then in addition to that um we're trying to create other bonus programs like holding back two percent of our revenue month monthly as well for uh at the end of the year doing something bigger for for the whole team and stuff like that so we're trying to really build that out we just hired a head of people ops to really focus on a lot of that core culture because we have a really good product culture but we were kind of like lacking on you know internal company culture so we're really trying to focus on that right so if you hold back two percent per month i mean that's like 5k month or about 60 000 bucks per year right what do you think you might do with that next december like how would you split that among your team members do people in brazil get some out or just the 5w2s yeah no people in brazil will as well um so part of it is um are in person so uh we're working it really tight it's been kind of hard with the whole you know global you know situation we've had in the last two years but they were just here in the us we brought other developers in the us we do a mastermind twice a year a lot of our our users come in they pay money uh they come to our office and we mastermind um in the braz uh people in brazil came in uh three of them did and so that you know some of that money goes through that you know bringing them in to to be here in person for some of those q4 meetings um other than that our plan right now as of right now depending on how things go next year is uh to distribute some of that as bonus revenue um but more than anything uh it's going to be focused towards culture and i don't know what that answer is yet but i'm hoping it's some sort of like um you know as a team as in a retreat right um because i plan on using separate revenue for bonus revenue i want to dedicate that to uh retreat so taking a step back again because i love bootstrap founders like if we were to sort of categorize or describe the business of tyler it's sort of software revenue very high margin dividends out to you personally which you then reinvest in real estate as maybe a hedge against like the software business and those are really too your personal net worth is really split mainly amongst those two things yeah my personal net worth is split um you know on building that uh you know personal expenses and passive income from real estate you know above that so that all those distributions that i get you know from my uh real estate company and my software company because i still do a lot you know flips and i still do real estate myself not just buy deals but mostly now um it's you know taking all that revenue getting that passive income and then and then taking that uh distributions to be able to you know have to dissipate out there i put a lot of money in whole life policies now uh index funds regular stock market you know five percent into crypto and then um and and so i have a whole diverse vacation that i like to try to do but most of it's about 40 of my revenue goes into your real estate very cool i mean this is the life man i don't know people hit founders like you all the time they go oh well tyler's not vc backed like he's not on techcrunch you know what look how happy tyler looks you want to be like tyler tyler's tyler's it's way easier and less risky to build a 5 million dollar sas company than it is to go try and raise 500 million and build a billion dollar business that you own like one percent of at the time you try an ipo so kudos to you and what you've done how have you resisted i'm sure you get outbound all the time or inbound all the time um i i have to get so not many people know about rasif even in the real estate space i mean we have uh we're slowly people are hearing about are you talking about with offers like getting off yeah there's a vcs wanting to invest yeah yeah so i've had people looking to invest um i am looking now um to put on probably an advisor um and so i and my core dev team the guys in brazil i am looking at uh right now doing and giving them some equity to maintain them long-term and you know we want to build other projects together so um but as far as like receiving revenue it's just it's not something i technically you know need i'm sure there's things in mainly because i probably don't know what to do with it to be honest with you if i would receive 500 000 right now i really wouldn't know how to like impact that in my business so um we are looking to hire a marketing person right now because we've done zero marketing to date you know so it's like how people found you then uh facebook word of mouth where on facebook are you have a big group or something um we have a personal group but no it's you know we we have um you know some people that that used our product that ended up having groups and so they uh how do you get the original folks i just need to know them from like mastermind groups and stuff like that so like once i go to one mastermind i talk about it and then they talk to somebody else and it kind of just slowly spread and they're like oh there's this challenge and then from those they talk about it and then just i don't to be honest what's the top mastermind that you're in um on the real estate side or the software side i'll actually give one on each um software side sas academy and on the um real estate side i actually am not part of a real estate mastermind i have my own now and that's it okay very cool hey we're out of time tyler this is great let's wrap up with your famous five number one favorite business book um shoot if you don't have one that's okay i probably do but i just lost it my favorite book right now that i'm reading is uh breathe the loss uh science of asian art that's a good one number two is there a founder you're following or studying uh trevor mock i carrot yup he's a good he's not an investor is he you're bootstrapped right i am bootstrapped he's not even he would kill to write you chuck you know that number three what's what's your favorite online tool for building rei um the tool we use the most is slack so i'm just gonna say slack number four how many hours i sleep to get every night uh right now between nine and ten okay and situation married single kids i am married with a six-year-old and a four-month-old boy wow busy guy how old are you i'm 29 29 last question something you wish you knew when you were 20. um there's more outside the military guys there you have it rei sift he you know built it really to solve his own it scratches on it easy on dog food launch about uh call it uh two years ago went from thirty eight thousand dollars a month in revenue a year ago to two hundred and twenty thousand dollars a month today profits 160 000 per month which he plows back into real estate serving 1300 customers that want to launch their own real estate businesses he's teaching them with challenges he's onboarding them for free no cac right now uh mainly free stuff via facebook groups team of ten five uh in brazil five here in the states as he looks to continue to scale tyler thanks for taking us to the top hey thanks man appreciate it one more thing before you go we have a brand new show every thursday at 1 pm central it's called shark tank for sas we call it deal or bust one founder comes on three hungry buyers they try and do a deal live and the founder shares back end dashboards their expenses their revenue arpu cac ltv you name it they share it and the buyers try and make a deal live it is fun to watch every thursday 1 pm central additionally remember these recorded founder interviews go live we release them here on youtube every day at 2 p.m central to make sure you don't miss any of that make sure you click the subscribe button below here on youtube the big red button and then click the little bell notification to make sure you get notifications when we do go live i wouldn't want you to miss breaking news in the sas world whether it's an 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