PadSplit · marketplace for affordable rooms
Keep the first 10 days of rent you fill, then take 8% after
$250M+ a year flows through; growing 70% a year for 3 years
Workedpricingrevenue-capture
What they did
When PadSplit sources the resident for a host's unit, it keeps the first 10 days of that stay to recover a good portion of the marketing cost of finding them, then takes 8% of every ongoing rent payment. It only gets paid when the host gets paid, which the founder pitches to hosts as the key difference from lead-selling 'demand aggregators' like Zillow, realtor.com or apartments.com, where landlords pay for leads.
What happened
Over $250M/year gross transaction volume; 70% YoY growth for about 3 years (not isolated to the fee model)
- Stage
- Current model at ~34,000 units
In their words
Top Founders with Nathan Latka · $30/Night Rooms Make Him $60,000 Per Day | PadSplit CEO Atticus LeBlanc“So, we make money because if we source the resident into that unit, we take the first 10 days of that stay to help recover a a good portion of that marketing expense. And then we get paid 8% of ongoing transactions.”
“So, we only get paid when our our hosts actually get paid, which is a key differentiator with our marketplace compared to what we refer to as demand aggregators like a like a Zillow or realtor.com or apartments.com, where you're paying for leads.”
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More from this episode
- PadSplit: Charge rent weekly, since many renters are paid weeklyNo result given; chosen because it is easier to budget
- PadSplit: Run a marketplace for other owners' homes instead of buying property82 units at end of 2018 to ~34,000 in 40 states, owning none
- PadSplit: Require every listing to be furnished with utilities included, so renters move in fastVacant rooms refill in ~8 days on average; move-in 48 hours after booking
- PadSplit: Partner with a crowdfunding site that buys your best-performing listings from ownersPartner owns many well-performing homes; no numbers
- PadSplit: Run near break-even so you can tell any investor you don't need their moneyClosed a bank credit line on great terms, then an unsolicited lender facility
- PadSplit: Give support agents AI to answer the wide range of tenant ticketsFounder says productivity is up; no numbers