Scott Steps Down as CEO: A New Age for BiggerPockets Money

0:00Welcome to the BiggerPockets Money Podcast. This is a special edition, and today I'm going to share a bittersweet announcement. What's going on, everybody? I'm Scott Trench, CEO of BiggerPockets, here today with a very special guest for a very special episode and my last episode as CEO of BiggerPockets here. And that's the big announcement I wanted to make today is after a decade of leading this incredible organization, I've made the decision to step down as CEO and refocus my energy full-time on BiggerPockets money alongside Mindy Jensen. And as part of that, I'm welcoming the next leader of BiggerPockets here, Ale Ayesteran.

0:39How'd I do? Did I pronounce that right, Ale? Yes. Well, welcome to BiggerPockets. Welcome as the new CEO. Thank you, Scott. I'm super excited to be here. I actually don't formally start until next week, but of course, you know, this is a big milestone for the company. And I'm really pumped that we're doing this this way, you know, actually letting the community know first, obviously lots to discuss, but I'm really excited to be here with you today. Awesome. Well, we couldn't be more thrilled to welcome you. And in a few minutes, we'll get into your background and all those kinds of things. Before we get to that point, I did want to share with the BiggerPockets community some of the reasons why I made this decision and kind of the context behind it.

1:20So we'll jump right into that. The first reason is that this company, BiggerPockets has been more than a job. It's been my passion, my purpose, and for maybe to an unhealthy degree, a little bit of an obsession here for the last decade. I've spent the entire time helping people retire early. It's time to take a little of that for myself here and practice what I preach. So I'm going to take a step back, doing the BiggerPocketsMoney podcast, even foolish time. I think that's the right word, foolish time, will be a much more sustainable workload for me and my family. And I'm looking forward to spending Tuesday afternoons maybe on a mountain bike or on a hike and those types of things.

1:54That's the first part of this. The second reason is I think that folks who've been following BiggerPocketsMoney and me on the podcast here know that while I love real estate, I have an even greater passion for just the concept of early retirement. And I really want to focus on studying a lot more depth into broader portfolio theory, different tactics for financial planning, preparing for college savings, all of those different aspects of personal finance that I really want to add to my skill set here and take that theory for traditional financial planning and perfect it or apply it to the pursuit of early retirement.

2:31And then the last reason, and this one's really important here, is I think that the next phase of BiggerPockets growth here calls for a leader with a different and evolved skill set here to take BiggerPockets as a business, as a platform, and as a community to that next level. And I think there are three areas that we'll really emphasize here going forward. Those three areas are first building a world-class technology experience, especially on biggerpockets.com, and particularly as it relates to personalizing the experience. I think people need to come to BiggerPockets, and if you're a rookie, here's a rookie experience.

3:05If you're an experienced investor, here's an experienced system for that. Second, on that point, I think we've done a really good job here at BiggerPockets in helping new investors buy their first, second, or third investment property. And I think we have an opportunity to do a much better job of helping more experienced investors build larger portfolios, raise capital, or operate much larger businesses, the business of real estate on that front. And then last, I think there's an opportunity to develop a lot more of a broad partnership strategy with many of the technology and services firms in the real estate ecosystem here.

3:45We have plenty of partners that are wonderful here, and I think there's a lot more we can do with a more sophisticated partnership approach. So those three reasons for what I think BiggerPockets needs, in addition to my personal passions and pursuits, were the reasons behind this decision. And we actually began the process of looking for our next leader in December 2024, when I notified the board of my decision to take a step back and end my time as CEO of BiggerPockets here. And we worked this entire time period to find the next leader. I'm excited to, again, welcome Ale to the team here as our next leader.

4:24And I think his experience that fits all three of those needs that I just described so perfectly. I mean, he's got a background in building great technology products and technology-enabled real estate services. His whole background is in helping these more experienced investors and building the operations for huge real estate portfolios over at Mind, where he was the chief business officer and chief operating officer. So with that, Ali, one more time, welcome again to BiggerPockets. Maybe you could round out a little bit more of that experience, that background for folks wondering who you are and what your background and skill set are.

5:00Thank you. And absolutely. But before I talk about myself, I first want to for sure appreciate, you know, recognize and congratulate you starting with Josh and the team at BiggerPockets, past and present on the amazing company and business and community platform that you've built. really the envy of the real estate industry, especially for individual and what we used to call at mine the retail real estate investors in contrast to the larger institutional players. It is just an amazing company and you should feel very proud of everything that you do. I really mean that. And I wouldn't have taken this opportunity if there wasn't a very, very strong foundation to build upon.

5:45Well, thank you. And I'm so glad you mentioned Josh Dorkin. I mean, josh you if you're if you're listening to this built um in there and it's been a true pleasure to join as a early member of that um building off of what you and i'll call out brandon turner here and many of the other content creators really really built uh over the years and and push that flywheel forward to you know we'll talk about a little bit about later about the the aggregate impact we think we've had here at bigger pockets but it's just it's just a been an astounding outcome here, really the privilege and honor of my career.

6:16So super lucky to have that start and foundation poured by those folks. And then to work with everybody else, all the stakeholders, the community members, the sponsors, the team here at BiggerPockets, our investors, everybody has just come together to really build a really special company, I think, here. I'm really incredibly excited. Let's see. About myself. I am originally from Argentina, if you can tell from my accent, I'm not a native English speaker. Grew up actually in the very south of Argentina, in a region called Patagonia, in a small town. So a very idyllic upbringing, I would say. And the reason I even started as far back as my childhood is I really cherish and remember fondly those moments when I was growing up because it really was about community.

7:04This is a small town in the most remote part of Argentina, which makes it one of the most remote parts of the world. You would know everybody, your neighbors, the principal at school, the mayor, the owners of the businesses, the farmers. We were really a strong need community. And I think that has really shaped who I am and what I value, because I only wish for my kids now, I formed a family here in the U.S. with my wife, that they get to experience just even a little bit of what it is to be part of an amazing and tight-knit community. I moved to Buenos Aires right before my university years. I studied engineering there.

7:46That's something you all should know. I'm a geek. I'm a technologist. I'm a builder at heart. And I just was and forever will be an engineer in that sense. I love problem solving, specifically with technology. And after a few years working in Argentina, I actually started to have an international career with the Boston Consulting Group, which is a leading strategy consulting firm working elsewhere in Latin America. I spent some time in Europe based out of Paris, which was an amazing chapter and ultimately came to the U.S. in 2010 to pursue a master's in business administration and MBA at Stanford University.

8:23And that was an amazing inflection point, sort of literally landing in Silicon Valley. You land 15 minutes off campus. I knew right away that I would want to spend the rest of my career and life here. I was fortunate to meet my now wife on campus. She is Mexican and had moved also to start her program. And so upon graduation, we decided to, you know, stay in the Bay Area. We married a couple of years after. We currently live in San Francisco. We have three kids. And both her and I have had careers specifically in technology companies since. Now, as I, you know, look forward, my last chapter was at mine.

9:09And I would say so far that has been one of the most, one of the richest chapters in my career because I really got to flex all the things that I'm super passionate about, all my muscles, if you will. You know, Mind is one of the largest property management companies in the world, right? Could you tell us a little bit about your experience there and what you did? What was the secret sauce behind Mind? Might be a known fact to some of you, but maybe not widely understood that Mind as a third-party property manager, meaning as a company that doesn't own the assets, Unlike an Invitation Homes, you know, think one of the larger owner operators of single family rentals.

9:50Mine manages on behalf of other investors, both retail individual investors, even, you know, single unit landowners to large institutional players that own hundreds, if not thousands of units. and they currently manage very close to 20 ,000 single family rentals all across the US, which is an incredible feat given the variation in geographies, unit types, investors, buy boxes, and preferences makes it quite challenging to account for all those differences. But the secret sauce there really to scale at that level and do it with great outcomes for the investors and with good profitability for the company is with technology.

10:38So I learned a great deal through that chapter, but I'm even more excited to, in a way, continue the mission, which is, you know, my mission is to help individuals achieve their dreams and achieve financial freedom through real estate, which I'm almost shocked. It almost matches one-to-one to BiggerPockets' mission, which is to help individuals achieve their dreams, create wealth through real estate. Another means, certainly real estate, a big, big aspect of the mission. But it is actually doing it at a scale that even though mine is one of the larger property management companies out there, we're talking thousands, tens of thousands of investors, whereas BiggerPockets really plays a part in shaping that journey for millions of members of our community.

11:32But I think that's just the beginning. I think the potential that BiggerPockets has that we have ahead of us in terms of reaching the next million and the next 10 million of aspiring and existing investors, both domestically and internationally, because, by the way, I think this is very much a universal thesis. I think is unparalleled and unmatched. So I'm just really excited to, in a way, continue the mission, but at a much bigger level of scale and impact. I feel like there's a lot of things I'm super proud of. And that opportunity on the scaling property management and operations and helping people, again, turn these small mom and pop portfolios.

12:13That's, you know, the retail investor, the small investor. That's who we serve here, right? I mean, most people in this country who own real estate own 10 or fewer properties. And I think it's something like 70 or 80 % of the single family rentals in this country are people with just one or two rentals outside their primary residence. So it's a huge, that's the population. But how do we help those folks in that next phase, you know, determine which properties to sell, which properties to keep, how to generate much more operating income from those properties and actually have those properties finish that play and make them feel financially free.

12:44And that's why I'm so excited about your arrival here at the home here at BiggerPockets. So, but what are some of the things that maybe you most appreciate about BiggerPockets today? And what are some of the opportunities you see coming up? There's so many things that I'm really excited about. So the business is incredible, but I think it starts because of its community. I think community is really hard to create or recreate or replicate. You earn. You earn community through a lot of hard work really being there for each other, for the members. I'm just thinking, if I were to start a company, and many companies, many founders out there are trying to launch businesses in different verticals, and they only wish they could have a community to build upon.

13:33It's almost impossible to, there's no playbook that would tell you how to create community. it's through the many years of hard work and just being there for the customers for the members and for each other that you create that so the fact that that is bigger pockets starting point it's as i said is the envy of the industry and one thing i'm gonna be very focused on building from is that community which i think is is incredible the power of the brand second of course bigger Pockets has been affected by the macro in real estate. There is no one company, I have yet to find a company in PropTech or real estate that hasn't been massively affected by the macro in the last few years.

14:16And Bigger Pockets is part of this industry, but it has been incredibly resistant, resilient and resistant actually to that macro. And that just shows to me again how much value BiggerPockets continues to create for its members and customers, right? Where the business, despite challenges, continues to thrive. The early inroads, you know, some of them actually, you know, we have real evidence that there's a big opportunity to continue to lean in, as you said, on technology, right? The launch recently of the mobile app. Of course, the forum is at the core of the experience for many members. But I think there's a lot more that bigger pockets we can do with technology to improve the experience and add even more value for our members and our partners.

15:04So there's definitely success to build from, but way more to do. And that gets me obviously excited. Well, you talked about that macro impact. And I think the best way I can articulate that is transaction volume, right? So the number of investors who bought rental properties in 2021 was 1.4 million per our estimations. There'll be different variations of that out there. And we believe that number dropped to 760 ,000 in 2023 and has stayed about the same in 2024 and is within a couple, one to three percentage points of that in terms of pacing here in 2025. Is that the problem you're talking about from a macro perspective in terms of that?

15:47And what do you think is the biggest challenge for investors that's causing that drop off in transaction volume? You know, first and foremost, if you're a real estate investor, you are an investor. And I think so some challenges that we're facing in this industry are challenges that we're facing just because of macro conditions that affect everybody. Volatility. We had the pandemic, crazy supply chain, backlashes, the rate environment and how rates not only moved, but moved at a pace that was basically unprecedented. And so all those macro uncertainty on the economy and some years of high cumulative inflation, those affect all asset classes, all investors.

16:30And so we just are in that backdrop. Now, specifically for real estate, I think rates and what that means for cap rates and yields just has meant that there has been fewer transactions, which is, you know, for us, one reason why members, customers, you know, can't come to the community to learn from each other, you know, to get that content and expertise. So there's less demand for that, for sure. I'm also thinking, like, what happens when those wins change from headwinds into tailwinds? as I was sharing the news of this next chapter for me and talking, catching up with some friends and mentors.

17:08They were like, oh my God, I love bigger pockets. I used to, you know, listen to the podcast. I would go in, I was learning. And I was like, okay, you said you used to, why are you not doing that? Well, that was more actively buying then, not so much right now. So I think the demand is still there. Of course, we are being affected by, as you said, the transaction volume. To me, that's opportunity because those headwinds will turn into tailwinds. But it also makes me wonder how might we continue to help investors, even when the conditions for buying are maybe not as favorable. Might we help them with thinking through how to optimize NOI, how to think through OPEX?

17:46Are there opportunities there? And so I think there's a lot we are doing and we can continue to do, even in an environment where investors, you know, so transactional volume is depressed and more about like managing and optimizing an existing portfolio, right? Because there's always opportunities to do that more effectively. What are some of those, like you said, tailwinds that you kind of think might manifest over the next few years for investors in particular? What's going to help them maybe solve this problem of, you know, I think the way I've phrased the problem is it's hard to make a property cash flow with six and a half or 7 % interest rates at max leverage.

18:21And that is really keeping a lot of people out of the market. Fundamentally, it's really hard to just find something that works at a basic level in that environment. What are some of the tailwinds you think that might change that dynamic or help investors succeed despite that dynamic? Yeah, taking the long view here, which I think is the right view to take if you're going to get in real estate investing, you ought to think, you know, this is an asset class and a play that really pays out over the long haul in terms of just cumulative risk and tax adjusted returns. One is that the industry is being professionalized and institutionalized at a rapid pace.

19:00Now, I don't think we'll get to like in MFR multifamily, you know, to anywhere close to 50 % institutional ownership of rental units. Most rental homes are and will continue to be owned by individuals, by families, by mom and pop, as you said, investors. But the reality is that the institutionalization of the asset class does have an impact. There is almost a Cambrian explosion of new software solutions, service providers that are going and meeting those demands for institutions. But I think then what happens is some of those solutions can be also made accessible for retail investors. I like to think of Formula One and then mass market cars.

19:45You know, the Formula One teams are innovating with, you know, engines and fuel types. But eventually we all benefit from those innovations in the mass market cars that we purchase and drive. And I think the same thing is happening at a rapid clip in real estate where institutional investors have a different level of requirements in terms of how they get the reporting and the data that they use to make decisions, portfolio optimization, asset management, how they go about leasing and managing vacancy and turns and OPEX and reverse and maintenance. And all those solutions, where it's a service provider, a software provider, are increasingly becoming available for us as individual investors.

20:29So I'm excited about really having BiggerPockets be almost that orchestrator and helpful guide to investors in knowing and being aware of, hey, what are some things that I should be looking at that might be helpful to me in my unique situation, right? As you said, that personalized experience. So that is one. It's like there's so many solutions out there. And notably, many are technology solutions, right? New entrants, many venture-backed companies, not all of them. And specifically, of course, with generative AI, where that pace of innovation is almost accelerating. And AI today is the worst it's ever going to be.

21:11It's going to be better tomorrow and then the next day after. and the next day after. And so while real estate is sometimes a bit of a slow moving industry, I think that pace of adoption is actually accelerating, which to me is exciting because that's where I think we can guide each other, guide our members and investors in finding ways to drive NOI despite the macro today. A couple of years ago, there was this thing of like, the institution is going to take over the industry. It's going to be all owned by corporate America. And they get to have institutions on like 3%. of single-family rentals in this country, of single-family rentals, not of single-family homes, single-family rentals, the 15 to, I think it's 18 million single-family rentals, give or take, in the United States.

21:54And, you know, they were net sellers, I believe, starting in 2023. I believe that was the case in 2024. And I believe it'll be the case again here in 2025. So that share is actually diminishing. The retail investor is the one buying most of the inventory for sale here. And, you know, I go to these conferences like IMN, single families rental, rental forum or whatever. And everyone's been on the institution. I'm like the only guy who's like, guys, this is a, this is a bigger pockets, um, uh, uh, industry. Like the people that buy these rentals are, you know, somebody who works a full-time job or has a small business and buys one, two, five, 10 properties over a lifetime.

22:31And there's a small, tiny tale of people who go on to buy, more than those 10 properties in their lifetime. But these investors are, in many cases, every bit as sophisticated as the institutional investor in terms of the specific property that they're buying. They're going to get to know that property is such an all-in bet for this individual. It's multiple times their annual income, especially the first one, two, or three. I mean, these are just all in bets, the terror and fear that go into buying that and the hope that they will appreciate and produce that cash flow in time that I think has generally been rewarded by and large to those investors.

23:12But it's funny that the rookie investor, the people who listen to the BiggerPockets Real Estate Rookie Podcast, are actually the most sophisticated investors on BiggerPockets, even though many of them don't own a property. If you put a test in front of them about real estate knowledge, they're actually the most advanced ones here because of that dynamic. And these powerful tools that were built for these institutional investors, these sophisticated software systems, I think the people who really will benefit the most from them in the end will be the rookie who spent a couple hundred hours listening to a bunch of podcasts, reading a bunch of books, getting fairly sophisticated and is ready to use that knowledge.

23:53knowledge and that and and i think that there's a really good application for those and i think that's where that partnership angle i was discussing earlier comes in and obviously your your knowledge of that space is going to be so critical in translating these solutions that have been built hundreds of millions of dollars invested in many of these solutions and helping to make them accessible to the bigger pockets members yeah there was a lot of fear mongering about you know wall street is out here to to get our homes the data doesn't show that in fact there's actual research that shows that when there is increased levels of institutional investment into SFR, that actually helps community because they will typically rehab stock, you know, improve ultimately, you know, those homes and neighborhoods and create more rental supply for folks that don't want to or can't afford to actually buy.

24:44And so we can talk, obviously, probably a whole episode on that. But I 100 % agree that just because of how they configure a buy box and the fact that they need to deploy capital at scale, they have to work with pretty narrow buy boxes, three bed, two baths, right, in certain locations. And there's so much alpha you can get if you're going to approach investing that way, which they have just because of the amount of capital. But as you said, if you're going to buy one unit, two to three, right, over the course of some period of time over a few years, you can really find those unique opportunities that would fly under the radar where institutions can't actually access.

25:25So, yes, it happens that sometimes you lose out on a deal that is also being considered by an institutional investor and they can pay cash and they can move quickly. But, you know, next to that deal, there are going to be many opportunities where you being local or partnering with folks who really know that market can help you find that alpha. And that is what we see in the data, as you said. Most investments, most purchases of rental units are still done by individuals. Awesome. What are some of the first areas that you're going to dive into here in terms of exploring as the new CEO? First, I'll say that I'm really excited to build from a very strong foundation.

26:04And my first round of business will actually be to listen and learn. Obviously, get to know our team, talk to them, learn from our customers, our members, our partners. And I'll just put it out there from day one. I'm a big believer in feedback, so I'll be seeking out feedback. You'll find me in the forum. So, you know, there's, you know, any way that you feel comfortable with reaching out, please do so. I want to hear from you. Now, in terms of opportunities, I'm excited to actually, you know, I think we can invest really a lot in one technology. I can only imagine what would an AI-enabled experience look like in the forums.

26:41You know, it's so funny. I got to chime in here. The bigger pockets, we have spent the last 10 years that I've been here building a lot of cool features. We built 100 features over there. Some of them people have completely forgotten, never used. No one cared about. We built them. We spent a lot of time on. Some of them are integral parts of our site and are major revenue centers and clearly driving a lot of value for customers as well, like our agent finder, for example. But we've never figured out how to say, oh, you're on the site looking for this. Here's how to instantly find it. We just have like a big navigation bar in that.