179. Using AI to DOUBLE Your STR Revenue?! Interview with Matt Sanderson

17:00Natalie Palmer:Yeah. Which is something we're already doing. Like we, we underwrite deals at the median projection, right? We're always like, here's the low end. Here's that high end. This is the median. And we want to make sure the number is pencil here. And it takes hours to do hours and like how many properties start getting underwritten and then don't pass the test. And it's like, okay, throw that one out. And we're starting over and finding a new deal. So this is, this is insane. I can't wait to see this.

17:26Matt Sanderson:So like another example is say you find a property. so like imagine zillow with an ai feature built on top of it like what i told my design team is i want to build our product as if zillow and airbnb had a baby like that's what i want it to look and feel like and that's what i just showed you before we got on the call i mean it it looks very similar to like a zillow airbnb experience and it's simple like that's the biggest thing for me is i just want it simple but imagine you know you get on there and you find a property and you're like oh my gosh, this thing can make like 150 grand, 15, 20 % cash on cash.

18:03Matt Sanderson:Sweet. Okay. Well, now I'm going to pull up my AI. Hey, can you, hey, strike, can you show me all the top comps for this property? And it'll show you like the top five to 10 comps, highest revenue. Okay, well, cool. What's unique about these comps in this market? Well, this one's, you know, close to Main Street, or this one's close to these attractions, or this one has really great views or whatever. Okay, cool. Well, based on this property I found, Strike, what amenities do you think I need to add to my property to get to this revenue threshold? Okay, cool. Well, how much capital do you think I need to spend or budget for based on those amenities or design?

18:42Natalie Palmer:Oh, my gosh. Okay, cool.

18:43Matt Sanderson:Can you update my underwriting so that the deal actually pencils and I'm actually able to cash flow what I'm trying to target? I mean, the entire experience can be infused by AI. based on these scenarios you're trying to go for. I mean, it's going to be cool.

19:00Natalie Palmer:You could even do it like instead of asking it the open-ended question of like, okay, how much capital do I need to improve it? Could you put something like, I only have$50 ,000 to invest in amenities, which ones should I prioritize? And then how much will that help? Like have it actually like customize the plan to your needs?

19:19Matt Sanderson:Exactly. So, I mean, for sure you can, and it'll show you which amenities might drive the highest ROI or revenue uplift is what we're calling it. So we already have some of that already factored in now, but again, intelligence tier is going to come out probably like summer, maybe fall of this year. There's already things we're building in now just to kind of tease to the market. But yeah, I mean, those are all things we'll be able to do later this year.

19:45Natalie Palmer:Very cool. What are you hearing from your community right now, people who are beta testing it already? What are they saying so far that they want to see or like what's what's working? What needs tweaks? I'm just so curious of like what the behind the scenes conversations are.

20:02Matt Sanderson:yeah i think the biggest thing is like data can tell you what it is but people still deal with like fear and so even if even if the data is like screaming at you like oh my gosh this deal is incredible people are still dealing with like am i sure like you know can i trust it and i trust and that's the problem like you know people are like i don't know if i trust air dna i don't know if I trust Mashvisor. I don't know if I start. So like there's a fear and trust problem that just is kind of just always going to be around in this industry. And so our main objective is to solve the confidence problem or to solve the fear problem with confidence.

20:43Matt Sanderson:And so we built something unique to strike, which is called the strike score. And so one thing we did to help solve this is to basically rank every single property on a scale from zero to 10. and give it a rating from 0 to 10, and we're calling it the strike score. And so right now, the score is made up of cash-on-cash return to give it a higher score. So if it's like 20 % cash-on-cash return or higher, it'll be closer to 10. But what we're going to do over time is we're going to infuse that through AI insights of all sorts of stuff. STR regulations put into that score. We're going to add in cash flow potential, revenue uplift potential, market trends, all sorts of stuff into that strike score so that the investor is able to make faster and quicker decisions with more confidence because of all this packed into one metric that makes it easier for them.

21:42Matt Sanderson:So that's one thing we're hearing from our customers is it's just overwhelming. It's they're scared, all this stuff. So what we're trying to do is really simplify it and give them a very digestible number so that they can pursue it much faster.

21:59Natalie Palmer:So that number, the strike score, I'm curious how it gets ranked. So let me explain what I'm trying to ask here. I've noticed, let's talk about on Airbnb, right? It's very interesting to me how you can have a super luxury seven bedroom home in Scottsdale with a private golf course and stuff. And that rating will, that property will be ranked 4.95 or something. But then you can also have a very budget friendly one bedroom studio, mother-in-law suite that like you can't even find parking for it, but that one will have a 4.95 star rating because it's just so accurate in the expectations and the pricing is on point.

22:46Natalie Palmer:And it's a totally different experience, but they'll end up with the same ranking, even though they're totally, totally different. I'm curious how this one to 10 score, is this similar in nature to that? If you put in that your budget for a property is only, you're looking in the$300 ,000 range and somebody else is looking at the like million dollar range for properties, how would that strike score like be reflected? Does that make sense what I'm asking? Like based on your tier, is it just like the top properties are getting the nines and tens and the lower ones are getting worse or it's stabilized because it's only looking at cash on cash return and not the actual quality of the property?

23:31Yeah.

23:32Matt Sanderson:So yeah, I mean, great question. So if you think about like what matters to the investor, and that's what the score is really trying to accomplish is what does that investor actually want?

23:44Natalie Palmer:Okay.

23:44Matt Sanderson:If you go back to what investors really want, I mean, you know, what I've learned through just a lot of conversations and love your feedback on this is they typically want one of four things and it's either they want cashflow because they want to replace their income. So So I oftentimes hear, hey, I need$2 ,000 to$3 ,000 a month in net cash flow or$5 ,000 a month in net cash flow or more. You know, cash flow is a big deal to a lot of people that are trying to get in this game. Wealth building, just, hey, I want to park my money somewhere else other than the S &P 500 or whatever investment that they're doing crypto.

24:17Matt Sanderson:And I want to park it in real estate because it's different. And I want that debt to be paid down by someone else and it to just depreciate over time. The third, tax write-offs. How much can I get an instant ROI because of this tax write-off? And then the fourth is usually memories or experiences, which not every investor wants that, but it's a really incredible nice to have that's very unique to this asset class. For sure. I love it. So if you think about those four things, cash flow is really the biggest one. And so that's going to be a heavier metric in the strike score is, hey, what is that cash flow potential of that property?

24:57Matt Sanderson:Now, if you think about cash flow, that's more related to expenses and revenue. But we do need to factor in, hey, how much capital is it going to actually take to drive this type of numbers? And so we're going to actually have projected capital for each tier that's going to be built in as well. So again, no number on, at least on the capital or expense side will be like 100 % perfect, but it gives you rules of thumb to like get there 90 % of the way. And then what I tell people is like, hey, you found this property in literally 60 seconds, which would have taken you two weeks or two days, whatever, to find.

25:34Matt Sanderson:Now that you found it, go find that local agent or that expert or whoever it is, your coach and just go verify and validate that data so that you can go under contract tomorrow. So, you know, anyone out there, use Strike to find it super fast like today, but make sure you still go validate and verify with comps and that local expert before you go execute on it, unless you just know what you're doing.

26:02Natalie Palmer:Do you guys have any data of when, because Strike is only showing for sale properties, right? It's like Zillow. Like once it hits the market, then it enters your database. It's on the MLS now and that's when it gets analyzed. Do you happen to have any data on how quickly properties are going under contract that show up on Strike? I'm just curious, like with this AI feature, I wonder will people even have time to go ask their mentor? I feel like things are going to start getting snatched like so quickly.

26:30Matt Sanderson:Yeah, I know. I mean, so we haven't rolled out the AI stuff to the public yet. So it's only for beta testers and founding members currently. Now, yeah, I mean, through AI, I mean, when people start to catch on that you're able to find like these deals are revealed to you like instantly, like I'm getting Wall Street people, institutions coming to me saying, hey, can you have me on like deal alert? We're like, y 'all are sending us deals. So all of you individual investors out there, be aware that wall street and these big institutions want to get into this game too because the returns are huge and a ton of capital partners that want to go raise money want to get in this game as well and so i've told people there's no shortage of money out there that are looking to get into this the problem is it takes a ton of time and knowledge to know how to find these deals and to underwrite them to unlock that capital.

27:28Matt Sanderson:So right now, there's still an opportunity to beat out the big money because the AI hasn't gotten there yet with other tools. But you're right. I mean, when AI and the data is democratized, then it's anyone's game. But that's our entire mission is, I had someone come to me the other day and they're like, wait, Matt, so you're literally anywhere in the country, you can find the best deals anywhere for sale and I'm like yes and he's like why don't you just keep this in house and like go raise a bunch of money and go buy these deals or like go like sell it for a ton of money to institutions whatever and I'm like because at the end of the day the entire mission of like why I'm doing this is because I my life has been blessed because of short-term rentals I'm like a son of a farmer like I grew up from nothing I did not have like a trust fund And my life's been blessed.

28:25Matt Sanderson:And I truly do want to help other people just like me get into this game, which, you know, I'll help the institutions too. You know, it just happened. But I really deeply love the individual investor and want to help the individual. So we're trying to democratize these institutional type of tools to give, you know, to you guys in y 'all's hands. So that's really the heartbeat of what we're trying to do.

28:48Natalie Palmer:Well, even selfishly, it's good you didn't keep it to yourself because the product is so much better now based on feedback and the community and this whole concept that you're building the plane while it's in the sky already. You wouldn't have this product if you had just kept it for yourself. So we all win by you sharing it with everybody.

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29:43Matt Sanderson:What's something that's really cool that's kind of coming down the pipeline, which again, these are more kind of idea phase, but this is why I'm a deep believer in community because we started something called the Strike Squad. It's a free community for people to just kind of jump in and start learning and just kind of building that network and connections. But a couple of things kind of happen when you bring the community together around a tech platform. So if you imagine like Waze. You can use Google Maps, Apple Maps, or you can use Waze. Well, why do people use Waze? You can usually get your destination faster.

30:16Matt Sanderson:Why? Because it's crowdsourced information from the community helping each other avoid pitfalls, potholes, and police cars and all that stuff. Well, imagine if the community came together, the strike community came together around a unified product and tool, and we were able to crowdsource information around STR our regulations, comp data, and we became a sharing community with a centralized technology. I mean, imagine how much better that would be for all of us. So that's really the direction we're going is trying to bring the community together so that we can help each other versus just buying deals in isolation.

30:56Natalie Palmer:Yeah, that's a great idea. I'm just thinking like the deals, you know, my listeners will know I've been working with Maddie and Skylar for the love of Upstate. And right now, the properties that we are investing in in upstate New York, they do not pencil in AirDNA. I've talked about this on the podcast before. The data does not support it. And we're having better luck finding investors now because we're basically using our own properties as a data set.

31:23Matt Sanderson:Yeah.

31:23Natalie Palmer:But still, if you go on AirDNA, it shows that the properties we're investing in are going to do like between 50 to 70.

31:30Matt Sanderson:Do you know why they show they won't pencil?

31:32Natalie Palmer:Why?

31:33Matt Sanderson:AirDNA, I mean, I don't want to talk, love AirDNA too. The problem that they have not solved yet is they forecast every single property with average revenue. So again, it goes back to that range of revenue.

31:49Natalie Palmer:You're not doing the percentiles at all.

31:50Matt Sanderson:You don't do the percentiles, which is a huge problem. It's like you and I, you could go buy the same property I did, but we could perform drastically different because I may not know what I'm doing. You might be the expert and be like, no, we need pickleball court. This is going to be a wedding venue, blah, blah, blah. And you might make$100 ,000 a year more than me just because you know how to do it.

32:13Natalie Palmer:Yes. And the revenue shows you that.

32:16Matt Sanderson:Yeah.

32:17Natalie Palmer:Yep. Yeah. And so the first few properties that we were trying to get investors for, it was just such an uphill battle of like, where are you getting these numbers from? And it's like a hunch. Just trust us. Trust me, bro. We've done this for a while and we know what we're doing now that we have our own properties as a comp set it's so much easier but that's i love this idea of like mixing the like ways capability and like hey you know is there a policeman still there like if you could just like put like a little question of like i don't know how you guys would do it but almost you know what would be really cool is if you could i know like on zillow you can do this like when you go log in and look at a property one that's not for sale, Zillow will ask you, do you own this property or do you want to claim it?

33:01Natalie Palmer:Like, I'm sure you've seen that question pop up. I almost wonder if you guys could do something like that, like claim a property and then maybe you get questions about it. Like which amenities did you end up putting in, in this property? How's it performing? Like if you could combine some of that data and then it would like really show the difference. Cause right now, where does the data, I don't want you to give away all the like behind the scenes, like all the trade secrets, but where do you guys source data from right now? Like how do you know what amenities a property has or what will make the difference?

33:32Matt Sanderson:So this is where I think the secret sauce is and where I think things could get interesting if the community is willing to come together. So right now, again -

33:43Natalie Palmer:I feel like some people won't be. Well, I never know.

33:45Matt Sanderson:I mean, not everyone will. Okay, I was in commercial real estate 13 years, still am. You buy and sell these huge office buildings, industrial buildings based on real comps, real leases, real data, right? In Airbnb, we're making decisions on projected hypothetical estimated data. Now, where things could get interesting is if somebody, maybe Strike, is able to crowdsource real data together and have that as a platform for everybody's benefit. So right now, I mean, all the players out there, they're all scraping data. So they're basically scraping Zillow. I mean, not Zillow. I mean, some are scraping Zillow too.

34:37Matt Sanderson:Airbnb, VRBO, Booking.com, TripAdvisor. And they're aggregating all this information from a scraped estimated perspective, which is pretty accurate, but it's not perfect. And coming up with their own assumptions for that. or they're partnering with like property managers for the real data, which again, property managers out there, some of the big ones may not be as good as operators as like the local individuals. There's some good ones, there's some not. So they're kind of doing a combination of that. But imagine a world where you're not only scraping and syndicating data from these partners, but you actually can crowdsource it from the community.

35:17Matt Sanderson:And there's some ways we're testing that out right now. But I think that's where things could become extremely valuable because I, at the end of the day, I think the most valuable thing that a technology provider could provide in this space is comps. Like the comps are extremely valuable. So that is something, you know, we're exploring right now and, you know, we'll see where it goes. But imagine real comps paired with AI for that investor. I mean, that's where things go, you know, incredibly valuable for everyone.

35:51Natalie Palmer:I have a question for you about direct bookings. So, I mean, I think it's Airbnb and Vrbo still probably 90 % of all short-term rental bookings happen through the OTAs. But direct booking is growing more and more. And I'm wondering, like in those cases, it's interesting because the players that are killing it on direct booking are probably the ones in that top 1%. And that data is decentralized. Like you don't have it. You can't just scrape Airbnb. Like there's thousands of direct booking sites. So is that something that you guys can pull data for? because that would really, the direct booking sites that are killing it and have built a brand and are in that top 1%, those are the ones that are like edging out at the top percentile and can show you what's possible.

36:44Natalie Palmer:But how would you guys even gather that? So, I mean, when you think about direct booking, like I've got a direct booking site too, but it's integrated and connected with

36:54Matt Sanderson:my Airbnb and VRBO. So I guess my question for you would be these direct booking sites that are only direct or are they also connected to airbnb and vrbo yeah i guess if you can and they're

37:07Natalie Palmer:probably using price labs still or some pricing algorithm even on their direct booking site so yeah maybe you're right if everything's still all api connected it doesn't yeah so even if you

37:18Matt Sanderson:have the only way we would not be able to capture information is if it's legit just a direct booking site that's standalone not not connected then it's like okay we probably don't have that comp. But if it's connected to Airbnb, VRBO, any of those platforms, we probably have the comp.

37:35Natalie Palmer:But if somebody's booking, like, let's say some property is crushing it and they're doing 50 % direct bookings. On Airbnb, it would only show that the calendar is blocked for five days. But on the direct booking site, they got booked for five nights. Would you be able to see like what price they got booked at?

37:54Matt Sanderson:Yeah, I mean, it'll show the price before the booking. And so, So, I mean, yeah, it's getting into the weeds. But essentially, when you're running scrapers and you're running things, you know, pulling comps, it's able to do this on like a daily type of basis. Okay.

38:11Natalie Palmer:So, at some point, the price would have been there and you guys can capture the data. Then it disappears. It's grayed out because somebody booked it, whether direct or not. So, you know what price most likely it would have been.

38:21Matt Sanderson:And our revenues are actually adjusted for how long that listing was actually available for that entire year. So if an entire year is 365 days, but something was blocked for 50 days, we would adjust the revenues based on what was actually available for booking. So we don't have these hypothetical revenues that are extremely high. we also account for, you know, if that listing was not available for a certain amount of time.

38:54Natalie Palmer:Okay, okay. Yeah. And I'm not trying to get like too technical here. But that's just one segment that I know the players crushing it on direct booking are that top 1%. So like, it would be such a shame to have that data just not accounted for. But it sounds like that's not an issue. Okay.

39:11Matt Sanderson:Here's what I think people should hear. And you know, you can pull up, you book a demo with me, and I could literally run your property, any address you could give me and I could run revenue and analysis for it, an entire range. And so what I do is I say, hey, let me run your number. Let's test it and you can compare to AirDNA or whatever these providers are and see. And what the cool thing is, is that because we have that range, I'm not saying, hey, Natalie, your property can make 50 grand. I'm saying, hey, here's what I think it can make based on this range, based on all these comps around, but it really depends what amenities and experiences you've provided.

39:53Matt Sanderson:So based on what I'm seeing, you could probably make the 80th percentile, which is$90 ,000 in revenue. And so as an example, I did this exercise with Michael Elefante, who's a partner with me. I was like, hey, test out some of your properties versus what you saw in the past when you're underwriting these. And he actually sent me a text the other day. is like dude like your your data is actually more accurate on my properties than air dna and i'm like sweet well that's awesome that's good validation so we're hearing from our customers that and i don't know if it's in every case but in many cases that when you type in your property to get a revenue estimate it's more accurate with our comps dashboard than even air dna and so you know if you don't believe me you can try it out and we can run any property for you and that could be something we do for free on a demo if you want to.

40:41Natalie Palmer:I was literally just going to ask because you mentioned that the biggest deterrent for people actually like investing in a property they find on the dashboard is fear, like wondering if it's too good to be true or how can I trust this. So I was going to ask you if you have any case studies. So that's awesome that Michael was able to validate the data. Do you guys do anything where if somebody, maybe you have this feature already, but I'm almost thinking because people can like wishlist properties on strike, right? Like you can favorite one and come back to it. Yeah. You guys should do something where like after 30 days or whatever, it prompts them like, Hey, did you end up buying any of these?

41:19Natalie Palmer:Did you end up investing in any one of these that you, that you hearted and like, keep us posted almost something like what's the data, like some sort of way to just check in and be like, did this end up being accurate for you?

41:33Matt Sanderson:Yeah.

41:33Natalie Palmer:I think that that's really cool that like Michael was able to show like, oh yeah, this, this data like actually matched up. I don't know. Do you have more case studies like that? Is that something you guys are tracking?

41:46Matt Sanderson:Well, yeah, it's, so it's funny because we're a data company and people just know me as like the Airbnb expert because they created a data company and they're like, can you help me find a property and I'm like well I probably can but I'm really busy trying to build this tech company

42:01Natalie Palmer:so I've had a couple what do you need your help for just go make an account I know I'm like well

42:06Matt Sanderson:but the thing is like I have to kind of teach people how to use this tech yeah okay then once they get it they realize but you know this is for a lot of the people you're teaching you're

42:14Natalie Palmer:teaching a man to fish instead of fishing somebody hey get on strike and it'll literally

42:19Matt Sanderson:instantly show it to you so a couple of examples of that I had a guy named Parker Gregg here in Houston. He came to me and he's like, man, I'm a high income earner, tired of paying taxes. And maybe one day I might want to just get into real estate investing only and just replace my income. He's like, can you help me out? He's like, my daughter's an Aggie at College Station. I saw you buy an Airbnb there, Matt. Can you help me? And I'm like, well, how about you just get on strike and just see what we can find? And so anyway, I was like, I just got on my phone and I literally typed in anything over 20 % cash on cash, went to college station found a property in less than two minutes i flipped it over to him hey what do you think about this thing could make like over 120 grand in revenue maybe more and which would be like a 20 cash on cash making five grand a month in net cash flow i was like what do you think and he's like are you serious so he so then he jumped on a call with summer led and he's like hey i found this property what do you think and they're like yeah actually we think it can make like 150 grand in revenue and i was like see i told you i was being more conservative because i don't want to you know promise something i can't deliver on he's like oh my gosh so then he went under contract bought that thing and he's doing better than i did in college station and crushing it as a six-bedroom property on track for 120 grand or more in revenue oh my gosh and he put in like pickleball core all that stuff he for the month of december and november he made twenty thousand dollars each month i mean he's just crushing it it's insane so that's one example of like literally found the property in like two minutes and just flipped it to him but that's the that's

43:57Natalie Palmer:the biggest thing that's not even the tax doesn't even include like the tax benefits and stuff the whole reason he wanted to invest you're you're not calculating any of that that's just the cash flow

44:07Matt Sanderson:for him that yeah exactly so that's a fun story and then another one that just recently came up is so my other buddy marcus he came to me he's like man similar situation a lot of these like high income earners and they're like hey can you help me out i'm like well how about we get on strike he's also an investor with me and he's okay so then i got on there and i said you know i was looking i was like hey dripping springs texas the hill country of texas is kind of an interesting market it's like wedding capital of texas or even the u.s i mean a huge wedding capital of like bachelorettes all that stuff and i was like i think we need to be looking for like a mega property there because he had some pretty good cash so i got on my filter anything over 20 cash or cash and boom like thousands of properties went away except for like three and he went and toured a few of these properties and he found this one and i i sent it to him i was like dude this sucker could crush it showed strike showed it can make like over 400 grand in revenue per year.

45:06Natalie Palmer:What?

45:07Matt Sanderson:Yes, over 400 grand. And he's like, Oh my gosh, that's amazing. It was a nine bedroom property on 10 acres. And so he went and toured, fell in love that we went under contract the next day. And he closed on it. And I sent a text to Michael Alifonte. Because again, he's my partner with Strike. And I was like, Hey, check out this cool property we found in Dripping Springs. He's like, you got to be kidding me. And I was like, what? He goes, I'm buying a property in Dripping Springs. I was like, are you serious? And I said, what's your address? And he sent me the address. I was like, you got to be kidding me.

45:39Matt Sanderson:You stole the property we were going to buy. So he literally bought the property right next door on the property line to the one we bought. He bought 10 acres and we bought the 10 acres right next door. So they're both 10 acre mega properties. He found his something. I don't know. We found ours in two minutes on strike and they're both projected to make four to five hundred grand in revenue each.

46:03Natalie Palmer:Okay, you have to keep me post on that one because is there any fear that having them be neighboring properties, they're going to compete with each other or anything like that? Or you think that the numbers are still going to pan out with both with two four to five hundred dollar properties right next door to each other?

46:20Matt Sanderson:Great. Yeah, I mean, there were some, it was weird texting back and forth on that with Marcus too, and we're joking around. But let me ask you this, how many nine bedroom properties are there in Dripping Springs?

46:34Natalie Palmer:I have no idea. Four, five? Probably not many. Yeah, less than 10. How big is Austin, San Antonio, Houston, Dallas, right? Yeah, and if that's the wedding capital, you're going to have more than one wedding a weekend.

46:50Matt Sanderson:There's probably only, I don't know, a handful of mega properties out there and enormous market share and demand. So, you know what? It's probably like CVS and Walgreens kind of being close to each other. Yeah, good point.

47:04Natalie Palmer:Don't they always put a Burger King right next to a McDonald's? Isn't that the whole thing?

47:09Matt Sanderson:It's just, hey, if the demand's there, it's almost like restaurant row, almost. Like by them just being there, maybe it drives more demand. So who knows? It actually could help benefit.

47:19Natalie Palmer:You know what else I'm thinking? like, okay, worst case scenario, they do eat into each other a little bit and you don't make 400 ,000, you make 350 ,000 a year. What a shame.

47:29Matt Sanderson:The fun story with this is, so I do a lot of stuff with like home team and Elefante's companies too. And so Marcus actually hired after he managed it for a little bit, flipped it over to home team management, who's managing both properties. So because of that, they actually could sell out both properties to like a mega corporate group or whatever. So like because there actually is synergies being close to each other under the same management.

47:56Natalie Palmer:Right.

47:57Matt Sanderson:That could drive additional booking. So we're trying to be more friendly with each other than competitors.

48:03Natalie Palmer:Sure, sure. Anyway, that's a fun case study. Those are great case studies. Actually, I feel like you might be doing, Strike might be doing too good of a job because now I'm thinking if those really high income investors were trying to get into STR for tax write-offs, they need to be reporting a loss and you're helping them cash flow too much. So I think you're creating a problem. I don't know if you're solving it. I mean, the best part of it, I know, true.

48:28Matt Sanderson:The best part of that was, I mean, I think he's going to get like 500 grand in tax savings from this property. Because it's a big one. It was a million dollar property. Unless he put in capital. And so he's going to get like 500 grand in savings, which is like an instant 30 % return. Plus enormous cash flow of like 8 to 10 grand a month in net cash flow. Like it's going to be crazy. So that's the story. And then one final story I'll tell you, and then just cut me off when you need me. At the end of last year, so I have four short-term rentals, and I'm like, crap, I need to buy another one because I'm going to have taxes I got to pay.

49:06Matt Sanderson:And so I didn't want to pay taxes last year, and I went to my wife, and I said, hey, babe, I think we need to buy another property. She's like, we got to buy another property? And I said, yeah, we do. And she goes, why? I said, or otherwise we're going to have to give the government like 50, 100 grand. Do you want to do that? And she's like, no. I said, so we needed to buy another property. And she said, okay, fine. So then I said, okay, well, let's get on strike. So we get on and we, my wife funds this property in Fredericksburg. And I'm like, oh my gosh, this thing's awesome. It was 1.45 million bucks.

49:38Matt Sanderson:And so then I get on there. I see that revenue tier. I see the strike data show that it's currently making about 108 ,000 in revenue as an active SDR. It's seven bedrooms on six acres with like a creek and a huge barn that could be converted. And we saw the potential. Again, the data gave me the insights to that revenue uplift. And I said, oh my gosh, this sucker could go way above this average revenue. It could go from$100 ,000 to maybe$300 ,000 if we convert this barn, put in a pickleball court, turn it into a wedding venue, and have a speakeasy game room out there and sleep 22 people instead of 16 people.

50:17Matt Sanderson:So I updated the underwriting in Strike. and it showed a, you know, close to a 20 % cash on cash return with like eight grand a month in net cash flow. And I flipped it over to my father-in-law and his fiance. I said, Hey, what do y 'all think about this property? And they're like, Oh my gosh, that's awesome. They're like, Hey, I just sold my company. I've got a bunch of taxes. I'm going to have to like pay if I don't buy something, which I want to partner up. I'm like, I don't know. Would y 'all want to partner up? And like, yeah, let's do it. So I literally, because of Strike, found a capital partner and closed on December 29th before the end of the year.

50:54Matt Sanderson:And now I own 50 % of a$1.45 million property because Strike unlocked that. So I tell people all the time, the problems holding you guys back is time, knowledge, and money. And Strike unlocks the time and the knowledge because we speed up the time, we make you smarter through the data. but it unlocks the capital piece too because if you find a great deal and just simply share it via text or email with someone, you can unlock the capital piece. And that is like one of the most difficult things to do, which is awesome.

51:29Natalie Palmer:This is amazing. And the, I think my favorite thing about this is the idea that you guys have added because you're right. That's, that's what was missing with AirDNA. And I'm sorry. I love the people that I know who work at AirDNA. We don't only show you the average. And I've had so many conversations of just like, well, this is what AirDNA says. That's our conservative. But we have a feeling that we can do this and this. But it's always just based on like we have a feeling, we have a hunch, like I think it could do better. What I love about this is my audience, the people that are going to be at Level Up, most of our listeners and stuff are really hospitality driven and want to be the host that adds all those amenities.

52:09Natalie Palmer:They're not satisfied with a turnkey property. They want to be the one that takes it to the top 5%. And I love that this now validates it. And it's like, hey, you can still be that kind of investor, but now you actually have the data to back it. You can be in that 5 % and that's what it's going to perform if you get there. Now you run with it, you hire the best designers, you put in the amenities, you deck it out and do what you know is going to perform and we can actually back up that that's where it's going to land. I just love

52:37Matt Sanderson:it exactly and it just it makes it easier to underwrite because if i have 15 comps when in this you know radius that are showing this range of revenue what i do is you know i see the full range i'll usually underwrite my property as if it's the 75th percentile that upscale yeah knowing hey if i moonshot this thing i still have like way more upside but i need to be a little bit more protective but i have pretty good confidence that i can hit the 75th percentile and i have all these comps to back it up and so like my college station property i'm operating at like the 80th percentile which is like right in between that 75th 90th and then parker greg who i helped buy you know something there he's operating at like the 90th percentile because his backyard was bigger he was able to put in the pickleball the swimming pool you know these other things that were unique that I couldn't do with my smaller backyard.

53:32Matt Sanderson:So it just, yeah, it makes it easier to know what you can actually hit when you can actually see it, you know?

53:39Natalie Palmer:And you know what else you just made me think of? If somebody, if there's an investor who, let's use you as an example, you have this college station property. What if at the end of last year, I mean, you had to invest in something new for tax savings, but what if somebody's in the boat where they're like, you know what, we have just enough to either invest in a new property or Or should we go back and improve on one of the other ones? You could run that so easily now and say like, okay, we're at 80th percentile with this property. If I put in 100 ,000 and get it to the 95th, what are we going to do?

54:10Natalie Palmer:Is it worth that? Or should I just go buy another one? Like the scenarios that you can run now. I wonder if you could even ask the AI, like, what should I do? What will pay off more?

54:20Matt Sanderson:Oh, 100%. I mean, I have another example of my Fredericksburg property. My first one I bought, a two-bedroom. again that was the one i just stumbled upon back in 2020 and i bought it turnkey i didn't do anything to it and it was still like a 60 return but that's because interest rates were all low well now i'm like you know what i i plugged in my address to the comps dashboard and it showed me the range and it showed me i could go from making like 65 000 per year in revenue to like 90 to 100 grand or more in revenue if i just added in these key things and i leveraged ai to also help me there and i'm like why would i not put in these things you know like the outdoor movie theater the golf putting green these things that would cost me probably like 50 grand total for like and make that back in a year and then i'll make yeah i'll make an extra 30 to 40 grand per year so like i would instantly make like a 50 or more cash on cash just instantly because of that.

55:21Matt Sanderson:So, and then that's ongoing, right? And then your, your return is, I don't know if it'd be infinite, but it would be really high. So what I would encourage everyone is, Hey, before you buy another property, just type in your address, see what the range looks like to see if you can juice up your revenue by an extra 50 grand a year or whatever, and just reinvest in your properties. Cause that's where you'll get your biggest ROI. And then once you maximize your existing, then you can go, you know, buy these new ones.

55:48Natalie Palmer:Yeah, yeah. Okay, this is like, you got me so hyped to just like go spend time playing in there and just have fun with it. Yeah, run your own properties. Even if you're not in the market to buy something right now, just see if there's like, you know, easy improvements you can make to get yourself to the next percentile. Because that's data that you're not gonna be able to get anywhere else. Matt, what would you say are next steps for somebody who now is intrigued and excited and wants to go play around? I know

56:13Matt Sanderson:2.0 won't launch till May 1st, but can people like, where should they dabble or like learn

56:19Natalie Palmer:more right now?

56:20Matt Sanderson:So three next steps, one, come to the conference because it'd be awesome. So we'll be there hosting coffee. It'll be fun. And we can run anybody's properties for free, just to come hang out with us. The second thing is May 1st, we launched 2.0. So what we're doing prior to that launch is something called the founder member campaign or founder member seats. So basically meaning we've got 50 seats available right now for people that want to jump in early that are ready to execute. And that's 75 % off per year for life. So we're going to have pricing at like$199 a month when 2.0 launches for that pro tier.

56:57Matt Sanderson:Well, you're going to get in at 75 % off essentially for life. So even if prices go up over time over the next couple of years, as AI is infused and enhanced, you'll be able to lock in 75 % off. So I think we have like 15 seats still available for that. So if you're interested, you could go to striq.com backslash founding dash member. That's a long one. So Natalie might need to put that in the show notes. Or you can reach out to me at matt.sanderson at striq.com. and I can give you more information on that. But yeah, we've got about 15 seats available out of those 50. And then the final thing would be, you know, again, I started my journey by myself watching social media, just in isolation, didn't know what I was doing in 2020.

57:46Matt Sanderson:And I wanted to flip that on its head and say, you know what, investors should not do this alone. So I built a community called the Strike Squad. It's free and it's a great place if you're just wanting to just jump in, learn, meet other really cool people. Again, we want to bring the community together to help each other. That's on school. And again, it's a free community. We can have that in the show notes for you to jump in.

58:08Natalie Palmer:Okay, I'll include that and then how to sign up to be the founding member. Pricing on the intelligence tier. I think you said pro was going to be$199 a month when currently, unless you get one of those founding member seats. But what's intelligence going to be?

58:21Matt Sanderson:Yeah, so we're still kind of working it out. So like, again, the value proposition, if AI can literally hunt and find deals for you based on your buy box and send them to your inbox every single day, like what is that value? Right. It's pretty big. So I don't know. It'll probably be somewhere between$499 to$999 a month. Okay. Sounds kind of high. But I mean, it's, you know, not everyone will want to do that.

58:49Natalie Palmer:If you're buying a property that's doing$400 ,000 a year in revenue, I don't know. I think it's worth it.

58:54Matt Sanderson:But again, we want to build this airplane in there with our customers. If y 'all are like, you're crazy, you know, whatever. I mean, we're open to feedback. It's just we want to be able to price it based on the value provided. And so we also want to deliver on that value. So it'll probably be cheaper in the beginning. And then as demand ramps up, we'll probably ramp it up over time.

59:12Natalie Palmer:On that note, if people want to sign up right when it launches, do you have like a newsletter sign up or wait list so people can be the first to know and reminded on May 1st?

59:20Matt Sanderson:Yeah, well, the founding members will for sure get early access to everything, including the private community where we're working with them to learn what they want to build into the actual product itself. And they'll get early access to the intelligence tier too. So I'd say that'd be the best place to start to learn more about it.

59:37Natalie Palmer:Perfect. We'll put those show notes down here and I'll see you in a couple weeks in Phoenix. I know, I'm excited.

59:42Matt Sanderson:Well, thanks for having me on.

59:44Natalie Palmer:and with that it is now checkout time thanks for listening and i'll see you back here next week lastly as airbnb hosts we all can appreciate a good five-star review so you already know a great review on this podcast would mean so much to me please subscribe review share and connect with me in the show notes below bye

1:00:24We'll see you next time.