Rebroadcast — Leading Voices in Real Estate with Tyler Christiansen on centralization before AI

In this special rebroadcast, Funnel CEO Tyler Christiansen joins Matt Slepin on Leading Voices in Real Estate to explore the rise of centralization in an industry overdue for operational change, and how centralization before AI is reshaping multifamily operations.

Together, they unpack what Tyler calls the “new operating model”—a shift toward centralized, specialized teams and AI-powered workflows that make leasing more efficient, renters happier, and teams more fulfilled.

The conversation traces Funnel’s early days building automated lead management tools, the “aha moment” that unlocked portfolio-level leasing, and how REITs like Essex and owner-operators like Cortland, Windsor, and UDR helped prove the model.

You’ll hear:

• Why centralization—not AI—was the first domino to fall in multifamily transformation.
• How “renter-centric architecture” changes the owner-to-resident relationship.
• What new specialized roles (like renewal and leasing hubs) mean for teams and career paths.
• How AI fits into the model once workflows are centralized—and why it boosts both efficiency and retention.
• The leadership and cultural traits shared by companies successfully navigating this shift.

Tyler and Matt go deep into the structural rewiring happening beneath multifamily’s surface showing why technology is only part of the story, and why operational design is where the real innovation happens.

Listen for insights from Deepali Vyas, Global Head of Data and AI at ZRG, at the end of the episode, as she zooms out on what centralization and agentic AI mean for leadership, talent, and trust across real estate.

• Leading Voices in Real Estate Podcast
• ZRG Partners

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Episode transcript:

0:00 Matt Slepin — Leading Voices in Real Estate Bonus Episode

Tyler Christensen: We have long advocated at Funnel that centralization and automation—or AI—are two core pillars of what we call the new operating model. It’s an operating model that’s more efficient, it’s better for consumers, and it’s more likely to lead to higher retention of associates.

Introduction

Matt Slepin: Hi, this is Matt Slepin, and welcome to Leading Voices in Real Estate.

Today’s episode is a conversation recorded on June 3rd with Tyler Christensen, the founder and CEO of Funnel, a multifamily PropTech company that provides what they call renter management software—which means software and services that connect and manage the relationship between apartment property owners and their renters.

But it goes deeper than that. You think renter management software is obvious in something that has existed forever. But as you’ll learn in the podcast, that owner to renter relationship kind of never existed. That relationship has been between the renter and the property entity versus renter and the owner entity. An important distinction and that this innovation has deep, deep ripple effects changing the structural nature of the apartment management operating platform.

This is a follow on to our last episode with David Stanford and Chris Shada from Real Foundations. With David and Chris. We talked a lot about the importance in meaning of the operating platform, and here with Tyler, we go deep down the rabbit hole exploring how something like Funnel fundamentally changes the essential way of operating an apartment business.

And we talk a lot about how these changes to the operating model. Which cries out for and enables at least some centralization in the business model in what had been historically a property centric IE decentralized business. And with centralization comes the creation of new specialized support disciplines based in call centers or hubs.

For example, a centralized leasing renewal team that then facilitates bringing AI into these more specialized functions within the business. It’s hard to bring AI into support the role of a site-based property manager. But easy to leverage in these specialized, centralized disciplines. 

This deep dive with Tyler might sound like we’re just talking about the apartment business, but generalize everything we’re talking about into each of the different food group verticals in real estate, and even outside of real estate for the deep impact of what you’re hearing.

We hear so much about AI, this makes its applications real. I was blown away by this conversation and have been ruminating on it since my conversation with Tyler last week. We’ve been exploring this stuff for a while on Leading Voices, but this and the Real Foundation‘s discussion made real for me the importance of a conscious and ever evolving business platform and that AI will be a huge leverage point within that, and it set the bar for the work we do in recruiting at ZRG in the real estate space, where our job in the coming years is really to help companies build new kinds of teams and disciplines within the real estate business that catches, not avoids this new wave of the importance of business platform.

Again, as the Real Foundations guys said, the point here is to focus on your business platform as the context, and then AI is one of the drivers within that which you must leverage. As in the Real Foundation’s discussion. Please stay tuned at the end of the conversation to further thoughts from the new head of data and AI search at ZRG Deepali Vyas. Deepali, and I pull the lens out further on the implications of this conversation.

She’s an expert in this part of the business, so her comments really drive home the overall discussion. So thank you for sticking with these conversations and listening onto our show. Coming up will be another double episode discussion this time. One I’ve wanted to explore for a long time, a conversation on fire, in this case, the LA Fires and Disaster Recovery, and how we as a real estate industry are major, major players in that.

Please continue to listen. Please follow the show in your podcast app so that the next episode will automatically deliver. Please check out the archive and do share the show with your friends and colleagues. Feel free to get in touch with guest ideas or importantly, if ZRG can be helpful to your business in recruiting, talent management, or consulting on the people side of your business, please get in touch.

My email is mslepin@zrgpartners.com. I hope that you get as much out of this conversation with Tyler as I did enjoy. 

First impression of Funnel: Disruptor

Matt Slepin: So Tyler Christensen, welcome to Leading Voices in Real Estate. It is real estate technology and disruption, seasonal leading voices. We started a conversation with Ben Miller from Fundrise about a month or so ago, and then the last episode was with David Stanford and Chris Shada from Real Foundations talking about technology in the use of real estate companies and operating platforms of real estate companies.

This week we’re drilling down further and more sector specific from the Real Foundation’s conversation to dive into multifamily. And we’re gonna talk all about Funnel and your business and brief anecdote. I did a search three years ago for one of the major REITs in the apartment business, and they said that they were disrupting and changing their operating model, which we were gonna help them do from a people standpoint because of the disruption that Funnel created in their business.

I’d never heard of Funnel. I said, what is it that they do? They explained it to me and now you’re gonna get to explain it to our guests, so our to to our listeners today. 

So I’m thrilled to have you on the podcast, really looking forward to this deep dive. And although it’s a deep dive into the apartment business, and we’re gonna go geeky into the apartment business, I think there’s lessons here for all sectors of commercial real estate and what the technology stack and what AI means specifically into how we run and operating our businesses.

So Tyler. Thank you for being here.

Tyler Christiansen: Thank you for having me, Matt. I’m a longtime listener. I actually remember listening to your podcast years ago with the phenomenal leadership team at Camden, and I’ve appreciated the perspective you bring to these conversations ever since.

As a technologist, your anecdotal intro couldn’t be more of a compliment. We all aim and aspire, as entrepreneurs, to disrupt the industries we serve, and I’m very grateful that Funnel has played a part in taking this concept of centralization—which I know we’ll unpack together—and AI technologies, and bringing them into the mainstream.

Whether that was very early on with Essex Property Trust, one of our early REIT partners, or more recently with UDR, our most recent REIT partner—centralization has been in multifamily for a while. You’re absolutely right: the takeaways from both the operating model and the staffing model, and how those intersect with technology—I’m excited to talk about how it impacts multifamily today and where it’s going. I also agree there are takeaways for any real estate vertical.

4:09 What was the first concept of “centralization” for Funnel?

Matt Slepin: And it’s interesting you talk about centralization, ’cause we’re gonna get into this, but the word that I heard was that they’re creating a one-to-one relationship between the company, the owner of the properties and the residents.

And that that took the property out of the middle of that relationship. So it was kind of an orientation in relationship to the residents, kinda like a CRM, but maybe that caused centralization. But I don’t know what your first concept was for this? 

Tyler Christiansen: You’re right. To unpack it a bit: we didn’t even know what we had. A good friend, Pat Klein, former CTO at Essex Property Trust who told me what we had on our hands.

He took an early look at an early version of Funnel when we wouldn’t have described ourselves as a CRM yet. We are now, we are a CRM for nine of the fifteen largest owners in America, and many more smaller operators, but at that time we would have said we were an automated lead management tool.

In demonstrating early capabilities in the product, Pat illuminated something: Essex and a few other REITs had already begun cross-selling their properties—an element of centralization. The idea was to take a single lead and show them multiple communities. The REITs have geographic density—Essex, for example, has a ton of properties in Orange County—so he was tasked with: how do I help someone seamlessly book tours at four different communities in Irvine?

It sounds simple, but to your question, the legacy systems—the CRMs or even the property management software systems in some cases— they created a unique record each time. So if you, Matt, were moving to Irvine and inquired at four different communities, even if they were all Essex communities, you’d create four instances of yourself.

The reason is that, outside the REITs, there isn’t typically a single balance sheet. Every asset is owned by a unique set of investors and JV partners, and from an accounting software perspective it makes sense to silo information. I don’t want to be blending my expenses and debits and credits among communities if you’re investing in a single asset. That wasn’t lost on me—I’m the son of an asset manager.

But when you think like a REIT—from a single balance sheet—the customer management never made sense to be siloed. Pat told us back in 2018, “You can do something here with this technology—the way you’re building this.” He called it portfolio leasing, and that was the genesis.

A lot came out of that: role specialization, centralization. But the architectural difference is the key: a property-centric accounting system or CRM silos your data—more like a car dealership—whereas a hospitality-style model (think Marriott Bonvoy) has one record across communities. That was the impetus for everything centralization is now.

7:18 Funnel following the forks in the road

Matt Slepin: So much to talk about here today. I’ve always wondered when an entrepreneur starts a technology company, if they see the end game, or if they take a baby step and then someone takes the baby step and makes that into what becomes an end game. 

You had a little idea. That then germinated into a big idea. And we’re gonna talk about how that evolved. But that’s gonna be maybe the first part of the conversation, which I find fascinating.

Tyler Christiansen: You’re right, and that’s the fun part as an entrepreneur—you constantly face forks in the road. Looking back, we were, like others, leaning into what became AI. We didn’t know what AI was capable of yet, but we knew there were better, more automated ways to respond to prospective renters, and we leaned into that.

It wasn’t until we got this feedback from an early customer, and then went and validated it with another customer, that we said, “It’s worth leaning into.” We’ve spent the last five years building a CRM that goes deep there, and we’ve continued advancing the AI conversation as well.

You have a thesis, an idea. I’ve spent my whole career in multifamily—starting on the asset management side, doing internship work for my dad at Wasatch Property Management, then jumping to a tech company in Utah called Property Solutions (now Entrata). So I knew the space well, but it wasn’t some grand insight that we should build it this way—it was partly coincidence that the technical team had designed it that way.

Where our team at Funnel deserves a lot of credit is being willing to zig when the industry was zagging. We heard this from Pat, but most customers said, “No, that’s bespoke to the REITs. Don’t build a company around it. It won’t scale.” You have to decide: go the opposite direction and believe in the secret?

Peter Thiel’s Zero to One talks about believing in a secret long enough to create a big moat. Luckily, nobody else believed the secret, that centralization would apply to everybody, so it gave us a head start building what we call a renter-centric architecture.

9:38 Tyler’s history in multifamily

Matt Slepin: So let’s talk about that evolution. And you talked about yourself. You’re my first guest who said they’re the son of an asset manager, and then you went from asset management to the, the predecessor of Entrata, which is one of the big software companies.

Talk about that because that’s where you got started on the tech side of the business. ’cause I want to hear how this evolved and the continued evolution will be the beginning part of the story.

Tyler Christiansen: I appreciate that. We’re all products of the environments and cultures we’re raised in. My father was always on the lending side of multifamily. I’ve always liked shows like yours that go beyond just multifamily tech or operations, because at the end of the day, this industry is an asset class.

Buying and selling assets makes it all work, and American multifamily stands far ahead of other countries. I love to travel—there’s nothing like American rental housing in terms of quality of life. What makes that work is that it’s an asset class where assets can trade hands freely.

I grew up with that mindset. As a kid in Southern California, we’d go to a soccer game and then my dad would say, “We need to go look at a deal we’re financing,” working as a banker. In college he moved to the asset management side—specifically financing and underwriting, not operations.

I remember doing my first unpaid internship driving around Salt Lake County looking at potential parcels of land for them to acquire. And it was pretty clear to me that wasn’t the part of the business that appealed to me.

What I love about that, you know, as a millennial, we’re always like, well, what’s, you know, my why, my purpose in my job, and what I love about the apartment industry is the why is so clear. At the end of the day, you’re helping people with their most expensive, uh, purchase every single month, and the most important thing in their life in terms of physical. Property and that’s a home. And so I loved that part of it.

And then I was very fortunate. I remember literally driving from Salt Lake down to Provo where I was going to school at Brigham Young University. And I saw a big billboard at that time. Silicon Valley was, you know, the main tech hub. Silicon Slopes in Utah was emerging as a big technology hub. And I saw Billboard for a company called Property Solutions. And they were advertising jobs. I had lots of sales experience as well working my way through school. And so I was able to kind of merge these multiple careers of multi-family and helping people with homes. I also spent some time in single family homes doing real estate sales there. And the technology I got, I lucked into, so I fell into that and immediately just loved early days of property solutions.

And their big value prop, Matt, if you’ll believe it in 2012, was helping people pay rent online. I mean, 90% of renters in 2012 were still paying via check.

And so it was fun to be able to introduce new technology to make living an apartment easier. And I remember I was a renter myself, and I’d walk my check down every single month. So I got the bug very early. And between housing and technology, I, I just never left the industry and, and I never will. I love it.

12:34 Early experience at multifamily tech startup

Matt Slepin: Yeah, and then Entrada moved from. Helping people pay rent online to becoming one of the platforms underpinning the real, the apartment industry like RealPage and like Yardi, is that correct? So full suite of services.

Tyler Christiansen: That’s right. That transition could be a whole multi-part series. What was fun for me is I saw an early-stage startup reinvent itself as a platform. I started as an individual sales rep, ultimately managed the sales organization, working with larger companies.

I loved the intersection of what’s possible with technology and the leadership required to partner with an operator to say, “How do we get outcomes for you?” Something as simple as enabling renters to pay online—today it sounds pedestrian, but then it was a big transition. How do we partner to make it possible?

Similarly today, my top motivation is finding an operator who has something they can’t do: “We want A, but B is blocking us.” Can our technology unblock you to do that thing, automate communications, or whatever it may be?

13:46 Knowing the multifamily business is essential 

Matt Slepin: Got it, and one question about being a salesperson or running the Salesforce for a company like Entrata, the way I look at that, having recruited people like this, but it, it’s not, to me, it looks like both sales and use case in that the sale is helping them understand deeply how it will impact and affect their business and how their business will now have to run. So you need to know your stuff. You’re not a sales person per se, in the old style of that word.

Tyler Christiansen: That’s right. A lot of people think “sales” is a mall kiosk where someone tries to sell you a phone case in two seconds. That’s not a quality partnership. I’ve always enjoyed exactly as you described: You have to know your stuff and their stuff. 

The greatest compliment is when an operator calls for genuine advice—even if it doesn’t intersect with my technology. And that is what I train my (small) sales organization that you must be fluent in multifamily.

It’s like your role, Matt: they can’t call you to fill a role and then have to explain what that person does. The more you understand their business, the more they trust you to help solve the problem.

At Funnel, we are very proud to run communications and leasing for nine of the fifteen largest owners in America. And that’s not a responsibility we take that lightly. From sales to marketing to implementation, they have to our partners’ business. Interestingly we’ve also become more multifamily-centric—when I started, nobody had worked on-site; today I’d guess half of Funnel has on-site experience, which brings a lot of empathy to the role. 

15:33 Using that knowledge to be a technology disruptor

Matt Slepin: Back to the point that you made about what I get to do is, I actually know more about the role than they do. They know about the role in their company. I know about their role in the world, and then I can bring back that perspective back to their company. On the last podcast with David and Chris, we talked, we laughed about the word asset manager, which we already laughed about together here.

And it means totally different things in every company. And sometimes client will come to a recruiter and say, Hey, go find me an asset manager. And we have to figure out the context and the flavor of that in order for it to make sense or else we’re all gonna waste our time. 

So you know more than they do actually about the technologies in the apartment business so that when you landed into their company, you’re thinking of the breadth that they can’t see outside of their own walls.

Tyler Christiansen: What’s uniquely fun in disruptive tech is that there’s limited experience to draw on. Back in 2012, that was payments. I also worked with LRO on revenue management and learned that language. Now I’ve learned the language of operations, particularly cross-property or centralized operations.

And so most of my conversations with executives are about, hey, how does this look when I move from a property centric model of, one community manager, one assistant community manager, just the typical one to 100 ratio that folks talk about. They wanna understand how Funnel helped Camden or Essex or Cortland or BH transition from that old model to a cross property model.

And you have to really know it. You can’t have just looked at it at a distance, right? You’ve had to sit in the contact centers, visit the sites, and learn through, you know, trial and. What actually works.

Matt Slepin: It’s gonna be different in each use case, correct? It’s all gonna be bespoke adopted to what those companies are. Even though you have the same concept going in the same direction. 

17:24 From Nestio to Funnel

Matt Slepin: So when you started Funnel, when you left the where in the sales role and started Funnel, what was the vision and how did you leap off the diving board to do this?

Tyler Christiansen: I appreciate that, as I mentioned, I’m a husband and father, I take my role as the provider seriously. There was a predecessor to Funnel. I was recruited—shout-out to recruiting—to join a company called Nestio in New York City. Nestio was a relatively small company, serving the New York broker community. A lot of innovative companies start in New York—many also die there because they don’t serve the broader multifamily industry.

I was recruited to see if the nascent tech I mentioned—a single renter record within a community—could be brought to multifamily at large. I spoke that language. I spent the first year in New York—moved there for the summer—to learn the broker industry and the Nestio business.

That first summer, 2019, we launched Funnel. From a small predecessor focused on brokers, we launched a new company and product line called Funnel. The original idea was much more focused on automating follow-ups and communication. The industry had shifted from demand generation to demand management—the ILSs were pummeling CRMs with way too many leads, and that leads to apathetic leasing associates.

So our initial idea (and others at the time had similar) was to organize that chaos and as much as possible automate responses wherever possible. That was the thread. As an entrepreneur, you pull the thread to see where it goes. 

And that has been a consistent one. To this day, the #1 value prop of our tool (and probably others) is: how much time can we save leasing associates by taking care of the mundane, answering pet policy questions, booking tours.

It wasn’t until we went out and started talking to customers that we had any notion that not only will this clear value prop of automating communications, there was also a really disruptive mindset of centralizing operations. 

We stumbled into the latter but it only happened because we were passionate about solving the first problem.

19:58 Deploying during COVID: Sink or swim 

Matt Slepin: When did it move from kind of lead tracking to now I have a CRM-ish one-to-one relationship between the owner of. 50 apartment buildings in all of these residents, because I think that’s when the game started changing and you became who you are.

Tyler Christiansen: You’re right—that shift didn’t happen until COVID. We launched Funnel in 2019—at Denver’s Apartmentalize. The word “centralization” never left my lips then. It was all automation, AI, and everything related to making that leasing process easier.

As we progressed with Essex and Cortland in late 2019, they bought into the concept of changing the dynamic. To be clear, legacy systems would take three inquiries at three communities and create three unique records. Funnel would take those three unique records, combine them into one, and let you communicate across properties. We knew about the potential to make that happen, and we started coding for that in late 2019. 

Our technical team flew to Las Vegas, where Essex has its contact center, and was coding contact center software for centralization over Thanksgiving. The plan for 2020 was to slowly testing these products in the wild, Cortland as our East Coast partner, Essex as our West Coast partner.

Then of course the world shut down in March and it was sink-or-swim for our business and product. Within a matter of weeks, we deployed across the entire Essex and Cortland portfolios. That’s when the amazing outcomes started happening.

One example: Cortland could tell you for the first time that 20% of their leases started at a different community—they inquired at Buckhead Property A but leased at Buckhead Property B. Suddenly: what does that mean for staffing? For marketing? Should we create different customer journey paths from this information? 

22:15 Rudimentary AI + machine learning, to agentic workflows

Matt Slepin: So the ripples started then.

It’s just so funny ’cause you mentioned, you talk about COVID, and I know COVID was a long time ago, but I’m an old guy. It was a minute ago. So you’re describing everything in the last few minutes to me, um, versus the history of the world. The speed of change is fascinating. And also when you said you, you talked about, when you started, you talked about automation and you talked about AI.

Did you talk about AI and automation, but not centralization? So three different words. And did you talk about AI at the same time that you were starting this? ’cause we ChatGBT was still four years away or three years away.

Tyler Christiansen: You’re absolutely right. So yes, AI, but at the time, I could not have articulated to you the difference between AI and machine learning. And the average consumer had no concept of what we were really talking about. Most of what we built would today be described as a rules-based chatbot. 

I mean, the level of intelligence was incredibly rudimentary with these tools. But by the standards of the late 2010s, they were artificially intelligent. right? Because it could, for instance, tell you, Matt, that your your text message just came into my system at two 30. My response is going to say Good afternoon, right? That was the level of intelligence. 

It wasn’t transcribing and Mandarin the pet policy as it was not ag agentic at that point in time. It was not at all. And so you, to your point, the real kind of initial focus for Funnel was automation. COVID helped us shift the focus to centralization. And then, yes, most recently the focus has been about how do we take this amazing game changing generative technology to create agentic outcomes, as you just described. 

But you’re right, there’s always these inflection points that in hindsight come very quickly. But at the time, I mean, as right now, you know, I listened to the podcast with the folks from Real Foundations. I think it might have been David who said, you know, AI blather, it’s everywhere. All the time, all at once. And I think we’ll look back in hindsight and say, oh, those were both rapid moments and there were huge shifts and some things stayed more similar than we could have thought of. 

But you’re right to key in on the fact that yes, it was, it was the COVID era that led to operators thinking we have to centralize and really proving the use case in ways that under normal circumstances might’ve taken much longer. 

24:33 The old multifamily operating model vs. the new operating model

Matt Slepin: So, we’ll come back to centralization in a minute, but the first thing I want to just land on your comment, which is I’m an owner, I’m Essex, I have 50,000 apartment units and now I have a one-to-one relationship with my residents that I actually never had before, because before that moment, each of those relationships were via the 60 properties, not directly to those people.

And then what that means, we’re gonna land on in a few minutes. But, but that was the kernel of the shift.

Tyler Christiansen: That’s correct. That was the initial impetus. And that’s why I think the REITs play such an important role in our industry is they think about things through funds from operations. They think about things from a single ownership perspective. And so they bother to ask themselves, why are we marketing to this renter multiple times if we could know that they are one renter? 

But absolutely, and, and to be clear, like any technology transition, frankly, probably the majority of multifamily today, Funnel’s grown to 2 million units on the platform, but the majority of operators today still think through property centric and they’re creating multiple records. So it’s still more an anomaly than the norm to think about a single renter record. Uh, but it is quickly changing. 

But you’re right, that was the kernel of insight, why create multiple records? I should have one record across the management company.

Matt Slepin: Fair deal. And so, two couple threads there. Thread number one is that the REITs were the most natural place to do this, although Cortland is not a REIT, right? But the REITs were the most natural because they have a single balance sheet and multiple properties.

So they’re already thinking in that way. Plus, they can make platform investments more easily than, say, a third party manager at the other end of the extreme.

Tyler Christiansen: You’re right. Yes, that’s correct. The REITs, I think there’s a reason Revenue management started with them. There’s a reason centralization started with them. And then you’re right. The next closest thing to a REIT is a company like Cortland or Morgan, another large Funnel partner who are owner operators, kind of vertically integrated that they look like a reit, but they don’t have to talk every quarter about their results. 

Matt Slepin: Then a second thing, and here’s a history lesson. I worked for the largest then owner of apartments, a hundred thousand plus units. So this is called a company called the National Housing Partnership a long time ago. And so they were the first kind of, central’s the wrong word, but it was the first hierarchical, well organized apartment company and the guy who ran the apartment management platform is a guy named Lindsey Crump, and he came from the bowling alley industry, if I’m correct, in my recollection here. There were a lot of bowling alleys and almost all of them ran on one technology, which was a MF or a MG, or I forget the name of it, but he did it and it was a hierarchical business.

So there’s a guy in DC named Lindsey, and then he had head of operations, but then he had like five regional people and they have district people. And the district people would run, you know, three properties or 10 properties each. And it was this very much of a military like chain that had many stops between the central office and the property.

And that’s the business that everyone did. And half the companies or two thirds of most companies still do that very hierarchical management scheme. But you’re enabling that to be totally blown up. We’re coming from that to this new thing. So I want to think about what that sent. Well, any reactions to the hierarchical experience that I’m describing to you? That’s the model, right? The old model.

Tyler Christiansen: It is. And then, yeah, so that’s the old model. And then I think if you combine the fact that that’s being done even at, you know, large third party managers, it gets far worse when you add to the fact that the technology, because of this single asset management ownership construct, which makes sense in that context, but you get such siloed operations and that’s why I think any other industry of our size would’ve by now found far more efficiencies. 

But you mentioned bowling, the industry. I like to explain to people, so I have friends who, you know, know nothing about multifamily. Like why is the Funnel growing? What are you guys doing? What’s so special about it? And I described to them that it’s a little bit like the multifamily industry is a little bit like car dealerships. That, you know, historically you don’t buy from Ford, you buy from, you know, whatever your local Ford dealer is. Right. Gary Brown Ford, Matt Schlein, GMC. Right? And these businesses are completely fragmented. There’s no economies of scale. If I go to the next Chevrolet dealer, they don’t know who I am. And they have their own whole staffing model. And so multifamily, to your point, is created this franchise fragmented model that just is highly inefficient. And it only makes sense if you’re thinking about the financial books. 

But you, one of the things I highlight for folks of the inevitability of this all going away and moving towards this centralized model is, we are not that different as an industry from hospitality. In hospitality there could be a courtyard on one side of the street and a residence and on the other, and they’re both Marriott properties and people say, well, it’s because they’re both Marriott. Yeah. But Marriott doesn’t own both those properties probably. Right. They probably, they’re just even a brand on them. They could be two unique management companies and certainly are likely to be two different owners, but they’ve realized the hospitality industry rise and we as consumers have realized it’s better to have a connected experience for the consumer. I like to be able to stay at a different hotel and they know who I am and I can bring my points with me. And for the operator, they can be far more efficient if they start looking at their portfolio as a collection of assets rather than individual siloed franchises. So yeah, that definitely resonates.

Matt Slepin: And many of them, their relationship is not at all through ownership and it may also not be through property management.

The relationship is with totally with the persons staying in the hotel that night? That’s correct. It’s the head in the bed that night. 

Tyler Christiansen: I think as an industry, hospitality, their technology’s not great. I love looking behind the screen in the technology industry. I mean, it’s like DOS software, they’re running, but the operating model is far more efficient. And I think because of the dynamics at play in multifamily, we’ve run it as an incredibly inefficient industry for a very long time.

31:00 What does centralization mean?

Matt Slepin: So let’s talk about what centralization then means. If I have this hierarchical management model that Lindsay Crump at NHP invented 50 years ago down the hall from me, a little scary, but if we, if we think of that model and then you’re gonna blow it up, what can be centralized or regionalized or hubbed? And then once you do that, what dynamics, what are the ripple effects of having a hub or a call center or a central this or that? 

Because the ripples are huge. Huge, huge. You can’t go halfway or you go halfway, but you gotta be conscious about what’s halfway, what’s not halfway.

Tyler Christiansen: No, you’re right. And this is where the conversation, hopefully folks have followed along to this point, but this is where the conversation requires kind of a graduate level understanding because you can both do what you described, and I’ve seen it many times. You can blow up the old model and that’s the biggest thing to maybe understand is today, if I am an asset manager and I’m hiring a third party manager, it’s kind of one size fits all. You get a community manager, assistant community manager, and a set number of maintenance and leasing associates. That’s the existing model. No if, ands or buts. 

If you move to a centralized model, to your question, it can look like on the one extreme, nobody on site. No one on site. And we have seen that. And the only person who comes on site is a roaming maintenance person who you know is there to plunge the toilet, but everybody else is doing remote work. 

Now that is possible. I would not say that’s the norm. I think folks think that’s the norm, it’s not the norm. 

And then on the far other end of the spectrum of where you’re just dipping your toe in the water, and this is where, most third party managers have to start. Because as an industry, we’ve created this relationship between asset manager, and I say that knowing the jokes, but you know, specifically somebody who owns the property and someone who they pay to manage the property for a very low fee, and they’re on a month to month contract. And those contracts have stipulations. Like you can’t have your staff work on a different property. And so we’ve not, and this is very similar to my car dealership analogy. Tesla and Rivian and other ev you know, kind of, uh, startups have said, Matt, you buy the vehicle from me and then I’ll give it to you. You know, I’ll ship it to you. Or you can pick it up at a showroom. But there’s no dealership model. Ford and Chevy, they’re kind of trying to catch up because they’re stuck in their old contracts. There’s literal business implications to saying, can they sell you the car or do you have to buy it local? 

So the third party managers, for the most part, the relationship with their clients, they have to dip their toe in the water and say, well. My clients probably aren’t okay with me sharing leads. Generally. That’s the mindset today, although I think it’s outdated and it’s gonna go away eventually. But they’re absolutely okay with me moving administrative work off the community level. And that’s something I would say, you know, across the various viewpoints on centralization, that there is alignment on it should, it should result in less administrative work being done at the property. 

There’s just no reason to have a class A property or even a class C property with an office being utilized to work through renewals. That can be done offsite, that can be done by renewal specialist. And so this specialization that starts to happen when you take things off site, that’s where you get into a myriad implications of a model that looks different for each customer.

34:25 Role specialization and centralization

Matt Slepin: And renewal specialist, just think about that word for a minute. Because there was always someone who was a leasing agent or the property manager who would do that. But now let’s a specialized function across an entire portfolio. 

Tyler Christiansen: Yeah. And that’s where you start to see both cost efficiencies. So Camden, again, being a public reach shared that moving to Funnel and the staffing efficiencies that came with that saved them $4 million a year. Because instead of having an ACM at every community who 10% of their time is renewals and then, you know, fill in the blank on every other thing, you can have one group of renewal specialists who get really efficient and you can build software to support them. And you can optimize for that workflow. Whereas you know when it’s, again, 10% of an ACMs job, you’re not gonna find cost savings by automating that. 

So yeah, renewal specialist, fraud specialist, leasing specialist, collection specialist, you can think about all those different functions uniquely when you aggregate the work across multiple communities.

Matt Slepin: And when you have a job like that, let’s keep playing with that for a few minutes. The more specialized that job is, then you can have AI play a role in that job. You can’t have AI play a role in an assistant general manager who does 10 different things. But you can have it play a role in that centralized role of leasing renewal specialist.

Tyler Christensen: That’s absolutely right, Matt. I mean, we have long advocated at Funnel that centralization and automation or AI are two core pillars of what we call the new operating model. It’s an operating model that’s more efficient, it’s better for consumers, and it’s more likely to lead to higher retention of associates. 

So that new operating model, again, is centralization and automation. And if we get to consult our partners on how to do this, and of course they can do it how they want, but to get the highest ROI you should do centralization first and automation second for the, exactly the reason you just described, right? That when the 10% of work is spread out across all these different pools, all these different bodies, you can’t really get the cost savings. And the most obvious example where our partners, in particular the owner operators early days, saw huge cost savings is, let’s just use tour scheduling, Matt. 

Again, go back seven years the vast majority of tour scheduling was done. Human to human. Let me check my calendar. Literally we sat on in the Essex contact center and timed them. The average time at the Essex contact Center was eight minutes to schedule a tour. Eight minutes? Because they were looking at papers and asking, you know what, oh, does this property have the pool? Or does that one It was so manual and moving that into a centralized group like Essex had done, we could automatically say, let’s put all of that into AI. And where are the cost savings? 

So the average call handle time by building a centralized workflow and adding AI got cut in half. Because a lot of renters never called anymore. Because they said, well, you know what, I can just go ahead and book it myself, you know, using AI, give me the options, this is what I’m looking for. But then also creating a specialist, a tour booking specialist, which is a crazy concept, but it was valuable. That was a huge time savings. 

And so you saw these contact centers, which, one thing that’s important to recognize, it’s a really important thing to bring up in the world of AI, there’s a lot of conversations about the impacts it’s gonna have to the workforce. 

And they’re good conversations to have. Our industry, we don’t need to worry about them. 

Lemme tell you, this is my opinion. The reason why is that I think you’d be hard pressed to find an industry in America that has more. Empty jobs has worse turnover than we have, particularly on site. And so the opportunity to reduce the job postings far outweighs the need or the likelihood of us just eliminating leasing associates altogether. I think we’re gonna have leasing associates in multifamily forever. I do. I don’t think we’re going to zero, but we’re gonna get away from the really high turnover in particular high turnover in contact centers. Those jobs, Matt, they’re impossible to keep staffed. And so AI is going to replace a job that nobody wants and you can’t keep staffed and in its place. 

What Cortland has is they have a hub where instead of being the person handling a hundred calls a day, saying, what’s your availability, Courtlands hub, follows up with the people that have booked tours using AI or have a bespoke question and they jump in and they guide them, Hey, I’ve got three communities in Mesa, let me tell you about them. So it shifts away from high volume, low value to lower volume, higher value. By centralizing first and automating second.

Matt Slepin: So you said a lot of things there. One of them, if you get rid of the seven minutes to schedule, I didn’t know when I do a booking scheduling thing online that that’s AI.

The word AI scares me. But booking online makes me happy. So I’ve been using it forever or the last five years. We all have. 

Tyler Christiansen: Yeah, that’s right. And there’s, there’s a lot of nuance to that. In some cases, again, rules-based heuristic, you want a tour, this is it. Yes. In other cases, it’s highly conversational. 

We went live with our newest version of our chat bot and day one it booked a tour in Mandarin and then answered a pet policy question. And that’s, so the AI in some cases needs to be highly sophisticated. In other cases, Matt is just understanding your preferences and populating a self-service tool.

39:50 Creating better career paths + higher retention

Matt Slepin: And then in passing, you made a comment earlier, but then you doubled down on it and the passing was higher retention of associates. So one thing that we know is historically in the apartment business, the average turnover on site, I think is 50 to 60% per year. Something like not of residents, although residents too, but of associates.

And if you could cut that turnover down from 50 or 60% to 30 or 40%, you’re making a massive difference in the bottom line. And it must mean you’re creating better career paths. So does the thing that we’re discussing create better career paths and happiness and retention for the workforce, for Essex or Cortland or Avalon Bay or whomever.

Tyler Christiansen: This one is a unequivocal empirical: Yes. I mean, it is so clear to us now with our partners that retention rates skyrockets in this new model. I mean, we’ve seen as high as 90% plus for partners like RMR or GID Windsor, and in particular when they’re clear to your point about what they’re trying to achieve. 

I would give Windsor a ton of credit for this. They pride themselves on their relationship with their renters and their associates. When they introduced what they called Windsor 2025, they said, the point of this is to create bigger, better jobs. And so we no longer want you to feel like you have to leave Windsor just because you’re a really great leasing associate. 

Maybe you want to go be a sales manager in a software company, because we had these career paths that were nonsensical. It was, Hey, you’re great at sales. Let’s move you to admin. As an assistant community manager, and if you’re good at the admin now we’re gonna make you a front office leader. As a community manager. The career paths were really like ping-pong versus now many of our partners have roles such as regional sales leader. That person maybe never wanted to do the renewals back office work, but they wanted to be the person who’s thinking about training other salespeople. And we’ve also introduced the word sales into multifamily, training them on, Hey, how do you do a high touch close? And these are big deals. I mean, I’d mentioned earlier car sales, you know, these leases are $30,000 a year transactions. Like why not have a really charismatic, well compensated sales associate that’s there greeting and leaning into that. 

And going back to the point earlier about different models, it is very unique. We’ve got partners. Like an organization of Canada called QuadReal. They were our first to centralize in Canada. The only roles they left on site are resident roles. So resident ambassadors, they’re really leaning into renewals and, and when a tour comes through, they want somebody who knows about the resident experience. 

What is probably more common is to have that really charismatic, high EQ salesperson standing at the door ready to greet you. And I would challenge anybody, walk into a Cortland community, walk into a Camden community, Windsor community, you’ll see this. They’re not, they’re no longer stuck behind their desk doing the busy work, right? They’ve got a team that can help them do that. Their job is to engage and close the leases that are ready to be closed. 

Matt Slepin: And if I’m engaging and I’m closing, am I also the person who helps the resident while they’re there for their 12 months and hopefully the next 12 months, is there hospitality service coming from that as well?

Tyler Christiansen: Yeah, that, that’s a huge opportunity. And obviously it depends on the asset class type. And that’s where you’re seeing certain operators, they are leaving a community manager on site and they’re operating like that concierge. They’re the high value, super knowledgeable individual. 

And this is where technology plays a big role. The majority of renters, and I remember myself not long ago, renting an apartment. Don’t wanna walk to the leasing office. They would rather pull out their phone. And this is the concierge. Just like when I’m in a Marriott now, I don’t wanna walk down and order my food. I wanna pull out my phone and say, okay, what are my options? Or can I schedule a late checkout? I don’t even wanna pick up the phone, I just wanna tap into here. 

And so I would say by and large, the folks that are really treating their residents excellently start with technology. ’cause the data is clear. The majority of consumers don’t wanna walk to the leasing office. They wanna just engage with you via technology.

44:02 Renter-centric technology 

Matt Slepin: Let’s stick with that one for a minute. I’ve been in this world for a while and the thing, and I’m one of those people who prefers to engage through technology, not from human to human. And I’m a people person, but nevertheless, if I’m ordering food, I’d rather not spend the time engaging with a person.

I don’t mind that. But because the renter has changed, and someone said on the podcast, they’ve all been trained by Amazon, how to interact with the world. So we’re trained on how to do that, but not everybody is. So the range of behaviors by residents doesn’t work in seniors housing probably. My mother could have never done that.

Tyler Christiansen: You nailed it. And I think that’s where right now. We don’t do a good job as an industry, and this is one of my favorite topics to talk about in branding, the consumer expectation experience. And so, again, going back to some, think of any vertical you’d like, but for me, I’m, I’m gonna keep it with hospitality.

I know depending on the type of hotel I’m in, what expectation is. Many hotels that I stay at don’t have a concierge. I wouldn’t go down and ask for certain things. Others do. Others have room service, others don’t. I think that there’s a huge opportunity right now, and you see this with some of these large mega managers, and I’m, I’m not speaking at a school ’cause they’ve, they’ve talked about this publicly, but probably the best example I’ve seen Matt, is Greystar has a brand called LTD. And with LTD, they’re incredibly transparent. There’s no leasing office. You have an app, there’s a number you can call. And because of this, the trade off is you get the cost savings passed on to you. 

So similar to when I walk into a Walmart, my consumer expectations are lower than when I walk into even a Target, right? You just know I’m getting some cost savings, but I’m probably not gonna get a lot of help. 

Now, I think that generally speaking, there are things that residents absolutely know they need to have. They need to have maintenance, and they need to have communications around the renewals. They deserve to have those. And every type of asset should optimize for it. But outside of that, that really depends on the value you’re trying to create for the renewal, right? 

If you’re doing a lot of community events, then yeah, maybe you do want somebody who’s a resident ambassador ’cause you’re in Austin, which is a highly competitive market and you’re just trying to get that renewal so you’re indexing and investing into that. 

But it’s a great point. I will say. Again, Essex doesn’t have leasing associates in the office. And then Cortland who does have associates in the office, they can guide them to a renewal specialist. Say, Hey, you know what? I saw that you got your renewal offer. I can see that in the system here, but if you wanna negotiate it, that’s not my job. Here’s the number you call. Right? And Cortland has a renewal specialist.

Matt Slepin: Because that leasing agent could be hospitable and not have to be the negotiator, which are two different skill sets and faces that you wanna show. They may go do that other job at night.

Tyler Christiansen: Exactly right. And that’s a huge opportunity. S lot of folks want the flexibility of either working from home or they want to, you know, high volume, high income opportunities and they want to go into an office. So you as an operator, this is where I said it really opens up the doors for you. You can create a customer service experience to meet your needs, but it doesn’t have to look the same. ’cause again today, all of that happens on site. You’re overwhelming your staff.

In a centralized model you can pick and choose what is the onsite team, what is a centralized team, and then what is AI going to handle.

Matt Slepin: And you can also have someone there in the middle of the night because they’re a middle of the night, amortized over 200 properties or whatever it is.

50:32 We’re not settling: Centralization is the new flexible model

Matt Slepin: One of the recent podcasts was with Corman, who you, I, I’m guessing you don’t work with, but I have no idea. But they’re very, very heavily hospitality oriented and heavy people.

We got three people at the front desk willing to, you know, hey, you want a cup of coffee while you walk out the door. That’s important to their brand and it matters. But they could be part of your system too. It could be high touch, low touch, medium touch, this doesn’t matter. That’s the choice either per property or per different kind of owner or perspective.

Tyler Christiansen: That’s correct. That’s absolutely right. Yeah. We have Class A, New York City/ Boston assets that are renting for $6,000 a month and we’ve got garden style, class C assets that are, making intentional decisions about how they service their properties.

And it’s evolving. Even our partners that have been on Funnel the longest, they’re constantly changing. Um, you know, our, what roles are work from home, what are in a corporate contact center, what’s on site? So it is, we, we finally have broken out of one model, but we are nowhere near settling into another.

48:36 Centralization and third-party management

Matt Slepin: So let’s talk about different parts of the industry and then I wanna talk about AI kind of towards the end of the conversation, but I want to think of the applicability.

You’ve talked a lot about both Cortland and the REITs, so you’ve put that and, and GID. So those are companies you’ve mentioned through the conversation and. It’s less natural in a third party manager because they’re managing for others and others may not make the same investment or view the property, the corporate, the property manager serving them if they’re sharing leads or whatever you’ve said.

So how does this work for third party managers versus a REIT?

Tyler Christiansen: Yeah, this is great and I think, um, I would highly recommend anybody check out Dom beverage’s white paper on this topic where he talks about centralization and third party management. 

The first thing to note is, while most disruptive technology and multifamily starts in REITs, it then moves to owner operators, it then goes to hybrid owner manager. The best example for us is a wonderful partner named BH. They own about 50,000 units and they manage about 50,000 units, right? Some of those being BTR. And they have the incentive as an owner manager for half their portfolio to really embrace this. So they started their own contact center. They started with their own assets. Now, the reason they are now offering those services to the third party clients is ’cause they’ve proven to themselves, they can deliver a superior level of service.

What’s the job to be done? If I’m a third party manager, the job to be done is to deliver better service than the next manager down the street, right? Mm-hmm. And across the board, if you’re doing centralization, right, it should do that. It should deliver a higher level of service at a lower cost. 

And so BH was one of our first clients that offered and branded this centralized service. They call it the Mint Experience, where it’s a point of differentiation for them. They say, hey, you know what we think like an owner, we act like an owner. If you want a contact center where we’re gonna do A, B, or C service, you can buy that from us, right? And so it really begins to look more like hospitality in that I can choose the residents and has a profile of the guests that stay there. Or I could choose a Ritz Carlton, which is gonna be more high touch, probably more staffing. 

And so third party management, I believe, is in the middle of an evolution towards instead of just selling staff on site and these terrible relationships where I’ll fire you on 30 state notice, I think we’re moving towards a world in which I’m really hiring a business outcome. I want a level of service that ensures collections are being followed up with. 

And these kind of, in software, we call them SLA service level agreements, where, you know, my clients expect that Funnel is up 99.9% of the time and that’s in my contract. And if I fail to do that, you know, they can ask for a credit. Well, I think the same thing is gonna be true in third party management today because it’s so fragmented and it’s all on site and they’re constantly turning over. They just say, well, I don’t care. I’ll fire you on 30 days notice. 

I think a much better model would be to go and say, Hey, you know what? I know I’m paying a little bit of a premium for this Mint Experience. Or, you know, Greystar got offerings, RPM and ZRS have offerings, but it’s worth it to me ’cause I know the level of service is better than what I would get at the, you know, the bargain price. So I think we’re moving towards more differentiated service models.

Matt Slepin: I’m finding it interesting because I’m an owner. I’m a Invesco or somebody. Yeah. And I’m using one of these third party managers. And the service that you’re talking about is not necessarily the service to the resident, it’s the service to help me have better NOI and help me have predictable, less hassle with you to get that better NOI.

Tyler Christiansen: Right. If there are going to be clear drivers of outcomes, whether that’s through AR or customer service that I want to guarantee you do. 

So as an example, we partnered with Greystar on their centralized renewals team. And one of the things clients want is they want to know is everybody getting followed up with personally, right? And maybe that starts with AI, but I, at some point, I want a human to reach out and make sure that they know their renewal offer was there and ask to, to go through it with them. 

It’s possible to do that in the old model, it’s far harder in all reality. We don’t know if the property’s gonna be staffed well enough. They’re gonna be distracted by a million things happening on site. It’s much easier to achieve a hundred percent attainment levels or fidelity levels if I have a team that’s only focused on that thing, be it collections or renewals or whatever else. 

In a system like Funnel, there is no way to fake completing your task. You, you have to make the call, you have to log the call. You have to send the message. All of it is crystal clear that you’re at chaining these service levels. And again, I think that’s a healthier version of the asset manager, fee manager relationship than the one in which I can fire you. ’cause I just, eh, I kind of feel like you’re not doing very good.

53:43 Scaling centralization

Matt Slepin: So if we look ahead, I wanna think of different parts of the industry and I wanna think of different size companies and I wanna think of different sophistications so much to talk about.

But if to afford to do this, do I have to have a certain scale? And let’s say I’m not a third party manager, I own a portfolio. If I have 5,000 units, can I afford to put in this kind of centralization or call center or whatever that is? Yeah. Do I need 20,000 units? What? What’s that mean? Talk about that scaling.

Tyler Christiansen: Yeah, really, really great question. I think like any business, there are unique opportunities that come with scale and size, but that does not mean that the benefits are solely accessible to them. 

So to unpack that a little bit, we have phenomenal partners like a Monument out of South Florida, Kane out of North Carolina, who are sub 10,000 units and are achieving very similar results to their REIT peers. Now, they may not be doing some of the heavy customization and investing in things like high amenity resident portal tools, right? That’s not something that they’re budgeting to do, but they’re absolutely leaning into the idea of specialized leasing associates, specialized renewals associates. 

And I think when used properly, technology is more of a democratization tool of, you know, it levels the playing field of, you know, Camden has access to certain technology, so does Monument right? 

And I, in my experience in Matt, I would imagine this is true in your recruiting efforts. It still really comes down to the same things that I learned way back when I was in college about business, which is culture, right? Culture, leadership, execution. 

There are large operators who cannot get out of their own way, and they have all the resources in the world and all the technology in the world, but they can’t execute on these things. And then there are small operators who are running circles around their larger peers. They use their lack of size as an advantage, right? To say, Hey, we can get the same technology, we can move quicker. We can deliver a better experience. 

So I don’t think that size is necessarily a criteria for success or lack thereof, but I will say that the technology, we have seen it be implemented successful, and we’ve had failed implementations at all sizes.

Matt Slepin: I think scale does matter, but I like the demic. Democratization is a good word because technology is available to everyone. So you know, two years later, the small companies could get access to the same stuff, but they can only buy so much of it at a certain size of scale.

Tyler Christiansen: That is true and I will say that the, you know, if you are running a portfolio the size of Camden’s, it’s possible to save $4 million with it by improving your unit ratios. The ratios would probably look the same at smaller operators, but they’re not gonna save 4 million. 

And, and I will agree with you that generally speaking, the volume leads to benefits if you have all the above. And so I think that’s why it’s frankly incumbent upon the smaller operators in particular to be leveraging this technology to be leaning in and delivering a high quality experience. Because there will be our, our point of view, and this shows up in our data, is the bigger, getting bigger. And those who are doing these things well, especially again, if you’re delivering a superior experience to your client, being your asset manager, you’re gonna get more, you’re gonna be awarded with more units.

So I think the smaller operators in particular really need to be embracing this technology now.

Matt Slepin: And dig into the difference between, I’m saving money doing this. Or I’m doing a better job so I have less turnover of residents and less turnover of associates. How much of it is I say I cut 4 million bucks outta my bottom line, or did I save 4 million bucks through lower turnover? Or which, or both?

Tyler Christiansen: That’s another example of it really comes down to the operator’s choice of what are they trying to optimize for. I think what makes the REITS unique is this focus on FFO, which I love because it’s just everything is a little bit cutthroat at the end of the day. Like, I need both. And so I’m going to, if there is a lever to pull that makes me more efficient, I’m going to pull it. Versus often the private clients will tell me, we have no intention of trying to find cost savings. We believe so strongly that if we deliver a better experience, it’s going to show up in both lower cost savings. We’re gonna have lower turnover, we’re gonna be able to retain people better and make them more efficient over time give them more responsibilities over time, and ultimately in higher renewal rates, higher rents. 

So I think depending on where you are in that spectrum influences the objective you’re looking for. And there is a correlation of how willing are they to start with pain. You know, one of our newest partners, UDR, they centralized before Funnel and they did it by going out of industry and they bought technology and built it themselves. Spent a lot of money doing so, to your point earlier about kind of the scale. But they were clear that, hey, we are willing to deal with pain as a first mover, right? We’re gonna close leasing offices. 

Only now in implementing Funnel do they feel like they can kind of have their cake and eat it too. We get the efficiencies of a centralized model, but we really want to elevate the customer experience simultaneously. And so you can optimize for one or the other. I think you have to be very intentional, have a great culture, which UDR does. They’ve been a phenomenal partner. If you try and get both. Better customer service and cost savings, it’s tricky. It’s possible, but it requires a lot of leadership. 

59:02 Working through technology pain and fatigue

Matt Slepin: And let’s think about the words you just used going through pain. If you have to go through pain to get to this, but you’re gonna go through pain to upgrade your accounting management software as well. 

So there’s pain points happening technology wise all the time in these companies and they keep having to evolve the operating platform to catch up with the technologies or to implement those technologies, but there’s a lot of pain along the way, and then you get a couple years of breather until the next pain point. Any comments on that? And how do you help them through their pain?

Tyler Christiansen: Great. Yeah, great question. And I think since you had our friends at Real Foundations on last time, I’ll counter. They’re phenomenal, and we use real foundations for a number of partners. They exist in many ways to help with that pain and that change management. And, you know, if I could give David some truth serum though, he doesn’t need it. He is always straightforward. I think that changing property management systems, and I sold property management software, I think you’re hard pressed to come up with a real clear ROI What you’re actually doing more efficiently are, do you, can you, you know, cut a roll at every single property? No, you can’t. Can you genuinely increase renewal rates 2%? Doubt it. 

There’s enough evidence now with centralization, and maybe you could, you could excuse it and say, well, the REITs are unique, but we have small operators as well that just don’t have assistant community managers at all. Right. And the math is pretty easy. If you can eliminate one role at every single community and do that through attrition or do that, you know, when job openings come up, the cost savings are going to be there. 

And I would also say you ask any operator who made it through the pain and fully implemented a change management concept, and they will tell you their customer service is elevated. And they couldn’t go back to that. 

Now, now to your question of can we help with that? We can, and we actually have a consulting service that, that provides, uh, what we call it Centralization as a Service Consulting. But by and large, I’ll tell you, it comes back to the leadership of each organization. There’s this wide spectrum of results that we’ve seen where when you have an organization that’s kind of at war with itself, they never get the results, because they’re just looking to prove something doesn’t work. 

When you’ve got alignment top to bottom. Like you see in, um, UDR who rolled us out recently, GID, Kane, Windsor. These are organizations that knew why they were doing it, brought in the resources to do it, and got really great outcomes. So that pain was, you know, they always felt like it was worth it. And that shows up. We track end user sentiment. There’s something called net promoter score. And the organizations that start with why and really lean into their teams, the end users love the tool because they know why they’re using the tool rather than. Being forced upon them.

1:01:45 Who makes the decision? How to secure buy-in for centralization.

Matt Slepin: One of my favorite parts of the conversation with David and Chris last week was about what kind of executives, and where does the ownership of these decisions sit? And so is it the CEO? Is the COO, is it the chief technology officer? Is it the board of directors? 

And I’ll ask you this question in a moment. And then the other question is, how does, what’s the breadth of buy-in to do this? Because it takes the whole organization to move to make those decisions.

Tyler Christiansen: Yeah, no, you’re absolutely right. And I think that does correlate with strong cultures. In my experience helping companies change software for the last 10-plus years: these shifts start at the top. You usually need an outspoken leader who says, “Here’s what we’re going to do; here are the outcomes I want; I trust you to manage the details.” When it’s “let’s just try it,” or the leader is in every detail with a hair-trigger to punish failure—those don’t work

There are fantastic leaders: Andrew Livingstone at Greystar; Tom Sloan at Windsor; Scott Moore. And Cortland is a great example. The CEO, Stephen DeFranc, doesn’t get in the weeds, but he’s crystal clear on objectives and empowers his team. He’ll say, “My CTO, Scott Moore, will figure out how it’s possible. My Chief Experience Officer, Mike Gomes…”—and by the way, Chief Experience Officer is a newer role in multifamily. When I see a company has one, I get excited; it means someone with budget authority cares enough about experience to dedicate an executive to it. You see that at Cortland, Continental, others. 

Then that leader group goes and evangelizes with stakeholders, operations being the most important stakeholder because at the end of the day if your teams are happy and bought in, they can achieve magic at the site level. I think a lot about at Funnel, one of our unique advantages to beat our competition is do people love working at Funnel?

I’m here at the Tampa HQ. Do people get excited to come to work? Will they deal with our failures? And if they do, we’re gonna be great as a company. And so I think that’s operations and multifamily. 

The asset managers and accountants, I’ve sold to them, I know them, I love them, I started this show Matt by saying they make the industry work. But they do. They shouldn’t really care that much about the technology that the operations team picks, because if the operators own it and embrace it, they can achieve magic at the site level.

1:04:18 Elevating the talent pool in multifamily

Matt Slepin: I want to think of the old hierarchy versus the new hierarchy. And I’ll tell another story, like the Lindsey Crump story. If you think of the Lindsey Crump model of this hierarchical site managers or leasing agent to site manager to district manager to regional manager, up that food chain, a lot of what drove that model in the old days were people who started in leasing, wound up getting seduced by the business, did not finish college. They were like one or two years through college, wouldn’t finish college, then start going up that food chain. 

And one of the limitations in the business is you had the business largely populated by people who didn’t have the sophistication of either finishing college or going through graduate degrees.

I’m thinking in the new hierarchy of those roles that you’ve just described in the last few minutes, now you have business leaders versus people who graduated up the hierarchy. And the business leaders to run the call center or the business leader to run the renewal center, those are big jobs with different kinds of people coming into the industry versus those who just kind of came up the food chain.

Is that right?

Tyler Christiansen: It does turn the whole model on its head, and it absolutely takes advantage of career pathing that didn’t exist before.

And you mentioned these different career paths, and contact center being one of them. There’s a gentleman who runs the contact center at BH, and I don’t know his background per se, but Andre Washington, the man is so sophisticated and knows his stuff intimately. He could run contact centers at Delta. 

But I get to meet his team members, and you meet these folks that run organizations like Christie Weinstein, the COO at BH. Those are now roles that mirror the site and the customer service experience so much more. They’re thinking about the same problems, rather than, to your point, it was such a different job when I’m siloed into the leasing agent. And then I move up to the community manager. I think that we are turning the model on its head.

I also will say, just anecdotally, as a demographic shift, my industry was one where college degree attainment, particularly for females, was much higher. And so most leasing associates that I meet now are college-educated. And it’s a good job to be a leasing associate now, and today, especially when you start thinking about the intersection of leasing associate and the technology they get to use. I mean, it’s a white-collar job. And if I’m doing it in an organization that has centralized sales opportunity, I can make six figures. I may actually not want to be a manager because I’m a really highly compensated sales associate. 

So I do think we’re going to elevate the status of every job in multifamily and make those jobs look more corporate-like the roles they would hold at the top of the typical hierarchical food chain.

And I’ll say, I am very excited about the new titles we’re seeing in multifamily. Never before would you have seen postings for a Director of Centralized Operations or Regional Sales Manager. And those are roles that not only can folks grow into, but they’re also going to attract a sophisticated kind of leader from other industries. I’m seeing more folks from hospitality. I’m seeing more folks that come with certain gravitas and are really elevating our industry as a whole.

1:07:44 What is agentic AI? What does it mean for multifamily?

Matt Slepin: I knew the answer to the question that I asked a few minutes ago—as a recruiter, it was a selfish question—because I was going in the direction that you’re now creating a more professional industry across the board.

You gave great examples for that. We haven’t talked specifically about AI, it’s been throughout the entire conversation, and you have an AI tool and maybe a separate company that runs this for you.

But let’s riff for a few minutes on what it is to have the sophistication that you can bring to this. What does the word agentic mean? We all hear about this all the time. What are the other ripples of this? Kind of demystify it and bring it into what we’ve talked about through this conversation.

Tyler Christiansen: Yeah, well, I’m really excited to talk about this, Matt. And yeah, from day one, Funnel, our first tagline before we knew that we were going to be the renter-centric software was “the automated software.” And so we’ve always believed in AI and automation.

But you’re right when you said earlier, the world changed dramatically when these generative models came out, and it really brought everybody up to the latest and greatest. And what that means for leasing associates is that the job is, and again, this is where I said it’s a more corporate job; they’re not doing the things I did as an entry-level salesperson. Half my day when I was an entry-level salesperson was note-taking, and entering in by hand: “Oh, the call was about this. Then I’m gonna call them back next week.” With the AI that Funnel has embedded in our tool, all of that is automated. I finish the call. The call is already recorded. It’s transcribed. It’s summarized. The phone number’s in there. And, in fact, we’re working on—okay, well, let’s just schedule the next step for them.

And that’s what you asked—the word agentic. AI is a technology, much like the internet, that can be applied to a lot of things. Agentic is more a description of a modern type of software that actually takes actions on your behalf. 

And there are a few examples that already exist in multifamily. One that we’ve talked about already is tour booking. So if you, Matt, were to look at a community and say, “Hey, I’m interested, I want to know the pet policy,” you’re chatting with an AI agent. But then if you say, “Well, I want to come by on Tuesday. Can you give me a tour at three?” it goes and looks at the calendar and books that. There’s no human on the other side taking those actions.

So a bot or a chatbot is really answering the question. Agentic software is taking action to do the thing. And that’s what everybody’s very excited about: so far in multifamily AI has primarily been about answering questions. Can we go to a world where it’s actually taking actions on my behalf and freeing me up, again, to everything we’ve discussed—to focus on higher-value consumer interactions?

So Funnel started with the question-answering portion. We’re extremely focused now on, for many of our partners, we do everything from application screening, lease signing, move-ins, rent payments, move-outs, renewals. We do the whole workflow. And in those use cases, it’s really fun to think about: how can we empower leasing associates who today still have quite a bit of button-clicking to do, where, okay, I know I had this conversation, my renter’s ready to renew, or they’re adding a roommate. There’s some unique nuance that required me as the human to sell them and to bring value. But now, rather than me going through a bunch of fields and filling things out and clicking buttons, could AI take my conversation and take the actions for me to generate the renewal offer, send the renewal offer, collect another payment—whatever it may be. And that’s what’s really important.

One of the things people are thinking a lot about is: does this favor incumbents that already have the software, or does it favor disruptors? You said early on Funnel is a disruptor. The answer is only time will tell. But we feel very excited at Funnel that we’ve got great partners and great technology because we’re all learning together about these new agentic outcomes.

1:11:43 The future of multifamily is AI + humans

Matt Slepin: So one of the outcomes, it’s the renewal center. Could be that the agent thing is not just getting you started in the process, but actually completes the process because they know what the renewal rate should probably kind of be.

Tyler Christiansen: Yeah. These things already exist. You mentioned we have a new company. So we launched a new brand. We acquired the assets of a company called LeaseHawk. They were an early adopter of AI technology in multifamily. And so we acquired their technology, their assets, and then are replatforming it with a partner called Sierra. The chairman of OpenAI created this company called Sierra.

And they do things to use your example, if you’re a SiriusXM subscriber and you’re thinking about canceling your subscription, if you go on the website and engage with their chatbot, you’re going to have the opportunity to negotiate with AI. That same use case can exist for renewals.

What I believe per our earlier conversation, and Matt, you understand the humans of this industry very well, I think that there is not going to be a rush to the lowest common denominator. I think there is going to be a rush toward the best outcomes, which is how do I ensure that my residents get the best experience and my clients, the person that owns this building, gets the highest renewal rates possible, the best rate, the best rents possible, highest renewal rates. And that will be a combination of AI and humans.

As you said, I’m similar. Oftentimes I don’t want to pick up the phone or walk to the leasing office. I would rather engage with the AI tool. And there are other times where I just want to speak to a human, and you should make that easy for me.

Now to put a very specific point on what you said, there is a demographic of renters today who won’t tell you if they’re going to renew and they just have one outstanding question. That’s a great use case for AI. They say, “Hey, am I allowed to add a pet to my lease? I’m thinking of getting a puppy next year.” And AI could absolutely answer that question.

But then you need an AI, if you want it to be truly agentic and you don’t want a human involved, which again, that’s preference, you could, and the consumer may want that because maybe they’re asking this question at 2:00 AM, you could empower the AI to go and take actions for you in a system like Funnel.

Where you say, “Hey, they’re good to go. Send them the renewal offer.” Or, “I’m actually going to give you the agency AI to give them a 2% discount. Go ahead, update it, send the renewal offer.” So we’re early innings, but that is what agentic software would look like.

1:14:08 Managing early expectations (and possible hallucinations) with AI

Matt Slepin: A couple of points to that. One is we don’t want it to hallucinate very often. That’s very important, but that’s a joke. But the second thing is something you said earlier in the conversation comes back to me, which is if I want to renew at two in the morning, but I only speak Mandarin, this can do it. Your human probably can’t do Mandarin or Spanish.

Tyler Christiansen: Or it may not be possible to staff in all the time zones that people want to be answered. There are a lot of use cases where AI is going to be better than the alternative outcome. I don’t think it will be all the outcomes or all the pathways, but you’re absolutely correct.

And I will say, we’ve made a lot of progress—we being the technology industry in general—in the last two years on hallucinations. So as a quick example, we don’t use AI to fill in the pricing field. We put a blank template there, and that’s a rule. So it doesn’t make up, it cannot make up its own price. But it can generate the conversation in whatever language it may be, with the proper context.

And it says, “Well, I’m authorized to give you [fill in the blank] discount.” You, the operator, say, “You can only give a 2% discount,” and it generates that. So it’s a combination of rules and AI, and those are the experiments we have to run. Because you’re correct, AI is still very much early in terms of what it can do.

1:15:27 Balancing the cutting edge with Sierra

Matt Slepin: And an interesting thing that you’ve said is that you’ve partnered with Sierra to do this. So you’re not writing AI code yourselves. Your partner does that, and then you bring the AI into your business, and you’re writing the code for that.

Tyler Christiansen: So we do both. And I think that the nuance here would be, there’s a lot of unique use cases. For instance, our partners Sierra are much better at a 2:00 AM Mandarin conversation about the pet policy. That’s something that they, the edge cases and really cutting-edge technology. 

What we know is multifamily. And for instance, the highest converting communication in the leasing journey is a well-timed follow-up email. Funnel uses AI for that. We’ll continue to keep on staff machine learning engineers and data scientists so we have the optionality of when to use this tool versus when to use our own.

The reason we partner with Sierra though is, I mentioned earlier, what is now Entrata. In 2012, it was really cool to build your own payments technology, and that was a unique differentiator. No technologist in the world today would start a software company and say, “I’m going to build my own payments technology.” You would just use a tool like Stripe, which makes that super easy because it’s a commodity now.

And so we think the ability to have a conversation in any language is going to become a commodity. So we’re partnering with the best company in the world at it. But the edge cases of our industry, the unique nuance of integrating a Blue Moon lease into an email, for instance, that’s something Funnel does really well. And we’re going to continue to own those parts that are multifamily specific. But we didn’t want our partners to be behind the cutting edge; we wanted them to be at that cutting edge where appropriate.

1:17:09 Building trust in multifamily

Matt Slepin: We’ve talked a lot about the apartment business here, and I want to ask a complicated question as we begin to wrap up. The complicated question is, are we ready for this? And I’m thinking of two different challenging questions:

Question one is the RealPage lawsuit, where the government may not be ready for how the apartment business behaves or operates or what’s written into the code of how we do our business.

And then the second thing is, in the world—and I talk about this all the time on Leading Voices—people hate the word landlord. They hate the word developer. Those are the two things that our business does. So we’re hated, but we shouldn’t be hated. And nothing that you said in this conversation, and nothing we talk about on Leading Voices, would have people in the general population want to hate our industry.

But I fear the things that we’re talking about as things that could make us be mistrusted.

So go forward a little bit, think about the application of this, think about the challenge that our industry has in the public sphere, think about the legal questions, and then let’s land your business in five years and what does all this mean.

Tyler Christiansen: It goes back to something I’ve said quite a bit here, which is leadership matters, culture matters, why you do what you do matters. And I said the reason I love this industry is I love providing housing to individuals.

We were very intentional early on about creating a 501(c)(3) inside our business—it’s called HOME. So every time Funnel helps somebody sign a lease, we donate $1 to helping an individual find a home.

I think we haven’t done a good job as an industry of showing how committed we are to the core reason we exist, which is to provide quality housing for renters fairly. So for our business, we’re always going to make sure that’s front and center.

And we have daily decisions to make. Matt, to your point, none of us can predict the future. I’m sure if the folks in question had known the future of revenue management, they would have picked to market the technology differently or to use LRO, candidly, which didn’t use proprietary lease data and used the trend, the market traffic data. We don’t have that crystal ball to know what the future looks like.

But I will tell you, we get confronted probably on a daily basis, but definitely weekly, with forks in the road on, “Should we use AI to do this or that?” And I think that as an industry, the whole world hasn’t settled these questions. We should, agreeing with your point, be very conscious of the perception.

For instance, Funnel has taken a very conservative approach on rent collection because there are tools out there that are borderline abusive in the way in which they’re going out and trying to find collections information. I think humans are better at having those empathetic conversations about setting up payment plans.

Now, there are some basics there that absolutely should be automated. Another example is Funnel, I hate as a consumer how much my phone rings, Matt. While we’ve been sitting here, it’s probably rung 10 times with spam calls. So we will never do, and put this on the record, auto dialers. A lot of our competitors do auto dialers. I think that’s going to get sued into oblivion.

We’re not going to hide things in leases. And so I think that it really comes down to leadership and every organization making conscious decisions for the betterment of our industry.

So there’s not, that’s not a really succinct answer, but let me tie that into what you said about where is Funnel five years from now.

If we continue on the trajectory that we’re on, something like a quarter of apartments in America will be using Funnel, and that would make me very, very happy and very proud. I love driving with my kids around the country, especially here in Florida, and pointing at a building and saying, “They’re using Funnel. That’s so cool. The people there pay their rent on Funnel.”

But I think that if we look forward, I feel very confident that the industry will have a better perception because we are going to provide a better renter experience and a better associate experience.

I think that’s already showing up. Our friend Jay Parsons likes to talk about renewal rates ticking up as an industry, and I think it’s because we’re delivering a better experience for renters. We’re also seeing all of Funnel’s partners are seeing higher retention rates on associates. It’s a better job in multifamily than it was in the past.

So if we continue leaning into the great leaders we have, like the folks that I hear on your podcast—there’s been a lot of them—leaning into why we do this, and yeah, we’re all trying to make a profit, we’re all trying to create a better industry, but at the end of the day, we’re providing quality housing to Americans and Canadians and everybody in our ecosystem. I think that it’ll end up very well for us.

1:21:46 Advice for those just entering the real estate industry

Matt Slepin: I agree. So last question on Leading Voices: your advice for a young person entering into the real estate business?

Tyler Christiansen: Listen and learn. If you do that, and you learn the language of the industry—whether you go into technology or recruiting or asset management—you’ll be incredibly successful. There’s a huge opportunity, given the disruption that’s happening, to be a young professional coming into this vertical, because what your boss’s boss knows is getting upended today.

So you learning the industry as it changes creates enormous opportunity.

Matt Slepin: See the number of facets to the industry. I’m thinking of that from this conversation. There are all these traditional roles—half a dozen traditional roles—but you break it down, there are dozens of roles. We’ve covered a lot of facets that now exist in the industry that never did before.

Tyler Christiansen: Yeah, it’s fascinating. And I love this industry. Frankly, Matt, I think all the time about going over on the operator side because I just love it so much, and I’ve spent a decade on this side. The facets and the nuances are incredible.

Matt Slepin: Wonderful. Tyler, thank you so much for what you’re doing. Thank you for being on the show.

Tyler Christiansen: Thank you, Matt. Thank you for doing this podcast. I really enjoy it.