Built to Work: Episode 13: Bo Lais - Lula Founder and CEO

https://www.youtube.com/watch?v=0PkvIzChZDM

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Welcome to Built To Work the podcast that gets its hands dirty dives into the grid and uncovers the heart of what makes the blue-collar world tick I'm Colin your host and I'm sitting down with the people who keep our world running from those tackling the tough jobs no one else dares to do to the HR professionals working overtime to find the labor force we desperately need Whether you're in the trenches or behind the scenes this podcast is for anyone who values hard work determination and stories that build the backbone of our workforce So grab your gloves your coffee or your clipboard It's time to get to work Welcome to another Built To Work podcast I am here with my friend and somebody that I used to do a lot of business with Beau Lace with Lula Beau thank you for being here today Yeah absolutely happy to be here All right So Beau and I have known each other I don't know at least 5 years now probably 

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going back into the property management world when I used to own a company and Beau is the CEO and one of the founders of Lula which is an awesome company So Beau can you tell the people about Lula What do you guys do Yeah Yeah So we're a technology platform that streamlines that maintenance process for property managers and the residents while also bringing a fully vetted nationwide network of contractors to complete the work 

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Okay So in simple terms for somebody else that's a property manager if You basically that means they don't have to have their own maintenance guys on staff Yep And renovation guys make-ready guys all that sort of stuff They can just totally outsource that to you and it's all done through you guys right Yeah And even if they do have some W-2s the reality is in this business with the seasonality- 

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is you can't staff appropriately year round Yeah So you're always gonna engage third-party contractors- 

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even if you have a few W-2s But we do have some customers that have you know outsourced 100% of their maintenance to us 

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It's just easier to take that pain away from them and put it on our plate and that Yeah And maintenance is definitely a- property management pain Yeah So we actually got to the point pretty qua- 

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pretty quickly where we were 100% with you guys Yeah I I think we kinda we kinda worked into it and then once we saw the path forward we were like "This this was the way to go for us." 

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you were serving us 

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you guys started with Kansas City as your first market 

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then we worked with you guys in St Louis and then in 

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Ohio Ohio as well yeah I think 2 markets in Ohio 

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so how many markets are you guys in now So we're in around 47 markets today so just most recent- Geez Yeah most recent markets we just opened up San Diego Minneapolis and Colorado Springs so Okay That's awesome 

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so how many pros are in your network Like how many people do- Yeah do you guys have access to Yeah so we have 7,000 

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Lula pros- Okay 

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nationwide today that go through a pretty rigorous vetting process And so we get about 1,000 applicants of contractors a month 

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we only accept about 12% That few Wow Yeah Okay So what's the criteria for acceptance versus not acceptance Yeah I mean you know obviously we go through all your traditional you know make sure they have the right insurance make sure that they pass background check make sure they have professional license- 

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but then we also check you know their any reviews that they have online Better Business Bureau We're we'll also 

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put them through competency tests to make sure that they truly know what they're doing within their trade 

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and then we put some guard rails once they do get approved where they can only accept 3 jobs and have to successfully complete those 3 jobs before they can actually start seeing more jobs and then- Okay we kinda take those guard rails off and let them go to work Okay Yeah Y- I li- I like that That's that's great So with the competency test so if somebody comes in and says "I'm a general maintenance guy-" Yeah you're going to give them a different set of questions or scenarios than if it's an HVAC guy for instance Yeah we do So it depends on the trade If it's a handyman we have certain handyman questions- Okay that are pretty common right- Okay that we ask them but we also ask not how they approach the work to- 

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get the repair done but also what they typically charge So we let our pros put their own rates- Right but within a certain threshold right Okay So like you know no one's gonna pay $700 to replace a toilet in the property management industry right Like you want that $250 $300 right Yeah yeah That's right So 

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we do let them put their own price but we ask those pricing questions upfront- 

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to make sure it's gonna be a good fit before we even allow platform Okay 

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and then you know the most qualified and affordable pro 

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are the ones that see the most work basis Okay Gotcha Yeah I know that with the way everything's gone from you guys and you guys are technology is your thing- Right at the end of the day right Yeah Like you're a technology company working in the property management space which is is great and is very needed and then specifically the maintenance side which I feel like is pretty slow to adapt to technology right 'Cause a toilet is a toilet and garbage disposal- is a garbage disposal at the end of the day- Yeah and you still have to turn those wrenches 

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it's been great and working with you guys 

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what what year was it started 

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we were founded in 2017 Okay 

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we actually started as a B2C model 

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So we were serving homeowners Okay So 

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but what happened is about a year in is about 80% of all our revenue was coming from DIY landlords So landlords found it faster and more efficient to leverage our platform- 

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to get a quick resolution for the residents than it was to go through like a lead generation platform or call their contractor list see who's available And so 

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we actually started picking up the phone talking to DIY landlords and then realized that quickly realized that there was an opportunity for us in the property management space 

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So we pivoted in the property management space We don't necessarily serve DIY lands any- DIY landlords anymore that have you know one or 2 homes 

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It's typically more of the property management companies that have several hundred to maybe 10,000 Okay.Yeah No that's- that's awesome It's been great to see the way that your product has evolved Sure I- i- in the time that I've used it and I- it's been a couple years now since we we sold and I'm sure that it's changed since then But from how we went from okay we submit a work order via email to at least with the property management software we were on you guys then plugged into the software Yeah integrations Yeah So you got those integrations going so then you could see as it was coming in in real time and you guys were dis- dispatching and managing all the tickets and we didn't even have to worry about that at that point And w- we did a lot of the triage manually So our service team would triage with the resident Once we receive that work order we would call see if we could walk them through some of the troubleshooting to see if we could deescalate and eliminate that work order Yeah Or at least curate that work order so we have a high chance of one-trip resolution Now we've got an AI 

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product that basically sits on top that front end So when we get a work order from a property management company it's ingested We have an AI with natural language processing that actually conversates with the resident at the time of that work order being ingested that walks them through the troubleshooting and then it curates that work order and ingests it into our system and then we kick it out to our network so So you're refining the work order using AI so that- Yeah Okay you've tried troubleshooting steps that anybody can do like one two and three Yeah Then you pass that information on into the work order hey we tried resetting this we tried this and nothing's changing Yeah It's just more information Yeah Troubleshooting information that we log for the contractor that's gonna be going out or the Lula pro in our case right And so 

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you know examples is like replacing thermostat batteries right 

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resetting the garbage disposal Yeah GFIs like these things a lot of times are residents they want the fastest resolution possible and if it's something simple that they can do they're happy to do it right Yeah So let's see if we can do that troubleshooting and deescalate that If not we have a very nice packaged curated work order that we can then kick out to our contractor network which we've seen the increase in a one-trip resolution go from like 62% to in the 70% now Oh okay Because we're curating those work orders much better on the front end Yeah So you're saving money for your customer as well at the end Absolutely Because it's not a 2trip process Yeah And it's a you know no resident wants a contractor in there multiple times for the same thing Yeah If you can help it right Yeah absolutely So if you can get it done in one trip let's get it done Have you also found a I don't want to say a decrease but have you found that the that those resolutions and the triage has helped reduce the number of simple calls that you have to go out and do like resetting the garbage disposal Yeah totally 

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you know I think we're averaging around 10% that gets deescalated So out of all the work orders we receive about 10% 

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we eliminate a trip through that AI troubleshooting process That's great 

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and you know I think residents for the most part are happy to do it 

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If- if it's something simple so You know one thing that I found that was awesome was working with you guys was okay we focused on managing the property re- you know interacting with the tenants and we could pass you know the maintenance off to you guys right And for lack of a better term you guys were the specialists in that department not because you guys knew everything about HVAC or everything about plumbing but you had your network of pros You had such such a breadth of people that knew those specific trades that- Yeah it was easy just to pass that off to you guys Yeah 

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I think you know a lot of customers that go all in with us there's a couple th- couple can 

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conveniences for them right 

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one is you know some of the larger operators are buying additional portfolios in different areas They may you know in Raleigh North Carolina for example they may get a portfolio of 300 doors but they have no maintenance 

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supply there at all right Yeah So they either have to try to build that on their own or well Lula's already in this market we're already using them in Kansas City Yeah You know we're confident we can buy these this portfolio and immediately start servicing it Yeah Because we have Lula right And something else that we started rolling out because we're in so many markets we have such large buying power now we've started rolling out flat rate pricing programs Okay So HVAC appliances water heaters we're just getting ready to roll out drain cleaning is flat rate Okay So you know the price of what it's gonna 

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cost to replace you know a certain tonnage of HVAC- 

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system a water heater you know gas electric whatever the size And it's flat rate so we're helping our customers start control costs and it's highly competitive So because of our buying power we've gone direct to manufacturer to negotiate the rates on equipment And then we have negotiated rates with our contractor network that's 

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in the 45 or 46 markets that we're in today Okay Great So you're saying "Hey we're going to go straight to one of the HVAC companies Hey we're going to pay you guys $2,000 for this system." Then you talk to the HVAC guy and you say "Hey- Yeah we're going to pay you guys 750," I don't know- Yeah $1,000 whatever for insula- installation So here is this That's right This is always going to be this no matter what market effectively right That's exactly right 

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that is great because there is s- so much variability in those prices Oh it's all over the board I'm- I'm sure you've seen that I mean we would go get the same thing quoted before we kind of start working with you guys and they'd be like oh it's one guy would be like $3,000 one guy would be $2,000 and it's the same thing and you just- Yeah I don't I don't understand why there was that difference So 

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okay So you're up to 7,000 pros now Yeah What's You're in 46 markets How many markets are you guys going to try to be in I'm sure there's a minimum threshold of size of market that makes sense for you Yeah Well it really 

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we were in some smaller markets that we thought we may not go to I mean Colorado Springs isn't a really big market- Yeah but it's a good real market 

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and so we'll go where opportunity is Okay In partnership with either our existing customers right Our larger customers have portfolios We already got a relationship with them They've got portfolios in other markets Yeah We know the work's there We'll open it up but 

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you know we have a strategic partnership with AppFolio and PropertyMill even TurboTenant which actually does serve the DIY landlord- Okay 

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space 

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but wherever the opportunity is- Okay 

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with those partners or existing customers we'll go if the opportunity is big enough So we just prioritize those markets based on the opportunity 

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we're planning on opening quite a few in California this year quite a few markets- Okay in partnership with AppFolio That's where they're based They have a lot of customers there And so 

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we're going to open up you know we just opened up San Diego I think LA is probably the next one we'll open up I- I imagine in market like in LA or San Diego like- Tough it's a lot of work but there's so much opportunity there as well There's a l- there's a lot of opportunity You have to have a lot more pros Traveling in Kansas City is much different than traveling in LA Yeah Right So you know a pro in L- little pro in Kansas City might be willing to travel 30 miles you know to- to a job Could cover the who- the whole metro in 30 miles That's right Yeah And in LA it's more like 3 So Yeah Same amount of time as traveling 30 in Kansas City That's right So you have to have a lot more density so Okay But we understand that and so we're excited for the challenge Yeah So what's the process for going to recruit like these pros Hey you're going to open up San Diego I- I don't know how many millions of people are in San Diego and you guys do some analysis that says "Hey we need a- a 

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you know just a general maintenance guy." Right That can handle So we need one for every so many square mile as Like how do you guys figure that out and how do you recruit that Yeah So we break it down by doors Okay And so we know typically for 1,000 doors we need X number of pros within each service vertical or trades Okay Right 

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however depending on you know 

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the market we may need more because of traveling issues Okay Right So but what we did years ago 

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is we had our data team our data science team get with our marketing team and created these custom scraping scripts Okay They basically scrape the internet all the directories and created 

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basically this provider universe Is what we call it And then we have data entry people that go and enter in all the data We have the trades they're in all the information about the services they provide what zip codes they cover And so when we open up a new market we go to this provider universe that's refreshed every single month 

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say we've got 1,000 doors in Atlanta with a new customer we need X number of pros We'll go to that provider universe and then our provider success team will start contacting these individuals See if they're interested in working with us And then we'll put them through the rigorous vetting process And then once they're approved they're off and running Okay No that's- So that's great Yeah I- I can't imagine trying to get that ball rolling and it's a little bit of the chicken or the egg first right Yeah Do you need the pros or do you need the doors in these markets 

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so yeah that's- that's awesome So do you guys think that down the road you're looking hey we're at 7,000 is it going to be hey we're going to 10,000 20,000 pros What's- Yeah What's the target It just depends on you know the markets How fast we open them I think that you know a couple years ago it's like let's open markets as quickly as possible 

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And now it's like let's just where the opportunity is let's just open those markets up and make sure that the work is there Yeah Right back before you know years ago when we didn't have great processes it was like "Well let's Atlanta sounds like a great market It is a great rental market." 

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"Let's open it up." But then you have all these pros that we've onboarded but we haven't engaged customers yet Yeah Right So now we've got pros like where's the work So you know So now 

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we've evolved we've matured and we have a pretty large customer base now- 

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I think close to 150 customers And some of them are larger institutionals that have portfolios everywhere So and then we got the strategic partnerships now 

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So now there is the work just waiting Yeah We just Where the biggest opportunity is that's where we're gonna go and open up And 

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I can't tell you how many pros we'll have maybe we'll have 20,000 in a year you know just- I can't even imagine just depends on how fast we scale the business Yeah Right So Yeah Well I know with us and- and you know following the customer is a great way to do it right Following that demand because I know that we weren't the only one asking you guys to open up Ohio Sure But you were like "Okay we've got 3 of you guys now asking for Ohio." Yeah "This is We're- we'll go ahead and focus on Ohio." And I was like-We very much appreciate that 'cause we don't want to have to try to manage multiple different vendors in a different state Yeah And it was just It was great working through you guys Yeah 

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one thing I'd like to focus on is like success stories that people have had by utilizing services such as yourself really- Yeah like where they can outsource right We've You know we've outsourced you know accounting we've outsourced HR we've you know these different various things within within our companies Can you share any success stories that people have had where it's like before maintenance- Yeah was a wreck and then after like it's streamlined What what what have you seen anecdotally or experienced Yeah I mean first of all we all know that maintenance is one of the biggest pain points of right Yeah It's just It it's a hassle but doesn't necessarily have to be Yeah Engaging a a partner like Lula a- allows you really to consolidate a lot of things Like we'll take the you know the ingestion of work orders directly from the resident off your plate We'll take the phone calls off your plate 

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we'll consolidate things so that you only have one vendor that you're- Yeah paying on the back end so the administration burden is lightened 

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we have one customer that has portfolios in Kansas City and St Louis and they've been with us for gosh I'd probably say 3 or 4 years now 

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but they 

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visited our office not too long ago and they told us that if it wasn't for Lula they would have closed their doors 

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Like that's how much of a pain the maintenance was for them just managing all the different vendors and then You know those vendors will disappear on you and then you're just It's a constantly like revolving- Yeah door of just like trying to build a vendor list and maintaining 'em And so they just got tired of that burden right And then we consolidate everything on the back end I think that you know they were able to reduce their staff by like 50% and - you know so they're more operationally efficient 

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And maintenance is 

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Maintenance is being done it's streamlined and it's a better experience for the residents at the end of the day Yeah So So you literally will help them not shut their doors That's right That's great And I- Can't get a better testimonial than that No you can't And I and I'll say that our experience is probably very similar right We were having just turnover with maintenance guys and then we had to get the specialists right Like we had- Yeah the general handymen but once we were able to to find you guys we started You know if somebody was quitting like we weren't backfilling those those positions Yeah Right We were just kind of letting those position We were just shifting more of the work over to you guys And it got to the point too where it's like okay our life is easier our field staff is cut in half to eventually where it was effectively zero and we're making more money with less headaches now And that was just part of systematizing our business Yeah And that was an excellent for us Yeah I mean we've seen customers reduce the maintenance coordinators that they need 

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Because we're handling a lot of that coordination W-2s there's a lot of turnover of W-2 maintenance techs 

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And they're hard to find good ones And so you know some a lot of customers if they lost a couple like you just mentioned we'll just Well we'll just leverage Lula right 

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we do a lot to try to control the cost for customers as well 'cause maintenance costs you know They have They're very you have to be very competitive in this industry Yeah Right And we understand that which is why we're continuing to roll out on that flat rate pricing program- 

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so that we can control the costs and our customers know what it is up front But- That's great 

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our algorithm when we send out a job to our network of contractors 

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you know performance is one of the pieces pricing is one of the pieces locations you know- 

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skill everything else But we're always when that job goes out we're notifying in that algorithm the most qualified and affordable pro that's already working in that area so they don't have far to travel So we're trying to do everything we can to really reduce the maintenance costs on top- 

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of everything else So I was never on the contractor side of that Do they just have like an app on their phone that- Yeah they can utilize and it pings them says "Hey there's a job nearby Hey there's a job in your your niche that's just come across the table" Yeah It's a native mobile app Okay They have to use it in the field So we have 99% app compliance So in order to actually do the job and get paid as a Lula pro you have to use the app 

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So that means you know they're hu- they're hitting when they're in route they're hitting when they reach the job site they're starting their clock so we can see how long they're there- 

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stopping their clock and then service notes and pictures and everything else Yeah But what that does also it gives us real-time information 

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Which typically doesn't happen if you're just leveraging you know your property management software's work order management system you don't have that visibility So Lula on top of everything else we do is we provide real-time visibility throughout the entire life cycle of that work order From the time that job's ingested all the way through completion 

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you can see exactly the state of that job where the contractor is You can even see when he's on site in real-time And then you have instant access to the notes and before and after pictures and an invoice So- Yeah you're not waiting around for you know contractor to get around to type up his notes and submit an invoice which sometimes could be days later and you don't know what's going on So Yeah I had an HVAC guy reach out to me and it was like 2 years later and he was like "Hey I don't think I ever invoiced you for these properties." And I was like "Man I don't own those properties anymore." Yeah Like I can't tell you if you did or didn't do that Like it was- Yeah like personal properties too And I was like 

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yeah." So that's the exactly- It's a problem Yeah It i- it is a problem 

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and I remember on on you know the PM side being able to see the dashboard and I'm sure it's evolved since I've seen it last But just like "Hey these are scheduled these are completion these are here's the photos and these have issues there they're coming back." Like it was- Yeah it was it was very very insightful So you guys are definitely doing something good with that Yeah We started exposing gotten a lot more granular in what we show Okay So we're we're now at the point where you can actually watch the triage process with a resident when the work order is first ingested Really So you can see everything that's going on 

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we mark if it's resident responsibility out of the gates You know if it's a home warranty we recognize that 

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different rule sets that your owners might have as property manager for a specific property like we have what's an AI co-pilot for our coordinators here that it serves up all that information in real time So if there's a warranty on a property home warranty on a property we're not just immediately dispatching someone right Yeah We'll work through the home warranty process If it's resident responsibility we're feeding that back into you know to let the resident know upfront that they may have to pay for this work if they're gonna continue because it's part of the lease agreement which we have stored in our system this is a resident responsibility This light bulb is a resident responsibility Yeah Exactly You can do this with the most expensive light bulb you ever put in That's right But I would recommend you go to Home Depot and grab one Yeah So we're evolving of where we get all these rule sets from our customers and ingest that so that we're making the right decisions at the time that work order enters into our system Gotcha No that's that's great I mean the evolution's great What you guys are doing is great So 

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so the future for you guys right now is just going where the market market demands- Yeah and requests you Yeah I think right now 

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this is gonna be a big year for us I think we've got a lot of really good processes 

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we've got a lot of exciting product updates coming out and it's really about scaling the business 

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especially with you know new partnerships that we're forming 

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as we speak And so it's really growing into new markets growing the business 

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staying close with our customers figuring out what their need evolving needs are and making sure we're serving them the right way And then AI has always been a component to what we do but we're doing a lot of really neat stuff with AI now you know just the ingestion piece I talked about Yeah His neat AI coordinator co-pilot You know even on the back end we've got AI that will rewrite service notes so they make sense when they from some pros that come in right They aren't always great 

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so a lot of different use cases there 

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and then I think what's really exciting is commercializing 

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our AI work order management system called Foresight Okay So we're releasing that So basically taking our internal platform that drives 

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incredible efficiency for our team 

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we always you know when customers come to visit us they always see how small our service team is and it's "How can you manage you know a thousand work orders a day with this small team?" It's because of the technology Yeah So Foresight is essentially externalizing our internal platform that drives our own efficiency for what we do to a true SaaS product work order management system that we can sell to customers so that they can drive more efficiency in their own business Yeah No that's beautiful No I I think that outsourcing to a company like yourself that can help drive efficiencies that allow the experts to do the expert things then those companies the property management companies those owners they can then focus on new sales- Yeah collecting rent dealing with tenancies whatever it is right And and let them focus on that So you guys are doing great I love your product It's been cool to see you guys grow as well And you know there's pride too in a Kansas City company that is- that is out there just killing it right Growing coast to coast So you guys are doing awesome Well we'll keep trying Yeah And I think you know you hit something you said something that 

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I think is important is that a lot of these companies property management companies especially when they get into the hundreds of doors they get bogged down with maintenance right 

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And they're l- they're looking for solutions because what they really want to do is go back to growing their business Yeah And Lula allows them to do that And when we were at 1,000 units we couldn't focus on trying to coordinate 25 maintenance guys a day We just needed to pass it off to somebody- Yeah and you guys were the best solution for that Yeah So all right Well thank you so much for your time I appreciate it Yeah Thanks for having me