Jason Hartman plays a Flash Back Friday episode focused on self-management. He hosts Gino Zahnd to talk about Cozy, a program that makes rent collection and screening tenants easier and accessible from anywhere. Jason explains that owning the most historically proven asset class, income property, is getting easier especially with the increased number of self-management tools and online software. Zahnd explains that Cozy’s goal is to be the best one-stop-shop for realizing rent payments.
This show is produced by the Hartman media company. For more information and links to all our great podcasts visit Hartman media.com.
Jason Hartman 0:09
Welcome to this week’s edition of flashback Friday, your opportunity to get some good review by listening to episodes from the past that Jason is hand picked to help you today in the present, and propel you into the future. Enjoy.
Welcome to the creating wealth show with Jason Hartman. You’re about to learn a new slant on investing some exciting techniques and fresh new approaches to the world’s most historically proven asset class that will enable you to create more wealth and freedom than you ever thought possible. Jason is a genuine self made multi millionaire who’s actually been there and done it. He’s a successful investor, lender, developer and entrepreneur who’s owned properties in 11 states had hundreds of tenants and been involved in thousands of real estate transactions. This program will help you follow in Jason’s footsteps on the road to your financial independence day. You really can do it. And now here’s your host, Jason Hartman with the complete solution for real estate investors.
Jason Hartman 1:16
Welcome to the creating wealth Show Episode numbers six to six 626. I’m your host, Jason Hartman, thank you so much for joining me today, as we review what has happened so far this year for just a moment, before we get to the main part of our show, and it is it’s devastating. I mean, it is devastating. Do you know that the world’s stock market just so far this year, it’s not even the end of January yet? The world’s stock markets have losses approaching $8 trillion. That’s trillion with a T and so on. These nervous investors have rushed out of the stock market. And they’ve put a lot of money into government bond funds. Now, it just begs the question of how engineered these crises are, you know, Rolling Stone, I think it was rolling stone A few years ago, did a big expose on Goldman Sachs. And the Federal Reserve. I believe they talked about that, too. You know, forgive me if I’m not exactly remembering this right, by the way, but you probably saw this it was pretty famous story. I believe it was rolling stone to Rolling Stone magazine. kind of odd for them to cover this maybe. But they talked about the giant bubble machine, how these ups and downs in the economy, that the Federal Reserve when it came into being just slightly over 100 years ago, was supposed to stop the ups and the downs, the gyrations the rollercoaster ride the debasement of currency. You gotta laugh at that. Because if it wasn’t so sad, it would be funny, because it’s so ridiculous, right? They’ve the dollar has been debased more than 96%, since the Federal Reserve took the helm, and it was created on Jekyll Island in 1915. And it’s just mind boggling. So if you think about this, right, if there is a group that runs the world, okay, let’s just, let’s just toy with the conspiracy theory here for a moment before we get into the main portion of our show. If there is a group that runs the world, maybe it’s the Bilderberg Group, I don’t know whoever it is some secret society, or maybe it’s just the 12 richest families or you know, whatever, whatever, whatever, right? If you’re running a world and you want to shift wealth from one place, group of people to another group of people look at what you can do, you can run the world stock markets up, then you can sell all your stock at high prices, right? Because you might own most of the stock right? Or, you know, not most but a large amount of it to be able to unload onto, you know, the middle class investor so that they get the burden, right? You, you start, you sell it off, and then the market starts to tank. And you’ve already you know, you’ve already moved your losses off, right. So you’ve you’ve sold at a high price, and then that money pours into government bond funds, looking for safety seeking the Safe Harbor, you know, things like treasury bills or whatever bond fund from whatever government around the world, right. So the money pours in there. And then After that, you know, the rationale would be, well, the markets are down, we got to do something to fix it. And, you know, we haven’t even talked about, you know, the real estate market because that one’s harder to control, you know, that, that especially globally, it’s really hard to control the real estate market, you know, in the US, I mean, at least you can make a case for it, you can toy with interest rates, you can toy with, you know, the government sponsored agencies, Fannie Mae and Freddie Mac who, who are buying loans on the secondary market and you can, you can, you can control the flow of money and thus the supply and the demand dynamic and the prices, you can also influence maybe tax law changes, tax code changes, and things like that, that will influence things but those boy I’ll tell ya, when it comes to real estate, those sacred cows, they change very, very, very slowly. I mean, there’s very little change. And, you know, people come to me and they say, Jason, you know, don’t use think the government could change the laws and take away all these great tax advantages we have as income property investors, you know, its most tax favored asset class in America, you always say, Well, yeah, they could. But in in many decades, it really hasn’t changed that much. I mean, it changed a little bit. Well, not a little bit. I guess that was pretty significant actually, under Reagan, okay. Quite arguably the best president in modern history. But he had his flaws too. Okay. He was a he was a globalist, okay, just like all the rest of them. The change there was from accelerated cost recovery. Do you remember that? Are you old enough to remember that? Okay. So we had the AC Rs, the accelerated cost recovery, which means you could accelerate the depreciation and that was a big tax advantage for the front end years of your property. And now There’s we don’t have accelerated depreciation anymore except, you know what a few unique cases for example, we have that in the go zone several years ago. And of course, you’ve heard me talk about the go zone, many of our investors made huge tax benefit profits, including myself by investing in the ozone. But then, like any idiotic government program, which I do ultimately think it was idiotic, you know, it causes malinvestment, because all the investors rush in there, they heat up the market too much. They overpay, they drive up prices too high. And there you got another little mini bubble, right? It wasn’t a significant one. But you know, it was happening in there. And so this is this is the rationale. Right? Okay. So let me get back to my point, Jason, you’re on a tangent again, stop being on a tangent. Okay, back to the point. So, the powers that be drive the stock market up, they unload tons of stock on to middle class investors. So The rich get richer. And then the stock market starts to tank as it has over well approaching $8 trillion in losses so far this year. Wow. Now, just to get a perspective on that, okay, what is the size of the global economy? What is the size of the entire economy of planet Earth in a year? Well, you know, I don’t know offhand. But it’s somewhere around 60,000,000,000,006 zero trillion. And here, we’re talking about losing 8 trillion in less than a month. Whoa, that’s ugly. That’s really, really ugly. So understand the perspective here, when investors lose $8 trillion in stock value globally, in less than a month. And you look at the world GDP have somewhere in the neighborhood of 60 trillion six, zero trillion with a T. Okay, right, that is giant, this is a giant amount of money we’re talking about. And then you look at the GDP of the entire United States, right? The entire United States GDP in 2013 was just under $17 trillion. Okay, just under $17 trillion. So, that is Jai enormous. Okay. So, going back to the concept of how this could be engineered, stock market goes up, the rich take their profits, stock market goes down. All of the scared investors pour into government bond funds, and then the rationale becomes, well, we got to do something about this. This is terrible. The market is down. What are you going to do? Well, the only answer any of these morons that run the world ever have I guess they’re not that dumb. They’re smarter than me. I must be an Uber moron. Because they’re morons to okay. The only tool they really have when it comes down to it when push comes to shove, is they just change the monetary and fiscal policy and what do they do to monetary policy? Well, let’s print more frickin money. That’s all we can do. So whenever the the g7 and the g8 and the G 20, and the G whatever, meet the industrialized countries of the world, all they do all they’re really all their answer all comes down to one thing, quantitative easing, money creation, fiat money out of thin air. Okay. And then what does that do? Well, that creates inflationary pressure. Now, I know what you’re thinking, especially you, Jeff, I know what you’re thinking. Well, Jason, they’ve been doing that and it hasn’t really caused much inflation is very tame. You’re right. But you know, it’s arguable. As to whether or not how much of that is baked into the cake, and when it’s coming, okay? And look, remember, you’ve got to remember something people, this is incredibly important. There is no limit what so ever, to the amount of money creation, and thus, the amount of resulting inflation that can be created, there is absolutely no limit. So if there is another shoe that’s going to drop, and things are going to get ugly, then they will simply pull out all the stops and print more and more and more and it doesn’t even print anymore. It’s just electronic now, so they can cause inflation if they want to. Believe me. There is no limit. Just look at all the examples throughout history whether they be sim Bob way why Mar Republic, Hungary, Argentina Oh, over and over and over again. Argentina is just so funny like that. And then God, Venezuela, you know, I’m glad Obama’s reading the book that the late Hugo Chavez gave him, right. It’s just unbelievable, folks. I mean, you couldn’t make this stuff up. It’s like this is better than fiction, right? It’s, it’s insane. It’s just totally insane. The way the world works, I mean, these these, these supposedly adults, and these brilliant economists, these Nobel laureates, at the end of the day, they’re just flippin people. That’s all they are. And most of them are overly self important people that gets chauffeured around at our expense. It’s just absurd. Okay, so Enough said, Okay. Hey, before we get to our guest today when we talk about self management, rent collection, and tenant screening, with the founder and CEO of cozy This is Gino who came out and spoke at our Meet the Masters event. He was awesome. This is an awesome product, you’re gonna love this episode. Before we get to that, I want to remind you to get some free stuff. You know, I forget to say these things a lot on the show. Okay, so first of all, go to Jason hartman.com slash matrix ma t ri x matrix and get those slides that we talked about several episodes ago about the investment matrix. And it relates totally to this $8 trillion in stock market losses. Because it talks about and shows you visually to correspond with what I was talking about on the podcast several episodes ago about the way different investment vehicles act in the three basic economic scenarios inflation deflation and stagnation. Very important slides, just go get those PowerPoint slides, Jason hartman.com slash matrix ma t ri x and save the date for Jason Hartman University in March Okay, this is going to be a good event, Salt Lake City, Utah you can get some skiing in while you’re there probably be nice spring skiing conditions my favorite because I do not like being cold. It’s tentative okay but do save the date, March 12 and 13th Saturday and Sunday March 12 and 13th, Salt Lake City, Utah, very convenient destination for many people. And also if you want the slides from my Ironmen presentation that I did in Scottsdale in early December, go to Jason hartman.com slash I am en if you’d like to get a hold of the meet the Masters online course. Go to Hartman education comm I know I’m probably like overwhelming you with websites right now. But you know, you can rewind, okay, that’s the nice thing about this. It’s there. You can reference it. Anytime, check that course out a lot of you have given some very favorable feedback on that and how how nicely organized it is. So we appreciate that we put a lot of effort into it. And gosh you know, of course check out the properties at Jason hartman.com. But let’s talk about self management. Let’s talk about rent collection. Let’s talk about tenant screening and how easy it is becoming, you know, with our new software company we are working on, you know, a relationship with cozy of how they could use our investment evaluation and tracking stuff with their system. So I think you’re really gonna like this show and without further ado, let’s talk to Gino founder of cozy it’s my pleasure to welcome Geno’s on to the show. He is the founder and CEO of cozy and we’ve talked a little bit about cozy on prior episodes before and we wanted to take a deep dive into it find out what it is find out how it can help you With the management of your real estate portfolio, and especially if you are self managing or thinking of self managing, not going the the more popular property manager route, and we’ve had clients have tremendous success with both of these approaches, sometimes, sometimes self management, believe it or not, is actually easier than managing your property manager. As I always say, if you have a great property manager, heck, keep them. But if you have a mediocre or a poor property manager, self management really could be a good alternative for you. It’s worked for me. You know, many years ago, as I as I have before on the show many years ago, if you told me that I could self manage a property that I’ve never seen. That’s 2000 miles away with a tenant I’ve never met, I would have told you you were absolutely crazy. However, I’ve done it successfully quite a few times, and many of our clients have as well, so it is an option. Remember, you’re listening to flashback Friday, our new episode loads are published every Monday and Wednesday. And let’s just kind of dive in and see what Gino has to say Gina, welcome. How are you?
Gino Zahnd 17:09
I’m doing well. Thanks for having me.
Jason Hartman 17:10
Good. You’re based in Portland but coming to us from Sin City today, right Las Vegas.
Gino Zahnd 17:15
I am in Las Vegas today I am here for the money 2020 conference. And so it’s been two days so far of back to back meetings with folks and it’s that’s been a really good conference. Fantastic.
Jason Hartman 17:27
Well, you know, what is cozy? When you when you give an elevator pitch to someone, you know, just in 30 seconds. What is it?
Gino Zahnd 17:36
Yeah, cuz he is a very simple to use service for landlords, property managers and their tenants to do everything from paying and collecting rent, rental applications, Tenant Screening background checks, and our goal is to be the one stop shop that you can run your rental business with.
Jason Hartman 17:56
Okay, great. And how did you come up with the idea? I mean, I did it Tim Ferriss is an investor in cozy, isn’t he?
Gino Zahnd 18:02
Yes, Tim is an investor. And the the idea was born from a lot of miserable experiences as a renter in San Francisco Actually, I lived there and worked in the valley for almost 20 years. And the the idea for cozy really started in 2009. And my business partner and I had had been talking about it for a couple of years. And in 2011, I was moving again and I had filled out the the standard 10 or 12 rental applications that you fill out in San Francisco, and a landlord accidentally ran my credit score six times in three hours. And there’s not a lot you can do about that other than wait for the consequences and then and then ride them out. And that made me angry enough to think that I could actually do something about it. And so the nutshell of how cozy was was born, started there and We were actually running another company at the time. But I removed myself from the daily daily operations of, of that company. And we went to I went into about 40 different markets to, to speak to people firsthand. And we wanted to know, you know, what tools they used at that point, or, internally, our biggest competitor was Microsoft Excel. It’s a very entrenched tool and in the small landlord space, we wanted to understand, you know, where the big headaches were between landlords and tenants, we wanted to understand if there were markets in the US that worked differently, where were they and why was that the case? You know, for example, we had this perception that in New York City, it would be very difficult to use something like cozy because there’s such a strong broker presence there. But at this point, we have a lot of customers in New York who screen their own tenants and we’ve we’ve made all of that very simple. And so that’s that’s where the idea came from. We launched publicly in July of 2013. And at this point, we’re used in over 4000 cities around the country. So every urban area, every suburb, everywhere.
Jason Hartman 20:07
Okay, so for tenants, basically, it sounds like the USP, the unique selling proposition is that the tenant can just go to cozy when they want to look when they want to start looking for new place. And they can fill out one application. And cozy will be this sort of centralized service that will run their credit report do their background check. And then landlords can just go there and find out what they’re all about. Is that correct?
Gino Zahnd 20:35
So we’re not a listing service so you don’t
Jason Hartman 20:38
come to cozy? I know, I know that I know, they’re not I know you don’t have listings on there like Zillow or any or you know any of the other sites or Craigslist. But they can they do what I said though,
Gino Zahnd 20:48
yeah, so generally, the way that it works is when when a landlord is looking for a new tenant, for example, part of the application process is the credit reporting background check. And so When a tenant is filling stuff out, it’s just a seamless part of it. It’s not a separate piece. And the beauty of cozy is that as a tenant, you never have to give someone your social security number. So you pay for your credit report, but you own that data, you control it. And so mechanic the way that works, say that I apply to your place, I would run my own credit report, I would get the results and I would share those with you as part of my application. So you get what you need. It comes from the Bureau in real time, so you can trust the information, but I’ve never given you anything that you could use for identity theft. So, so that’s that’s how that piece works. Okay, so it’s good for the tenant in that way. Now, tell us how the landlord uses it. So landlords use cozy in two big ways today. The first piece is with rent payment and collection and the other piece is our story. screening tools and rental application. So we make finding a tenant very, very easy and we make the quality of the data that you get very high.
Jason Hartman 22:07
Okay, so let’s take those in chronological order. Let’s talk about screening. So you’ve got a property that’s up for rent, you know, many of our clients that self manage, they’ll use a real estate agent or a property manager, just to do a one time lease up. Some of them do it themselves to, you know, if, if they’re if they’ve got this one time lease up sort of thing. Can you tell your real estate agent or property manager that I want to use cozy to screen all the tenants?
Gino Zahnd 22:34
Yes, and that’s actually a very common use case. For us. We have a lot of listing agents who only use our screening tools. And then when it’s time to just start collecting the rent on a monthly basis and we’ve automated all of that, then the landlord can just set up those payments and the payments go directly from their tenant to to whichever bank account they want it to go to.
Jason Hartman 22:56
Okay, so what do they do? Tell us exactly what happens so the attendant comes expresses interest in the property and then what?
Gino Zahnd 23:02
Yeah, so there are a number of ways that that people use cozy in terms of where they come into the product. So on the tenant piece, if I’m looking for a place I can take my my cozy property and we give you a unique URL for the application for any given property. So I can put that that link in my Craigslist ad or my Zillow ad or wherever I want to market it, tenants can simply go to that link and apply and they can apply from their phone. So so you there, there will be a link, there will be a link and you can put that link on a Craigslist ad. You can put it in postlets, Zillow, wherever you’re listing the property right, that says if you like this property apply here. Is that how it works? Yes. Okay. And then and then the tenant goes and applies, and how much do they have to pay for the application fee. So there there isn’t an application fee. We have decoupled the Do have a fee from the application. So most landlords do want a background check on a credit report. And we, that’s the default setting. So if if the tenant does need to pay for that bundle, it’s 3495. If they just need to buy a credit report or a background check, those are 1995 each. And as I said before, the tenant controls that information and never has to share anything that can be used for identity theft. And so it’s free for the landlord, the tenant pays for it, but they they have control of that. And so in the very rare cases where a landlord or property manager or just accepting applications, there’s no fee for the application itself,
Jason Hartman 24:41
so there’s no fee for the application. Now, landlords usually make a little bit of money off the application, okay. I mean, they have to spend their time so it’s a fair, you know, I guess, a fair request. But for example, you know, a landlord might charge a $25 application fee for each adult occupant in the house, right? So if it’s a husband and wife, it’ll be $50. If it’s just one party, it’ll be $25. But then they’ll go, and they’ll run the background check, and that only cost them maybe 10 bucks. What happens with cozy? Can they still do that? Or does that opportunity gone? And I’m calling it an opportunity, because you know, they do make, you know, it’s a nominal amount of money, but
Gino Zahnd 25:20
it’s icing. And so, so cozy is completely free. And we take the burden of actually dealing with applications from from the the landlord, right. So we did a lot of early homework on this because we, as renters had experienced the wonderful and mysterious application fee. And what we learned is that when and we asked about 3000 people around the country about this, specifically about why do you charge an application fee and if so, why? And the overwhelming majority of respondents to that survey They told us that they use the application fee simply to go pay for a background check and credit report. Less than 5% used it to collect an additional fee from their tenant. And so we made the decision early on to just remove the concept of an application fee and and only have tenants pay for the things where they’re actually acquiring data about themselves to apply to a place. And so you know, we’ve been in business for two years now. And I think we have had maybe three or four people over the course of our history email to ask, Hey, how can I charge a tenant an extra, you know, 10 or $25. And so
Jason Hartman 26:47
there’s actually kind of a little other benefit to the landlord. You know, if the tenant pays something, even though it’s a nominal fee, like 25 bucks, you know, it sort of makes him more committed to the property. If they’re out looking at you know, two dozen properties. Applying everywhere, you know, they kind of feel like they’re really sort of into it if they gave you 25 bucks. So, you know, look at know, landlords making money off application fees, okay, they have to spend a lot of time screening the tenants and so forth. But, you know, certainly institutional apartments do this. And it’s probably a big business for them. Actually, yeah,
Gino Zahnd 27:19
but But to your point, the way that we’ve designed it is that the the tenants who really want a place are going to purchase their their credit report and background check. And so that just the, the design, the way that we have designed the software naturally causes the higher quality tenants to bubble up to the top if you are getting multiple applicants for a property. And so to your point of, you know, it weeds out the people who the application fee weeds out the people who are not interested. We still do that. But what is attached to that is high quality data, rather than just intent.
Jason Hartman 27:58
So how do you make money I mean, because you’re we got to get into the thing about the monthly rent processing. Okay, I don’t want to spend too much time on this. But how does cozy make money?
Gino Zahnd 28:08
Yeah, so we give away the core tools to landlords and property managers. So the application is screening tools and a CH payment and collection tools. And today we have two revenue streams. One is around credit reports. One is around background checks. So today, that’s currently how we make money. In less than a month, we will actually start allowing tenants to pay rent and other things like utilities with debit and credit cards. And so we’ll start actually monetizing the very large amount of money that that we move every month. And then there there are things coming, but those are those are the three that are immediate.
Jason Hartman 28:50
So anything more you want to say on screening just quickly, and then let’s move on to monthly rent collection.
Gino Zahnd 28:55
And yeah, let’s move on.
Jason Hartman 28:57
Landlords collect rent in various ways, you know Good old fashioned send me a check. And then the tenant says the checks in the mail. As the old saying goes, my mother self manages all of her properties. I call her kind of an extreme do it yourselfer, she’s sort of a little too much on the Do It Yourself side for sure. And I’ve had her on the show a few times to talk about it. And she just has the tenants deposit the money into her bank on the first of the month. And boy, she is like a hawk. At the end of the day, on the first of the month, she is looking at her bank and making sure all those deposits were made. So the tenants it’s their responsibility to just put it into her account. And so you know, you can do it that way. There are a couple other payment processing things, but the problem is with other payment processing systems, is of course, you know what I’m going to say they charge a fee, and that’s okay when the transaction is 20 bucks, but you know, when it’s 1500 dollars a month or, you know, even worse in the Socialist Republic of San Francisco, you know, then it really adds up. It’s a lot of money.
Gino Zahnd 29:58
Yes. So We have aggressively negotiated our AC h payments, which is, you know, direct from one bank to another, to a point where we feel that it’s a great value to just offer that service for free to both landlords and tenants. And, you know, today we move about a quarter billion a month, sorry a year, and that’s growing in 2015. That’s been growing at about 140% every quarter. And so that’s, you know, volume is one way that we make that free. And as I just mentioned, we’re actually getting ready to roll out the ability for tenants to pay with debit cards and credit cards and there will be a convenience fee associated with that. But the cool thing about cards is that if a landlord also wants to use a debit card, we can actually make those payments almost instant. So if attended It pays with a debit card, we can then almost immediately push that money to the landlord’s debit card as well. So that’s something that’s coming that we’re super excited about. The other thing that is much better about cozies and
Jason Hartman 31:14
I have a I have a question for you. And you know, you know how in life we have these things that we just sort of take for granted and never question and and some of them are acronyms abbreviations. Do you know what a CH even stands for? I mean, I know what it is. But I don’t even know what it stands for. Is it like automatic cash transfer?
Gino Zahnd 31:34
It’s Automated Clearing House. Oh, thank you. Yeah. And actually, we have on our website, there’s a link. I think it’s cozy.co slash a CH explained. And don’t quote me on that, but it’s something like that, where we actually explain what happens to your money when it leaves your bank account and then goes into the Federal Reserve and then goes through a couple of processes before it actually ends up in your landlord’s account. But yes, the Automated Clearing House is the service that our federal government built decades ago and it’s the the rails on which all United States payments still run. And unfortunately, we’re all still beholden to, to their rules.
Jason Hartman 32:27
Just a reminder, you’re listening to flashback Friday, our new episodes are published every Monday and every Wednesday. Okay, so so cozy can process payments for free is that
Gino Zahnd 32:42
it costs us a tiny amount of money. But it’s it’s worth it for us to offer that service for free to our customers. Wow.
Jason Hartman 32:53
Okay, so you’re, you know, it’s kind of like saying, we lose money on every deal, but we make it up on volume. Well, yeah and and you know, I’m joking with you obviously. Yeah, sure. Well not really
Gino Zahnd 33:05
well, I you know, there are it’s certainly a loss leader for us but it’s it’s a very sticky product and it’s a product that works very well for people. And, you know, when you when you open to the show and you were talking about being 2000 miles away, we actually just a few hours ago got a comment from a customer who’s in Saudi Arabia, nine time zones away from his three rental properties. And he was he was raving about how much better cozy his has made his life. And so it’s, you know, it’s, it’s, it’s worth it for us to provide that because it’s such a sticky service and people do need to screen tenants. And, you know, soon we’ll actually start monetizing the rent payments by allowing tenants to pay with cards. So so it’s it’s worth it for us.
Jason Hartman 33:53
Okay, so how does it work? What happens? I mean, what, what, what, what is the landlord do and what is the tenant do to make this automatic Payment happens.
Gino Zahnd 34:00
Yeah, so there there are really two ways that a landlord would initiate payments. So either I, I as a landlord just found a new tenant through cozy and now I’m getting them set up on payments. A more common case for us actually is people already have tenants and they discover cozy and they say, you know, oh my gosh, this is just so much better than rent checks or PayPal or direct deposit or you know, however they’re doing it and so they just onboard their current tenants to start using cozy to to pay and collect rent. And so the way that it works is I let’s say that you’re my tenant. I simply set you up in cozy which you know, takes 30 seconds you know, I know your your email address, and a little bit more information about the property and I essentially just send you an invite you get an invite that says, you know, hey Gino is setting you invited you to pay rent through cozy and You go through a process, we verify that you are in fact who you say you are, we verify that you in fact own the bank account from which the money will be withdrawn. And it’s it’s that simple. And then once it’s set up, it just runs automatically every month, and we do a very good job of notifying both the landlord and the tenant. You know, hey, rent to do in five days, just a heads up and then the day that the rent is pulled, we we let you know. And then we also let your landlord know hey, the rent on its way. So your mom actually wouldn’t need to go Eagle Eye her bank account because she would get a you know, a notification on her phone or email or wherever. proactively that just says, Hey, your tenant at this property has paid their rent, you can expect it in the next three to five days.
Jason Hartman 35:49
I just keep thinking what is your ultimate goal? I mean, look, there’s no shortage of tech companies in the world who never had a penny of revenue or either You’ve either no revenue or certainly no profit, yet they’ve sold for a gazillion dollars to another company. I mean, is that your plan with cozy? Are you just looking to get traffic and eyeballs? Or? Or do you really have a revenue model here? I mean, it sounds like you charge for some things, but I don’t know I can’t imagine it’s, you know, how much do you charge for whatever you charge for?
Gino Zahnd 36:21
So to answer your first question, what our goal is our goal is to build the best one stop service for anyone to run the rental business. And that means if you have two properties, or if you have 2000 properties, we want you to be able to do it soup to nuts with cozy so that’s, that’s our goal. Now the the exit, which I think is what you are implying is is really not relevant or of interest. At this point. We’re, we’re growing fast. We’re making money. We’re we have a lot of new revenue streams lined up. The next one’s getting ready to launch in November? We have some top secret stuff there probably right? Well, no, the cart card payments that I mentioned. So okay, that’s, that’s coming and you know, given the volume of cash that we move every Yeah, it’ll be significant. Right again, okay, good. I, you know, things that we’re looking at in the future without giving too much away. Everyone needs renter’s insurance. Every every small rental owner needs liability insurance. And the adoption rates of those things today are abysmal. And we have a really huge opportunity to make a positive impact and those kinds of things as well. So there, there’s absolutely a business here, and it’s growing very well. And you know, what, what the, the long term goal is to build the best products that we possibly can and have a massive swath of people not only in the US, but around the world. world using our product to the point where if you took it away, they would say How the hell did I get this done before and right? Yeah, okay,
Jason Hartman 38:07
that’s awesome. This is just a great tool. I mean, do you have a competitor? Or is it just this is pretty much the kind of a new I mean, of course you have services like PayPal Venmo. There are others, but it’s not designed for landlords. And of course, you’ve got those pesky fees. Of course, you can get around that with PayPal, if you say it’s for a friend or a relative. I don’t know, you know, not really a solution. Right?
Gino Zahnd 38:29
Yeah. So when we started out, we were very much the the lone few people in a canoe in the middle of the ocean. There were no competitors. Historically, no one had ever designed a product for the sub 20 unit, you know, independent rental owner market. And, you know, the interesting thing is, is that that sub 20 building is actually about 75% of the US market. It’s I mean, it’s the huge majority of rental properties in the US and the reason that no one had ever done that in the past is that it’s such a fragmented market there you can’t hire a sales force and and call everyone right and and you know, luckily now that we have things like your show that we’re doing right now we can get in front of people but there have also been a number of things on the internet that have allowed cozy to get in front of the right people at the right time where historically that just wasn’t possible. Now, since we have launched there are a lot of copycats and I you know, I think it’ll be interesting to see what happens over the next five years to see where, where where the industry lands because what’s happening with cozy is that while we very specifically designed the the V one of the product for the the smaller, independent loan or professional property managers have heard about cozy as the brand has grown And now what’s happening with us is we’re being pulled up market and we have more and more customers that have you know, 200 units or 1500 units. And so we’re we’re very quickly designing the product to to also handle the kind of scale that they need to deal with the headaches that they have while maintaining and continuing to grow the audience that we that we started with, which is our bread and butter. So, you know, it’s still fragmented. A lot of companies are coming at it from a lot of different angles. But look, it’s a it’s a huge market and, and cozy is we’re excited about where things are headed right now. So
Jason Hartman 40:41
yeah, I’m excited to I’m excited to see that there’s a service like this out there. And you know, look forward to seeing you know where it goes, it’s sorely needed. Anything else you want to say of course the website is cozy, calm.
Gino Zahnd 40:53
It’s actually cozy, co cozy.
Jason Hartman 40:55
Oh, thank you. So you use the Colombian domain extension. co Hmm. It’s more
Gino Zahnd 41:00
and more common. And yeah, I’ve noticed that. You know, it’s interesting. We we started there and a lot of people just call us cozy co now, which is kind of kind of cute. And it’s it’s okay with me.
Jason Hartman 41:12
Sure. Yeah. Good good stuff. Anything else you want people to know? Maybe you know, a question I didn’t ask you are just anything
Gino Zahnd 41:19
well, we’re the rest of 2015 is going to be super exciting for us. We’re we just launched a new mobile web app for landlords so you can do almost everything on cozy on your phone or tablet now. Over the next eight weeks, we’ll be rolling out a number of new features for both landlords and tenants around around payments and listings management. And we’re also in two weeks announcing a big partnership. And I wish I could tell you what it is, but I would encourage people to just follow us on Twitter at cozy CO and we’ll be making that announcement there.
Jason Hartman 41:57
So Fantastic. Well, Gino, thank you so much. You know, one, one thing I just did want to mention to investors, you mentioned fragmentation. And you may want to speak to this, by the way, and I always say to investors embrace the fragmentation, because the fact that you have that fragmentation, that’s what keeps the big institutional players out of our business in the, you know, in the small rental business. So, you know, you see some hedge funds and some private equity groups, you know, kind of dabbling and, you know, when I say dabbling, you know, I mean 10,000 units, but
Gino Zahnd 42:30
on the order of billions,
Jason Hartman 42:31
but by their perspective, compared to Wall Street money that is dabbling. Okay. You know, it’s not, it’s not, you know, Goldman Sachs tight money, but that keeps them out of our game. So, you know, you got some tools like cozy and some other great tools that we’ve talked about on prior episodes out there. And, you know, it’s just, it’s the most historically proven asset class in the entire world If you ask me, so, this is great. And thank you for doing what you do. I just think you know, there’s some great tools like yours out there. So investors, please check them out. Take advantage of them.
Gino Zahnd 43:02
Thanks so much, Jason.
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