Property rental app Speedrent wants to take agents out

  • Currently has 6,000 users, hopes to hit 50,000 in 6-12mths
  • Malaysian startup also eyeing Singapore, Bangkok and Jakarta
Property rental app Speedrent wants to take agents out

MOST tech startups in the property space play nice, and talk about how they want to develop the entire ecosystem by enabling not just buyers and sellers, but also real estate agencies and their agents.
 
Asia Capital Management Sdn Bhd makes no bones about what it wants to do with its Speedrent app – it wants to disrupt the property rental market by taking real estate agents out of the equation.
 
The company says Speedrent helps property owners lease their properties, without the need to go through real estate agents. Landlords can deal directly with prospective tenants.
 
Asia Capital Management founder and chief executive officer Wong Whei Meng says the app benefits both home owners and tenants: Home owners don’t have to pay real estate agents any commission, and thus can offer better rental deals to tenants.
 
“We hope that with Speedrent, we have created an unfair advantage for landlords who lease through the app, while also providing financial saving incentives to woo tenants to rent through our platform,” Wong told Digital News Asia (DNA) in Petaling Jaya recently.
 
The app, which is under six months old and available for the Android and iOS platforms, currently has about 6,000 users according to Wong, who hopes to grow this user base “drastically” over the next 12 months when the company embarks on marketing campaigns.
 
“To be honest, I don’t think 6,000 is fantastic. However, considering that we have not spent much on marketing and that the number is based purely on organic growth, we are quite encouraged,” he said, adding that the target is to hit 50,000 users over the next six to 12 months.
 
How it started
 
Property rental app Speedrent wants to take agents outWong (pic), who is 32 this year, said he has been involved in a few startups over the past 15 years. When he was 17, he and his friend started a webhosting company called Ultra Unix.
 
“I started that as a hobby with friends … then one of the partners passed away and I ‘inherited’ debts of about RM30,000-40,000 – not a huge sum today, but back when I was just 17, it was a big amount,” he said. [RM1 = US$0.23 at current rates]
 
He eventually cleared the debts and sold his stake to his other partner when he was 22. He then ventured into the business of providing content delivery network solutions, and that company was sold to a European company.
 
The idea for Speedrent goes back to when Wong himself was trying to rent out his condominium apartment.
 
“I went through an agent, who came, snapped a few photos – and within a few weeks, the unit was rented out,” he said.
 
“So I did some searching on what she did online to get it done so fast, and it turns out that she only posted on one of the property portals … that’s all,” he added. “It made me wonder about what value-add a property agent brings.”
 
Going through an agent was actually not the first choice for Wong, as he would have preferred to have dealt with tenants directly.
 
However, there are not many avenues for home-owners who want to lease their properties directly without going through agents.
 
“Property owners can place a listing on online classified portals, but these portals may not have mindshare with people wanting to rent property. Of course, there are also property portals like iProperty and PropertyGuru, but for those, you need to go through an agent,” said Wong.
 
He started to toy around with the idea of an app or platform that could connect landlords and tenants.
 
The app that came out was first named ‘Saywa,’ but “not many people got it,” he said. [Saywa sound like sewa, which is Malay for the word ‘rent.’]
 
“So I decided to take it down and rebrand it as Speedrent. I think it is also a better name, especially for when we expand outside of Malaysia,” he added.
 
Business model

Property rental app Speedrent wants to take agents out

While the immediate plan for Asia Capital Management is to acquire as many users as possible, and to make Speedrent the preferred choice for landlords and tenants, monetisation will come from another app.
 
The “soon-to-be-launched” app Speedsign will allow landlords and tenants to sign tenancy agreements via their mobile devices – which means no agent is required there either.
 
With the synergy between the two apps, Wong hopes his company can help landlords and tenants on an end-to-end basis – from looking for property to rent and viewing said property, to closing the deal.
 
However, the service won’t come free over the long-term. The plan is to charge landlords RM100 (US$23) for each agreement.
 
“For now, we will offer it for free,” Wong said however. “We want to let users get familiar with our solution.”
 
“We are looking to start charging after one year or so,” he added.
 
But even when it starts charging, there is no guarantee that landlords and tenants will use Speedsign to seal the deal. After all, they may also want to remove Speedsign as the ‘middle man.’
 
“That’s why in my revenue projection, I am only estimating 20% of users will use our tenancy agreement service,” said Wong.
 
“We believe that over 400,000 properties are available for rent every month. Let’s say we manage to capture 10% (40,000), and from that amount, only 20% use our tenancy agreement service.
 
“That’s over RM8 million a year,” he declared.
 
A DNA search on the popular Mudah.my online classifieds portal showed more than 52,000 units of landed residential properties and apartments combined available for rent in the city of Kuala Lumpur alone. On the iProperty, there were over 32,000 units.
 
Wong also said that tenancy agreements were only one portion of Asia Capital Management’s overall monetisation strategy.
 
“Once the tenant signs the tenancy agreement, we would know when the tenant will move in, so there are opportunities for us to provide logistic services, broadband connectivity service, pay-TV services … the list goes on,” he said.
 
For example, by helping tenants get broadband connectivity, the company hopes to get a commission from the telco. “[This] helps us to push up revenue on a per-deal basis,” he declared.
 
Funding needs and growth potential
 
Wong said his company is in talks with a few venture capitalists (VCs) in the region, as well as in Europe.
 
“Currently, I’m funding it entirely right now for about RM500,000. There are a few VCs in touch with us, and we are looking at about RM1-2 million of funding,” he said.
 
VCs will not only bring financial fuel to the startup, but would also be able to share valuable regional experience, Wong said.
 
He believes that Speedrent has the potential to scale outside of Malaysia, especially in cities where property prices are expensive.
 
“We are looking at Singapore, Bangkok and Jakarta over the medium term. We will focus on highly dense areas. These are places where property purchase prices are not within the reach of most people.
 
“When property prices are too high, people who can’t afford it will have to resort to renting,” said Wong.
 
“Rentals will be a strong market ... it’s already happening in the United States and Europe.
 
“Previously, people wanted to move out of their parents’ house as soon as they were financially independent. These days, they are moving back to their parents’ house,” he added.
 
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