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“I was building buildings. I was running a large portfolio. And the number one brick wall I kept running into was technology silos. There were 8 to 10 things I had to buy for everyone of those buildings, and they didn't talk to each other..."
—Prasan Kale
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Episode 111 is a conversation with Prasan Kale, co-founder and CEO of Rise Buildings, which was acquired by VTS in 2021 and is now VTS Rise.
We talked about:
Without further ado, please enjoy the Nexus podcast with Prasan Kale.
You can find Prasan on LinkedIn.
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Note: transcript was created using an imperfect machine learning tool and lightly edited by a human (so you can get the gist). Please forgive errors!
[00:00:03] James Dice: hello friends, welcome to the nexus podcast. I'm your host James dice each week. I fire questions that the leaders of the smart buildings industry to try to figure out where we're headed and how we can get there faster without all the marketing fluff. I'm pushing my learning to the limit. And I'm so glad to have you here following along.
[00:00:31] James Dice: This episode is a conversation with PR kale co-founder and CEO of rise buildings, which was required by VTS in 2021. And is now VTS rise. We talked about why VTS acquired rise and why they acquired lane technologies. We talked about how tenant apps like rise, integrate with other systems in the building and in the cloud.
We talked about RISE's patented beacon technology and how it's used to track space usage. And finally PR shared how [00:01:00] tenant apps help with getting people back to the office, what impact they have on leasing renewals and what analytics or data exhaust as he calls it can be produced by tenant app to help support business decisions on the landlord side.
So without further ado, please enjoy the next podcast with PR kale. Hello, persona. Welcome to the show. Can you
[00:01:18] Prasan Kale: introduce. Hey, James. Great to be here. My name's person, kale, I started co-founded rise buildings about six years ago now and was their CEO and, and co-founder more recently VTS acquired rise. And so now I, I serve as the, as the managing director of VTS rise.
Awesome.
[00:01:36] James Dice: And we've had you on the list for the show. Ever since then, probably before then, actually. And it's just taken this long to get, get our calendars to align. So can you talk about your, your background first? Maybe before rise, what were you up to?
[00:01:49] Prasan Kale: Sure. Yeah, I'm I'm a real estate guy uh, spent my entire career after college.
I went to, went to school for electrical and computer engineering. Funny story. But my [00:02:00] first job offer was to design a blinker for a car. Okay. Yeah. And I said I don't want, I don't wanna design, I don't wanna design a blinker for a car. That's gonna go inside of a car, a chip set that nobody's gonna care that you design this blinker for a car might be a great blinker, but who cares about blinkers on cars?
Right? Mm-hmm turning signal. So I really, I, I was like that electrical and computer engineering side of me really wanted to sort of be technical. And that first job offer while it was great. I, I actually chose to go into a very different profession. Ended up in the world of property or project management rather in the world of real estate and helped redevelop a hotel and fell in love with not only Chicago, which is why I moved here as a city, but real estate as a business.
And so over the sort of career arc I've done. Everything from property management consulting to property management, portfolio management, asset management construction management. So really I've seen a [00:03:00] lot of the broad swath, including development management, which was responsible for developing a series of high rises in Chicago.
So I've really seen the broad swath of what it looks like to take a underwriting and a property, whether it's a new property or redevelopment and see it through all its phases of execution. I'd say the only thing I've really not touched is lending. Although I've probably borrowed money from a lot of people, so
[00:03:26] James Dice: cool.
And then what? All right, cool. And then what got you into
[00:03:28] Prasan Kale: the tech side of things? Yeah, I think it was the, it was the arc of the career that, you know, I was building buildings. I was running a large portfolio of properties, both residential and commercial. And the number one thing that, you know, the brick wall I kept running into was I was trying to make these properties more efficient, whether that was saving energy or better operational systems or better staff management, all the above, create retention and engagement in these properties, trying to do this.
With technology as a primary sort of tool. But [00:04:00] there were like eight or 10 things that I had to buy for every one of those buildings. And so as a developer, I was like, yes, we gotta have the package management solution. We gotta have the Intercom solution or visitor management solution. We gotta have this and rent payment and blah, blah, blah, blah, blah.
But then when I stitched 'em all together. And handed off to where my property operations had. What I quickly found was none. None of those point solutions were being effective. What was happening instead is you know, although I desired sort of staff efficiency, my staff was going, how many things do you want me to log into?
Mm-hmm . And so they were going, I'm not efficient at any of these systems and those systems don't talk to each other. I'm spending a lot of time in my day doing double data entry and air checking and sort of going task switching at the end of the day. Yeah. And that wasn't, that didn't feel good cuz I was like, that's the opposite reason of why I put those systems in and then, and then the worst thing, which was, you know yeah, of course it costs more cuz you're buying sort of eight, 10 systems, but then.
The worst thing was the people that ended up living or [00:05:00] working in those buildings had no idea where to go to get something done. So, you know, they were told to go to this website for X thing and call downstairs for this Y thing and go to the back room to do the other thing, and then get an app for your experience, which, you know, was like an info app at the time.
I was like, well, that's not right. So, you know, really with Sid, my Sid Jane, my co-founder. Really thought about, well, how do we single stack this? How do we create a total technology solution for real estate? Whether it's an office building residential, industrial, it doesn't matter if it's a building with four walls and a roof and people that live, work or play in it.
And there's staff and property management that sort of run that asset. How do we single stack it and create a one stop shop for the industry? Something I desired as a solution to my own real estate. And it turns out so did a whole bunch of other people mm-hmm
[00:05:47] James Dice: Nice. So that became rise
[00:05:50] Prasan Kale: then. That's right.
Yeah. Rise buildings. Yeah, totally. Okay. So
[00:05:56] James Dice: catch me up then. So, You founded rise six years [00:06:00] ago. It got acquired. What last year is that? Right? 20, 21
[00:06:03] Prasan Kale: in March of 2021. Yep. What was that
[00:06:05] James Dice: journey like from having that realization on one of your projects to getting acquired? Can you sort of fill in the story in the
[00:06:12] Prasan Kale: middle there?
Yeah. There's there's not just a story, but there's probably a couple of novels. I'm sure. I'm sure. Cliff notes. I keep it to the cliff notes. I. We were a bootstrap startup, right? So very much, you know, elbow grease and all those things never really raised a big round of venture money or anything like that.
Not saying that's wrong. Just, we said, look, let's go, let's go focus on the product, put all the money into the product and the deep integrations that it requires. And just a high technical execution that it requires. And then let's go put it into one building or five buildings. And if we did something right then those five buildings or customers will tell the next few buildings mm-hmm and that's kind of how it played out.
Now that that was not easy because you know, every, when you're, when you're bootstrapped, everything is tight and you're working 48 hours in a 24 hour day. Yeah. But it was, it was probably the [00:07:00] most fun I've had in my whole life. I mean, The things we were able to accomplish in a day took, you know, weeks for many companies to do.
So that was, that was a lot of fun and that that's going back early days that, that tactic of like build a really great product. And, you know, if you build it, they will come. It actually worked. Most of our early customers told the next customer that. Don't believe the marketing hype don't don't, you know, forget about what's on the blogs or this or that.
Right? Like those are those, those things that actually work in the field are what most are mostly are important. Mm-hmm and you really look at rise buildings because they've, they've designed something and actually executed on it. That works day to day. So like that we sort of in the second call phase of, of growth really grew by word of mouth.
And at, at that point there was like, there was a real impetus to going, okay, let's raise some money so that we can take that word of mouth and turn it into a, you know, system and, and have a few more people to do the work. So that it's not 48 hours a day and a 24 hour day mm-hmm . Uh, So that [00:08:00] was phase two and we were very, very lucky.
And I think this is the secret to everything. That's successful is that we were very lucky to find. The best people in that middle phase, you know, so the early days we were sort of founder led and founder executed in that middle phase we really were lucky in finding the right people to take over, you know, everything from our client success to our back office, to our accounting, to you name it, right?
Every part of the business that's really important. And all of the parts of the business have to fire on, on all cylinders for it to truly catch exponential growth. And that's what we were very lucky in finding really great people strong culture as, as a company and really what attracted the next person to join us as well.
And that led to sort of scaling execution, where we are able to not just deploy five or 10 buildings in a month, we were able to deploy 20 or 30 and sell 50 or 60 and, and so on and so forth. Build the right product enhancements in the next integrations for the next set of buildings that we're about to, to, to be [00:09:00] sold to.
So that third phase was really where we went from sort of bootstrap, you know, you know, in a closet startup to, okay. There's there's real presence here. And short of any real sort of venture fundraising or anything like that. We were able to get into a whole lot of buildings very, very quickly in that sort of mini scale phase I'll call it.
Gotcha. And that's really when, sort of, I got the call from Nick, you know, one day saying, you know, I've been talking to lots of customers in the tenant experience space and, and your name keeps coming up, but I don't see, you know, rise buildings plastered on every, every sort of banner out there.
Like, yeah, we don't, we don't really have a marketing department , you know, he was like, you should get a marketing department. He's like, I can fix that. I was like, great. He's like, I'll come see you tomorrow. I was like, great. And, and, you know, I obviously I've known Nick for a long time now, but was a big fan of his, even before that conversation.
And we got together and, and really saw the value inputting the great product that we had built and being able to scale that even further, having all the right resources and, and people you know, [00:10:00] in growing the team even further. To really take it to the next level. So we got together and, and come March of 2021 and it was through COVID.
It was crazy time. It's like, you know, who goes through a whole acquisition during COVID without seeing, you know, each other sort of post the first couple of times. But all that happened in March of 2021, we were fully acquired. And it's been a great journey since it's been over a year now. And It's it's, it's a lot of fun with, with a really big team now, a lot bigger than the 30 or so that we're in the office before.
And it's, it's a, it's a really great journey thus far. Yeah. Awesome.
[00:10:31] James Dice: And for those who don't know, what is, what is VTS? What do they do?
[00:10:34] Prasan Kale: Yeah. So VTS is. Call it the first true unicorn PropTech company. Mm-hmm they were the original PropTech company and VTS focused its time over the last decade on really first a lease automation platform that converts leads to, to signed leases a lot faster.
So really took sort of the. Even in my real estate days, the leasing activity report used to be an Excel file that leasing [00:11:00] agents would fill out and they'd say, oh yeah, this person called me on this date. And it was brutal. It was, it was time consuming. It was inaccurate always. Right? Yeah. You'd miss the Rofer or you'd miss the, you know, whatever the, the encumbrance that you had on that lease.
And then there would be a big meeting and. You know, be mad at, at the leasing people. And so VTS really totally invent reinvented that said, look, use technology to make it fail safe, to make it just more efficient. And that was really something that resonated with me is that they took a business process in the world of real estate.
Truly understood it. Cuz I think Nick, you know, Nick and Ryan both spent their time. And the asset and brokerage worlds. So as founders, they really had a very clear vision of what the industry needs. And I think that's a very important theme here is that you really need to understand what the industry wants and needs as opposed to looking at it, just from a software perspective, most other industry coming in trying to do what real estate needs.
So they were able to execute on that and since have grown the product to market, which is another offering that digitizes and automates the [00:12:00] marketing equation for commercial real estate and then data. Which takes all those first party you know, inputs that are in the system and gives you near realtime data and, and insights into how you should strategize your portfolio or even one specific space in your building.
And that really changes sort of, dynamically how real estate has operated from a leasing and asset management standpoint over the course of the last 10 years with BTS and the, you know, number one player in the space and over 12 billion square feet, I think that are served by the core product.
And then with the addition of, with, of addition of rise buildings, and more recently even lane technologies out of Toronto what we were able to do is fill in that product you know, kind of round out that product with like, okay, well, you leased the space on VTS and you had, you know, you found out about this space on market there's data flowing out of that.
Once you've moved into that space. You need something, a technology tool to operate your day to day, right. To operationalize that asset. So that's really where rise buildings came in. It was a nice puzzle piece fit into that equation. And now with the acquisition [00:13:00] of lane, even further rounding out that feature set to where really is a, a full stack solution real estate.
Got it, got it. And
[00:13:09] James Dice: catch me up on lane as well. So. I think a lot of the nexus audiences, what we're, we'll talk about front of the house first back of the house a little bit, but I think a lot of the nexus office nexus nexus audience is coming from the back of the house. And so these more front of the house, or really business specific business automation, focused startups, they might not have as much knowledge of those.
So what, how is lane different than what you guys were doing?
[00:13:31] Prasan Kale: Yeah. It's a great way to sort of, split that up, right? I think there's. With with lane, first of all, great team, great founders and a, and a great architecture to how they had built the platform. It really is a technology forward platform.
And while lane was focused on sort of the front of house, which is, Hey, look, what does the end user want? And center the technology around the end user. Allow them to do things like flex, right. Which is a very important thing. I think, going into the future here, mm-hmm, , allow them to do things like [00:14:00] engagement content in a, in a, in a very powerful way, allow them to maintain a unique user identity between buildings that they might visit and so on.
So forth. Very powerful big front of house. If you will on the back of house, it's the native property operation software where rise really created that value. Right? So, instead of buying those six systems or eight systems, you're, you're buying one, you're saving yourself money, hopefully around 50.
50% of your tech spend can be reduced by this consolidation place. So whether it's visitor management or work orders or preventive maintenance, or access management at the conference bookings and all the sort of day to day operational things that happen in the building happen on one single stack in one product.
Well, you've saved yourself some money and because you're offering the end user and the staff and the property manager, sort of a remote control for the building. They use it every day and they adopt, you know, you'll see 90% adoption and they'll use it like a toothbrush twice a day. You know, it's, it's really powerful when you get them to use the platform for the tool that it is.
Then you can [00:15:00] leverage that to engage them on the platform for the network that it creates. Right. Mm-hmm . That's where like the puzzle piece as well of lane and rise coming together and adding all those feature sets and sort of best of both worlds, if you, if you will. I think that sort of creates the future of what is, what was known to be 10 experience.
Right? 10 experience was a big buzzword. And certainly I think a worthy one. But I think that was looked at as a point solution. Like, Hey, here's your app for your building? Mm-hmm and it's got a bunch of information on it and you can't really transact or. Pay for rent or do any of those, those functional things, but it's got, it's an app for your building and you've checked that box.
I think bringing that together with the back of house mm-hmm and truly making it a one stop shop technology solution both for the front and the back of house really establishes what I think's gonna be the future of, you know, tenant experience. Cool. So, so
[00:15:53] James Dice: one of the things that we were talking there, I think I've been confused about front of the house back of the house.
It's almost like what you were [00:16:00] describing as. There's like the engagement in perks and flex space options. That's like very, very front of the house. And then what you described is like, in my mind, like middle of the house, cause it's still touching tenants, still touching occupants, right? There's the, you know, visitor management conference room booking amenities, things like that.
And then I'm still picturing like more back of the house technologies. Right. I, I need to manage this air handling unit and what, what temperature of air it's putting out and, you know, all of those types of things that are way, way, like way, way back of the house, right? Yeah. Is that, is that kind of how you think about it too?
Like the spectrum it's not necessarily either or thing.
[00:16:42] Prasan Kale: Yeah. I, I, I definitely look at your, sort of what you described as back of the house. Yeah. As the way, way back of the house. Way, way back. Okay. Your building systems. Yeah. Well, you know, and I think there's real value in that, and that's not something sort of, we do today.
Right. We don't get all the way to the back of the house. Mm-hmm we do connect to it. We do provide inputs to it. Mm-hmm but we're not [00:17:00] the HVAC system. Yeah. We don't aspire to be. I think, you know, we could touch on that. I think there are some great companies doing great work in that space, the way, way back of house and your system side that I think, you know, if they do their job well, right?
Those companies, they do a good job. Nobody will really know that they existed because they, would've probably driven some efficiencies and automation without anyone actually knowing. And you know, so the, so the middle of the house as you described it, or the front of house can become inputs to those systems to say, look.
Nobody's showing up at the building today, cuz we know cuz we're the visitor management system or we have, we have a patented beacon technology that understands how yeah. Today's being utilized. So. Okay, well that can form a great input into the way, way back of the house systems to inform them, to reduce the set point or take in more outside air or cut off the valve or whatever you you needed to do.
[00:17:51] James Dice: Yeah. What about the other way? What, what might you guys be able to pull in from the way, way back of the house?
[00:17:57] Prasan Kale: Yeah. Great. It's a great question. So, [00:18:00] think about we'll use a simple one, right? You have for every generally sophisticated HVAC system. you have a temperature sensor at the output of the main duct that comes to a tenant space, right?
Mm-hmm so you might be pushing air you know, pushing air outta the vent at 62 degrees. And that might be cold, not by like a human feeling. It's cold, but it's actually cold, right? it's it's cold air. And now you might have an ambient temperature sensor that's from the way, way back of house system, that goes, yeah.
You know what it, that, that sensor is saying, it's like 68 degrees in here. When it's 68 degrees in here, it's probably gonna result in a work order or a ticket from someone from the middle of the house that says I'm cold. Right? So instead of waiting for the customer to be cold, maybe we can take those back of house systems and turn it into a preventive ticket that says, Hey, Go check, go, go hit, you know, take the temperature, cut out and see what's really going on.
And maybe adjust the set point before there's a customer complaint, or if I'm I'm too hot or I'm too cold, and you can do that [00:19:00] with a host of systems, right? Leak detection systems are mm-hmm and there's so many more elevator systems can provide great inputs to to like the work order solution that we have.
So it's a great question. Those those back of way, way back of how systems can actually be a great input the other way. Totally.
[00:19:15] James Dice: And it seems like you need to enable in order to enable some of the use cases you're talking about. Cause I know you guys do things like I don't exactly know the technical like way, way in front of the house term for this, but integrating with access control to help people get throughout the building.
So it seems like in order to enable some of the use cases that you guys are selling to your customers, you need some of those integrations with way, way back of the
[00:19:38] Prasan Kale: house. Yeah, a hundred percent, hundred percent. I think you have to have, and just not, not just front of house integrations, not just way, way back a house, it's gotta be everything in between too.
So think about, you know, some of the primary systems that are in building certainly have the building automation and building. Systems HVAC and so on. So forth elevators, [00:20:00] access control. Those can all be part of that same equation. Mm-hmm you have accounting systems. So they're kinda like the middle of the house, right?
You're you're literally, you wanna be able to pay for your rent or pay for that flex booking? Well, it's not good enough just to take the payment, you actually have to ledger it into the accounting system. So, you know, a property manager doesn't have to do double or triple data. It's automatic, automatic.
So, and then, so there's sort of these middle systems which are accounting and If you will, to some degree productivity related, but then there's front of house systems that are engagement related. Like we want to be able to integrate to fitness vendors. And you know, one of our integration partners is arch amenities group is formerly life start, you know, they have classes, fitness and wellness classes and buildings.
Well, it would be, it would be a shame if we sent a user to some third website to consume that inform. What they should be able to do is in that same app that they use to access the building and go up the elevator. They should be able to book their yoga class or whatever that offering is made it to the application.
So I think, I think it's all across the board integration as a topic, [00:21:00] it is extremely important and we, that's why we spent, you know, frankly, our early money on deep product integration. With those systems, whether they're way, way back, middle of the house or front of house. Because we knew that unless you do that properly, and if you do that in a stable manner you know, you can't really bring it all together.
We might be able to build native technology to do a lot of things, but we're not gonna run the pipes and wires in the building yeah. To, to, you know, control the HVAC or make the elevators go up and down. So I think integration is key across all those domains. Yeah.
[00:21:31] James Dice: Can you talk to me about some of the use cases you enable when you integrate, like when you integrate with access control, what can you do then when you integrate with elevators, what can you do then?
And et cetera,
[00:21:42] Prasan Kale: cetera, et cetera, right? Yeah. Yeah, so let's, let's take those two as an example. And I'll go to saying. There's been a sort of loose definition of integration that has evolved. You know, what some people say it's an integration is like, well, if you, if you're trying to use a mobile credential in my mind, an integration is not [00:22:00] getting a emailed token or a code, opening up another app to drop that in and then having it sort of confirm, and then sending you the credential and hopefully you get it.
And then maybe the turn style opens that is not an integration. So an integration should mean. When a net new user is added to a building, they are automatically pushed into the access control system as a net new bonafide user. And then the legwork of obtaining a mobile credential, let's say from a third party system or provider is done on the backend.
So that to the user, the experiences. Okay. I just, I just started my day, you know, at my new new job. And my HR told me to download this app cuz I'm pre-registered and I went through the steps and I. You know, when I, when I hit log in, it asks me a simple question. Would you like to use this device as your digital credential from now on?
And if I hit, yes, all the other work is done in the back, you know, background. Like I don't have to go down to the security desk. I don't have to go to the basement security office and, and, you know, wait there in line. It's [00:23:00] done. And from there on out, I can use that app to access my turn style or elevator or my, even my own suite.
Right. So that's a real integration, a real push and pull integration. You know, complex systems, not sort of a user layer to, to not a front end of the integration. So things like things that we can enable with that are obviously we can manage the employee population or residential population of building in that third party system access controller.
Otherwise we can allow them to carry a digital credential, which. Frankly gets rid of the plastic key cards. One of the, the greatest examples that is 800 Fulton. It's a building owned by Thor and quad here in, in our backyard. You know, it claimed and is the smartest building in Chicago? Well, one of the first things they did as the smartest building in Chicago was that we're getting rid of all the plastic.
We don't need it, right. It doesn't need to end up in our oceans or any of that. And we have the means to do digital credentials. So unless you literally don't have a smartphone, which, who, you know, who doesn't you don't get a [00:24:00] plastic key card anymore. You get a digital key card that gets you into everywhere that you belong to in the building.
So they did that. It was a great, great move, and it, it's probably the poster child of how to do digital credentials and how to do touchless access. And then I think you can even take it a step further. So for example, with Schindler port as, as one example we have an elevator integration. So we talk to the back end elevator system, allowing for things like a user can call an elevator from a certain location.
Upon presence of that. Cause you don't want them to call an elevator from their bedroom. Right. So, you know, using our tech in conjunction with the system that exists, allows that user to call an elevator as they're walking up to that elevator. So things like that. Look will every user call an elevator with their phone?
No, but 15, 20% of them will. And they'll think that it's great because they don't want to touch the thing on the wall or they just want to have it waiting for them. By the time they get to that, you know, lobby or whatever. They're in a hurry, right? Mm-hmm , you know, all [00:25:00] things don't apply to all people, but the goal with deep integrations on the back office and the middle office side, if you will, are to make, you know, some subset of the building populations life a lot easier so that they feel welcome coming to that workplace.
Got it. Got it.
[00:25:15] James Dice: Hey guys, just another quick note from our sponsor Nexus labs. And then we'll get back to the show. This episode is brought to you by nexus foundations, our introductory course on the smart buildings industry. If you're new to the industry, this course is for you. If you're an industry vet, but want to understand how technology is changing things.
This course is also for you. The alumni are raving about the content, which they say pulls it all together, and they also love getting to meet the other students on the weekly zoom calls and in the private chat room, you can find out more about the course@courses.nexus lab. Start online. All right, back to the interview
Do you guys get into HVAC and lighting integrations? How does that, in terms of being able to modify the like two way communication, like you're talking about modifying those [00:26:00] systems, automating those systems based on what's happening in the app.
[00:26:03] Prasan Kale: Yeah. Depends on the system. Right? So, one of our integrations is with a.
A smart, smart building solution that controls thermostats lighting leak detection, a handful of things. Mm-hmm . So with, with that, as an example, a user can turn on their lights, turn off their lights, dim, their lights, set their thermostat. Set point even roll their shades up and down in their particular suite.
So with that type of integration, yeah. You get real depth, right. But there's others. There's a flavor of integrations where, you know, you're, you're basically popping a user via an authentication protocol into a. A controller's web fee, right? It could be that simple mm-hmm and, and frankly, sometimes the third party doesn't have the ability to deeply integrate and all they have is a web front end that you can control.
That's a, that's a hidden and secure link that you can only authenticate into. So we can do things like past parameters and we can do things like past set points. But then. Really the, the, the app, if you will. And the web [00:27:00] portal that the user sees is kind of a launchpad for all of these other things in the building.
And then you could choose which things you wanna launch out of it. But the experience has to be seamless. So it can't be like I pressed a button and it asks me to log in again and then, you know, spend five minutes, try to log in and remember my password or whatever. No, it's gotta be seamless and it's gotta be user role based and permissioned according accordingly so that you.
Joe cubicle, maybe they don't have rights to turn on the AC or whatever it is only the facility contact can do that. Or the main contact can do that. So that's easier based as well. Got it. So how have you guys
[00:27:34] James Dice: handled this over the past, like six years when these integrations are, are not easy, a lot of these, right.
So, you know, you might. Find one types of access control system that can do what you want it to do. And it might be an API and it might be blah, blah, blah. You might come up to the next access control system that, you know, doesn't even have anything for you to integrate with, right. Or it's some sort of legacy protocol.
So how have you handled [00:28:00] that? And the ability to, to acknowledge right. That. Yeah. The use cases you're trying to like implement for your customers are enabled by the underlying infrastructure. And sometimes those are gonna fight against what you're trying to do. How, how do you guys do that in a scalable
[00:28:13] Prasan Kale: way?
Yeah. And I think in building rise buildings with sort of the real estate background that we had we knew that no two buildings are gonna be the same. In fact, every single building is different. They're literally like a snowflake, right? So, even if two buildings have the exact same access control system, the way they use that access control system could be completely different, which means your platform has to be from the beginning, set up in an architecture in a, in a dynamic workflow where.
Each building can be treated for its its use case and its scope specificity. Right. Mm-hmm so and so that's we designed it from the beginning to be adaptable to each building's use case. And I, I will say for the most part access control systems, I think there's like 130 of them out there in the world.
Yeah. Maybe more a new one comes out every week. It feels like, generally speaking, they've [00:29:00] gotten sophisticated, so they're allowing for things like push and pull and the. Fields and the right data points to be exchanged. So that's made the job easier over the last six years. But there's still some legacy systems that, that are not even cloud connected.
Right. Mm-hmm so you might have a, a system from 1985 in your building. That's never been upgraded. That there is no way for you to talk to that system. Yeah. Even if you had a computer on site or an on on-prem server, trying to do it. So those systems, if, if our client, if our client were to ask us, well, I want do digital access, but I have this X system from 1985.
Mm-hmm tell me how, how to go about doing it because everyone I talk to says, well, you gotta spend a million bucks to upgrade your access control system. And what we did early on was we devised a series of hardware. That helps automate some of these things. So certainly we have this gateway that sits with that system, allowing us to do certain things to it.
But then really we built a, a, a protocol of hardware that allows you to unlock [00:30:00] any door, no matter what system it is. Right. So if it's a sophisticated system, we'd much rather carry the digital credential and unlock that door. Yeah. But if it's a system from 1985, the. Doesn't have to resort to spending the million bucks and upgrading to a cloud connected system necessarily.
It might still be a good idea to do that. But we can still unlock that door using hardware that supports our software. Got it, got it. So some sort
[00:30:23] James Dice: of gateway that talks, whatever integration protocols need
[00:30:27] Prasan Kale: to need to happen. Yeah. And so, without touching any sort of the underlying infrastructure or without writing a string of code to the access control system, cuz it can't right.
Just not capable of talking to us. We're still able to open that door for the right credentialed user. Got it. Got it.
[00:30:43] James Dice: Cool. I wanna circle back on the, you mentioned this beacon technology. Can you talk, talk
[00:30:48] Prasan Kale: more about that? Sounds cool. Yeah. Yeah. It's it's, it's not as cool as it sounds. A Beacon's a pretty simple device.
It just sits there and says, I'm here. I'm here. I'm here all day long. Uh, We developed we developed a little algorithm to understand [00:31:00] how to read that beacon. And passively understand who's been around that beacon. So we actually filed a patent and got us PTO and a couple international, fully granted patents out of it.
And really the premise was, you know, I wanted to in operating my buildings, I wanted to understand how portions of that building were utilized. Now you could do that with an access control system. Right. You can run the report and be like, oh yeah, many people went through the fitness center. That's important.
But what do they do once they got into the fitness center? Oh, I have no idea. Cuz it's all open or it's not a reservable amenity, so it's just open access. I wanted to be able to measure granularly, like, Hey, there's a lounge with, you know, hard seating over here. And on the other side of the lobby, I have soft seating over there.
I wanna see which one gets used the most. So I want to make it hyper local to a certain area. And really leveraging that beacon tech. We're able to do that in a passive manner, in a statistically accurate manner. So we could show whether the treadmill or the Peloton bikes are being used or the yoga studio or the, you know, whatever the [00:32:00] meditation chambers getting more utilized.
Right. We can get that granular with it. And with that aggregate beacon data, we can even go so far as to say, well, occupancy's either going up or down for the building based on a handful of things that occur in that building. So yeah, the beacon itself is a pretty simple device. In fact, we made it so that it was peel and stick the actual hardware itself.
You didn't have to bring, you know, pipes and wire to it, which. Usually end up being more expensive than the device itself. So we said, look for, in order for these things to be deployed at scale they literally need to be battery powered work for five years. You peel to, you know, tape off of it or two screws and it's under a desk and it's up and running just like that.
Okay. That's kind of the mentality we took to it. That seems to have worked. I mean, we we've got customers that are raving about that data and you could do things for the customers, customer like, Hey, you wanna go down to. Fitness center. You can look on the app and see whether it's busy or not. Whether you, you know, choose to head down there or not.
Mm-hmm , this was really, really important during sort of the, the bulk of COVID where [00:33:00] lockdowns had happened. And then you finally started opening up a little bit. This was really important. You could really help keep people safe by not congregating it in certain areas or not going down to, to busy areas when they were in fact busy and giving your occupants the easy button to go.
I'm gonna check before I go down there. It's not only safe during the times of COVID, but it's a convenient thing, even, even long thereafter. Got
[00:33:22] James Dice: it. Very cool. So when would a, when would one of your clients or your customers use that versus using some sort of occupancy counter IOT
[00:33:31] Prasan Kale: solution? Yeah, I think, I think there's some great occupancy sensors, counters there's, you know, image based ones.
There's radar based ones. Mm-hmm, , there's all kinds of great stuff out there. I think those are all very important systems to have. I think where our clients see the value in the beacon tech is it becomes like the base layer. It's like, look just, just, we're gonna get the really, you know, high profile, sophisticated occupancy sensor that's video based that tells you people's emotions while they were in [00:34:00] your space and all those great things.
We're gonna get that. We might not be able to get that for every single room in our building. Mm-hmm every location within our building. Cause it's cost prohibitive at times. Right. So because you have to run infrastructure to those systems, right? Like I said, that usually costs you more than the actual sensor itself.
So the clients look at this as a base case, statistical, you know, look. We can get a pretty good understanding of how things are working and operationally how the building's being used. And then we can leverage that statistical data to go look, we're about to go renovate the amenity center. Should we put in a golf simulator or more lounge heating or a small conference room?
Our beacon data can surface that, but if they want to get really specific and granular, certainly there's use cases for the occupancy sensors and radar based systems out there. Got it. Cool.
[00:34:49] James Dice: The I'd like to switch gears a little bit. So we've been, I was planning on talking about the nerdy techs for, or second we, we, we went straight into it.
And so I want like, maybe [00:35:00] circle back to what I was planning on asking you about first, which was more business questions. So it's, you're a real estate guy, right? Which I didn't know. Which is awesome that you came from that, that side of things. Can you talk about getting back to the office and like kind of where we're at and this could be a novel, like you said earlier, this could be a six part series.
What's the cliffs notes of where we're at in terms of getting people back to the office and how 10 apps specifically help with that and how, how real estate owners are thinking about using 10 apps in that,
[00:35:32] Prasan Kale: in that situation. Yeah, I think you know, there's a hundred answers, right. And everyone has been on those answers.
I don't know what the answer is to be quite honest. But I, I, I, I think my theory is that. The first step we have to take is understanding whether going to the office is even required anymore. And my answer to that is, is an absolute 100%. Yes, because the innovation curve flattens so fast, it'll make your head spin when [00:36:00] people are disconnected, even though they're on zoom calls and slack all day long, right?
Mm-hmm look, I think there's, I think there's value to how we've pivoted during COVID to still being productive by, by while being away. But I think that innovation curve does slow down pretty, pretty, you know, definitively when you're not together in moving fast. And I don't think that just applies for startups or, or, you know, smaller middle size companies.
I think that applies to the biggest companies. Just the same. Right. So I think if the, if we start with, look. If we believe that in order for us to innovate that at at least for a portion of our work week or month or whatever it is that we have to be together in the same room, to be able to read each other's emotions and, and move fast through the problem at hand and, and really get to a best answer as opposed to.
The one that we came up with because we had zoom fatigue and everyone was like, okay, this is the 60th zoom call I've been on today. I'm fine with whatever you say. Right. Whatever.
[00:36:54] James Dice: Yeah. Whatever
[00:36:54] Prasan Kale: you're gonna do. Right. So if, if that's the starting point, if that's the theory of it [00:37:00] while recognizing like we've created also some convenience to employees and.
And, you know, people that have other responsibilities, like creating flexibility is important. And I think we've done that. I think there's a balance. Right. And, and who knows whether that's two days a week, five days a week, four days a week. We don't know that yet. But that'll just, that'll just happen out of time.
But I do know that some part of the week or month. Get spent together in real time, engaging with your, with your team and getting mentored and learning from each other and, and all those things. So, so if that's the case, if that's the sort of premise, then, then it's just a matter of time before occupancy comes back to pre COVID levels.
And it might not be that way on Mondays and Fridays or maybe Fridays. But it, it will be that way, I think for a majority of the week. And we're seeing that in our data, by the way, like in our beacon based data and a log data we're seeing a steady increase, like a 40 degree slope, you know, in markets like Chicago, New York.
So I think, you know, there's lots of companies out there that are sort of aggregating this data. [00:38:00] But, but very much what you're seeing is a steady uptick week over week, where people are more and more regularly coming back to the. I think if you switch that question to, well, how does a app help you with that?
I think over the course of the last two years or whatever, it's been. People have forgotten what the water cooler looks like. People have forgotten that, you know, the building hires a band and has a social hour on Thursdays. And that's cool. Cause I go down there with my employee, you know, colleagues and, and we used to talk about things other than work, you know, while, while being at work and that built relationships and that.
You know, that person helped me do something the next week. I think we've forgotten that mm-hmm and tenant app can help you remind it. So a very good example of that is Hines is 4 44 lake, which is one of our customers where that, that app actually went live in the height of COVID. Nobody was at the building.
Right. but ever since then, they've used the app to actually communicate with all those employees of their tenants. So their, their [00:39:00] customers, employees, mm-hmm about how great the building is and what they're doing at the building. And of course, every time they say, look, we're doing something to activate the building or create a little bit of excitement here.
You'll see a, you know, uptick, a direct uptick in how many people are coming back to the office. So, so the return to the office, I think happens gradually over time. Cause look, people are going to concerts and they're, they're taking airplanes all over the country. And so the safety part of it is, is somewhat sort of, not as bad as it was, say a year ago or two years ago.
But the, the sort of the, the desire to come back while they can be productive at home. Is starting to sort of snowball down the hill where people are like, no, no, no. I've had enough of, you know, having my dog bark in the background or, or whatever it is. And I wanna be back. I wanna, I wanna feel engaged with my, with my fellow employees.
And that building as an example, did a great job of communicating with the tenants and their employees, even though they were sitting on their couch at home. Totally. And really they, they did a good job of competing with the couch. We say it all the time, like as real [00:40:00] estate, as an industry, We have to compete with the couch.
So an app, well, that's, it's just a delivery mechanism. And if you have an app that's highly adopted because it does operational things or provides functional value, like digital access and things like that. Well, then you're gonna have really high adoption, which means when you send that message out about, Hey, we're doing a party in the park or.
Ice cream social or the yoga event or whatever it is, those front end engagement things. It's gonna entice more of your tenant's employees to actually come back to work, which is good for everyone. Not just for the tenant themselves because that innovation curve, but it's good for the building from a health of an asset standpoint cuz after all we're in the business of real estate.
[00:40:38] James Dice: Totally, totally makes perfect sense. Yeah. Uh I'm I'm one of those people that's sort of. Went remote during COVID when I started my own business and just missing that activity for sure. How about with Leasing. Right. So same question, but related to leasing activity and renewal, because I feel like that's the piece that I think a lot of people are concerned [00:41:00] about today in real estate, right.
Are so and so gonna renew their lease and are so and so gonna downsize like those sorts of questions. How can a tenant app help with those, those sorts
[00:41:09] Prasan Kale: of questions and, and fears? No, there's no doubt it's gonna be a renewals market for quite some time. There's some big numbers and stats of, of the lease expirations that are out there in the market Countrywide.
I think, I think I can answer that question with the. The decision maker of how much space to take and where to take it has shifted from the CEO or the, or the board members or something like that in a, in a company to the employee population that's happened over the last five or so years, maybe 10 years where.
Employees really have a voice in where they're located and why they should stay at a building or go to another one and, and whether their office should be bigger or smaller. So I think getting the voice of the customer is really important because if you engage that customer, the employee, the end user.
If you put [00:42:00] them on brand your building's brand, whether it's through an app or other means, right? If you give them good technology to engage and socialize with that building's brand and the other people in that building, if you get them the yoga class and the ice cream social and the convenient access and all those things that we've talked about earlier then that employee's gonna feel an affinity for that.
And so when the CEO asked that employee, Hey, should we take more or less space? Should we stay here? Should we just go remote and work from home from now on? And just sort of disband the office that employee's gonna have a strong opinion to say, look, I like being here and I have an affinity to this brand and this building, and I'm engaged here.
I've made a few friends by going to the. Whatever the yoga class or the ice cream social, whatever it might be. And, and I, my vote is to stick around here. I, I like my office space. I think that's an important thing that the real estate industry needs to tap into. I think the, the second part of it is, you know, if you're, if you're, if you're really sort of trying to think about, well, how much space is going [00:43:00] to be required, you know, everyone's like, well, everyone's gonna be working from home.
So we'll need a half the amount of space that we used to need. I actually think. Maybe not if you're a company that had a hundred employees and you have not grown or shrunk from a business standpoint through COVID and into the next five years. Well, you might just, even if 20, 30, 40% of those employees are working from home temporarily, you might actually need more space.
For the 50 employees that are coming to work every day, cuz we need to spread out more. You know, the, we went to a benching model, I think five, seven, something like that years ago. Mm-hmm where went to, you know, sardine offices or sardine Ken offices. And I think that's gonna shift back, right? I think you need more space, not just for people's own personal space but also for collaborative areas where.
The 30 or 40 workers that went remote, maybe full-time, or part-time need to come back, need to have more meeting space, need to have more, you know, lounge space, frankly, where people can sit around a comfy couch and it's almost feels like home, right? Like [00:44:00] that's what you wanna try to emulate. It's like, okay, you're not working from home, but you're working in an office that feels like home and it's comfortable.
And you can engage with your fellow employees when you do come to the office once or twice a week. I think that's gonna actually drive up the amount of space. Regardless of employee growth just for that hundred employee tenant. Like I think they might actually need more space than, than what they're sort of saying right now.
So I, but I, I don't know that that's today. I think that's what will happen over the next, you know, couple, three years. Got it. Got it.
[00:44:29] James Dice: I think we're related to those two questions around getting people back to the office and leasing activity and renewal. The question comes to my mind of analytics.
So helping. So you mentioned this one occupant that might like or dislike their space. That's one piece of data, right? What are the other types of analytics you can provide to help, you know, landlords, but also. Building owners, right. Could be two different entities, understand how, what to do with their space [00:45:00] and, and I guess tenants as well.
Right? You could provide analytics to all three of them to provide, to make better business decisions. So how, how do you.
[00:45:07] Prasan Kale: How do you think
[00:45:07] James Dice: about that?
[00:45:08] Prasan Kale: That analytics piece? Great, great question. And, and one, the answer, hopefully stitches all of this together, right? Yeah. Right. Why, why did we build rise buildings, you know, to create value for the owner from a dollars and cents standpoint, create engagement and affinity, but the exhaust of all of the native operations technology that we built back then, and then as part of VTS with VTS rise, The amount of features and functionalities that we've been able to scale up and sort of the data points that that is exhausting is creating a paradigm shift.
In how real estate makes decisions. Right? So VTS from a, from a sort of a historical standpoint, had all the great data around leasing and marketing activity and generated sort of the data exhaust from that rise from a operational input standpoint, and even more recently with lane and the engagement input standpoint starts to create a tremendous amount of exhaust data from how, how.
Visitors are showing up [00:46:00] to your building. How many conference rooms got booked is an employee happy or sad, literally an NPS score for your building. Right? How many events did they attend the RSVP, but didn't show up. Is that important? Like at a hundred people RSVP, but 10 people showed up that what happened that day?
Right? You can get into the granulars or you can start to look kind of zoom out and go, well, if I have a, just give you an example. If I have five tenants in my building and the top tenant has its lease renewal. Or expiration cuz they can send us a termination notice on X date, six months from now has, is having a terrible experience.
Their NPS scores are, you know, their detractors when, when they do a work order, they have lots of work orders that they're putting through the first party operation software. And then they're rating them as like, we're not doing a good job for them. Nobody's showing up at the office really like they're 50% utilized on their office space.
They start compounding these factors and they're paying, you know, below market rate. Okay. All of these things we know as the VTS ecosystem, that is all first parting area [00:47:00] that comes out of our, our different product blinds. Right? Well then you can actually make a decision about that space as a landlord and an operator and a leasing team to go, they're paying below market rate.
They're unhappy and they're paying in the ass. Maybe we should give 'em an early out cuz we can market, you know, clean up that space, market it and have it filled if that's the market that's out there. Right. Or you might be able to do something between now and their termination. That's focused to that tenant and their employees and their C-suite and whoever to turn that relationship around and entice their employees to come back to work, throw them an event, or, or give them an exclusive thing that is just done for them.
Really the, the, the premise here is that when you take that operational engagement data and you contextualize it with the, with the thing that matters the most, which is the business at end, it's the leasing part of the business, right. You can get to really get ahead of some of these surprises that when I was in real estate and our team was like, yep.
So and so terminated. Like, wait a minute. Did we, did we not know that that was coming? [00:48:00] They're like, yeah, no, we didn't really know. They kind of surprised us this week and they sent in their term notice. Like let's not have any more surprises as an industry. Right. Actually use the data to get ahead of it and do something about it.
And, and really start to shift real estate from a what has been in, in sort of the legacy sense kind of anecdotal it's like, yeah. I think someone uses the golf stimulator a lot. That's that's what the property manager will tell you. I tell the story all the time. It's like as a real estate developer.
And, and like we used to put in a golf simulator into every building we built. It's a terrible idea. It's like, because why? Because every one of my peers and colleagues, they all love golf. So we put in a golf familiarity mm-hmm but nobody was using the golf simulator. Right, right. So terrible idea. It's a waste of money.
What they really wanted was a small conference room. Well, we should have put in a small conference room, so. Shifting from like anecdotes. And I think this is happening in subjective sort of stories like that. One to, okay. The data proves that nobody's using a golf familiar and you know, this, tenant's not showing up to work and they're paying above market rate or below market rate.
These real data points can actually [00:49:00] totally change the way we make decisions in real estate. And, and that's what we built this product around. And that's what we're trying to bring to the. Got it. Got it.
[00:49:09] James Dice: This has been awesome. Persona. I wanna, I wanna be mindful of our time here. Um, Let's let's close this down.
I gotta ask you questions all day. Let's let's end with carves. What movie? Book TV show podcast, et cetera. Would you recommend the audience checks out could be personal
[00:49:26] Prasan Kale: professional or both? I'll do a fun movie real quick, cuz I haven't had a chance to see it yet. I'd really like to, it's a top gun Maverick Uhhuh, you know, it's a musty, right.
But on a more serious note, I, I really enjoyed third wave, which is by Steve case. Okay. I've read that book like three times. You know, it's, it's not necessarily like a new book it's been around for a while, but you know, he was part of AOL and revolution partners. And I think his, I think his approach to sort of how the next big.
Whether it's a technology [00:50:00] business or just any business will get built is I think, I think his punchline without sort of giving the cliff notes is, is really, you have to partner with the, the industry that you're serving and you have to, in, in some examples, you know, partner with, with things like government to, you know, it's no longer gonna be like run out there, like the wild, wild west, and then everyone will regulate around you.
It's actually be a part of that entire bring that into the entire equation. And I thought that was interesting. And some of the sort of bullet points along the way of that book and the way he's written, it really spoke to sort of my entrepreneurial journey and things that we have been through and lessons learned or, or, or, or sometimes it's like, crap.
It said that in the book, why don't we do it that way? Right. Mistakes made. So I really recommend that's, it's a great.
[00:50:45] James Dice: Nice. Nice. And, and are we still in the third wave? That's not over, is it who
[00:50:50] Prasan Kale: knows? I think we're in the Omicron sub variant two wave.
[00:50:56] James Dice: Yes we are. I
[00:50:57] Prasan Kale: don't, I don't know if any of those books apply anymore, but it's a good [00:51:00] read.
Got
[00:51:00] James Dice: it. Got it. All right. I'll to check that out. I remember like checking out the book and I just never, never bought it, but I'll share mine. So I've been training for a really. Run. I'm gonna run a hundred miles at the end of the month. Over, over a couple of days, not all at once, but all back country.
So I've been running a lot in training, so I've been really tired and I just like can't read right now. So I feel like I, on the last like five podcasts, I've shared all TV shows. Yeah. So I apologize for that. But the TV show I've been watching right now is called a loan and
[00:51:31] Prasan Kale: it is
[00:51:32] James Dice: incredible. They send people, haven't seen it, they send.
These people out into the wilderness all at once. And the goal is who can survive the longest. Oh, wow. And they all have, there's no camera crews. They all have their own personal cameras and, you know, GoPros on their heads and all that. And they're like narrating their experience the whole time. And you learn so much about survival.
I feel like
[00:51:54] Prasan Kale: I've learned a ton. So
[00:51:56] James Dice: that's all I'll say. Those eight
[00:51:58] Prasan Kale: season. Definitely gonna [00:52:00] watch that in eight seasons. That sounds like a very binge worthy. Yeah. That's lots of hours can be burned on that, but I'm gonna have to, I probably have to get you the audiobook version of third wave so you can listen to it on your, your, on my runs.
Yes.
[00:52:14] James Dice: There you go. There you go. All right. Thanks so much for coming on the show. I'm glad we finally did this.
[00:52:19] Prasan Kale: You got it? Yeah. Good to see you, James chat soon.
[00:52:25] James Dice: All right friends, thanks for listening to this episode of the Nexus Podcast. For more episodes like this and to get the weekly Nexus Newsletter, which by the way, readers have said is the best way to stay up to date on the future of the smart building industry, please subscribe at nexuslabs.online. You can find the show notes for this conversation there as well. Have a great day.
“I was building buildings. I was running a large portfolio. And the number one brick wall I kept running into was technology silos. There were 8 to 10 things I had to buy for everyone of those buildings, and they didn't talk to each other..."
—Prasan Kale
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Episode 111 is a conversation with Prasan Kale, co-founder and CEO of Rise Buildings, which was acquired by VTS in 2021 and is now VTS Rise.
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Note: transcript was created using an imperfect machine learning tool and lightly edited by a human (so you can get the gist). Please forgive errors!
[00:00:03] James Dice: hello friends, welcome to the nexus podcast. I'm your host James dice each week. I fire questions that the leaders of the smart buildings industry to try to figure out where we're headed and how we can get there faster without all the marketing fluff. I'm pushing my learning to the limit. And I'm so glad to have you here following along.
[00:00:31] James Dice: This episode is a conversation with PR kale co-founder and CEO of rise buildings, which was required by VTS in 2021. And is now VTS rise. We talked about why VTS acquired rise and why they acquired lane technologies. We talked about how tenant apps like rise, integrate with other systems in the building and in the cloud.
We talked about RISE's patented beacon technology and how it's used to track space usage. And finally PR shared how [00:01:00] tenant apps help with getting people back to the office, what impact they have on leasing renewals and what analytics or data exhaust as he calls it can be produced by tenant app to help support business decisions on the landlord side.
So without further ado, please enjoy the next podcast with PR kale. Hello, persona. Welcome to the show. Can you
[00:01:18] Prasan Kale: introduce. Hey, James. Great to be here. My name's person, kale, I started co-founded rise buildings about six years ago now and was their CEO and, and co-founder more recently VTS acquired rise. And so now I, I serve as the, as the managing director of VTS rise.
Awesome.
[00:01:36] James Dice: And we've had you on the list for the show. Ever since then, probably before then, actually. And it's just taken this long to get, get our calendars to align. So can you talk about your, your background first? Maybe before rise, what were you up to?
[00:01:49] Prasan Kale: Sure. Yeah, I'm I'm a real estate guy uh, spent my entire career after college.
I went to, went to school for electrical and computer engineering. Funny story. But my [00:02:00] first job offer was to design a blinker for a car. Okay. Yeah. And I said I don't want, I don't wanna design, I don't wanna design a blinker for a car. That's gonna go inside of a car, a chip set that nobody's gonna care that you design this blinker for a car might be a great blinker, but who cares about blinkers on cars?
Right? Mm-hmm turning signal. So I really, I, I was like that electrical and computer engineering side of me really wanted to sort of be technical. And that first job offer while it was great. I, I actually chose to go into a very different profession. Ended up in the world of property or project management rather in the world of real estate and helped redevelop a hotel and fell in love with not only Chicago, which is why I moved here as a city, but real estate as a business.
And so over the sort of career arc I've done. Everything from property management consulting to property management, portfolio management, asset management construction management. So really I've seen a [00:03:00] lot of the broad swath, including development management, which was responsible for developing a series of high rises in Chicago.
So I've really seen the broad swath of what it looks like to take a underwriting and a property, whether it's a new property or redevelopment and see it through all its phases of execution. I'd say the only thing I've really not touched is lending. Although I've probably borrowed money from a lot of people, so
[00:03:26] James Dice: cool.
And then what? All right, cool. And then what got you into
[00:03:28] Prasan Kale: the tech side of things? Yeah, I think it was the, it was the arc of the career that, you know, I was building buildings. I was running a large portfolio of properties, both residential and commercial. And the number one thing that, you know, the brick wall I kept running into was I was trying to make these properties more efficient, whether that was saving energy or better operational systems or better staff management, all the above, create retention and engagement in these properties, trying to do this.
With technology as a primary sort of tool. But [00:04:00] there were like eight or 10 things that I had to buy for every one of those buildings. And so as a developer, I was like, yes, we gotta have the package management solution. We gotta have the Intercom solution or visitor management solution. We gotta have this and rent payment and blah, blah, blah, blah, blah.
But then when I stitched 'em all together. And handed off to where my property operations had. What I quickly found was none. None of those point solutions were being effective. What was happening instead is you know, although I desired sort of staff efficiency, my staff was going, how many things do you want me to log into?
Mm-hmm . And so they were going, I'm not efficient at any of these systems and those systems don't talk to each other. I'm spending a lot of time in my day doing double data entry and air checking and sort of going task switching at the end of the day. Yeah. And that wasn't, that didn't feel good cuz I was like, that's the opposite reason of why I put those systems in and then, and then the worst thing, which was, you know yeah, of course it costs more cuz you're buying sort of eight, 10 systems, but then.
The worst thing was the people that ended up living or [00:05:00] working in those buildings had no idea where to go to get something done. So, you know, they were told to go to this website for X thing and call downstairs for this Y thing and go to the back room to do the other thing, and then get an app for your experience, which, you know, was like an info app at the time.
I was like, well, that's not right. So, you know, really with Sid, my Sid Jane, my co-founder. Really thought about, well, how do we single stack this? How do we create a total technology solution for real estate? Whether it's an office building residential, industrial, it doesn't matter if it's a building with four walls and a roof and people that live, work or play in it.
And there's staff and property management that sort of run that asset. How do we single stack it and create a one stop shop for the industry? Something I desired as a solution to my own real estate. And it turns out so did a whole bunch of other people mm-hmm
[00:05:47] James Dice: Nice. So that became rise
[00:05:50] Prasan Kale: then. That's right.
Yeah. Rise buildings. Yeah, totally. Okay. So
[00:05:56] James Dice: catch me up then. So, You founded rise six years [00:06:00] ago. It got acquired. What last year is that? Right? 20, 21
[00:06:03] Prasan Kale: in March of 2021. Yep. What was that
[00:06:05] James Dice: journey like from having that realization on one of your projects to getting acquired? Can you sort of fill in the story in the
[00:06:12] Prasan Kale: middle there?
Yeah. There's there's not just a story, but there's probably a couple of novels. I'm sure. I'm sure. Cliff notes. I keep it to the cliff notes. I. We were a bootstrap startup, right? So very much, you know, elbow grease and all those things never really raised a big round of venture money or anything like that.
Not saying that's wrong. Just, we said, look, let's go, let's go focus on the product, put all the money into the product and the deep integrations that it requires. And just a high technical execution that it requires. And then let's go put it into one building or five buildings. And if we did something right then those five buildings or customers will tell the next few buildings mm-hmm and that's kind of how it played out.
Now that that was not easy because you know, every, when you're, when you're bootstrapped, everything is tight and you're working 48 hours in a 24 hour day. Yeah. But it was, it was probably the [00:07:00] most fun I've had in my whole life. I mean, The things we were able to accomplish in a day took, you know, weeks for many companies to do.
So that was, that was a lot of fun and that that's going back early days that, that tactic of like build a really great product. And, you know, if you build it, they will come. It actually worked. Most of our early customers told the next customer that. Don't believe the marketing hype don't don't, you know, forget about what's on the blogs or this or that.
Right? Like those are those, those things that actually work in the field are what most are mostly are important. Mm-hmm and you really look at rise buildings because they've, they've designed something and actually executed on it. That works day to day. So like that we sort of in the second call phase of, of growth really grew by word of mouth.
And at, at that point there was like, there was a real impetus to going, okay, let's raise some money so that we can take that word of mouth and turn it into a, you know, system and, and have a few more people to do the work. So that it's not 48 hours a day and a 24 hour day mm-hmm . Uh, So that [00:08:00] was phase two and we were very, very lucky.
And I think this is the secret to everything. That's successful is that we were very lucky to find. The best people in that middle phase, you know, so the early days we were sort of founder led and founder executed in that middle phase we really were lucky in finding the right people to take over, you know, everything from our client success to our back office, to our accounting, to you name it, right?
Every part of the business that's really important. And all of the parts of the business have to fire on, on all cylinders for it to truly catch exponential growth. And that's what we were very lucky in finding really great people strong culture as, as a company and really what attracted the next person to join us as well.
And that led to sort of scaling execution, where we are able to not just deploy five or 10 buildings in a month, we were able to deploy 20 or 30 and sell 50 or 60 and, and so on and so forth. Build the right product enhancements in the next integrations for the next set of buildings that we're about to, to, to be [00:09:00] sold to.
So that third phase was really where we went from sort of bootstrap, you know, you know, in a closet startup to, okay. There's there's real presence here. And short of any real sort of venture fundraising or anything like that. We were able to get into a whole lot of buildings very, very quickly in that sort of mini scale phase I'll call it.
Gotcha. And that's really when, sort of, I got the call from Nick, you know, one day saying, you know, I've been talking to lots of customers in the tenant experience space and, and your name keeps coming up, but I don't see, you know, rise buildings plastered on every, every sort of banner out there.
Like, yeah, we don't, we don't really have a marketing department , you know, he was like, you should get a marketing department. He's like, I can fix that. I was like, great. He's like, I'll come see you tomorrow. I was like, great. And, and, you know, I obviously I've known Nick for a long time now, but was a big fan of his, even before that conversation.
And we got together and, and really saw the value inputting the great product that we had built and being able to scale that even further, having all the right resources and, and people you know, [00:10:00] in growing the team even further. To really take it to the next level. So we got together and, and come March of 2021 and it was through COVID.
It was crazy time. It's like, you know, who goes through a whole acquisition during COVID without seeing, you know, each other sort of post the first couple of times. But all that happened in March of 2021, we were fully acquired. And it's been a great journey since it's been over a year now. And It's it's, it's a lot of fun with, with a really big team now, a lot bigger than the 30 or so that we're in the office before.
And it's, it's a, it's a really great journey thus far. Yeah. Awesome.
[00:10:31] James Dice: And for those who don't know, what is, what is VTS? What do they do?
[00:10:34] Prasan Kale: Yeah. So VTS is. Call it the first true unicorn PropTech company. Mm-hmm they were the original PropTech company and VTS focused its time over the last decade on really first a lease automation platform that converts leads to, to signed leases a lot faster.
So really took sort of the. Even in my real estate days, the leasing activity report used to be an Excel file that leasing [00:11:00] agents would fill out and they'd say, oh yeah, this person called me on this date. And it was brutal. It was, it was time consuming. It was inaccurate always. Right? Yeah. You'd miss the Rofer or you'd miss the, you know, whatever the, the encumbrance that you had on that lease.
And then there would be a big meeting and. You know, be mad at, at the leasing people. And so VTS really totally invent reinvented that said, look, use technology to make it fail safe, to make it just more efficient. And that was really something that resonated with me is that they took a business process in the world of real estate.
Truly understood it. Cuz I think Nick, you know, Nick and Ryan both spent their time. And the asset and brokerage worlds. So as founders, they really had a very clear vision of what the industry needs. And I think that's a very important theme here is that you really need to understand what the industry wants and needs as opposed to looking at it, just from a software perspective, most other industry coming in trying to do what real estate needs.
So they were able to execute on that and since have grown the product to market, which is another offering that digitizes and automates the [00:12:00] marketing equation for commercial real estate and then data. Which takes all those first party you know, inputs that are in the system and gives you near realtime data and, and insights into how you should strategize your portfolio or even one specific space in your building.
And that really changes sort of, dynamically how real estate has operated from a leasing and asset management standpoint over the course of the last 10 years with BTS and the, you know, number one player in the space and over 12 billion square feet, I think that are served by the core product.
And then with the addition of, with, of addition of rise buildings, and more recently even lane technologies out of Toronto what we were able to do is fill in that product you know, kind of round out that product with like, okay, well, you leased the space on VTS and you had, you know, you found out about this space on market there's data flowing out of that.
Once you've moved into that space. You need something, a technology tool to operate your day to day, right. To operationalize that asset. So that's really where rise buildings came in. It was a nice puzzle piece fit into that equation. And now with the acquisition [00:13:00] of lane, even further rounding out that feature set to where really is a, a full stack solution real estate.
Got it, got it. And
[00:13:09] James Dice: catch me up on lane as well. So. I think a lot of the nexus audiences, what we're, we'll talk about front of the house first back of the house a little bit, but I think a lot of the nexus office nexus nexus audience is coming from the back of the house. And so these more front of the house, or really business specific business automation, focused startups, they might not have as much knowledge of those.
So what, how is lane different than what you guys were doing?
[00:13:31] Prasan Kale: Yeah. It's a great way to sort of, split that up, right? I think there's. With with lane, first of all, great team, great founders and a, and a great architecture to how they had built the platform. It really is a technology forward platform.
And while lane was focused on sort of the front of house, which is, Hey, look, what does the end user want? And center the technology around the end user. Allow them to do things like flex, right. Which is a very important thing. I think, going into the future here, mm-hmm, , allow them to do things like [00:14:00] engagement content in a, in a, in a very powerful way, allow them to maintain a unique user identity between buildings that they might visit and so on.
So forth. Very powerful big front of house. If you will on the back of house, it's the native property operation software where rise really created that value. Right? So, instead of buying those six systems or eight systems, you're, you're buying one, you're saving yourself money, hopefully around 50.
50% of your tech spend can be reduced by this consolidation place. So whether it's visitor management or work orders or preventive maintenance, or access management at the conference bookings and all the sort of day to day operational things that happen in the building happen on one single stack in one product.
Well, you've saved yourself some money and because you're offering the end user and the staff and the property manager, sort of a remote control for the building. They use it every day and they adopt, you know, you'll see 90% adoption and they'll use it like a toothbrush twice a day. You know, it's, it's really powerful when you get them to use the platform for the tool that it is.
Then you can [00:15:00] leverage that to engage them on the platform for the network that it creates. Right. Mm-hmm . That's where like the puzzle piece as well of lane and rise coming together and adding all those feature sets and sort of best of both worlds, if you, if you will. I think that sort of creates the future of what is, what was known to be 10 experience.
Right? 10 experience was a big buzzword. And certainly I think a worthy one. But I think that was looked at as a point solution. Like, Hey, here's your app for your building? Mm-hmm and it's got a bunch of information on it and you can't really transact or. Pay for rent or do any of those, those functional things, but it's got, it's an app for your building and you've checked that box.
I think bringing that together with the back of house mm-hmm and truly making it a one stop shop technology solution both for the front and the back of house really establishes what I think's gonna be the future of, you know, tenant experience. Cool. So, so
[00:15:53] James Dice: one of the things that we were talking there, I think I've been confused about front of the house back of the house.
It's almost like what you were [00:16:00] describing as. There's like the engagement in perks and flex space options. That's like very, very front of the house. And then what you described is like, in my mind, like middle of the house, cause it's still touching tenants, still touching occupants, right? There's the, you know, visitor management conference room booking amenities, things like that.
And then I'm still picturing like more back of the house technologies. Right. I, I need to manage this air handling unit and what, what temperature of air it's putting out and, you know, all of those types of things that are way, way, like way, way back of the house, right? Yeah. Is that, is that kind of how you think about it too?
Like the spectrum it's not necessarily either or thing.
[00:16:42] Prasan Kale: Yeah. I, I, I definitely look at your, sort of what you described as back of the house. Yeah. As the way, way back of the house. Way, way back. Okay. Your building systems. Yeah. Well, you know, and I think there's real value in that, and that's not something sort of, we do today.
Right. We don't get all the way to the back of the house. Mm-hmm we do connect to it. We do provide inputs to it. Mm-hmm but we're not [00:17:00] the HVAC system. Yeah. We don't aspire to be. I think, you know, we could touch on that. I think there are some great companies doing great work in that space, the way, way back of house and your system side that I think, you know, if they do their job well, right?
Those companies, they do a good job. Nobody will really know that they existed because they, would've probably driven some efficiencies and automation without anyone actually knowing. And you know, so the, so the middle of the house as you described it, or the front of house can become inputs to those systems to say, look.
Nobody's showing up at the building today, cuz we know cuz we're the visitor management system or we have, we have a patented beacon technology that understands how yeah. Today's being utilized. So. Okay, well that can form a great input into the way, way back of the house systems to inform them, to reduce the set point or take in more outside air or cut off the valve or whatever you you needed to do.
[00:17:51] James Dice: Yeah. What about the other way? What, what might you guys be able to pull in from the way, way back of the house?
[00:17:57] Prasan Kale: Yeah. Great. It's a great question. So, [00:18:00] think about we'll use a simple one, right? You have for every generally sophisticated HVAC system. you have a temperature sensor at the output of the main duct that comes to a tenant space, right?
Mm-hmm so you might be pushing air you know, pushing air outta the vent at 62 degrees. And that might be cold, not by like a human feeling. It's cold, but it's actually cold, right? it's it's cold air. And now you might have an ambient temperature sensor that's from the way, way back of house system, that goes, yeah.
You know what it, that, that sensor is saying, it's like 68 degrees in here. When it's 68 degrees in here, it's probably gonna result in a work order or a ticket from someone from the middle of the house that says I'm cold. Right? So instead of waiting for the customer to be cold, maybe we can take those back of house systems and turn it into a preventive ticket that says, Hey, Go check, go, go hit, you know, take the temperature, cut out and see what's really going on.
And maybe adjust the set point before there's a customer complaint, or if I'm I'm too hot or I'm too cold, and you can do that [00:19:00] with a host of systems, right? Leak detection systems are mm-hmm and there's so many more elevator systems can provide great inputs to to like the work order solution that we have.
So it's a great question. Those those back of way, way back of how systems can actually be a great input the other way. Totally.
[00:19:15] James Dice: And it seems like you need to enable in order to enable some of the use cases you're talking about. Cause I know you guys do things like I don't exactly know the technical like way, way in front of the house term for this, but integrating with access control to help people get throughout the building.
So it seems like in order to enable some of the use cases that you guys are selling to your customers, you need some of those integrations with way, way back of the
[00:19:38] Prasan Kale: house. Yeah, a hundred percent, hundred percent. I think you have to have, and just not, not just front of house integrations, not just way, way back a house, it's gotta be everything in between too.
So think about, you know, some of the primary systems that are in building certainly have the building automation and building. Systems HVAC and so on. So forth elevators, [00:20:00] access control. Those can all be part of that same equation. Mm-hmm you have accounting systems. So they're kinda like the middle of the house, right?
You're you're literally, you wanna be able to pay for your rent or pay for that flex booking? Well, it's not good enough just to take the payment, you actually have to ledger it into the accounting system. So, you know, a property manager doesn't have to do double or triple data. It's automatic, automatic.
So, and then, so there's sort of these middle systems which are accounting and If you will, to some degree productivity related, but then there's front of house systems that are engagement related. Like we want to be able to integrate to fitness vendors. And you know, one of our integration partners is arch amenities group is formerly life start, you know, they have classes, fitness and wellness classes and buildings.
Well, it would be, it would be a shame if we sent a user to some third website to consume that inform. What they should be able to do is in that same app that they use to access the building and go up the elevator. They should be able to book their yoga class or whatever that offering is made it to the application.
So I think, I think it's all across the board integration as a topic, [00:21:00] it is extremely important and we, that's why we spent, you know, frankly, our early money on deep product integration. With those systems, whether they're way, way back, middle of the house or front of house. Because we knew that unless you do that properly, and if you do that in a stable manner you know, you can't really bring it all together.
We might be able to build native technology to do a lot of things, but we're not gonna run the pipes and wires in the building yeah. To, to, you know, control the HVAC or make the elevators go up and down. So I think integration is key across all those domains. Yeah.
[00:21:31] James Dice: Can you talk to me about some of the use cases you enable when you integrate, like when you integrate with access control, what can you do then when you integrate with elevators, what can you do then?
And et cetera,
[00:21:42] Prasan Kale: cetera, et cetera, right? Yeah. Yeah, so let's, let's take those two as an example. And I'll go to saying. There's been a sort of loose definition of integration that has evolved. You know, what some people say it's an integration is like, well, if you, if you're trying to use a mobile credential in my mind, an integration is not [00:22:00] getting a emailed token or a code, opening up another app to drop that in and then having it sort of confirm, and then sending you the credential and hopefully you get it.
And then maybe the turn style opens that is not an integration. So an integration should mean. When a net new user is added to a building, they are automatically pushed into the access control system as a net new bonafide user. And then the legwork of obtaining a mobile credential, let's say from a third party system or provider is done on the backend.
So that to the user, the experiences. Okay. I just, I just started my day, you know, at my new new job. And my HR told me to download this app cuz I'm pre-registered and I went through the steps and I. You know, when I, when I hit log in, it asks me a simple question. Would you like to use this device as your digital credential from now on?
And if I hit, yes, all the other work is done in the back, you know, background. Like I don't have to go down to the security desk. I don't have to go to the basement security office and, and, you know, wait there in line. It's [00:23:00] done. And from there on out, I can use that app to access my turn style or elevator or my, even my own suite.
Right. So that's a real integration, a real push and pull integration. You know, complex systems, not sort of a user layer to, to not a front end of the integration. So things like things that we can enable with that are obviously we can manage the employee population or residential population of building in that third party system access controller.
Otherwise we can allow them to carry a digital credential, which. Frankly gets rid of the plastic key cards. One of the, the greatest examples that is 800 Fulton. It's a building owned by Thor and quad here in, in our backyard. You know, it claimed and is the smartest building in Chicago? Well, one of the first things they did as the smartest building in Chicago was that we're getting rid of all the plastic.
We don't need it, right. It doesn't need to end up in our oceans or any of that. And we have the means to do digital credentials. So unless you literally don't have a smartphone, which, who, you know, who doesn't you don't get a [00:24:00] plastic key card anymore. You get a digital key card that gets you into everywhere that you belong to in the building.
So they did that. It was a great, great move, and it, it's probably the poster child of how to do digital credentials and how to do touchless access. And then I think you can even take it a step further. So for example, with Schindler port as, as one example we have an elevator integration. So we talk to the back end elevator system, allowing for things like a user can call an elevator from a certain location.
Upon presence of that. Cause you don't want them to call an elevator from their bedroom. Right. So, you know, using our tech in conjunction with the system that exists, allows that user to call an elevator as they're walking up to that elevator. So things like that. Look will every user call an elevator with their phone?
No, but 15, 20% of them will. And they'll think that it's great because they don't want to touch the thing on the wall or they just want to have it waiting for them. By the time they get to that, you know, lobby or whatever. They're in a hurry, right? Mm-hmm , you know, all [00:25:00] things don't apply to all people, but the goal with deep integrations on the back office and the middle office side, if you will, are to make, you know, some subset of the building populations life a lot easier so that they feel welcome coming to that workplace.
Got it. Got it.
[00:25:15] James Dice: Hey guys, just another quick note from our sponsor Nexus labs. And then we'll get back to the show. This episode is brought to you by nexus foundations, our introductory course on the smart buildings industry. If you're new to the industry, this course is for you. If you're an industry vet, but want to understand how technology is changing things.
This course is also for you. The alumni are raving about the content, which they say pulls it all together, and they also love getting to meet the other students on the weekly zoom calls and in the private chat room, you can find out more about the course@courses.nexus lab. Start online. All right, back to the interview
Do you guys get into HVAC and lighting integrations? How does that, in terms of being able to modify the like two way communication, like you're talking about modifying those [00:26:00] systems, automating those systems based on what's happening in the app.
[00:26:03] Prasan Kale: Yeah. Depends on the system. Right? So, one of our integrations is with a.
A smart, smart building solution that controls thermostats lighting leak detection, a handful of things. Mm-hmm . So with, with that, as an example, a user can turn on their lights, turn off their lights, dim, their lights, set their thermostat. Set point even roll their shades up and down in their particular suite.
So with that type of integration, yeah. You get real depth, right. But there's others. There's a flavor of integrations where, you know, you're, you're basically popping a user via an authentication protocol into a. A controller's web fee, right? It could be that simple mm-hmm and, and frankly, sometimes the third party doesn't have the ability to deeply integrate and all they have is a web front end that you can control.
That's a, that's a hidden and secure link that you can only authenticate into. So we can do things like past parameters and we can do things like past set points. But then. Really the, the, the app, if you will. And the web [00:27:00] portal that the user sees is kind of a launchpad for all of these other things in the building.
And then you could choose which things you wanna launch out of it. But the experience has to be seamless. So it can't be like I pressed a button and it asks me to log in again and then, you know, spend five minutes, try to log in and remember my password or whatever. No, it's gotta be seamless and it's gotta be user role based and permissioned according accordingly so that you.
Joe cubicle, maybe they don't have rights to turn on the AC or whatever it is only the facility contact can do that. Or the main contact can do that. So that's easier based as well. Got it. So how have you guys
[00:27:34] James Dice: handled this over the past, like six years when these integrations are, are not easy, a lot of these, right.
So, you know, you might. Find one types of access control system that can do what you want it to do. And it might be an API and it might be blah, blah, blah. You might come up to the next access control system that, you know, doesn't even have anything for you to integrate with, right. Or it's some sort of legacy protocol.
So how have you handled [00:28:00] that? And the ability to, to acknowledge right. That. Yeah. The use cases you're trying to like implement for your customers are enabled by the underlying infrastructure. And sometimes those are gonna fight against what you're trying to do. How, how do you guys do that in a scalable
[00:28:13] Prasan Kale: way?
Yeah. And I think in building rise buildings with sort of the real estate background that we had we knew that no two buildings are gonna be the same. In fact, every single building is different. They're literally like a snowflake, right? So, even if two buildings have the exact same access control system, the way they use that access control system could be completely different, which means your platform has to be from the beginning, set up in an architecture in a, in a dynamic workflow where.
Each building can be treated for its its use case and its scope specificity. Right. Mm-hmm so and so that's we designed it from the beginning to be adaptable to each building's use case. And I, I will say for the most part access control systems, I think there's like 130 of them out there in the world.
Yeah. Maybe more a new one comes out every week. It feels like, generally speaking, they've [00:29:00] gotten sophisticated, so they're allowing for things like push and pull and the. Fields and the right data points to be exchanged. So that's made the job easier over the last six years. But there's still some legacy systems that, that are not even cloud connected.
Right. Mm-hmm so you might have a, a system from 1985 in your building. That's never been upgraded. That there is no way for you to talk to that system. Yeah. Even if you had a computer on site or an on on-prem server, trying to do it. So those systems, if, if our client, if our client were to ask us, well, I want do digital access, but I have this X system from 1985.
Mm-hmm tell me how, how to go about doing it because everyone I talk to says, well, you gotta spend a million bucks to upgrade your access control system. And what we did early on was we devised a series of hardware. That helps automate some of these things. So certainly we have this gateway that sits with that system, allowing us to do certain things to it.
But then really we built a, a, a protocol of hardware that allows you to unlock [00:30:00] any door, no matter what system it is. Right. So if it's a sophisticated system, we'd much rather carry the digital credential and unlock that door. Yeah. But if it's a system from 1985, the. Doesn't have to resort to spending the million bucks and upgrading to a cloud connected system necessarily.
It might still be a good idea to do that. But we can still unlock that door using hardware that supports our software. Got it, got it. So some sort
[00:30:23] James Dice: of gateway that talks, whatever integration protocols need
[00:30:27] Prasan Kale: to need to happen. Yeah. And so, without touching any sort of the underlying infrastructure or without writing a string of code to the access control system, cuz it can't right.
Just not capable of talking to us. We're still able to open that door for the right credentialed user. Got it. Got it.
[00:30:43] James Dice: Cool. I wanna circle back on the, you mentioned this beacon technology. Can you talk, talk
[00:30:48] Prasan Kale: more about that? Sounds cool. Yeah. Yeah. It's it's, it's not as cool as it sounds. A Beacon's a pretty simple device.
It just sits there and says, I'm here. I'm here. I'm here all day long. Uh, We developed we developed a little algorithm to understand [00:31:00] how to read that beacon. And passively understand who's been around that beacon. So we actually filed a patent and got us PTO and a couple international, fully granted patents out of it.
And really the premise was, you know, I wanted to in operating my buildings, I wanted to understand how portions of that building were utilized. Now you could do that with an access control system. Right. You can run the report and be like, oh yeah, many people went through the fitness center. That's important.
But what do they do once they got into the fitness center? Oh, I have no idea. Cuz it's all open or it's not a reservable amenity, so it's just open access. I wanted to be able to measure granularly, like, Hey, there's a lounge with, you know, hard seating over here. And on the other side of the lobby, I have soft seating over there.
I wanna see which one gets used the most. So I want to make it hyper local to a certain area. And really leveraging that beacon tech. We're able to do that in a passive manner, in a statistically accurate manner. So we could show whether the treadmill or the Peloton bikes are being used or the yoga studio or the, you know, whatever the [00:32:00] meditation chambers getting more utilized.
Right. We can get that granular with it. And with that aggregate beacon data, we can even go so far as to say, well, occupancy's either going up or down for the building based on a handful of things that occur in that building. So yeah, the beacon itself is a pretty simple device. In fact, we made it so that it was peel and stick the actual hardware itself.
You didn't have to bring, you know, pipes and wire to it, which. Usually end up being more expensive than the device itself. So we said, look for, in order for these things to be deployed at scale they literally need to be battery powered work for five years. You peel to, you know, tape off of it or two screws and it's under a desk and it's up and running just like that.
Okay. That's kind of the mentality we took to it. That seems to have worked. I mean, we we've got customers that are raving about that data and you could do things for the customers, customer like, Hey, you wanna go down to. Fitness center. You can look on the app and see whether it's busy or not. Whether you, you know, choose to head down there or not.
Mm-hmm , this was really, really important during sort of the, the bulk of COVID where [00:33:00] lockdowns had happened. And then you finally started opening up a little bit. This was really important. You could really help keep people safe by not congregating it in certain areas or not going down to, to busy areas when they were in fact busy and giving your occupants the easy button to go.
I'm gonna check before I go down there. It's not only safe during the times of COVID, but it's a convenient thing, even, even long thereafter. Got
[00:33:22] James Dice: it. Very cool. So when would a, when would one of your clients or your customers use that versus using some sort of occupancy counter IOT
[00:33:31] Prasan Kale: solution? Yeah, I think, I think there's some great occupancy sensors, counters there's, you know, image based ones.
There's radar based ones. Mm-hmm, , there's all kinds of great stuff out there. I think those are all very important systems to have. I think where our clients see the value in the beacon tech is it becomes like the base layer. It's like, look just, just, we're gonna get the really, you know, high profile, sophisticated occupancy sensor that's video based that tells you people's emotions while they were in [00:34:00] your space and all those great things.
We're gonna get that. We might not be able to get that for every single room in our building. Mm-hmm every location within our building. Cause it's cost prohibitive at times. Right. So because you have to run infrastructure to those systems, right? Like I said, that usually costs you more than the actual sensor itself.
So the clients look at this as a base case, statistical, you know, look. We can get a pretty good understanding of how things are working and operationally how the building's being used. And then we can leverage that statistical data to go look, we're about to go renovate the amenity center. Should we put in a golf simulator or more lounge heating or a small conference room?
Our beacon data can surface that, but if they want to get really specific and granular, certainly there's use cases for the occupancy sensors and radar based systems out there. Got it. Cool.
[00:34:49] James Dice: The I'd like to switch gears a little bit. So we've been, I was planning on talking about the nerdy techs for, or second we, we, we went straight into it.
And so I want like, maybe [00:35:00] circle back to what I was planning on asking you about first, which was more business questions. So it's, you're a real estate guy, right? Which I didn't know. Which is awesome that you came from that, that side of things. Can you talk about getting back to the office and like kind of where we're at and this could be a novel, like you said earlier, this could be a six part series.
What's the cliffs notes of where we're at in terms of getting people back to the office and how 10 apps specifically help with that and how, how real estate owners are thinking about using 10 apps in that,
[00:35:32] Prasan Kale: in that situation. Yeah, I think you know, there's a hundred answers, right. And everyone has been on those answers.
I don't know what the answer is to be quite honest. But I, I, I, I think my theory is that. The first step we have to take is understanding whether going to the office is even required anymore. And my answer to that is, is an absolute 100%. Yes, because the innovation curve flattens so fast, it'll make your head spin when [00:36:00] people are disconnected, even though they're on zoom calls and slack all day long, right?
Mm-hmm look, I think there's, I think there's value to how we've pivoted during COVID to still being productive by, by while being away. But I think that innovation curve does slow down pretty, pretty, you know, definitively when you're not together in moving fast. And I don't think that just applies for startups or, or, you know, smaller middle size companies.
I think that applies to the biggest companies. Just the same. Right. So I think if the, if we start with, look. If we believe that in order for us to innovate that at at least for a portion of our work week or month or whatever it is that we have to be together in the same room, to be able to read each other's emotions and, and move fast through the problem at hand and, and really get to a best answer as opposed to.
The one that we came up with because we had zoom fatigue and everyone was like, okay, this is the 60th zoom call I've been on today. I'm fine with whatever you say. Right. Whatever.
[00:36:54] James Dice: Yeah. Whatever
[00:36:54] Prasan Kale: you're gonna do. Right. So if, if that's the starting point, if that's the theory of it [00:37:00] while recognizing like we've created also some convenience to employees and.
And, you know, people that have other responsibilities, like creating flexibility is important. And I think we've done that. I think there's a balance. Right. And, and who knows whether that's two days a week, five days a week, four days a week. We don't know that yet. But that'll just, that'll just happen out of time.
But I do know that some part of the week or month. Get spent together in real time, engaging with your, with your team and getting mentored and learning from each other and, and all those things. So, so if that's the case, if that's the sort of premise, then, then it's just a matter of time before occupancy comes back to pre COVID levels.
And it might not be that way on Mondays and Fridays or maybe Fridays. But it, it will be that way, I think for a majority of the week. And we're seeing that in our data, by the way, like in our beacon based data and a log data we're seeing a steady increase, like a 40 degree slope, you know, in markets like Chicago, New York.
So I think, you know, there's lots of companies out there that are sort of aggregating this data. [00:38:00] But, but very much what you're seeing is a steady uptick week over week, where people are more and more regularly coming back to the. I think if you switch that question to, well, how does a app help you with that?
I think over the course of the last two years or whatever, it's been. People have forgotten what the water cooler looks like. People have forgotten that, you know, the building hires a band and has a social hour on Thursdays. And that's cool. Cause I go down there with my employee, you know, colleagues and, and we used to talk about things other than work, you know, while, while being at work and that built relationships and that.
You know, that person helped me do something the next week. I think we've forgotten that mm-hmm and tenant app can help you remind it. So a very good example of that is Hines is 4 44 lake, which is one of our customers where that, that app actually went live in the height of COVID. Nobody was at the building.
Right. but ever since then, they've used the app to actually communicate with all those employees of their tenants. So their, their [00:39:00] customers, employees, mm-hmm about how great the building is and what they're doing at the building. And of course, every time they say, look, we're doing something to activate the building or create a little bit of excitement here.
You'll see a, you know, uptick, a direct uptick in how many people are coming back to the office. So, so the return to the office, I think happens gradually over time. Cause look, people are going to concerts and they're, they're taking airplanes all over the country. And so the safety part of it is, is somewhat sort of, not as bad as it was, say a year ago or two years ago.
But the, the sort of the, the desire to come back while they can be productive at home. Is starting to sort of snowball down the hill where people are like, no, no, no. I've had enough of, you know, having my dog bark in the background or, or whatever it is. And I wanna be back. I wanna, I wanna feel engaged with my, with my fellow employees.
And that building as an example, did a great job of communicating with the tenants and their employees, even though they were sitting on their couch at home. Totally. And really they, they did a good job of competing with the couch. We say it all the time, like as real [00:40:00] estate, as an industry, We have to compete with the couch.
So an app, well, that's, it's just a delivery mechanism. And if you have an app that's highly adopted because it does operational things or provides functional value, like digital access and things like that. Well, then you're gonna have really high adoption, which means when you send that message out about, Hey, we're doing a party in the park or.
Ice cream social or the yoga event or whatever it is, those front end engagement things. It's gonna entice more of your tenant's employees to actually come back to work, which is good for everyone. Not just for the tenant themselves because that innovation curve, but it's good for the building from a health of an asset standpoint cuz after all we're in the business of real estate.
[00:40:38] James Dice: Totally, totally makes perfect sense. Yeah. Uh I'm I'm one of those people that's sort of. Went remote during COVID when I started my own business and just missing that activity for sure. How about with Leasing. Right. So same question, but related to leasing activity and renewal, because I feel like that's the piece that I think a lot of people are concerned [00:41:00] about today in real estate, right.
Are so and so gonna renew their lease and are so and so gonna downsize like those sorts of questions. How can a tenant app help with those, those sorts
[00:41:09] Prasan Kale: of questions and, and fears? No, there's no doubt it's gonna be a renewals market for quite some time. There's some big numbers and stats of, of the lease expirations that are out there in the market Countrywide.
I think, I think I can answer that question with the. The decision maker of how much space to take and where to take it has shifted from the CEO or the, or the board members or something like that in a, in a company to the employee population that's happened over the last five or so years, maybe 10 years where.
Employees really have a voice in where they're located and why they should stay at a building or go to another one and, and whether their office should be bigger or smaller. So I think getting the voice of the customer is really important because if you engage that customer, the employee, the end user.
If you put [00:42:00] them on brand your building's brand, whether it's through an app or other means, right? If you give them good technology to engage and socialize with that building's brand and the other people in that building, if you get them the yoga class and the ice cream social and the convenient access and all those things that we've talked about earlier then that employee's gonna feel an affinity for that.
And so when the CEO asked that employee, Hey, should we take more or less space? Should we stay here? Should we just go remote and work from home from now on? And just sort of disband the office that employee's gonna have a strong opinion to say, look, I like being here and I have an affinity to this brand and this building, and I'm engaged here.
I've made a few friends by going to the. Whatever the yoga class or the ice cream social, whatever it might be. And, and I, my vote is to stick around here. I, I like my office space. I think that's an important thing that the real estate industry needs to tap into. I think the, the second part of it is, you know, if you're, if you're, if you're really sort of trying to think about, well, how much space is going [00:43:00] to be required, you know, everyone's like, well, everyone's gonna be working from home.
So we'll need a half the amount of space that we used to need. I actually think. Maybe not if you're a company that had a hundred employees and you have not grown or shrunk from a business standpoint through COVID and into the next five years. Well, you might just, even if 20, 30, 40% of those employees are working from home temporarily, you might actually need more space.
For the 50 employees that are coming to work every day, cuz we need to spread out more. You know, the, we went to a benching model, I think five, seven, something like that years ago. Mm-hmm where went to, you know, sardine offices or sardine Ken offices. And I think that's gonna shift back, right? I think you need more space, not just for people's own personal space but also for collaborative areas where.
The 30 or 40 workers that went remote, maybe full-time, or part-time need to come back, need to have more meeting space, need to have more, you know, lounge space, frankly, where people can sit around a comfy couch and it's almost feels like home, right? Like [00:44:00] that's what you wanna try to emulate. It's like, okay, you're not working from home, but you're working in an office that feels like home and it's comfortable.
And you can engage with your fellow employees when you do come to the office once or twice a week. I think that's gonna actually drive up the amount of space. Regardless of employee growth just for that hundred employee tenant. Like I think they might actually need more space than, than what they're sort of saying right now.
So I, but I, I don't know that that's today. I think that's what will happen over the next, you know, couple, three years. Got it. Got it.
[00:44:29] James Dice: I think we're related to those two questions around getting people back to the office and leasing activity and renewal. The question comes to my mind of analytics.
So helping. So you mentioned this one occupant that might like or dislike their space. That's one piece of data, right? What are the other types of analytics you can provide to help, you know, landlords, but also. Building owners, right. Could be two different entities, understand how, what to do with their space [00:45:00] and, and I guess tenants as well.
Right? You could provide analytics to all three of them to provide, to make better business decisions. So how, how do you.
[00:45:07] Prasan Kale: How do you think
[00:45:07] James Dice: about that?
[00:45:08] Prasan Kale: That analytics piece? Great, great question. And, and one, the answer, hopefully stitches all of this together, right? Yeah. Right. Why, why did we build rise buildings, you know, to create value for the owner from a dollars and cents standpoint, create engagement and affinity, but the exhaust of all of the native operations technology that we built back then, and then as part of VTS with VTS rise, The amount of features and functionalities that we've been able to scale up and sort of the data points that that is exhausting is creating a paradigm shift.
In how real estate makes decisions. Right? So VTS from a, from a sort of a historical standpoint, had all the great data around leasing and marketing activity and generated sort of the data exhaust from that rise from a operational input standpoint, and even more recently with lane and the engagement input standpoint starts to create a tremendous amount of exhaust data from how, how.
Visitors are showing up [00:46:00] to your building. How many conference rooms got booked is an employee happy or sad, literally an NPS score for your building. Right? How many events did they attend the RSVP, but didn't show up. Is that important? Like at a hundred people RSVP, but 10 people showed up that what happened that day?
Right? You can get into the granulars or you can start to look kind of zoom out and go, well, if I have a, just give you an example. If I have five tenants in my building and the top tenant has its lease renewal. Or expiration cuz they can send us a termination notice on X date, six months from now has, is having a terrible experience.
Their NPS scores are, you know, their detractors when, when they do a work order, they have lots of work orders that they're putting through the first party operation software. And then they're rating them as like, we're not doing a good job for them. Nobody's showing up at the office really like they're 50% utilized on their office space.
They start compounding these factors and they're paying, you know, below market rate. Okay. All of these things we know as the VTS ecosystem, that is all first parting area [00:47:00] that comes out of our, our different product blinds. Right? Well then you can actually make a decision about that space as a landlord and an operator and a leasing team to go, they're paying below market rate.
They're unhappy and they're paying in the ass. Maybe we should give 'em an early out cuz we can market, you know, clean up that space, market it and have it filled if that's the market that's out there. Right. Or you might be able to do something between now and their termination. That's focused to that tenant and their employees and their C-suite and whoever to turn that relationship around and entice their employees to come back to work, throw them an event, or, or give them an exclusive thing that is just done for them.
Really the, the, the premise here is that when you take that operational engagement data and you contextualize it with the, with the thing that matters the most, which is the business at end, it's the leasing part of the business, right. You can get to really get ahead of some of these surprises that when I was in real estate and our team was like, yep.
So and so terminated. Like, wait a minute. Did we, did we not know that that was coming? [00:48:00] They're like, yeah, no, we didn't really know. They kind of surprised us this week and they sent in their term notice. Like let's not have any more surprises as an industry. Right. Actually use the data to get ahead of it and do something about it.
And, and really start to shift real estate from a what has been in, in sort of the legacy sense kind of anecdotal it's like, yeah. I think someone uses the golf stimulator a lot. That's that's what the property manager will tell you. I tell the story all the time. It's like as a real estate developer.
And, and like we used to put in a golf simulator into every building we built. It's a terrible idea. It's like, because why? Because every one of my peers and colleagues, they all love golf. So we put in a golf familiarity mm-hmm but nobody was using the golf simulator. Right, right. So terrible idea. It's a waste of money.
What they really wanted was a small conference room. Well, we should have put in a small conference room, so. Shifting from like anecdotes. And I think this is happening in subjective sort of stories like that. One to, okay. The data proves that nobody's using a golf familiar and you know, this, tenant's not showing up to work and they're paying above market rate or below market rate.
These real data points can actually [00:49:00] totally change the way we make decisions in real estate. And, and that's what we built this product around. And that's what we're trying to bring to the. Got it. Got it.
[00:49:09] James Dice: This has been awesome. Persona. I wanna, I wanna be mindful of our time here. Um, Let's let's close this down.
I gotta ask you questions all day. Let's let's end with carves. What movie? Book TV show podcast, et cetera. Would you recommend the audience checks out could be personal
[00:49:26] Prasan Kale: professional or both? I'll do a fun movie real quick, cuz I haven't had a chance to see it yet. I'd really like to, it's a top gun Maverick Uhhuh, you know, it's a musty, right.
But on a more serious note, I, I really enjoyed third wave, which is by Steve case. Okay. I've read that book like three times. You know, it's, it's not necessarily like a new book it's been around for a while, but you know, he was part of AOL and revolution partners. And I think his, I think his approach to sort of how the next big.
Whether it's a technology [00:50:00] business or just any business will get built is I think, I think his punchline without sort of giving the cliff notes is, is really, you have to partner with the, the industry that you're serving and you have to, in, in some examples, you know, partner with, with things like government to, you know, it's no longer gonna be like run out there, like the wild, wild west, and then everyone will regulate around you.
It's actually be a part of that entire bring that into the entire equation. And I thought that was interesting. And some of the sort of bullet points along the way of that book and the way he's written, it really spoke to sort of my entrepreneurial journey and things that we have been through and lessons learned or, or, or, or sometimes it's like, crap.
It said that in the book, why don't we do it that way? Right. Mistakes made. So I really recommend that's, it's a great.
[00:50:45] James Dice: Nice. Nice. And, and are we still in the third wave? That's not over, is it who
[00:50:50] Prasan Kale: knows? I think we're in the Omicron sub variant two wave.
[00:50:56] James Dice: Yes we are. I
[00:50:57] Prasan Kale: don't, I don't know if any of those books apply anymore, but it's a good [00:51:00] read.
Got
[00:51:00] James Dice: it. Got it. All right. I'll to check that out. I remember like checking out the book and I just never, never bought it, but I'll share mine. So I've been training for a really. Run. I'm gonna run a hundred miles at the end of the month. Over, over a couple of days, not all at once, but all back country.
So I've been running a lot in training, so I've been really tired and I just like can't read right now. So I feel like I, on the last like five podcasts, I've shared all TV shows. Yeah. So I apologize for that. But the TV show I've been watching right now is called a loan and
[00:51:31] Prasan Kale: it is
[00:51:32] James Dice: incredible. They send people, haven't seen it, they send.
These people out into the wilderness all at once. And the goal is who can survive the longest. Oh, wow. And they all have, there's no camera crews. They all have their own personal cameras and, you know, GoPros on their heads and all that. And they're like narrating their experience the whole time. And you learn so much about survival.
I feel like
[00:51:54] Prasan Kale: I've learned a ton. So
[00:51:56] James Dice: that's all I'll say. Those eight
[00:51:58] Prasan Kale: season. Definitely gonna [00:52:00] watch that in eight seasons. That sounds like a very binge worthy. Yeah. That's lots of hours can be burned on that, but I'm gonna have to, I probably have to get you the audiobook version of third wave so you can listen to it on your, your, on my runs.
Yes.
[00:52:14] James Dice: There you go. There you go. All right. Thanks so much for coming on the show. I'm glad we finally did this.
[00:52:19] Prasan Kale: You got it? Yeah. Good to see you, James chat soon.
[00:52:25] James Dice: All right friends, thanks for listening to this episode of the Nexus Podcast. For more episodes like this and to get the weekly Nexus Newsletter, which by the way, readers have said is the best way to stay up to date on the future of the smart building industry, please subscribe at nexuslabs.online. You can find the show notes for this conversation there as well. Have a great day.
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