It seems often that founders start off attempting to solve one problem in a market, and that work leads them to an even bigger problem—and their second startup. This is Johnny Hanna’s story.
He began with a startup just out of college that offered a software solution for apartment rental management. Through this work, he discovered that many people chose to rent apartments because they were too intimidated by the bureaucracy and expenses of buying a home. So he started his second company, Homie, which set out to eliminate those obstacles.
On this edition of Founders Journey, Johnny discusses the special challenges he faced in a highly regulated market with a fixed culture, how he eventually managed to raise fifty million in funds, and overcoming the fear of failure in the beginning years.
More information: https://www.homie.com/
Johnny Hanna is CEO and Co-Founder of Homie. Homie’s mission is to simplify home buying and selling with a one-stop-shop experience with Homie Real Estate, Homie Loans, Homie Title, and Homie Insurance.
Prior to Homie, Johnny was President and Co-Founder of Entrata, a real estate software company, where he helped the company grow to over $100 million in annual revenue. Johnny and his wife, Paige, have 7 boys, 1 little girl, and two dogs. Johnny and Paige are both trained mental fitness coaches and have a passion for helping others heal.
TRANSCRIPTION
DISCLAIMER: Below is an AI generated transcript. There could be a few typos but it should be at least 90% accurate. Watch video or listen to the podcast for the full experience!
Johnny Hanna 0:00
We tried to learn from every pitch that we gave, that we heard a no from. And investors are great at telling, you know, a lot of them are like, this is amazing. This is great, you know, it just doesn’t fit our criteria, when in reality, they’re like, you’re never gonna succeed.
Alexander Ferguson 0:19
Welcome, everyone to UpTech Report. This is our Founders Journey series. Joining again, with me is Johnny Hannah, who’s based in Mapleton, Utah, co founder of Homie, check out part one of our discussion where he described their real estate platform for buying and selling a home along with getting loans, titles and home insurance. Now they’re based in five markets at the moment, but soon to be expanding nationwide and beyond. I’m excited, though, to hear more of your founders journey. Like you’re not new to real estate, the company before this, Johnny, you, as you said it was in apartments, correct?
Johnny Hanna 0:53
That’s right. Yeah, it was we started a company called property solutions. We changed the name to entrata. But we started in 2003. out of college, we want a business plan competition, and it was property management software for the large apartment communities you see around the US. So we helped renters pay rent online, we help renters lease apartments online. So our software was for the owners, but it you know, it was built for the renter the consumer.
Alexander Ferguson 1:21
And you mentioned in part one of our discussion where you saw the problem of people were doing apartments, but not going to real estate because the process was just too long, complicated, expensive, which is why you started homing us five years ago, and you’ve mentioned what’s the one thing you’d wish known five years ago was maybe not to take on the entire problem and change everything all at once. For me finding from the beginning, what was probably the biggest lesson learned then, aside from don’t take everything on, but getting it started and getting the product up and going and people on it. What would you say one of the bigger takeaways that another entrepreneur and other business leader could could learn from?
Johnny Hanna 2:01
Yeah, I think fear is was a stumbling block. You know, like, Man, it’s not going fast enough. we’re failing, like, you know, telling yourself these stories, instead of just continuing to move forward. Like not letting fear creep into your head. And when you recognize it, like booted out, you know, get it out of there. And I think there’s a lot of mental fitness tools to help you recognize that and to assist you in getting back to a place of truth and connection. So to me that that was one of the biggest things like, yeah, early on, it was hard to raise money, it was hard to get people to trust us. We weren’t licensed agents. So yeah, there was a lot of fear that came with that.
Alexander Ferguson 2:41
I mentioned in our previous discussion there, you’ve raised up to 50 million so far to date. What would you say is the biggest mistake one could make when trying to get funding?
Johnny Hanna 2:53
Um, you know, it’s just hard. It’s really difficult. I think. We, we tried to learn from every pitch that we gave, that we heard a no from, and investors are great at telling, you know, a lot of them are like, this is amazing, this is great, you know, it just doesn’t fit our criteria. When in reality, they’re like, you’re never gonna succeed. You know, it’s what they’re really thinking. So they’re there. So, I don’t know, like, they try to be kind, but it’s not really helpful. So I think trying to get direct feedback is really huge. Like,
Alexander Ferguson 3:25
you’re just like, ask them, Hey, no, no, actually tell me what, what? What? Yeah,
Johnny Hanna 3:29
we’re like, Okay, well, if this did fit your company, if this if real estate was a sector you invested in, what do we what are you not seeing from us? You know, like, because that’s such a common excuse, like, Oh, we haven’t done many real estate deals, our focus is on SAS, you know, companies that do medical supplies, you know, I don’t know, like whatever it is, I really get curious. Because these guys are smart. And they, they might see some flaws and holes in your business. And if you can refine that pitch, great. But if you can actually change your business and improve your business, and then have the pitch really reflect that. I think that’s helpful.
Alexander Ferguson 4:09
That’s powerful to push a little further. Let’s just switch out to another question. from different perspective. Funding is one thing getting customers and Platt people on the platform that’s a whole nother endeavor, especially in the consumer environment. biggest lesson learned when in order to get enough people on the platform that it’s benefiting everyone.
Johnny Hanna 4:29
I think we just tried to message what we did in so many different ways we really hit savings. And like you don’t need to pay a fortune in realtor fees. But that you know, as we grew we recognize that’s not what everybody wants. Some people just want to really qualified realtor to get the most money out of their home, not save on fees, you know, you can save on fees and still sell your home for hardly anything. And that’s what a lot of our competitors accused us of, you know where our data shows The opposite but yeah, it’s getting that that messaging, right is a really difficult thing to do.
Alexander Ferguson 5:06
And how long did it take for you to kind of nail in and hone that message? How many we’re
Johnny Hanna 5:11
still working on it. This is six years into it. So yeah, we’re still working on it. But we’re really fixated on savings like that was we were just preaching that pounding that having that same message. And that’s not a bad one. I mean, Geico does, you know, the save 15% or less like they hammer it to?
Alexander Ferguson 5:28
In that plus something? Yeah, yeah,
Johnny Hanna 5:31
I think you can expand your reach like on insurance, maybe that’s all people care for. But when buying or selling a home, it’s not the only thing. And you can get a wider market if you if you actually hit service and quality.
Alexander Ferguson 5:44
And I appreciate your whole kind of change in heart there of going just from hard technology and, and no touch to high touch with technology. And I feel like that may be a nice combo for a lot of other businesses out there that are trying to streamline something and use technology, but maybe missing the human interface.
Johnny Hanna 6:01
Yeah. And you know, as founders, or any business, like you want to rally around the idea, the mission is like, this is who we are. And if you get too prideful and stuck on, this is who we are, you’re not going to pivot to what the client actually wants. You know, and we’ve done that, like, we’ve been so adamant on saving our clients money in this area, and the consumer doesn’t care. They just don’t care, you know, and it’s like, well, then what are you fighting for? What are you so adamant on your position,
Alexander Ferguson 6:28
the holding that message itself, so that they resonate and experiences one thing, what just practical tactic or channel worked really well in the past few years, that you would, you’ve doubled down on and would recommend overall, when it comes to interacting with consumers.
Johnny Hanna 6:47
I made phone we tracked Net Promoter Score, that’s our the customer satisfaction survey. And anybody who gave us negative reviews I personally called I mean, even if it wasn’t a negative review online, they would just turn in the survey and say, this was crap. You know, like, we hated our realtor, or we have these expectations from your marketing and got this. And that was so hard to do. But I would call united send an email text and be like, Hey, I’m so sorry, I’m the CEO, homie. Like, I want to make this up to you, you know, like, I want to figure I want to get this right. Like, if you can tell me where we dropped the ball, and I fixed those things, those, and we have a process around it, that can be fixed, forever, we’re gonna see that much better of a company. So I made countless phone calls, you know, and, you know, I don’t like to admit that we failed that many times. But we struggled early on, like we really, it took a while to nail it. And right now, like our clients satisfaction scores are through the roof. And we still have a few clients that aren’t happy, and I you know, I still try to glean knowledge from them. So that’s, I think that’s the best thing to do is talking to the actual consumer and then talking to your people on the front lines, because some consumers like in a consumer business, there’s just unhappy people out there we see it on social media, right? There’s just people that are not super happy individuals. But um, yeah, talking to both to understand situations and, and, and have empathy, I think has been really critical.
Alexander Ferguson 8:19
honing in on hearing what they actually have to say, and then improving on it. Don’t lay it, don’t letting it just to go away. Thank you be able to share just a couple tidbits of your journey that you’ve been on. I know there’s probably hundreds more of lessons learned there. But I’m excited to see where you guys are, are going next. Definitely for those who want to learn more about homie go to homie.com. That’s hmie.com and listened to part one of our discussion where he shared even more insights and about their product and where you guys are headed. Thanks again, john, for joining us. Good to have you on.
Johnny Hanna 8:48
Yeah, thank you so much. Nice to be here.
Alexander Ferguson 8:52
UpTech is sponsored by TeraLeap.io. Learn how to leverage the power of video. And thanks again, everyone. We’ll see you guys next time. That concludes the audio version of this episode. To see the original and more visit our UpTech Report YouTube channel. If you know a tech company we should interview you can nominate them at UpTech report.com. Or if you just prefer to listen, make sure you subscribe to this series on Apple podcasts, Spotify or your favorite podcasting app.
