00:03:14 · Ilia Drozdov, Sebastian Johnson
[00:03:14] S2: Just maybe kind of add add a little bit on top of that. I think there is a just outstanding enough opportunity for the industry at all to elevate the level of service and to effectively get back to the original proposition where lettings and property managers were closer to the wealth managers for their clients. But as the regulation was pretty much just widening and widening, I think most of the agencies we see in the market, they just ended up being effectively administrators to make sure that you comply with all the regulations, to make sure that property management requests are being resolved, etcetera, etcetera. And I think with AI, when most of these tasks can be significantly automated, people in the office can get the time back actually to do what kind of in the first place made them be dreaming about this profession, to spend more time with landlords, to actually ask more often the very kind of question landlords love most, like, what else can I do for you? Right? Because kind of the compliance and pretty management is dealt with kind of quite quite significantly by AI, and people can can spend more time with the judgment calls, with analyzing the kind of yields for landlords, with analyzing kind of how the property is performing, etcetera, etcetera, etcetera. That's amazing. [00:04:25] S0: So are you seeing quick uptake once you once you kind of... Quick improvements once you're kind of bringing them into the business? [00:04:34] S2: Definitely.
00:04:34 · Ilia Drozdov, Sebastian Johnson, Dan Lifshits
[00:04:34] S2: Definitely. [00:04:35] S0: And and is that changing as AI is getting better? As the fundamental kind of like LLMs are improving? [00:04:41] S1: I would say that kind of to to the improvement point, I think we usually see the kind of thing start to change within three to six months since we integrate the business. And then with regards to the capabilities, I think that there are improvements happening for sure with regards to the foundation models. You also can kind of, to be honest, use a lot of outsource kind of the open source these days, obviously, as the models get better and better. But I think that the key thing that you achieve really is just bringing visibility to some of the workflows that before that were just kind of lost and messy and kinda running elsewhere, etcetera, etcetera, etcetera, that you just bring to surface. So that kind of before you had to chase a property manager to ask, like, five times, what is the update on my bathroom and all the things. Right now, you can be just on the front foot and be proactive to the tenants, to the landlords with regards to what's going on, etcetera, etcetera. Obviously, kind of with the foundational models getting better, you get this improvements as well. But I would say that a big chunk of it happens just by design or bringing visibility and just, like, identifying these processes by by itself. [00:05:38] S0: And when you talk about kind of the integrating of the agencies, how's that going? Is that happening faster or slower than it was six months ago? Is that going better than it was?
00:05:38 · Sebastian Johnson, Ilia Drozdov
[00:05:38] S0: And when you talk about kind of the integrating of the agencies, how's that going? Is that happening faster or slower than it was six months ago? Is that going better than it was? [00:05:46] S2: I think it's going kind of better than it was. And to a significant extent, actually, it's not just the technology, but also it's around kind of how we how we run these integrations. Because kind of, obviously, probably kind of year ago, half a year ago, there was a little bit of a shock kind of whether AI gonna take all the jobs, etcetera, and people were kind of speaking about this kind of less direct. But I think we pretty much kind of understood spending more time with teams that AI is kind of unlocker of all this kind of free time, and people can kind of spend more time with clients. So once we started kind of talking about kind of exciting opportunities more kind of openly, the integration happens kind of much faster Because actually, this makes the job much more exciting than it was. [00:06:32] S0: And how are the undermen... The underlying fundamentals doing? You you've raised a lot of debt to service the debt. You obviously need to have a very strong business model. How has that changed in the last five or six months?
00:06:32 · Sebastian Johnson, Dan Lifshits
[00:06:32] S0: And how are the undermen... The underlying fundamentals doing? You you've raised a lot of debt to service the debt. You obviously need to have a very strong business model. How has that changed in the last five or six months? [00:06:42] S1: In terms of fundamentals, whenever you buy the business, it's pretty profitable by design itself and obviously with freeing up some time. Some of that you reinvest back into kind of growing the top line and better service and everything. But by design, some people might be leaving the business. Some people might be kind of not fully on board with the kind of a transformation you're doing. So kind of efficiencies by design going up anyways. And it implies that effectively serviceability of the debt and other things only improves over time. Hence, kind of it's it's a very stable business by by nature. [00:07:12] S0: And you mentioned you're now kind of the top 10 Yeah. You know, The UK, ambition is to be top five soon. How much more opportunity is there in The UK market? And how much more do you wanna attack that before you start looking at maybe the rest of Europe? [00:07:26] S1: Yeah. Enormous.
00:07:26 · Dan Lifshits, Ilia Drozdov, Sebastian Johnson
[00:07:26] S1: Yeah. Enormous. [00:07:27] S2: I think opportunity is enormous. And hopefully, next time we speak, we will be kind of much more than 1,000,000,000 GMV. Currently, we are around 500,000,000 in dollars, kind of in pounds. It's around three fifty kind of million GMV rent roll. But kind of the overall market is 5,000,000 properties. And we are just approaching kind of whatever 20 as Dan said. So we are less than half percent of the market just in The UK. And the whole Europe is at least five times bigger than The UK, and US is, like, doubling kind of the overall size of Europe, including The UK. So the opportunity to build trillion dollar business here on the table. [00:08:04] S1: To to give a bit of a sense of the figure, so kind of there is just about 20,000 agents in The UK alone. And all agencies transact, kind of the total rental, total GMV, around 100,000,000,000 per year. So, kind of commission is around 10%, implying that the total market is kind of somewhere around 10,000,000,000 in The UK alone. So I think in The UK, you can build pretty easy kind of a few billion IRR business over the kind of course of the next few years. They're probably already in The UK alone would be a multi decker business, like $3,050,000,000,000 worth as a company. Definitely So it's an opportunity to build one of the largest consumer businesses in Europe. [00:08:38] S0: And and is that the focus? Is there a certain stage that you wanna get to a certain market saturation you want to get to in The UK before you start looking to Europe?
00:08:38 · Sebastian Johnson, Ilia Drozdov, Dan Lifshits
[00:08:38] S0: And and is that the focus? Is there a certain stage that you wanna get to a certain market saturation you want to get to in The UK before you start looking to Europe? [00:08:47] S2: Good. No. I think enough for us actually kind of scaling across Europe goes kind of slightly independent from the market share in The UK. For us, the key kind of criteria to go abroad is to make sure that UK market is set on the upward trajectory without, let's say, our personal involvement. And I think we are quite close to that. Like, we internally call it the market should be GMable, where kind of already leadership and the team... Senior leadership and the team can drive further kind of execution of the strategy, and we can start kind of testing the the company in terms of consuming kind of additional markets. Obviously, it's not only our own focus. It's also kind of the readiness of the technology and technological platform itself because kind of going into the market with different language, different legislation, etcetera etcetera requires additional effort. And for now, kind of the balance is still towards kind of improving the system for The UK purposes. But I think we are quite close to to being able to prioritize international expansion as well. [00:09:44] S1: You don't want to go with The UK to build an enormous business. Even in The UK, they're a pretty iconic company. But I think that next time we'll talk, we definitely already would be talking about that, and it'd a more practical term.