I meet a lot of aspiring founders who want to be founders just for the sake of being founders – they want freedom, build wealth, or whatever the case may be. However, in my experience, being a founder is a better idea when there is a bigger problem that you are really passionate about and you have a burning desire in your stomach and heart to solve it.
My first company, Insight for Dotloop, started with a problem I was experiencing as a real estate agent. I was walking around town chasing buyers and sellers to sign documents on the hood of my car. Not only was it consuming a lot of time and energy for me and my clients, but emailing or faxing important documents was not secure. I wanted to find a more efficient solution so we created DotLoop to digitize real estate documents which became a market-leading company and now serves more than half of our real estate transactions in the United States.
Likewise, Pacso is solving a problem that was personal to me. I grew up in a modest household living paycheck to paycheck. A second home was certainly not a luxury I had access to until I was older. But ten years ago, when my wife and I were lucky enough to own a second home in Lake Tahoe, it changed our lives for the better. We made new friends, found our favorite hiking and biking trails, local restaurants, family-run coffee shops, and more, and felt a deep sense of community connection. However, I saw a lot of problems with the old-model of owning a whole second home that called for better.
When I left Zillow in 2019, I spent most of that year trying to better understand the problem. I remember a quote from Einstein in which he said, “If I had an hour to solve a problem, I would spend 55 minutes thinking about the problem and only 5 minutes thinking about the solution.” I spent my year on vacation through that lens. As I researched, the scale and complexity exceeded my first guess.
I initially looked at the problem only from the perspective of one owner, where the financial burden and time commitment associated with owning a second home were significant. Once I found out that the average second home sits idle for ten to eleven months every year, it was as if a light bulb had gone out. There are 10 million second homes in the United States, many of which are concentrated in single destination communities that suffer from low inventory and high prices for housing. What if we were able to do a better way, making second home ownership more sustainable for owners and communities?
Pacso launched in late 2020 to offer a new class of real estate ownership, called co-ownership. Through this approach, we make second homes more accessible to owners by reducing ownership costs and reducing hassle through a fully managed owner experience. For communities, we strengthen second home demand by placing eight buyers into one luxury home. This means less competition for the average-priced homes most sought after by the local workforce, more spending on local businesses, and more tax revenue, according to the economists who studied our model. We developed this model because we understood the problem deeply. Today, the traditional second home is seeing unprecedented demand due to the pandemic and remote working and many communities are in an all-out housing crisis. Pacasso and co-ownership can help, and it excites me to wake up and work every day and bring value to more owners and communities.
Here are my tips for new founders on what to do and what to think about before starting your company:
- Find a problem you are passionate about. Don’t start a business just to start a business. It must be a problem burning inside you that you feel obligated to solve.
- Take the time to understand that problem. If you can afford it, try to take the time before starting your company so that the time is spent understanding the problem with a clear state of mind and no distractions.
- As you’re thinking about the problem and business you want to start, imagine a Venn diagram of 3 circles with one circle you like and the one you’re passionate about, the other one you know. (i.e. where do you find convenience compared to other founders) and the third is the one that provides a lot of value for consumers and makes the world a better place. If you can find the intersection of these things – what you love, where you get profit, and what provides great value to consumers, that’s the magic formula for building a great business that has a huge impact. Is.
This is a playbook that I recently had the opportunity to implement with our team at Pacso and it is paying off. In just a few short years, we now have 300 in our crew serving 40 destinations with nearly $1 billion in real estate in our marketplace, and we’re looking to transition from buyers to second home owners to a better and more sustainable way. are starting to provide and for communities. However, it is important to remember that these things do not happen overnight. It comes from the passion, time, and energy that comes from over a decade of building relationships, knowledge from prior companies, an entire year of vacation I’ve devoted to understanding the problem, and much more. There is no better time to start than today.