Building a PropTech Venture with a Virtual Team: Discount Lots President Paul Hersko (Part 5)

Sramana Mitra: What is your primary use case? City dwellers wanting to buy property outside the city?

Paul Hersko: Yes, I would say so.

Sramana Mitra: Were you self-financing still at this point?

Paul Hersko: No. I want to say we started our first funding round in the summer of 2020 where we raised money from friends and family. Then we raised $2 million in debt. Then we partnered with a fund that started funding us debt. We still work with them.

Sramana Mitra: What else is interesting in your story from a strategy point of view?

Paul Hersko: The interesting part is how we did it. We did a lot of this by utilizing overseas talent. We’re really good at hiring and finding talent in Philippines, Macedonia, and Colombia. The second is building systems. It’s not easy to operate a business at the size that we’re operating at. It gets very complicated.

Sramana Mitra: I would like to hear about your virtual team strategy. Step me through your teambuilding strategy.

Paul Hersko: When we first started, we added key functions in the office. There is a lot of paperwork involved in buying real estate. We have a small team in the US that deals with all those logistics which you simply can’t do overseas. We started getting good virtual assistants to do repetitive tasks and research-related tasks.

When we first started, we were utilizing VA’s more so for repetitive tasks. Now we know how to hire high-level strategic people who are a lot less costly but are smarter and have better experiences. It’s almost like labor arbitrage. We thought that you only hire overseas for repetitive tasks. The reality is you can hire for any position if you know how to do it.

Sramana Mitra: We use virtual assistants and overseas talent extensively. I fully resonate with what you’re saying. What kind of functions have you been able to hire for?

Paul Hersko: Anything from sales team, acquisitions like cold-calling, marketing manager, SEO, project managers, recruiters, video editors, graphic designers, and customer service.

Sramana Mitra: What is the distribution now? How any people in the US and the other geographies?

Paul Hersko: We have 60 employees. We were at 75 and cut back to 60 – 32 in the US and then 28 overseas.

Sramana Mitra: Philippines and Colombia?

Paul Hersko: And Macedonia. I think we have one in Belarus and one in Ukraine.

Sramana Mitra: You said there was something else that you wanted to discuss?

Paul Hersko: Maybe just high level, one of the things that we do differently is that we are metrics-driven. We track 250 KPIs from all the different team members. We review it every week so we know leading and lagging metrics. Knowing what numbers to track and tracking the numbers is super important.

Sramana Mitra: Can you elaborate on that?

Paul Hersko: Sure. From the simplest ones of how many properties did we sell last week all the way to cost-per-lead versus the cost-per-overall-acquisition, to the cancellation rate.

Sramana Mitra: Thank you for your time.

This segment is part 5 in the series : Building a PropTech Venture with a Virtual Team: Discount Lots President Paul Hersko
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