Lessons for Building Successful Real Estate Companies

Michael Schoen ([00:00:00]) – I love helping people. Um, and I believe in people, and I believe they can learn things. But I think what I’m learning more as I continue to grow and, uh, the more I want to be an entrepreneur, you know, in new successful things that I try to start, is I wanna actually surround myself with people who are way smarter than me, who know a lot more than me. Um, and I’m okay being the person who’s a little bit further down the ladder, even if it was my vision. I just wanna continue, are much smarter than myself. Welcome

Intro ([00:00:33]) – To the how scale commercial real estate show. Whether you are an active or passive investor, we’ll teach you how to scale your real estate investing business into something big.

Sam Wilson ([00:00:46]) – Michaels Shone is a global real estate brokerage, PropTech, founder and head of real estate for microshare.io. Michael, welcome to the show.

Michael Schoen ([00:00:55]) – Thanks for having me.

Sam Wilson ([00:00:56]) – Absolutely. The pleasure is mine. Michael, there are three questions I ask every guest who comes on the show in 90 seconds or less. Can you tell me where did you start? Where are you now, and how did you get there?

Michael Schoen ([00:01:06]) – Started in music, uh, in New York City. Um, at the same time as a broker at a, at a small firm called Hunter Real Estate. Um, family was in real estate. Um, I was in music, but really quickly realized that, uh, my skills were within business. Um, so yeah, family was within the garment center for many years. Um, garment Center shifted very quickly when business went over to China at the end of the nineties. Um, my father got into brokerage as a real estate broker for, uh, commercial offices. Um, and that took me, uh, into my first brokerage job in, uh, in New York City after being in music realizing that I need to be on the business side of things.

Sam Wilson ([00:02:02]) – Wow. Wow, that’s really, really cool. I mean, you, you’ve taken a lot of steps even from then till now. Where, where do you find yourself today?

Michael Schoen ([00:02:12]) – So, I find myself today after, um, a really wild ride through Covid. I had just started, um, about five years ago, I started a prop tech company called a retail space.com, uh, which is called a r s Data Now, um, and finished product market fit a r s very quickly. Basically was helping people, retailers find retail spaces based on demographics for footfall, uh, mobile tracking. Uh, our competitor at the time was a company called Placer ai, which just joined the, which joined the Unicorn Club. Uh, we went into deep freezes, COVID hit, um, uh, my real estate commercial office business. The ground fell out beneath that. So my wife is from London. And, um, yeah, we took the opportunity to say, let’s try something new. Let’s meet a new network of people. Let’s see if I can, you know, reshape my tech company. Um, and long story short, my neighbor where we moved to in Knotting Hill, um, was head of sales for Europe, for the company MicroShare.

Sam Wilson ([00:03:24]) – Okay. Okay. I mean, that sounds like a probably disheartening, I would think, at that point. You’re four or five years in, you’re building a huge company, you got a lot of time and money invested in it, and it just fell out from underneath you. What, what strategies did you employ to really shift your focus and find the next thing you’re gonna work on?

Michael Schoen ([00:03:43]) – Yeah, well look, I mean, the ego, going back to the beginning part of that, it was painful, but I think the ego part of it, uh, was taken out of that because everyone was hit so hard. I think we realized that we had something for the future. Uh, coming out of the craziness of the first stage of covid when people were getting back to somewhat of a normal life, data was just such an important piece to answering so many questions. So we knew to hold onto it, not just close the company. Um, and coming into London, uh, certainly a similar market, uh, to New York, different in other ways, uh, that might be obvious, not as many skyscrapers to start. Um, I found, uh, coming into this market, uh, you know, learning how to meet new people and speaking a new kind of language that I, that I was used to every day in New York. So I probably didn’t answer your question there, so we can go back to that if you want. .

Sam Wilson ([00:04:43]) – No, it was, it was, it was really just the, the question for a lot of entrepreneurs, I think, you know, we have these great ideas. We, we get the product, but we pour our heart and soul into it, and then something dramatic, a black swan event, covid or otherwise happens, and suddenly it’s like crud. It, it can be very demoralizing to watch everything you’ve been working on, just kind of not taken away, but, you know, um, suffer. How did you overcome that?

Michael Schoen ([00:05:07]) – Yeah, look, I think, um, I’ve learned even getting hit by Covid, we, we, I I scaled one of the leading, uh, brokerage firms in New York, boutique brokerage firms, beating out Cushman Wakefield, Newmark. I scaled. We worked over a million square feet in New York and researched globally. Um, and when Covid hit and that part of my business died out for quite a while, and then the tech got hit, I realized there’s nothing there. There’s certain things outta my control. And I’ve learned even along the way that these are, these are incredible opportunities to not allow yourself to sink into the ground, but just wait for what’s coming. I, I have a business coach named Rusty Bergen, who is really, we meditate together. We’ve, we’ve, we speak a lot about listening and just being quiet and waiting for that next thing to happen. Cause it all will, it’ll all come together at some point outta our control.

Sam Wilson ([00:06:09]) – Man, that’s great. I love that. I love that. Yeah. That, that, that slowing down that quiet space.

Michael Schoen ([00:06:15]) – Yeah.

Sam Wilson ([00:06:15]) – That is something that, uh, in the noise of today’s world, I think is really,

Michael Schoen ([00:06:19]) – I have two notes from him here on my desk. One says, slow down, and the other one says, clean up. And it’s really about just cleaning anything out in front of you when you’re just feel frustrated or don’t know what that next step is. And it just feels all of a sudden it comes to you. You know, it could be an idea, it could be a phone call that comes in. You just, you can’t get caught up in that moment.

Sam Wilson ([00:06:42]) – Right. No, I love that. I love that. This is great. I appreciate this. Let’s talk a little bit about Micro share.io. I know you said that company’s kind of shifted. What is microshare.io would love to love to hear?

Michael Schoen ([00:06:57]) – MicroShare is, um, an incredible company, uh, led by a C E O named Ron Rock, uh, serial entrepreneur, uh, someone who’s been employee number one multiple times. So just learning from him has been incredible. But MicroShare is an iot company, um, and as Global Head of Real Estate, we talk to multifamily owners. We talk to office building owners, um, about some of our solutions. The two top solutions we talk to landlords about today, or leak detection, smart leak detection, and, um, a product we have called Evers Smart Clean. Um, how, uh, we can create efficiencies for buildings using our iot solutions. Um, our I o T solutions are in the Denver Bronco Stadium through Aramark, gm, general Motors, general Mills, um, uh, McCormick Center in Chicago. And they, they’re globally, um, in Europe. We have more sensors in, in mousetraps than any other company we, we in Ireland. Uh, so yeah, we have a ever Smartt is our solution, uh, name, but we have a bunch of solutions that back that.

Sam Wilson ([00:08:13]) – Got it. Man, that’s a lot of, that’s a lot of moving parts. Let’s, let’s dial back to the, I guess maybe going back to your slowdown comment there. I wanna tie that to where you said learning from him, that was a comment you made about the CEO that you have that’s working, uh, that the CEO o I guess, of MicroShare. How have you slowed down and learned from the people that you’ve brought around you?

Michael Schoen ([00:08:37]) – So I learned where, where I thought I might be really strong in one area. Um, through seasoned entrepreneurs, I realized that, um, especially with sales in commercial real estate and office, I think that there reached a point where referrals were coming in. It was really easy. But then once I hit the iot world, even with my own company, a R Rs, when you’re trying to explain data and iot products, and we always say MicroShare, most people can’t even spell iot that we’re talking to. Right. Um, you know, um, I’ve learned that I really have to focus and concentrate on making my point and getting, getting things over the line rather than maybe in the past. I, um, I spent too much time moving on to the next one, getting focused onto one client and getting them to, to buy in and building up from there.

Sam Wilson ([00:09:40]) – Got it. Got it. It sounds like you’ve been very successful at bringing incredible talent or surrounding yourself with incredible talent.

Michael Schoen ([00:09:48]) – Mm-hmm. ,

Sam Wilson ([00:09:49]) – What, what are, what are some keys maybe that you would give to other people who are looking to kind of repeat what you’ve done?

Michael Schoen ([00:09:57]) – Sure. Um, look, and I think it comes even from, uh, when I was in the music world and meeting people. Um, there, I think you just have to let yourself be open. I think you have to, uh, talk to as many people as possible. Um, I think someone who invites that type of energy in when, when, uh, people are coming to you and want to be around you. I think, you know, sales in general, but I think overall you just have to open yourself up more,

Sam Wilson ([00:10:30]) – Open yourself up more. That’s great. That’s great. Have ha what, what have been maybe some challenges then that you have faced in building companies and building teams? What are, what are some things that you said, Hey, here was, here was a, a difficult situation and here’s how we overcame it.

Michael Schoen ([00:10:46]) – Yeah. Building companies, building teams. Ooh. Um,

Michael Schoen ([00:10:53]) – I think one of the hardest things is I, I always try to build teams with people that I’ve, I’ve I, um, have been friends with for a while. , I, I made that, I don’t, I don’t even know that it’s mistake cuz I would still hire friends, but I almost now learn not to take things personally. There’s been times of building teams, whether it was on my real estate brokerage team or a r s Um, I love helping people. Um, and I believe in people and I believe they can learn things. But I think what I’m learning more as I continue to grow and, uh, the more I want to be an entrepreneur, you know, in new successful things that I try to start, is I want to actually surround myself with people who are way smarter than me, who know a lot more than me. Um, and I’m okay being the person who’s a little bit further down the ladder, even if it was my vision. I just wanna continue to surround myself with people who are much smarter than myself. ,

Sam Wilson ([00:11:52]) – Which, which is the smart thing I think there to do. How do you, how do you, when you, when you meet that perfect a player like, man, this is gonna be the perfect person to work inside of our company. They’re way smarter than me. They’re way more talented than me. How do you convince that person, I’m convince it’s probably the wrong word, but what do you do to make the opportunity enticing to them?

Michael Schoen ([00:12:16]) – You know what, it’s interesting, and I, I, I think I’ve had a few people follow me now through a few different businesses. Um, it’s honestly, I think the, I’m an optimist in general. Um, I think that’s also a quality that, uh, I feel like I relate to the current CEO of MicroShare, Ron Rock. Um, I do, I think people are attracted to my optimism that I’m, I know we’re gonna eventually get to the finish line. I know we’re gonna be able to meet this person. And, and I think if you ask the people who have worked for me for many years, um, they see that we do eventually get there.

Sam Wilson ([00:12:58]) – No, that’s, uh, that’s very, very cool. Michael, let’s chat a little bit if we can. I mean, you guys with micro share, you guys are selling services to those of us in the c r E space. You’re not direct. Maybe you are, maybe you aren’t, I don’t know, but you’re not directly involved in it, I don’t think at the moment. But what, tell me, state of the market, like where do you, where do you see us right now? Where are risk being taken? Where are there opportunities? I mean, I’m sure you see stuff worldwide, so give us kind of your views.

Michael Schoen ([00:13:27]) – So it’s interesting, I, um, told myself several months ago I was gonna stop watching the news because it’s constantly horrible news . Ok. Um, so, and then you start reading about it, it’s, it gets even worse. But look, there’s a huge shift in the market even before Covid companies like WeWork and other competitors, WeWork, um, were making a change in the way people work. Right? The, the big news that because I’m so focused on New York, cuz that was my market for many years, I still do a lot of business there trying to sell products that we make, um, you know, some of our solutions into owners in, in the US and in New York specifically. Um, the market is, the office market is a mess. Um, you have all of these buildings that, you know, are sitting, you know, with empty vacant office space. But I think there’s a bigger issue.

Michael Schoen ([00:14:25]) – I think, yeah, the bigger issue has been recently that from the top down, the big REITs are also, you know, having issues now. Um, and, and people are really nervous in general in terms of where the market’s going. When is the bottom gonna fall out. You have institutional owners in New York who have had buildings that are probably less than half the value they were and don’t know when they’re coming back. I mean, the, the, the groups of people that are still leaving the northeast to go to places like Tennessee and, and, and Austin, Texas and Florida is, is real new places like New York and cities like New York and San Fran where the prices are so high for living. It’s, it’s crazy. I mean, when I moved to London a year and a half ago, London’s known as an expensive city. Sure. Cost of living here feels way much cheaper because you get more living space. Food is not a fortune. Um, yeah. It’s just wild. Some of these big cities really need to have this shift in, in how they wanna approach, you know, the future now because, uh, companies and people are leaving them.

Sam Wilson ([00:15:34]) – Right, right. Yeah. I had somebody here on the show recently that they specialize in office space in New York, in New York City, if I could speak today. Uh, and they were saying stuff that was trading maybe eight, 900 bucks a square foot four years ago. Yeah. Not trading. They said, look, we’re picking up stuff at three and 400 bucks a square foot. Which Oh

Michael Schoen ([00:15:52]) – Yeah.

Sam Wilson ([00:15:53]) – I mean, it’s astounding. One that’s a 50% drop in value. Uh, but then also it’s, it’s, they felt like that was an opportunity, you know, they said, Hey, this is cyclical. It’s gonna be an opportunity. You know, you buy when it’s low, you sell when it’s high. This is just the way this goes. For

Michael Schoen ([00:16:08]) – Sure. Look, you’ve got people like Joe sit who were, you know, legendary buyers, uh, retailers in New York who own a lot of buildings, you know, globally. Um, certainly it’s a time to buy. There’s a lot of cash out there. It’s just the moment of, of, of office. Um, look, I, I grew up in New York. When you walk down the streets and you’re bumping shoulders during the day, that’s New York. Right? Right. Um, when you go there now, midtown, from 34th to 42nd, the Plaza District, it’s quiet, you know, and things get busy on the weekend and at night and that’s great, but when you’re missing that daytime action, that was always New York for me. And that’s what I hope comes back. Look, it’s New York. I hope it does. Um, I just think the, from the top leadership of New York, we’ve gotta figure out how to make it safer. That’s the number one thing. Um, and, um, and more affordable.

Sam Wilson ([00:17:11]) – Yeah. How much, how much of what you see cuz you guys collect, I mean, you guys are, you’re a data company, you collect incredible amounts of data. Like is there anything in that data that would, I’m not even sure I can formulate this into an intelligent question, but anything inside of that data that would help you look at the stock and say New York City and say, here’s here’s an acceptable solution or here, or some potential solutions to do with all to do with all this excess inventory that, that maybe they have right now. Is there anything, is there any tie there that, that comes together? Is it, or am I just dreaming?

Michael Schoen ([00:17:46]) – No, I mean, look, ars uh, data is, is a tool not just used by retailers to find space, but it’s a tool that landlords, developers, um, and the city can use to see how people are moving around, where they’re coming from, where they’re going. Is this office building really appropriate to be an office building? Should it be a residential building? So certainly that data plays in very, very, very, very important way, uh, to understanding is making those decisions.

Sam Wilson ([00:18:21]) – Yeah. I guess that the, the way I, the way I would think about that is what does the market want? You can take, sure. You can take that data and say, Hey, what does, what does the market want? Where are people coming from? Why are, you know, oh they, it was, it was kind of crazy. And we may have been using your data on a, um, a research project we were doing down in Miami. I think. So we’re looking for Okay. Based down in Miami. And, and it was crazy the amount of, the amount of data that the brokers down there could pull. And of course they were third partying. It, maybe it came from, you know, the stuff that you guys are doing, the back end. Cause it’s like, oh, well we see that, you know, 50% of our, uh, people that visit this building just left Publix.

Sam Wilson ([00:18:56]) – Yeah. And then the Publix, they then got gas over here and we know that they then traveled to just using all that cell phone data map to figure out Yeah. Demographics and the ages and like, oh, then 50% of ’em stop at school on the way home and pick up their kids. You’re like, oh, okay. So they have kids, they’re from the age 20 to 40, like all of a sudden you could really dial down pretty uniquely into some of those things. And they just wonder, you know, how, how all that data eventually that cities can use this into an intelligent way of saying, you know, what do we do with this enormous amount of office space? Should this be real one,

Michael Schoen ([00:19:27]) – Should this 100%. Yeah, that’s a great way. And, and the way you explained how that is used is, that’s why it’s so great for a building on owner to understand, do I have the right services at my building? Why is everyone leaving my building to go to this building that they have specific gym or restaurant or, it’s a great way of bringing services back. Um, but again, yeah, great way of layering that data to understand like, should this be an office building at all? Should it be a residential building? Should it just be a mall? You know, . Right,

Sam Wilson ([00:19:59]) – Right. No, I think that’s fantastic. Yeah. Like, while the families are leaving. Well why is that? Maybe it’s cuz there’s no playground or play space for the kids. There’s no green space in the yards. There’s not, and you can get those, you can pull those data points by polling. But I think having, having just kind of an aggregate data set where you can look at it and, and extract the kind of high level things that people aren’t maybe necessarily verbalizing is a pretty cool, pretty cool tool set to have. Michael, this has been a blast having you come on the show today. I feel like I, there’s, there’s a hundred questions I should have asked you cuz you’ve, you’ve got just a wealth of information and growing teams. Oh, thank you. And knowledge. You’ve, you’ve built, uh, awesome businesses here worldwide, which I think is absolutely fantastic and across a lot of different, um, lot of different disciplines. Mm-hmm. , I mean, you’ve gone from brokerage to a tech company to, and it seems, it seems like you’ve just been able to seamlessly transition from one to the next, which is really, really cool. Learned a lot from you here today. If our listeners wanna get in touch with you, learn more about MicroShare or ARS data or any of those other things, what’s the best way to do that?

Michael Schoen ([00:20:58]) – Uh, best way is my email, which is, uh, m shown@microshare.io.

Sam Wilson ([00:21:06]) – For those of you who are listening, that’s shown. S c h OE n So that’s how you spell Michael’s last name. Michael, thank you for coming on the show today. I do

Michael Schoen ([00:21:13]) – Appreciate it. Thanks for having me. Really enjoyed it.

Sam Wilson ([00:21:15]) – Hey, thanks for listening to the How to Scale Commercial Real Estate podcast. If you can, do me a favor and subscribe and leave us a review on Apple Podcast, Spotify, Google Podcast, whatever platform it is you use to listen. If you can do that for us, that would be a fantastic help to the show. It helps us both attract new listeners as well as rank hire on those directories. So appreciate you listening. Thanks so much and hope to catch you on the next episode.

Sam Wilson

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