J. Darrin Gross
Frank Furman. What is the biggest risk?
Yeah, I feel like I've been talking about risk the whole time. Maybe I shouldn't put on a sunnier face to start. But yeah, it's a great question. It's, it's funny ask because I oftentimes get asked about insurance, that tends to be a smaller challenge for passport houses, because ultimately, it's a rental property, the big risks and insurance that, you know, your kind of homeowner's policy or, you know, kind of landlord policy would cover are the same, you know, risk of a tornado is the same risk of tornado, you know, we, we can be blamed for many things, but typically not for controlling weather. So, you know, that tends to be relatively straightforward. To me, the biggest risk to our business kind of gets to your point, certainly about zoning, but it's, I'd say less is a distinct zoning question and more. But certainly one around like kind of government involvement and prohibition. I mean, it's it's, I guess, you could broadly call it the the NIMBY movement, being weaponized and certainly you've seen it with, with other startups, certainly in the space and an Airbnb is a great example, where, you know, Airbnb, their core offering of letting people rent out their properties was essentially legal everywhere in the United States 10 years ago, you know, there there may be some small exceptions and you know, we can have the debate about you know, whether or not they should have been paying hotel tax in this map, but generally, it was just kind of off the books. No one even thought it was that strange If in 2005, you said, Hey, I'm going to run out, you know, I'm going to leave my house for a week, and I'm going to have someone pay me for the, you know, to live there for a week, no one would say do you would have no issue at all. Now, obviously, they, you know, they grew, they got a ton of coverage. And, you know, they're they're issues that people use party houses and you know, a bunch of guys come into a residential neighborhood to go to a, you know, for a big football game, and they are throwing a kegger and neighbors are mad. You know, I get it. I also live in a quiet neighborhood. I have kids, you know, I like I, we all have a little bit of the the nimbyism in us, right, especially on, you know, work nights and that kind of thing. So, so I get it. They also, of course, have a very powerful competitor and kind of hotel companies and so on let's consolidate and well resorts. So there's, there's a little bit of that, too. So, you know, fast forward to 2021, and many municipalities have either straight prohibitions that are new, you know, they've been legislated into existence, or pretty onerous requirements on Airbnb, and in some cases aren't actually been easy for them to answer, right. Because one of the unfortunate things about our kind of the way the politicians think about these things is like, they think Airbnb is operating all these units when clearly they're not, you know, they're, it's a marketplace house or operating a unit. So Airbnb doesn't know what's going on, or doesn't check the maintenance or, you know, whatever. That would be almost impossible for them to do. So. Okay, fine. But they've, they've obviously faced a lot of headwinds, but they were able to get big enough and secure enough that they could kind of attack them head on for us. You know, I anticipate some of the same sort of challenges. We, you know, we're in the workforce housing business. And, you know, everyone loves workforce housing, except in their street, you know, except in their neighborhood, except in their town, you know, they want they want it to be somewhere, you know, they want to get their Starbucks coffee at the you know, for cheap, but, you know, they don't they don't want to house the barista, so, okay, fine, we're gonna face some of the same headwinds, but can we get to a size and scale quickly enough, fast enough, become accepted enough to where you're, you know, not necessarily too big to fail, but where you can face those challenges head on, and where the, you know, the disruption of blocking things as at least as much as, you know, the disruption that you're causing, because, you know, real estate and renting, you know, that's it's not always an easy business, you know, we have challenges, you know, as I like to say, our, our residents are cut from the crooked timber, that is humanity, you know, and they, they sometimes fall short of what they'd like to do, you know, predominant good people, but sometimes they can only Park like jerks, you know, sometimes they, you know, cause trouble. You know, that's, that's just the reality of it. When you have a couple 1000 these people, it's inevitable. So can we get big enough, fast enough and really create enough value in the marketplace that, look, the hadn't there, headwinds are coming. You know, that's, that's inevitable, but we can face them with kind of a worthy challenge. And when communities say, Hey, you know, we don't actually like workforce housing in this town, we'd say, Okay, well, we're already here. So, you know, what's next? Do we need to tell you where they are? Do we need to, you know, this or that? How do we conform and meet it? But have it not be such an onerous? You know, have it have to have the scale to where we can meet it?