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Voice of FinTech®
Trailer
Bonus
Episode 150
Season 1
At the intersection of Insurtech and Real Estate with Derek Merrill (LeaseLock)
David Yakobovitch spoke to Derek Merrill, CEO of LeaseLock about how to get rid of one of the most painful steps in real estate transactions, paying a security deposit, by using technology. Derek is a product and financial technology-focused entrepreneur with a special interest in building data-driven products that service the enterprise.
As CEO, Derek leads the overall product, marketing, sales and engineering efforts at LeaseLock. Prior to LeaseLock, Derek founded Infreeda, a mobile advertising platform acquired by AT&T. Next, he founded MoVoxx, a pioneering mobile messaging ad network acquired by Motricity. In search of a large industry late to apply technology, Derek launched EverySignal to automate the detection of life events for insurance agents across social networks using natural language processing and machine learning. He later joined ZipRecruiter, the fastest-growing job.
As CEO, Derek leads the overall product, marketing, sales and engineering efforts at LeaseLock. Prior to LeaseLock, Derek founded Infreeda, a mobile advertising platform acquired by AT&T. Next, he founded MoVoxx, a pioneering mobile messaging ad network acquired by Motricity. In search of a large industry late to apply technology, Derek launched EverySignal to automate the detection of life events for insurance agents across social networks using natural language processing and machine learning. He later joined ZipRecruiter, the fastest-growing job.
LeaseLock's founding story
- After being denied housing in New York City because he did not earn the requisite 80x the monthly rent to live at a certain building, co-founder Reichen Kuhl set out to solve this problem to help people at all rent levels ease the expensive move-in experience while still providing the financial protection apartment owners need. He joined the Mucker Capital accelerator program in 2014 where he met Derek who had been working with a small engineering and data science team. After meeting, the two joined forces and LeaseLock was founded.
LeaseLock's flagship product
- LeaseLock's flagship product is “Zero Deposit” lease insurance. The company leverages artificial intelligence to eliminate security deposits and deliver the world’s first financial technology platform for enterprise rental housing. Its product seamlessly deploys through native property management systems, allowing properties to:
- Market their communities as Zero Deposit to drive more traffic & leads
- Replace upfront security deposits with a small monthly fee in the online leasing checkout
- Automatically gain $5,000 insurance against rent and damage loss in-system
- Automate the claims process in native receivables processes during move-out
- Automate billing through our integrations with all major property management systems
LeaseLock leads the overdue disruption of the insurance and real estate industries
- The multifamily industry is known to be somewhat hesitant to truly embrace change. Renter’s insurance is a prime example. It was years before operators recognized that requiring renter’s insurance did not negatively impact the ability to lease apartments, but rather, provided positive outcomes for both the resident and community.
- Renter’s insurance is now status quo within the apartment industry. LeaseLock believes that the same will hold true for lease insurance as the leading replacement to security deposits.
Why security deposits and surety bonds are done
- Security deposits are the most common way apartment owners shelter themselves from financial risk associated with residents.
- Security deposits are extremely expensive for the renter and require a significant amount of administration for an owner to manage.
- Surety bonds and other security deposit alternatives have been in the multifamily industry for quite some time. But these don’t always benefit both parties.
- Surety bonds may answer the affordability pain point for renters as they are less expensive than security deposits, but they fail to offer sound risk mitigation for operators. Also, bonding companies run collections on renters for claims paid to the property, resulting in a damaged reputation
- Lease insurance is a seamless replacement for both of these practices that benefits both residents and properties. With LeaseLock’s “Zero Deposit,” renters pay a small monthly deposit waiver fee in place of an upfront security deposit along with their monthly rent and properties gain over $5,000 in coverage per lease on the standard plan
LeaseLock's B2B Model ultimately benefits the consumer
- LeaseLock is NOT insurance for the resident, it’s a deposit waiver program that makes the leasing experience more affordable.
- LeaseLock doesn't deal directly with residents, but residents do benefit from a lower barrier to access rental properties.
- Renters do not need to apply to LeaseLock (unlike deposit alternatives/surety bonds), and LeaseLock does not run collections on renters for claims paid to the property
LeaseLock's mission
- LeaseLock exists to power a faster, simpler, more affordable rental transaction. Ultimately, LeaseLock aims to help people at all rent levels have a smoother and more affordable move-in experience while still providing the financial protection apartment owners need. We help the world find a home
LeaseLock is, at heart, a technology company
- LeaseLock created an entirely new category of insurance powered by AI
- LeaseLock is engineering a financial technology platform that removes friction, cost, and regulatory risk from apartment operators’ operating infrastructure
Conclusion
- Because LeaseLock sells to properties, its lease insurance product does not need to be sold by leasing staff and doesn’t require out-of-workflow application processes
- If you’re an apartment owner/operator, feel free to reach out today to learn more about what LeaseLock can do for you