Mike Bayer
You're listening to the SSTIR Crazy Month limited series as part of the Vacation Rental Success Podcast. This first annual month-long event through the month of February focuses on the key short-term rental business pillars of Safety, Sustainability, Trust, Insurance, and Regulations. This event could not happen without the support of our sponsors, and we need to give a special thank you to Proper Insurance for putting their full support behind this online event. Proper Insurance knows that short-term vacation rentals don't fit into one insurance category. So Proper developed a specialty insurance policy that covers both commercial and personal use for your vacation rental. The question is, are you covered? Contact Proper Insurance today to get your questions answered. Click the link in the description of this episode to connect with the team at Proper for a no obligation chat.

Mike Bayer
Let's get to the good stuff. Here is the ringmaster behind SSTIR Crazy Month and your host, Heather Bayer.

Heather Bayer
How well do you know your guests before they arrive at your property? Have you spoken to them at all? Or is it all a bit of a gamble? Maybe it doesn't bother you anyway. In this episode, I'm joined by Leo Walton of Superhog to talk about guest screening in today's automated world.

Heather Bayer
This is the vacation rental success podcast, keeping you up to date with news, views, information and resources on this rapidly changing short-term rental business. I'm your host, Heather Bayer, and with 25 years of experience in this industry, I'm making sure you know what's hot, what's not, what's new, and what will help make your business a success.

Heather Bayer
Well, hello and welcome to another episode of the Vacation Rental Success Podcast. This is your host, Heather Bayer, and as ever, I'm super delighted to be back with you once again, and welcome to Week 1 of SSTIR Crazy Month. We are going to be talking about the foundations of our business, Safety, Sustainability, Trust, Insurance, and Regulations. We needed another acronym in our business, didn't we? So now we've got one. So every week of February, we are discussing one of these topics. And as I said, this week is safety. And it's hard to believe that February is already here. And to think we'll be heading back to Ontario next month after this particularly wet and windy winter in Gulf Shores, Alabama.

Heather Bayer
So, back in the day - I seem to say that a lot - but it was all so much simpler back then. Back in the day, we screened our guests really carefully. In fact, the form that we had that potential guests filled in was really lengthy. So remember, we're talking 25 years ago when data protection wasn't as big an issue as it is now. People then were a lot more open with sharing personal information, because we asked for the names and ages and occupations, yes occupations, of every adult in a group. We asked for their children's names and ages. We took a driver's license number, and most of the property managers in our part of the world asked for proof of home insurance, as well as information on whether they rented or owned their home. Looking back, it was a ridiculous amount of data we collected, most of which wasn't used, but it helped us feel confident we knew who we were renting to. And we talked to them. We actually had real conversations on the phone, which actually, incidentally, is what phones were invented for in the first place.

Heather Bayer
So by the time that our guests arrived, we had a really good handle on the group, why they'd chosen the property. We knew what their wants and needs were and their dreams for a good vacation. We were happy. They were happy because they knew they'd chosen a genuine property and they had got to ask every question they had. Then along came online booking, then instant booking, and no one wanted to share any data about themselves, which I completely understand now. And the world of vacation rentals changed. We had a much tougher time with owners who wanted to be assured we knew who was renting their home. And of course, we couldn't get all that information that made us feel 100% confident. And we occasionally messed up, because a guest hadn't been upfront on what they really wanted and they made the wrong choice of property, mainly because they hadn't read the description or asked any questions, and it became so much more impersonal. Anyway, guest screening can still happen. It just needs good systems, an understanding of how guests want to communicate, and maybe some help from outside platforms.

Heather Bayer
In today's episode, I'm joined by my friend Leo Walton from Superhog to talk about all of this, and to share his thoughts on how we can still know our guests in this world of automation and AI.

Heather Bayer
Well, I'm super happy to have back with me once again, that's Leo Walton from Superhog. Leo, always an absolute pleasure to talk to you and to see you. We had a very brief re meeting in Orlando at the VRMA Conference and never had enough time really to sit and chat, because it's always such a pleasure to talk to you.

Leo Walton
Yeah, the feeling's very mutual. Thank you for having me on. It's lovely to be here. I feel like we have these moments, don't we? We have these sort of two or three days every few months in the calendar where we kind of see each other everywhere at the coffee bars and at the parties, and then off we go into hibernation for a few more months. It's a strange pattern, isn't it?

Heather Bayer
I know it's a weird world we all live in, but it's a fun one. I know you're heading off to the STR Wealth Conference soon, so that's going to be fun. I'm not going to be at that one, but I hope you enjoy that with the bands and the hype.

Leo Walton
I'm looking forward to it. It's a Nashville based one. Yeah. So it's music. Forgive me, because I'm not as knowledgeable as I should be. People call it Music City. Is that right? Rock and roll city?

Leo Walton
Yeah, I believe so. I was in Nashville for the [Vacation Rental] Women's Summit and the DARM Conference back in December, and I really didn't get to go and listen to any of the music or see the stuff. But my Uber, from the rental to the hotel every day, took me right through the center of Nashville. So I got to see everything. Even though it was in daylight when people don't look as fun as they do at night.

Leo Walton
Well, also, there's that moment, isn't there, Heather, which I know you and I always experience, where you just feel delighted that you weren't one of the people that was out very late and looking that disheveled first thing in the morning. There's always that when you walk down Broadway in Nashville or somewhere equivalent at sort of 10:00 in the morning. My experience, and I went last year, great conference, really, really educational, really informative, was even if you went to the smallest side-street burger restaurant, the food was lovely across the board. And the music, the live music was incredible. And I live in northeast London and there is exactly zero live gigs in all the pubs in my neighborhood. And I don't understand why. I'd love a bit of live music and no one's playing any. But in Nashville, you go to the burger van and the bands are fantastic. It's a very cool spot.

Heather Bayer
Yes, it's lovely. So I hope you have a wonderful time there. But I've grabbed you for the next 30 to 40 minutes for a very important purpose. And this episode is part of our safety week in SSTIR Crazy Month. This all came about, really, because I saw a post by Justin Ford. It was after VRMA and it was before the Rent Responsibly Annual Virtual Summit, and Justin was promoting Rent Responsibly's Summit. And he was saying that he enjoys going to all these conferences, but he thinks there should be more attention paid to the topics that actually are at the core of our business that everybody needs to be good at if their businesses are going to survive. And those core things are safety, their sustainability, trust, insurance and regulations. And if you don't pay attention to all of those, as Justin said, you may not be here in five or ten years time.

Leo Walton
I couldn't agree more, Heather. I always say to have a trust and safety strategy, then you're essentially accepting that something at some point will go wrong. Very fatalistic. You're accepting that something will go wrong. And there's a Warren Buffett quote regarding investments/investing that I think is so relevant here is it's only when the tide goes out that you can tell who's been swimming with their pants down. And that is how trust and safety is in this space. Whether it be safety, whether it be regulation, building compliance, screening, protection, whatever we're talking about, you can get away with it for a while, but you cannot get away with it forever. And you can't build a long-lasting, sustainable business like that.

Heather Bayer
No, exactly. And I know this, after 20 years as a property manager, something will go wrong at some time. And if you're not prepared for it, you really are, as you say, caught with your pants down. COVID was, of course, a great example of that. And there were a lot of people who were very, very surprised when that came along. But we're not here to talk about COVID, I sort of banned COVID off my radar.

Leo Walton
I promise I won't mention it, I promise.

Heather Bayer
But we're going to talk about the topic of guest screening because that is such an essential part of safety. And I think when people are thinking about the whole issue of safety and vacation rentals, they're thinking, oh, gosh, do I have an up-to-date fire extinguisher? Are my CO monitors working? Is my rug a trip hazard? They tend not to think so much about themselves and how they can be protected. And to me, guest screening is all about safety. It's all about keeping hosts and managers safe, keeping their business. There's a word, and it's escaped me, and I will probably come back to that and edit this bit out. What is that word? Anyway? But it's all about....

Leo Walton
Maybe I'll say it.

Heather Bayer
Yeah, maybe you will. It's all about looking after our businesses. I was going to use that word again. It's all about looking after our businesses. So we're going to talk about screening, about guest screening. Because as I said in the introduction, it was so much easier way back when people didn't care about their personal information. Yeah, I don't care if telling you what my home insurance number is or my Social Security number. They didn't care 25 years ago. But that's a quarter of a century and things have changed massively. Now people are much more protective of their personal data. They don't want to talk about themselves. They barely even want you to know their names.

Heather Bayer
So I want to start off, really, Leo, with why is it still important to know our guests.

Leo Walton
You know, you've touched on such important themes there around data protection and security. Clearly that's really important and we have to respect that. We have to try and create a guest-centric environment. Right? As operators, and ensure that people feel comfortable handing over the bits and bobs of information you might require to either be compliant in your local area or just make sure that you feel safe doing business and you're not going to get caught with parties and drug deals and awful things like that. It is still very important, obviously, to get to know who your guest is. And I would say..., look, I start from the position of wanting to trust the guest, but I also want to verify that that's the right thing to do. So the best way to build trust is to make sure that you're confident that you've got the right guest and that then becomes a big opportunity, marketing to that guest again and trying to retain them because you're able to start curating the journey towards their needs, learning a bit about them. So knowing your guest, that goes way beyond just getting those key bits of information from them.

Leo Walton
It's also starting to build that personal connection. And then from there there could be a WhatsApp message, why are you coming? Then you leave a bottle of champagne in the fridge, all those lovely, 'nice to do' things. So it doesn't just have to be big, scary compliance protection parties. It's an opportunity to personalize that whole experience. And that's what I would say is a really important thing to remember as a property manager. And you've got to be guest-centric while also getting the piece of information you need to run the types of checks that you can run on people's data to make sure they're giving an honest account of who they are. Another thing I think is that knowing your guests, screening, pointing to it in your literature, on your listings, on your website, the fact that you screen or that you ask them for more information, however you want to phrase it, is an incredibly good deterrent. And I think that that's often the unspoken thing, that by having this risk management strategy in place, that might include things that are particularly important in your market, wherever you are in the world and whatever guests you're used to having and the types of problems that can occur in your market, specifically people who read your listing and say, Oh, this company is very professional, they're taking it very seriously. Okay, well, actually we'll go and stay at the one down the street because there's no checks and balances there and that's where we can get on with whatever we wanted to do undisturbed.

Leo Walton
So that's going to help filter, but also it's going to help you grow and retain your business from a host perspective, an owner perspective, because that's going to really give the owner trust that you're professional and you're taking it seriously.

Heather Bayer
So how would you phrase it?

Leo Walton
How would I describe it?

Heather Bayer
How would you phrase it on a website? That we're going to check you out.

Leo Walton
Yeah. Well, I would say if you're working with a screening provider, so namely someone like Superhog, but you say, look, your details will be screened as part of your booking process and then at that point you can also add into that, you'll be asked to sign our rental agreement because.... You might pop the rental agreement in there. That's also a really good way of building trust, building professionalism. This is a contract that we've built as a property manager to make sure that there's a rules of engagement between the guest and us. So that can go in there. Your details will be screened, you'll be asked to sign our rental agreement and you'll be asked to pay a security deposit in there. In so saying that you've provided them with the exact layout of what's going to happen next and the opportunity to say, I don't want to pay a security deposit, or I don't want to be screened, or I don't want to sign a rental agreement, I will go elsewhere. But to most logical, normal people, they're going to look at that and go, that's perfectly fine. I'm dealing with a professional company. You can also lean on the fact that if you're in a state or a country where you have to take that information to be compliant, you can also mention that it's local regulation.

Leo Walton
Often it's a requirement of a building. If you're in a big multi-family unit, you can lean on those things. But again, be professional, highlight why you're doing it. It's to make sure they're safe, you're safe. It's not a lack of trust, it's just making sure that you're both going into this with your eyes open.

Heather Bayer
That's interesting because I know when I've been to Europe, particularly Italy, and stayed in properties there, somebody's always come around from the property management company or the owner has come around usually once we've arrived to collect information, that is personal details, it's passport information. And that was always made clear during the booking post process that you're going to have to supply this on your arrival. But of course in the US, in Canada, anybody can book and come to your home. So let's just go to the OTAs. Airbnb will tell us that they do screening. What does that consist of?

Leo Walton
They definitely do ID checks right on everyone that starts to use their platform as a guest. But there's no deeper background checking going on. They're not running these people's names and details against fraud databases, databases to do with damage. And really it takes a village to solve these problems. So the fraud lists are always growing. The type of frauds are always changing. So if someone uses an email address for some purchase and then maybe does a chargeback on that purchase, there's ways of being able to track that. Is that email real? Does it link to the phone number? Is the phone number deliverable? They're not doing anything of that nature. They're just checking the ID of the person. To the extent that you can also change your name on Airbnb. Right? So you go through their screening and then you might change your profile name, you might change your profile email. But don't get me wrong, they're doing something, which is obviously a good thing. The people I speak to, clients and people in the industry, I don't think there's any difference in damages between Airbnb and the rest of the OTAs. So it's clearly not a particularly deep level of screening that's going on.

Leo Walton
But again, it's a deterrent. It's something, it's focusing people's minds on the fact they need to take it seriously and they are going somewhere. So something's better than nothing. But clearly I think you need a joined up approach which is using different data points to tell you different things, to make sure that the person is genuinely who they are and who they've said they are at that moment. And also really, if you want an ID check and cross reference to be part of your screening. And again, it doesn't have to be. You might just background screen, fraud checks, things of that nature. I think you want to do it in the moment, because that's where you can make sure that all the other pieces of information match. Right? Rather than when someone joined a platform two years ago.

Heather Bayer
Yeah, this whole word screening is interesting because we used to ask about name. We had names and ages of every member of the group. So we'd have this form and we'd look at it and we'd actually go, Is this group right for the property they've chosen? So you'd see that there's a family group and there's grandma, who's 89 and grandpa is 92. And you know that this property has 30 steps down from the car parking area to the property and then another 90 steps down from the property to the waterfront. So we'll be able to go back and say, we've seen that you're bringing your elderly parents or your grandparents, and this property has these features that you may not consider to be the perfect spot for them. And we found being able to do that just created this element of trust with the guests who just went, oh, my gosh, we didn't know, even though it was, of course, in the listing. But who reads the listings? They would trust us because we'd gone back and said, this isn't going to be the property for you. Let's choose another one. That's what I loved about having that information. So it wasn't so much having an id checked, it was about delivering information you could actually use to create a relationship. How can we do that now?

Leo Walton
I couldn't agree more. So the example I always give is that anecdote, Heather, we're going back 25 years, right, with that anecdote. Right?

Heather Bayer
Probably only going back about ten.

Leo Walton
Okay.

Heather Bayer
We were still collecting names and ages, really, up to the time we sold the business a couple of years ago.

Leo Walton
Yeah, I suppose it became harder, though, right, as time went on, if you're going back pre-OTA days, or when it was like a brochure, or you put an advert in a magazine. So my dad was the holiday organizer in our family and he used to find these lovely villas or holiday homes in Devon and things like that, and he'd find it, he'd phone the owner, they'd have a conversation. And through that conversation, that owner was doing what you've just described. So they knew two little boys, mom and dad turn up. No pets thank God. Probably that's what they're thinking. Turn up in their Volvo estate car in the 90s and off they go for 2-weeks and we'd probably rebook the same places time and time again.

Leo Walton
The industry has completely changed now. Right? You can take bookings 24 hours a day from anywhere in the world. Super fast moving. So you have to automate that process as much as possible, because you just don't get the time to give that person a phone call up front and ask all those questions. Now, I would say you still want to build into that process, that handheld, Hey, do you know what? I'm always here to jump on a phone call. Thanks for giving us this information. It allows us to be compliant, work out how best to serve your needs. But I'm also available if you want to speak on the phone.

Leo Walton
So you mix the kind of the personal with the practical, the things you really, really need. So if you need an ID check - you don't always need an ID check - if you just want to learn a little bit more about them to make sure they are who they say they are, that's when you can then ask them, what time are you arriving? Would you like to have a phone call? Would you like me to meet you at the property? But all of that stuff does get harder, because, again, people are more used to working in a way that they communicate with someone on live chat or email, or text message. They expect to find a keybox or a smart door when they arrive at the property, and they expect to be let straight in. That is the way of things. So to try and accelerate that process, you as a property manager, your only choice is to automate, isn't it? Or you go really heavy on the handheld and you only have a handful of properties, but that's only really possible for, I guess, the people in the luxury market. Right?

Heather Bayer
Well, I'd argue that we were still working in that way back in 2018, and we had nearly 200 properties. Maybe it was expectations. Maybe it was expectations. And we were also 90% book direct.

Leo Walton
I mean, that's the key, right? Yeah, that's the key. And COVID... and I've said I wouldn't talk about it, and I have...

Heather Bayer
OK, that's a checkbox thing.

Leo Walton
Yeah. You're going to fine me! You're not going to invite me back now, are you? Because I talked about it. COVID changed the game, didn't it? Because suddenly people were like, okay, now it doesn't matter how much the client's paying for it, I have no chance of meeting them. So I've got to come up with a solution. Smart lock, automate things like screening. And then many people just never went back because they thought, well, why would I now send a human being? So again, I'm really pro the mix of that. I like the personal being mixed with the automated. I think you've always just got to go the extra mile for people.

Leo Walton
So my background, my non-corporate background, my non-working background was, I was brought up always working in restaurants as a young person from about the age of 14, initially washing pots and then serving food and then serving alcohol when I got old enough. Lots of stories there, Heather, you can imagine as a young man, and I loved it. And it was all about this idea that it doesn't matter what's going on in the kitchen, what chaos, what noise, what's gone wrong, when you're on the shop floor, when you're on the restaurant floor, you're charming, brilliant, everything's calm, everything's tranquil.

Leo Walton
I think any business you're in that, I think you always have to keep an eye on that. So I'm really pro this idea that you try and find creative solutions, I just think the reality of it is it does become hard at scale. But you watch people doing it and you watch people doing it fabulously well, and you can use things, you can use tech to your advantage. Right. Are you on WhatsApp? I'll send you a WhatsApp message before you know it. You're sending them pictures of the space because they're worried that the bed might be too small for their grandma or the stairs, the examples you've just given. So you can use tech to enhance that hyper-personalization, but if you're in a market where you're getting 80% of your bookings through one OTA, 10% of your bookings through the other OTAs, and then you've got a very small percentage of direct bookings, then it's a lot more challenging. Right?

Heather Bayer
Yeah, exactly. And I have to say, I was never in that situation because over 20 years, we'd built up this very large proportion of return guests. And you mentioned that earlier on. Once you do that, you're in a different territory because you already know them. You've got information on them, they've seen their reviews, and it's a much easier thing.

Heather Bayer
Okay, I'm going to take a short break just now to hear about our sponsor. We're going to be right back with more from this great interview in just a few moments.

Heather Bayer
So I'm here with Nick Massey from Proper Insurance to answer some of the most pressing questions owners and managers have about short-term rental insurance, Nick, let's kick off with this one. Many owners believe their regular homeowners policies will cover short-term rentals. I know I did. So what are these policies missing for a home that's going to be rented out in this market?

Nick Massey
Well, the biggest thing about your regular homeowners policies is that they're just that, they're for your primary home. And so when we start doing short-term rentals at our second residence, for topic of this question, it's no longer your primary residence. And the definitions in the policies say it has to be your residence premises. So you could be completely voiding your entire insurance contract by trying to maintain and run with a regular homeowner's insurance policy. So it's so important to have those conversations to make sure you have the right coverage in place. And you're explicit that it's not your primary home, that it is a second home that you generate revenue from.

Heather Bayer
That is a great answer, and I think that's one that everybody needs to take note of.

Heather Bayer
So we're talking about what I call, the soft and fluffy stuff, communicating with guests, which is something I mentioned in the introduction. You know, I talk about calling people. That is really, I know, not what many people want these days. They want that text, they want the WhatsApp. We forget that's what that telephone was invented for in the first place. But that's my seniority coming out on that one.

Leo Walton
Heather, I still want you to call me, and you can call me anytime you want. I'm always up for a chat. You and I could talk for hours. And we do, when we see each other. I find it crazy, I say, pick up the phone, pick up the phone. But then if I get a phone call, my first instinct is, well, why is this person phoning me? What's happened? What's gone wrong?

Heather Bayer
And I know that I revert to text a lot these days, rather than cold calling somebody. If I'm trying to make a connection, I will go to text and make that connection, or go to LinkedIn and make that connection first, before I pick up the phone. So, yeah, interesting. I mean, you've got tiny children, one with one more coming. I wonder what life is going to be like for them in 20 years time.

Leo Walton
Yeah, very much so. I often think that because as soon as you show them a screen, they go wild for it. They love it. Right? So you try and ration screen time. But, yeah, I think just more of that, more automation, less, I think, people picking up the phone and more integrated services that mean you don't have to hop between your apps in quite the same way. And that's, I think, how the vacation rental industry also needs to be setting itself up. Right? I think we often forget this because we're crunching away solving our problems, normally working from our homes, on our laptops. But the vast majority of guests are just doing it all on their mobile phone. They're searching on the mobile phone. They're certainly doing their check-in on the mobile phone. That needs to be mobile friendly, fast. And if you have too many clicks in your screening to check-in journey, whatever you want to call it, your pre-arrival journey, people will get bored and you'll never get them to complete it.

Leo Walton
The attention you get from people is so much less than it was 10-15 years ago. Right? So the idea that you could be calling people up and going, Let me tell you...., talk to me about this, what's going on? They go, great. I had a really good chat with Heather. Really looking forward to our week here. Can't wait.

Leo Walton
Now it's like back and forth, quick message. Okay, can you do this for me? Yeah, it better be quick and then I'm on to the next thing. That's just how things are, right. So you've got to be aware of that as a provider of screening technology is, if two clicks will do it, it's two clicks and you need to work on making the screening more intelligent in the background, not making it longer and more laborious for the guests, because the guests just won't want to do it.

Heather Bayer
Yeah. I had an experience of screening back in, I think going to Miami for the Book Direct Show a couple of years ago and stayed with a property management company there and they had a screening process and it was laborious. It was one of those things that it kept dropping in my inbox. You've got to do this before we can provide you with more information on the property and the key and whatever. And it's like, oh really? You're just adding another level of complexity to what's already a complex thing in finding somewhere and making sure it's in the right location and how am I going to get from A to B? You're doing all those things and now you're wanting me to provide more information through a screening process. So how do you balance that need for thorough screening with maintaining a positive guest experience?

Leo Walton
Yeah. So it's absolutely the number one challenge or should be the number one challenge of anyone in our space offering this product is how do I ensure that I'm not asking someone for a piece of information twice? Or that it's plainly obvious that they're just being asked to jump through another hoop? And the key word here is integration. It's making sure that if you're using a PMS, the service providers you use are properly integrated with that PMS, that the information is coming through seamlessly, as many fields as possible, being auto populated, that you can hook it to other services you're providing. So organizing a check-in time, organizing paying a damage deposit, paying a damage waiver, signing your rental agreement, there's any range of things that you could do to create a lovely check-in flow. You might want to think about integrating in one of these lovely guest upsell apps, something of that nature. Or you start to offer fridge fills, restaurant bookings. Try and remember that you're trying to charm this person. It's carrot and stick, isn't? It's the carrot. Right? You're trying to make sure you're giving the carrot. And the way you do that is automation and integration.

Leo Walton
And I've seen companies with thousands of listings do this really effectively and get basically 100% of people to go through this process because they communicate it really effectively with their guest curate the emails, ensure that they know why they're doing it, what the purpose of it is. And there's also some other bells and whistles in there too. And it is, it's really simple things. It's like, can you confirm what time you'll be arriving? Can you give us your flight number? And then they go, oh, yeah, that's it. I'd better tell the property manager when we land because that'll really help. And make sure someone's there to meet us, or that'll make sure, if the property is ready early, you can then text them and go, Your home's cleaned, by the way, so I know we said 04:00pm but you can actually come in from 11:00am. And if you get that text message when you've arrived, I'm sure it was something you guys were trying to do. Get people in as early as possible. As soon as your cleaners have gone, it's like, right, this house is good to go. If you land and get that text message. Oh, the host has just messaged me. And obviously they've been through that process previously, given you all their details. Maybe they've had to do their passport, maybe they haven't. They've gone through the process. You've got them what you wanted, but also you've been able to get to know them a bit better. You've taken their phone number, you've WhatsApp'ed them, you've then reconfirmed with them when they'd like to arrive. You've nailed it, because you've turned that into a really personal experience, but you've still managed to ensure that you had all the steps in place you needed to feel safe and secure.

Heather Bayer
Yeah, when I hear you talking about that, my head's sort of exploding, because I'm still thinking of it in my historical experience of doing everything manually, trying to build all these little steps in together, because way back, maybe 8-10 years ago, these platforms weren't available to be able to provide all this integration into, really, a one button push. Mr. Brown and family are arriving, press the button, all this stuff goes out, and communication processes all set up and automated. At what point does a property manager need to really start thinking that they've got to go away from those manual processes? Because I know there's still plenty of people, and not just property managers, but hosts as well, they're trying to do everything themselves, because they're trying to save a little bit of money. But in fact, I know from experience that time is money, and if you're spending a massive time, you've got to put a price on your.... give yourself an hourly rate. That's something somebody told me years ago. What is your time worth? Is it worth $50 an hour? Is it worth $100, $500 an hour? What could you be doing with that time if you weren't manually trying to screen your guests? So, at what point?.....

Leo Walton
In a spreadsheet.

Heather Bayer
In a spreadsheet? Yes.

Leo Walton
In a spreadsheet somewhere.

Leo Walton
And time back is sanity, isn't it? It's a cup of tea in front of the fire. It's time with your family, it's time watching TV. It's lovely. And, Heather, I'm sure you've probably met a lot more people than me in this particular stage of their business cycle. People that want out, because they can't quite find that balance between work and life in this business. So they've maybe built the property management company to a point, and they're saying, right, it's actually getting too much for me, I'm going to hand it on to someone else. I'm sure, given your connections, you've had loads of those conversations. And the age old question is how much to invest in technology to eat into your margin, that you're trying to also have to make sure that you can live off what you're doing. There's no right or wrong answer, but there's just shades of gray on it. I would fall down on the line of more integration, picking your PMS, your screening provider, your pricing software, picking it all really carefully, finding the best in class, negotiating hard on price and making sure that you find other ways to monetize the experience.

Leo Walton
Because remember, if you know who this guest is, you should be able to upsell to them as well. If you know what they're coming for, if you know why they're here, you can start like......, family of five. They're definitely going to say yes to a fridge fill. Great, I'll do them a fridge fill and charge a small commission for doing it. And suddenly I'm providing an extra service. I'm getting paid to provide that service. So it's spending a penny up front to save yourself a pound later on as well, right? Because if you invest in screening technology and PMS technology, that's where you're making the whole booking experience safer. So you could say, Well, I'm just going to get in and do it all manually. But actually it only takes one or two bad bookings and a few big losses. And actually investing in the technology would have saved you that. And then there's the upsell opportunity, not to mention the marketing opportunity, because the best people integrating all the technologies are then sending out automated emails to their guests to say, thanks for coming to stay with me, and then they send them one at Christmas. Have you got any Christmas plans? Do you want to come back in January? All that sort of stuff.

Leo Walton
So as much as you can, I'd run to it. I'd invest your time in it up front and invest your money in it, because it will help you later on when you go back to how big do you have to be? There is one school of thought that says, when the spreadsheet will do, you do use the spreadsheet and you just buy the tech that you need. And I probably do believe that, that you just buy the tech you need as you go. But I think probably, if you've got one listing that's taking a lot of bookings, I'd automate from day one, I would. And if you've got 2, 3, 4, 5, absolutely. Otherwise, before you know it, it's sort of 20-30 emails you've got to send every month. And if you can map that whole process out, then it's subcontracting out that part of it to someone else who's an expert in it. And we've got some great companies in our space with some really hands on, product focused sales teams that talk you through what they're doing. It's finding the good ones. Right? And not being afraid.

Leo Walton
Of course, the other argument is that just do it manually as long as you can, because ultimately it means, you know, when you're ready to automate it, you'll know exactly what you want from that automation. And so there's an argument there, isn't there, that if you've done it for a long period of time and you're really going to know what you want from your tech stack and your software stack. But yeah, I think I'd lean more on the side of doing it early.

Heather Bayer
Well, certainly as far as guest screening is concerned. And I often think if I had my time again, if I was starting up again, what technologies would be the most important. And guest screening is way up there, maybe because I had experience of the importance of guest screening and doing it manually. But I think nowadays, because it's become so impersonal and there's less connection, you've got to have something in place that's going to screen out the real possibilities of issues happening, as they always will. As we said right at the very beginning, these things will happen. It's just a matter of time. And if you can put something in place to avoid that, then I think that that is super important.

Heather Bayer
Let's just cover a couple of things that we meant to mention earlier on and I didn't, which are how does guest screening help in things like damage prevention, identifying fraud and combating fraudulent chargebacks? It's all these things that when we get excited about getting into the business and about starting up this exciting new venture, we don't think about these things. So how does a good screening process contribute to all that?

Leo Walton
Yeah, it's a really important part to focus on, because the issue of fraud, it's a moving target, it changes all the time. It's evolving the whole time. There's a huge problem in Europe, it's a huge problem in North America. Undoubtedly, the more transactions that happen online, on marketplaces, on websites, make everybody more vulnerable to this type of crime. It's where the most criminals are active these days. They're not robbing shops, they're not robbing electronic shops, they're online scamming and phishing and doing fraudulent things. So it's part of the toolkit for beating it. I think you absolutely have to do it. I think be aware of your market. Some markets have the fraud and charge back thing worse than others. And some markets are more damage related because you might have party bookings, stag and hen parties or bachelor, bachelorette parties, whatever you want to call them. You mentioned damage prevention there. So it could be that it's damage prevention because you want to deter those active groups who are coming to party from coming. And if you put someone through a screening, get them to sign your guest agreement, maybe even take a security deposit from them and tell them they're liable for damages, that's really going to distill in them the importance of not misbehaving when they're there.

Leo Walton
They might not even want a book or they might say to their friends, look, it's my name on here. And what we've found is that even when damage does happen, when we're providing our damage protection, because Superhog obviously has a $5 million guarantee against damage. So we have experience of that as well. We're able to lean on people's better judgment by referencing the fact. Say it's a bachelor party and we say, look, I can see what's happened here. You've all got a bit carried away. After being at the nightclub, the lead guest here has gone through the screening. Their name is going to flag to the database next time they try and book a lovely trip with their partner or their family. And then before you know it, the money gets gathered up and collected from everybody and paid. Now you don't have any way of getting, of recouping that if you haven't screened them up front and put them through that test. So it will reduce initially, so it will reduce the incidents from happening, it will deter. And when they do happen, it gives you some sort of way of chasing back and going, well, look, your details are here.

Leo Walton
You're going to flag to this database. This is within your interest to make this right. And normally, where damage is concerned, if it's premeditated, someone's organizing a wedding and they've not told you someone is filming something in a property, someone is having an organized party, you're never going to hear from that person again. There's no chance of getting that money back. That's why you have to screen because they will not want to give you real details. And if you're able to check their details by screening them, you'll see that they're using a false email, that you can't send an email to, a phone number that's not linked to their name. So a burner phone instead of a contract phone or you'll see that they've gone and taken some information from the Internet in the hope that they can get through the screening. But actually we can see it's in a forum that they've gone and got it from. Same thing with fraud and chargebacks being a problem, let's move on to that screening. Technology can say, Oh, that we've seen these emails and phone numbers before and they were used for a fraudulent transaction somewhere else in the world.

Leo Walton
So it will deter, it will reduce, but also when that person tries to make that chargeback you then have a whole list of things you can send to the credit card company. Say, look, here's a timestamped screening photo against their passport or driving license. Here's where they filled in this information, here's where they signed this contract. They signed my rental agreement here on this date. So I can tell you that they were in the property and that's how you win the chargeback. Well that's how you try to win the chargeback case. It's very difficult. But that's another tool in your box of things to say. And also they have this concept of saying fraud where you say, I wasn't there. Credit card was stolen, it wasn't me. Now it might be a stolen credit card, might be money laundering and the guests might never use the property, but it also might be someone trying it on and saying I wasn't there. That's fraud. Second one is friendly fraud where you turn around and say, I'm not paying for this because the towels took 3 hours to be delivered one evening and I didn't have any towels.

Leo Walton
As an operator, that's where your rental agreement is. Part of your trust toolbox is you put in there what your SLA [Service Level Agreement] is. If they send you an email or they send you a message on the OTA, how many minutes, hours will it take you to reply? How long will it take you to call out and deliver something that you've forgotten, have it all written out there, they sign it and then you can send that to the credit card company and say, well actually they agreed that we could deliver it in 3 hours. And that again unfortunately is just..., you have to be really savvy because people will try these things and it's getting worse. So it's just having a toolbox in place where you could deter, reduce and then ultimately fight back if you need to.

Heather Bayer
This is such a great conversation and one of the reasons why we set this up in the very first place. It's one of the conversations that doesn't often take place, and I'm so happy that you came along to talk about it Leo. Can you tell us then about Superhog and about the guest screening product that you have?

Leo Walton
So we see ourselves as a trust and safety provider within short-term rentals. We exist to make the booking experience safer for hosts and for guests. But essentially we're encouraging people to invest in our technology to make sure that they're mitigating their risk and reducing the amount of damages that happen off the back of that. We have a range of products that we can provide to do that which are screening-based. Right? So you can have a very light screening with us where the guest is only asked to fill in a few details, where we can still run very deep checks on those details, or we can go deeper and we can ask for an ID and you can start to - in some states in America now you have to do, it's compulsory, to do a sex offender background check in certain areas. So obviously we can include those checks. So there's a toolbox of screening that you can include. And I would say back to what I said at the start, if you only need two clicks and you only need a very light version of it, it's still a really substantial check. If you think your guests are not going to want to go through lots and lots of checks, you can make it very short.

Leo Walton
Again, we're linked with all the major PMSs, a lot of the portals. We're very, very integrated across the industry. So you might actually be using a Superhog screening, but it's being hosted by another provider. And that's what I mean about this point about integration and automation. I'm going to repeat that point because it just beeped in my ear. So we're integrated with many of the PMSs and many of the screening providers because we're really driven to make sure that our product is available in whatever tech stack you're using. And it means that again, minimizing, reducing the amount of clicks that a guest has to make to go on that journey and provide those screening. And like I say, when we get that information, we can run very deep, deep checks on people's email addresses, phone numbers, date of birth, and that's how we can really pull in the fraud databases, chargebacks, also our own database. So remember, we've been doing business as Superhog since 2020 and then previously, since 2017, our insurance arm, but since 2020, Superhog. And there's a lot of guest information in there about if something's happened that's significant and someone hasn't made it right and they've run off without paying.

Leo Walton
So we can also give you the benefit of that watch list and tell you, do not take this guest because we have evidence to suggest that they're not a good guest. So that's the screening element of it. Like I say, it's plug and play. You might include ID screen, you might not. I would say as few clicks as possible. Keep it interesting for your guests, don't allow them to get bored. And then that's when, if you want to, we can add in things like a damage waiver. We can collect that for you, we can remit it to you with a handling fee, or we can take a security deposit from your guest. We can include your rental agreement in our guest journey alongside our Ts and Cs, and we can create that check-in flow for you. It can be white labeled, so it looks like your branding, looks like your environment. That's another really cool way for a property manager to elevate their brand is we can customize that journey to look like your environment. And then finally, if you want it, if it's necessary, we can also provide you our $5 million protection for every booking that we've screened.

Leo Walton
Because for us, screening services are part of the whole toolbox. We think that makes your property super safe. Remember, we were born as an insurance company. So we've got risk management in our heart. We know definitively that if you screen guests, you will reduce the incidence of damage by an industry average of a factor of ten; it's huge. That's what our data shows from our insurance days, from what Airbnb say about damage, from what other operators say about damage. By screening, you can reduce that by a factor of ten. But still, things can go wrong, accidents can happen, people can drop things and burn kitchens down and all that sort of stuff. So we think damage protection can also be a part of that. But essentially, we consult, you tell us what you're looking for and we fit the solution. And almost always it links to another piece of software, normally the PMS. But of course, for those without a PMS, you can use the solution manually.

Heather Bayer
So this is suitable for independent operators as well as larger property managers. You go across the board?

Leo Walton
Yeah, absolutely. And I think my experience with the industry is that the biggest segment of host out there is the one with less than ten properties.

Heather Bayer
Excellent. Leo, I'm just going to ask you one more question before we finish, looking forward to the future. How do you see screening technology and practices evolve.

Leo Walton
It's a great question. Screening providers, namely Superhog in this instance, but I'm sure you could go across sector will get smarter, link to more databases, more learning about behavior, what you can learn about someone when they're going through the journey, what data points you collect. So this technology is getting smarter and it's becoming more integrated to the point where you, as a guest, may not even need to hit the screening environment for us to be able to notify a host that that person is fully screened. That's very cool. So you almost move into this world of having a digital passport that you take with you that goes across sectors and I think all of that will come. Right? So an understanding that if you've gone through one or two checks, therefore this person is safe and that might apply outside of vacation rental across the board. And again, everyone's trying to reduce clicks on their screening journey. That's a very important thing to do. So where that leads me to believe it will end up is it all just happens; automated in the background.

Heather Bayer
I love that. A long, long way from collecting driver's license details and Social Security numbers.

Leo Walton
I was going to say we can do the kind of serious, not so nice part of it as quickly and efficiently and almost behind closed doors. It lets you get on with the warm, cuddly stuff. Right? And that's what, you know, again, it goes back to what I said early on. We want to trust people. We just want to give you the ability to verify who that person is so that you can get on with trusting them and delighting them.

Heather Bayer
Wonderful. Thank you, Leo, so much for joining me, for telling us about Superhog. Of course, the information on Superhog will be in the Show Notes and featured on the SSTIR Crazy part of our website. Thank you for contributing to Safety Week of SSTIR Crazy Month. And we will cross paths again at a conference near us in the future. I'm quite sure.

Leo Walton
I look forward to it.

Heather Bayer
Thank you so much, Leo from Superhog. That was a great conversation and  this is a conversation we need to have. Like all of these conversations in SSTIR Crazy Month, whether we're talking about safety or sustainability or trust or insurance or regulations, we need to have that grounding, that understanding in these core pillars of our business. And screening is a part of the whole safety field, because it's safety of you as a host and as a property manager. So I hope you enjoyed that and please go and find out more about Superhog and their guest screening technology. Okay, that's it for this week in Safety Week.

Heather Bayer
Next week we'll be talking to Chris Maughan in Trust Week. That's Chris Maughan of I-PRAC. And that is also a really essential conversation to have about trust in this business, because if you don't have the trust of your guests, if you don't have the trust of your owners, you aren't going to have a business. And I think I'm going to come back to this over and over again. The fact if you're not paying attention to these particular topics, you may not have a business within the next five to ten years. So not really harsh stuff, it's just common sense. So on that note, thank you so much for joining us and we will continue with Trust Week next week.

Mike Bayer
That was some amazing information and we hope you'll take the chance to implement some of these ideas in your short-term rental business in 2024. Don't forget to connect and give our thanks to our platinum sponsor for SSTIR Crazy Month, Proper Insurance. Click the link in the description of this episode to connect with the team at Proper for a no obligation chat.

Heather Bayer
It's been a pleasure as ever being with you. If there's anything you'd like to comment on, then join the conversation on the show notes for the episode at www.vacationrentalformula.com, we'd love to hear from you and I look forward to being with you again next.

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