Hello Everyone! In today’s edition of Fintech Founders, we will be chatting with Josh Ernst, the CEO & Founder of Backflip. Josh and I actually met early on in my venture career and what I can definitively say is that Josh is one of the most focused, dogged, and genuine entrepreneurs I’ve met.

Josh is building what I like to think of as a cross between Zillow and Shopify. Backflip is a real estate-focused software solution designed to support individual entrepreneurs in their journey toward identifying, improving, and monetizing a real estate asset. One of the things I love most about Backflip is that it’s an enablement layer for entrepreneurship, and in a vertical (real estate) that is in desperate need of innovation. Check out our interview below and let us know what you think, and if you’re curious about getting into the real estate game, don’t hesitate to hit up Josh!

Josh, it’s so great to have the chance to interview you here for Signals’ Fintech Founders. Where I’d like to start is, tell us a little bit about Backflip, a little bit about who you are, and what your founding journey has been thus far.

Sure. I'll start by giving you the super high level on Backflip. We are supporting real estate entrepreneurs on their journey to reinvigorate the housing supply, and it's been an incredible journey so far, and we're really just getting started. I grew up in Texas, and growing up in Texas– as you did too, Dez– you are surrounded by business folks, particularly in the real estate sector. And there are people all over the place who are doing all sorts of interesting and innovative things in real estate. I also have always been fascinated by technology and data, and what's possible with innovation. And what’s so interesting to me, as well as others, is how slow the technology adoption cycle has been within real estate, and so you’ll see that that's been an ongoing theme throughout my career.

Long story short, I started my career as an investment banker in New York, working in credit and capital markets. After a few years I decided to start my own proptech company, Urbin, a storage disruptor. We were a competitor to Makespace and Clutter. I grew the company and sold it, which was a great experience and from there I decided to try VC investing. I worked with companies like The Trade Desk, which is an ad tech platform that uses AI & ML to make better decisions and make buying more transparent. I always knew I wanted to get back into operating, and after my VC experience, I was thinking about starting my next business or joining one of my portfolio companies. Eventually a founder friend of mine recruited me to be the COO of his company which coincidentally was in the real estate space, and in Texas.

That was a really important step in my journey because that platform had a couple of different business models, but one was a marketplace specifically for real estate investors who were focused on buying single-family residential assets. Those investors could make money in a lot of different ways: Flipping the house and doing a value-add deal, AirBnB-ing the asset… and our marketplace helped curate inventory for the investors. We helped about 20,000 investors scale their businesses, ranging from big institutions to Mom and Pops. They were all doing quite well and making good profit on fun, interesting strategies, but they were also so antiquated in their processes. They didn’t leverage what's available to them from the data technology standpoint, let alone a capitalization standpoint.

It just became more and more obvious to me that we needed to build a version of the capitalization stack that I'd been introduced to in my past lives, for example at The Trade Desk or in my early investment banking days, to help these really small-scale real estate entrepreneurs and investors.

Because today, although they do well, a lot of them are definitely still operating without vertical market software and more like old-school Moneyball. People act as scouts trying to make decisions based on gut. And then they're capitalizing these deals, honestly, with slightly predatory partners. That’s not the way that it needs to be.

These deals are interesting. There's a lot of potential upside. These entrepreneurs are unbelievably fascinating, and so finding ways to help them, whether that's accessing this asset class and getting into the space for the first time or their business– that's what Backflip is purely focused on, and it's been an incredibly fun and rewarding kind of platform journey that we're on right now.