Eric Breon built a single vacation rental management company for almost a dozen years.
Why, therefore, would he want to start again and establish a new business in the same sector on Tuesday? It’s because he thinks he has a better idea now.
Breon says, “I think I know the answer now.”
For a brief period, the most valued young Portland company in generations was his previous startup.
Vacasa, which operates vacation rental properties all throughout the nation, raised close to $970 million for its enterprise. When Vacasa’s stock first started trading on Wall Street in 2021, investors valued it at $4 billion because they thought it could restructure a fragmented industry and take advantage of the post-pandemic surge in vacation travel.
That did not succeed.
Vacasa’s sales fell as travel habits changed and the company struggled to add vacation properties, and managing holiday rentals turned out to be significantly more expensive than it had expected. Today, Vacasa is valued at less than $100 million, which is less than 3% of its highest value.
About two years before to Vacasa’s stock offering, in 2020, Breon resigned as CEO. Last year, he also departed the company’s board.
Breon stated that he believes he has a more intelligent approach to managing vacation rentals than his previous company, but he declined to discuss the specifics of what went wrong at Vacasa.
Fairly is the name of his new business in Portland. Similar to Vacasa, it provides assistance to property owners in managing their holiday rentals in locations such as Oceanside and Sunriver, or comparable retreats in other states. Fairly offers local guidance on property marketing as well as cleaning services.
However, Fairly has a much less ambitious strategy than Vacasa, which aimed to manage the rentals directly, with management operations in hundreds of holiday communities from Oregon to Maine.
The new business merely links property owners with nearby real estate brokers and cleaners who can offer management advice. Property owners may interact with these contractors and the tenants in their houses because to Fairly’s technology. If the quality of the work is subpar, property owners can switch contractors from the Fairly contractors available in their local areas.
Instead of growing into a large corporation with numerous offices, the objective is to facilitate personal communication.
According to Breon, the daily, individual operations don’t scale very well. Better-maintained properties can command greater rentals than those with bad internet ratings, he noted.
equitably retains 20% of the rent from a property. Five percent of the rent is taken by the local contractors that clean a property or give advice to the rental owner.
Fairly’s offices are located at the Kiln coworking space in Southeast Portland, while Breon resides in White Salmon, Washington. Ten employees and fifteen remote workers make up the startup. According to Breon, he usually visits the Portland office once a week.
Fairly assists with the management of rental properties on other websites, such as Vacasa, VRBO, and Airbnb. However, according to Breon, Fairly will eventually sell rental units on its own website.
According to Fairly, Breon alone has contributed the majority of the $10.1 million raised, with smaller contributions from other staff members. Through the development of a network of 1,000 local contractors, it has been testing its platform to handle roughly 50 properties that Breon owns himself.
We’re deploying it widely now since everything is going according to plan, Breon stated. We are launching across the United States.
–Mike Rogoway writes on the business and technology in Oregon. His email address is [email protected].
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