LoftSmart founders Sam Bernstein (left) and Sundeep Kumar (right).
IN CONVERSATION: SAM BERNSTEIN AND SUNDEEP KUMAR OF LOFTSMART
Over this summer, I had the opportunity to work with Sam Bernstein and Sundeep Kumar, two entrepreneurs who are currently disrupting the student housing space. They started a university student housing company called LoftSmart, a platform that makes off-campus housing market seamless, transparent, and trustworthy for both student renters and property managers. After their demo day at AngelPad (one of the biggest startup incubators in the nation), I spoke with both of them about their company, their lives, and their futures in the startup world.
So, off the bat, can you guys give me an introduction to LoftSmart? What issues do you aim to solve?
SAM: I founded the company when I was in college because there was a lack of search solutions for student rentals, which led to some ugly consequences for both students and property managers. The natural solution was to connect both parties through an efficient two-sided marketplace, with LoftSmart acting as a trustworthy third-party that would facilitate transactions and serve as a central listing and review platform.
Our goal is to ensure that students can discover and lease amazing rentals seamlessly, trustfully, conveniently, and transparently. All the while, we want to help property managers by taking care of more of the low-level aspects of their businesses so that they can focus on providing the best possible services to tenants.
Is this your first venture? What would you say drew you into the startup/tech world?
SUNDEEP: Coming from a mechanical engineering background, it was always important for me to work on something that brought change. It just made sense that I’d get into tech – a world that is constantly growing and changing. As much as I loved working at Dell, where I was before, this really is a place where I can grow, build something different, and drive results. This is our first time working full-time on a startup and I know both of us are having a blast.
SAM: Prior to LoftSmart, I spent some time working in finance, investment banking, marketing, and in politics (Obama 2012). Put simply, nothing moved as quickly as tech did, nor could those fields affect the lives of so many people at such a rapid pace. I love working on LoftSmart. I can work 18-20 hour days consistently without needing a cup of coffee. It’s all that I can see myself doing.
How did you guys meet and start working together?
SAM: I had just moved to Austin to run the company, and I wasn’t quite looking for a co-founder, but I knew that if I met the right person I would be very interested in having that conversation. I knew almost no one in Austin, so one of our earliest investors recommended that I go meet a friend of his, Chris Bostick, who runs the Half Step, on Rainey Street. It was my first night in town, and as I made my way through the bar, I overheard Sundeep and his friends talking about startups.
I sort of thought, “Well, might as well try to make some friends.” So I walked over and introduced myself. I had probably done an internal calculation that there was a roughly ~70% chance they would tell me to get lost. But instead of brushing me off, they invited me to sit down and have a drink.
I knew quickly that Sundeep might be that person I was looking for. About a week later, we had dinner, and I asked him to come on and start working part-time as a trial run. Things grew to the point where he became really invested in the success of the company.
When we applied to AngelPad, I asked him, “If this works out, are you ready to take the jump?” He didn’t hesitate to say yes. We found that we had gotten into AngelPad that same afternoon, and the next day we got on a plane to New York. 4 months later, here we are — 7 full-time employees, more than 20 folks total, an office in Soho, and over $2 million in funding. It’s been really fun.
What would you say that each of your personalities bring to the table?
SAM: Sundeep has a true engineer’s mindset — he’s much more measured and quantitative in his risk analysis. We like to joke that I operate at 30,000 feet – it’s always about breaking down barriers for me. He’s always there to pull me back to Earth when I’m thinking a bit too crazily. I focus mostly on product development and design, fundraising, high-level strategy, and the financial administration of the company.
SUNDEEP: I’m very execution-focused, and I spend a lot of time managing both our business development and local operations teams. Sam and I tag-team the sales side of the business.
SAM:Not to interject, but have to give credit where credit is due here. Sundeep is a fantastic manager.
SAM: Sundeep also interacts very, very closely with product — probably in a more granular way than I do. Oh, and I probably focus a bit more on marketing than he does.
What are some of the biggest differences that you’ve noticed between working at a corporation and working for your own company? How have your lifestyles changed in the past year?
SUNDEEP: While I was at Dell, I was given several great opportunities and worked with some of the best and brightest. That being said, I felt that bureaucracy and hierarchy posed real challenges to execution and upward mobility. Honestly, that's just how big company culture typically works.
At LoftSmart, Sam and I get to operate at 30,000 feet, and when we dream, we get to turn our dreams into a reality. The best way to put it is that we would rather work 100 hours for ourselves each week than work 40 hours for someone else. It’s a crazy sort of world to be in. We work a lot of hours, and a lot of weekends. Back when I was working at Dell, I had an apartment that I lived at, with all my stuff in it. Now, I have two suitcases and a hotel room.
SAM: It would be very, very hard for me to go back to being an employee. Sundeep and I love running the show. To run a company is to experience the highest highs and the lowest lows — the point is that the former always justifies the latter. To feel fulfilled and challenged and engaged each day is truly a blessing. It’s almost ludicrous how much I enjoy working.
You mention high highs and low lows – can you give us an example?
SUNDEEP: You want to take this one?
SAM: Sure. One of the first big meetings we took when we opened up our round was with an incredibly successful and well-known VC — a guy who had been very, very high-up at Google and created some of their signature products early on.
SUNDEEP: This is the kind of guy you dream is going to fund your company.
SAM: We walked in and did our pitch, and the room just fell totally flat. Not only did he fail to understand our idea — he totally ripped us apart. The feeling is sort of like, “If anyone that is this intelligent and successful could feel that way about our company, could we have been wrong about everything that we believed in?”
SUNDEEP: But then, you have another great round of meetings, and you have someone who loves the business model tell you that he or she wants to invest. Another great moment that comes to mind was when we signed one of our biggest partners, Peak Campus.
SAM: Getting into AngelPad, and then presenting on Demo Day, were awesome moments, too.
What are some things that you guys have learned at AngelPad? How have your perspectives changed?
SAM: On our first day in AngelPad, Thomas Korte, the program’s founder, asked us, “How do you guys really deliver value to your users and your customers?”
At first, we talked about reviews, ratings, and transactions. They told us that it wasn’t enough – in industry speak, that it wasn’t “10x.” We realized that we had to be the trustworthy agent for the student, to make students feel so comfortable signing leases on LoftSmart that they wouldn’t feel comfortable signing anywhere else. We’re going to be implementing verified third-party walkthroughs, cross-referenced lease inspections, and added services that all coalesce around this idea of the LoftSmart guarantee.
When you sign a lease through our platform, you know that you won’t get hustled, and know that you’re going to have a great experience living at an apartment that you love.
What are some big goals for your company moving forward, in the short term and long term?
SAM: This Fall, we want to process as many lease transactions as possible and to help as many students as we can to find amazing apartments to live at in their markets. Long term, we aim to create an efficient, broker-free environment that has no intermediaries, no bias, and no inefficiency. We envision a world where tenants and property managers can communicate transparently, transact intelligently, and allocate capital efficiently.
Lastly, how would you describe LoftSmart’s company mentality?
BOTH: Trust, transparency, and convenience.