Sitting on a ski lift on the way up the slopes of a snowy Mt Buller in 2015 is where the idea for CampaignAgent took off.
Founded by Seth Watts, a real estate printer, and Shaun Moriarty, a finance professional, CampaignAgent is a Melbourne-based financial technology company that is shaking up vendor paid advertising, reducing risk and boosting results for real estate agencies and sellers.
Instead of agencies stumping up cash to pay for residential sales campaigns and having to recoup the cost from vendors, CampaignAgent does it for them.
Seth says the premise is a simple one.
“We help agencies maintain cashflow strength throughout the real estate cycle, which has been extremely difficult for many firms over the past 18 months,” he says.
“Agents in living rooms are a real focus for us.
“We give them a simple script to ask their vendors, ‘would you like to pay now and save or pay later and enjoy the flexibility?’”
The idea that something needed to change in the way vendor paid advertising operated came to Seth in 2012 but didn’t crystalise until he and Shaun were riding the ski lift in August 2015.
Back in 2012, when the Melbourne property market was taking a bit of a beating, so did Seth’s real estate printing business as a flow-on effect.
In just two days four clients, some of the most prestigious agencies in the country, cancelled $5 million worth of print work.
“It was vexing to me,” he recalls.
“Here were four CEOs of four powerful companies, and they were telling me they needed to strategically pause their marketing efforts.
“I’d just finished my MBA, and I’d never heard of such a situation because in such a market it’s common practice to accelerate your marketing.”
Thinking long and hard, it suddenly dawned on Seth that the real estate agencies had allowed vendors to pay their marketing costs once their property settled.
But the properties hadn’t sold and the bills from the advertising platforms were coming in.
“Real estate was ticking time bomb,” Seth said.
In 2013 and 2014 the market picked up, but by 2015, when it boomed, Seth was already anticipating another bust.
Come August and sitting aboard a Mt Buller ski lift, Shaun told Seth about a new payment method called Afterpay.
“In 2015 not many had heard of Afterpay, but Shaun was saying ‘it’s really exciting’,” Seth says.
“In October 2015, we incorporated CampaignAgent with the simple goal of allowing vendors to choose to pay now or pay later for their marketing without putting real estate agencies and agents at risk.”
CampaignAgent has since grown to 40 staff who service more than 300 agencies and more than 2000 agents nationwide.
As well as taking the payment processing and debt collection pressure away from agents and agencies, CampaignAgent helps free-up agency funds that were previously tied up in vendor paid marketing.
“On average that is about $50,000 to $60,000, but for some agencies it is as much as $300,000. We even had one client who freed up over $1million in Melbourne,” Seth says.
“Over about three to four months, as we fund new campaigns and as the old ones are paid back, that money flows back to the agency. The process frees up significant free cash for shareholders.”
Marshall White Director James Tostevin started using CampaignAgent about six months ago and says the platform reduces the risk to agencies and agents, and helps foster better relationships between agents and vendors.
“Like a lot of agents, I’ve seen a lot of things change in my 34 years in real estate, one of which is that the cost of marketing campaigns has blown out massively,” James says.
“For years agencies and agents have been putting themselves at risk.
“I remember one client 15 years ago refused to pay a marketing bill in full and that property had sold and we hadn’t done anything wrong.”
The money had to be recouped via VCAT, and after that 50 per cent of marketing costs were required upfront, while the remainder was due the week before auction.
“That was often an awkward conversation for our agents to have,” James says.
“It almost felt like the agents were doing a bit of debt collecting.
“CampaignAgent has certainly changed the relationship for the better.”
CampaignAgent also reduces vendor anxiety about how much to spend on marketing their property and doesn’t charge penalty interest.
“Regardless of which option a vendor chooses, pay now or pay later, the right amount of money is invested in their marketing campaign,” Seth says.
“We understand that not a lot of Australians have thousands of dollars ready and waiting to pay for marketing.
“CampaignAgent allows homes to be marketed as they should be and not based on what the seller can afford that day.
“This usually results in a bigger marketing campaign, a home that is better presented, more buyers, a faster and better result, and it gives the real estate agency better exposure.