Growing up, Louis Baugier was influenced by his father’s business, which was not real estate, per se, though it was certainly in dirt.
Hs dad, Patrick, grew up in a grape-growing family in French wine country. The elder Baugier came to the New York in 1988 to establish MetroWine, an American distribution hub for his family’s centuries-old Bordeaux. That entrepreneurial spirit inspired the younger Baugier to strike out on his own, too.
“Seeing him carve out his own little slice of the American dream inspired me,” Louis Baugier said. “It taught me not to be scared and to go out and make my own story.”
That story began in JPMorgan Chase’s Global Real Estate management group then added a chapter at RXR Realty, where he helped close a $1 billion of new development deals in one year. Page after page revealed a common theme to Baugier: the disjointed nature of the real estate industry.
For his latest act, the 28-year-old founder and CEO of Surecave Inc. is challenging the status quo of that fragmented industry, hoping to stitch it together and streamline its various parts through technology.
Using knowledge gained on the job as well as his first-hand experience as a renter—plus some startup venture capital seed money—Baugier devised property management software that enables landlords to communicate seamlessly with tenants and vendors. Since March, Surecave has attracted landlords responsible for more than 200 commercial and residential buildings.
Surecave’s initial, self-named program has given way to new application called Vero, a residential tenant verification system that removes the need for physical documents such as drivers’ licenses, W-2s and paystubs. The app keeps the communication system from Surecave and allows landlords to schedule services and collect rent digitally.
“It’s essential like a social network for these different constituencies that operate in the real estate industry,” Baugier said. “From the tenants perspective they have a portal to add their credit card, bank account, see details about their lease and communicate with their landlord. It’s a one-stop-shop for all a tenant’s needs.
“A huge part of real estate is that social factor,” he added. “As an owner, you’re dealing with so many parties that are not necessarily communicating with each other as they should.”
Along with property owners and managers, Surecave has sold its technology to brokerages such as Douglas Elliman, Halstead and EXP Realty to simplify their application processes.
The system works by prospective tenants granting access to their bank account information, which then certifies income and employment through automated direct deposits. The idea, Baugier said, is to eliminate the need for paper documents to save time and money.
“From a business standpoint, I want to change the way people interact with real estate, not just tangibly but from a financial standpoint.”
The service is free, with the only revenue coming from a $2 charge per rent payment and a surcharge for credit card transactions. While Baugier could charge a subscription or licensing fee for his software, he said that goes against the end goal of saving money otherwise spent on lawyers, accountants and other professional services. In the competitive world of proptech, he said, nothing beats free.
“It’s incredibly crowed and it’s only going to get more crowded,” Baugier said of real estate’s burgeoning tech space. “It’s a race to zero so that’s why we started at zero.”
Besides, Baugier goal is not to be the new middleman but to remove middlemen wherever possible. For him, the real takeaway is not money—at least not yet—but rather the data from the various transactions and interactions that take place on the app.
Tenant information is double encrypted so nothing personally identifying is put at risk, he said, and after 30 days, the bank account information used for initial certification is no longer accessible. What Surecave keeps is the anonymized data to identify trends.
“The data itself is much more valuable than the dollar per
unit price point,” he said. “From a business standpoint, I want to change the way people interact with real estate, not just tangibly but from a financial standpoint.”
Born on Long Island to French parents, raised in Connecticut and educated in New Orleans, Baugier returned to New York in 2013 after graduating from Tulane University’s Freeman School of Business with dual bachelor’s degrees in finance and French.
Surecave consists of eight employees but Baugier said he hopes to double that next year. Currently, the startup is nearing the end of its seed funding, much of which is provided by Illinois-based First Midwest Group, TransUnion, Remax and Silverback Development.
Baugier said his plan is constant evolution. He’d like to expand his platform to cover commercial leases and residential sales, as well, though he said the data his company collects could take him in a completely different direction.
He’s big on blockchain, even adding a feature that allows tenants to pay their rent via Bitcoin. Though he noted that the cryptocurrency transfer fees are too expensive for the system to be viable at the moment, he wants to be ready when the bugs are worked out. He sees blockchain better serving as streamlined verification method that will remove the need for title insurers.
“The title industry, broadly speaking, is glorified cartels,” he said. “You have four or five major players that own the market. Blockchain can go a long way toward fixing that.”
He’s less bullish on artificial intelligence, the value of which, he believes, is overstated in the unwieldy worlds of leasing and property management.
“Everyone is looking for ways to standardize information but there’s been zero standardization to date because no two transactions are exactly alike,” Baugier said. “For an algorithm to work you need to have the same information over and over again. You can’t do that when there’s no consistency. That’s where you need that human touch.