San Francisco 2nd Week Recap
You might have seen our previous blog post, where we shared some reflections on our first week in San Francisco (SF). If you didn’t, we’ll
catch you up; 2ndLease has been touring SF, learning from the best , seeing what best practices we can bring back to the Australian start-up ecosystem, and figuring out how best we can bring the 2ndLease concept to the American market!
After a busy first week of networking; meeting with other start-ups and individuals interested in changing the way Americans access their appliances, it was time to get to work, hit the phones and discover our market. When not checking out awesome workspace cafes (see picture) Alex our CEO had to manage with using an ironing board for a desk, talk about lean start-up (and very expensive co-working spaces)!
An unsurprising reality about the American market was that it presents a huge opportunity for 2ndLease. It’s so big, that having laser focus is even more important, because targeting even a niche segment within a market can produce a larger customer base than the entire Australian market!
This laser focus is engrained in the small business psyche, so much so that many of the small businesses we spoke with did one thing and one thing only, with no consideration to branching out! The market is big and mature enough to enable them to do this.
During the week we spoke with a long list of businesses, and sole operators to understand the market better and evaluate how 2ndLease could fit in it. An interesting discovery was that the SF rental property market is somewhat different to the Australian market. For instance, the retail mum and dad investor market is much smaller while the Institutional property trusts (REIT’s) own a large portion of the residential rental buildings, a phenomenon not yet popular in Australia.
These property owners offer most rentals furnished or unfurnished, and have longstanding partnerships with major furniture rental companies (owned by the likes of Berkshire Hathaway!) to fulfill the furnished options. SF proved a tough market to crack, yet what we also learned was that SF bears no resemblance to the rest of the US.
On our last night we attended the Australia Day 2017 Happy Hour which was hosted by the Aussie Founders Network and featured a fireside chat with Larry Marshall (CEO of CSIRO). This was a great event where we got to network with more Aussies from the Bay Area, as well as here some great insights on the convergence of science, technology and start-ups.
If there was one important take away from this trip, it is how developed the Australian Start-up network is in SF. It it truly amazing how many Aussie start-ups have successfully made the big leap across the pacific! Even more humbling is how willing they are to offer their assistance; whether it be introductions, advice or sharing of information, to near strangers.
On a final note, President Trumps inauguration took place during the final week of our trip. Overall the climate in SF was that of shock and nervousness for what the future holds. However, on meeting with some local American startups, they were surprisingly optimistic about the potential upsides that protectionism and currency devaluation could have on their domestic markets. These guys will find a silver lining in all situations, is that a good thing or bad thing?