Designing Smart Locks For Airbnbs And Growing To $5M/Year
Hello! Who are you and what are you working on?
Hi! We’re igloohome and we create smart locks and lockboxes - these devices allow property owners to grant access to their properties remotely, via a mobile app.
Property owners can create PIN codes or Bluetooth keys to send to guests, and select how long these are valid for. Being able to limit the time range of these virtual keys ensures that the property is kept safe.
Our products work offline, which mean that there is no worry about wifi connectivity or wifi hacking. The technology behind our devices involves synchronization and encryption, similar to that in the internet banking token.
We are a partner of Airbnb and can integrate the generation of PIN codes with an Airbnb host's calendar. After a reservation on Airbnb is confirmed, igloohome automatically sends the guest a personalized PIN code to enter the host's property. When the guest checks out, the PIN code is automatically deactivated, giving the host peace of mind.
Till date, our products have been rolled out to over 80 countries, to great reviews. Our products have also received numerous media mentions and awards such as the CES Asia 2017 & 2018 Innovation Honoree Award (IoT), our Mortise has been featured in The Wall Street Journal as 'Best Mortise Lock', and our Keybox been featured in The Huffington Post as ‘Best Tech Products of CES 2017’, and GQ’s ‘The Best Stuff of 2017’.
What's your backstory and how did you come up with the idea?
As Airbnb hosts, our co-founders faced the frustrations of the inconvenience of physical key exchanges, especially when guests wanted to check in at odd hours. As such, the team wanted to enhance the experience of both hosts and guests and therefore set out to eliminate such problems.
Subsequently, we discovered that the management of access is a problem that is not limited to Airbnb—most home and property owners faced similar issues. As such, we developed our products and app further to cater to different market segments.
The response to the product has been very good. We received a lot of feedback from customers saying that they really appreciate the product works offline - maintenance of the lock is minimal for them, and it's very easy for them to grant access when they're away from home. As such, we continued our efforts in improving our products’ user experience till where we are today.
Describe the process of designing, prototyping, and manufacturing the product.
From the beginning, we had one problem to solve - which was to enable Airbnb hosts to manage their guests in a better way.
We designed the locks with over 50 beta Airbnb hosts, iterating with them as we went.
With hardware, the way we made our first prototypes were by ourselves, purchasing components and soldering it by hand. We even 3D-printed some parts.
These customers knew what they were getting into as we were rolling out beta products. We couldn’t be more thankful for their willingness to try it out.
After a year, we started engaging manufacturers & factories in China to help scale our production. To keep costs low and prices competitive, China was the way to go. Though navigating the China manufacturing ecosystem was not easy - we made several wrong decisions, but learned from them quickly.
Describe the process of launching the business.
We started out by bootstrapping and eventually raised our first USD$1mil about 6 months after starting out. This helped our acceleration in product development and go-to-market.
We knew that to grow the company to a reasonable size, we had to land just one customer - Airbnb. We were lucky to build that relationship and eventually launched with them after a year - that’s when we started to see our first spike in customers.
The most memorable was when we first launched our commercial product in Singapore. We underestimated demand and didn’t manage to get enough parts of the lock in on time, hence delaying delivery to customers. We learned to pay extra attention to lead times and to always build in an extra buffer to ensure this situation doesn’t repeat itself. It’s also one of the most important lessons in hardware startups.
Since launch, what has worked to attract and retain customers?
Partnerships
Our partnerships with the big players in the hospitality industry have helped us penetrate the target market. We’re partners with Airbnb, Booking.com & BookingSync; on top of that, we’re working with many integration partners to help the brand scale. These partnerships come from everywhere. We’ve actively sourced for some, while others were introduced by personal networks and from our participation in several acceleration programs and winning awards.
We are listed on Host Assist on the Airbnb website globally, which means that hosts around the world are channeled to us as Airbnb recognizes that our products help their hosts manage their properties more easily.
Distribution
We have also signed large-scale distributors around South-East Asia and USA, which will help support the marketing and distribution of our products in these countries. We’ve actively sourced for some, while others were introduced by personal networks and from our participation in several acceleration programs, exhibitions and winning awards.
Facebook Ads
We also use Facebook ads regularly. It helps increase brand awareness globally and is pretty straightforward to manage. This ties in closely with how we use Google Analytics to formulate our next step.
Tracking the effectiveness of an ad is important, most people tend to overlook the journey to effectiveness and focus on the end goal of conversion. This can sometimes mean wasted marketing dollars, and tracking help cut unnecessary spending on ineffective avenues.
Amazon
We are also on Amazon, but that’s handled by our reseller in the US.
Mostly, we think the reviews on such sites are great in pulling customers to us. These sites allow past customers to share their experiences, which is worth much more than any paid ad.
Of course, it’s also a double-edged sword; should your reviews be bad, you should act swiftly for service recovery to take place.
Reviews
That’s why part of our marketing efforts include managing reviews on any platform. This can be on Google, e-commerce sites, Facebook, forums and more.
It plays a vital role in shaping people’s impression of the brand when they see how you handle a bad review or read about the positive experiences others have had. To ensure we get good reviews, firstly, the product needs to deliver what it promises. We’ve dedicated time to perfecting our smart locks and lockboxes and will continue to further develop to keep up with the changing times. Secondly, customer service needs to be top-notch. We invest in training and retaining the right talent over time; this takes a lot of trial and error and isn’t something you can achieve overnight.
To improve reviews, we make sure that we respond to any negative feedback left on any of our platforms. We also trawl through forums to see what others say about the product and reach out to them. The proactiveness and an open mind will allow you to take constructive criticism, and help the business grow in the right direction.
It’s imperative to keep track of what’s being said on- and offline about your brand and products. We strive to upkeep the image and take every feedback seriously. Our efforts have seen some customers amend their review after service recovery.
How are you doing today and what does the future look like?
We have sold over 30,000 devices, and have a healthy pipeline of B2B customers in the USA, Japan, China, and other countries.
We have over 40 distributors globally that are carrying igloohome products across 15 different countries. We have also set up a global distribution backend and delivered to over 80 countries.
We are now expanding to different markets. We are already available in selected countries including the USA, parts of Asia Pacific, UK, Mexico, and we intend to go into new markets such as Europe. We are planning to appoint distributors in the markets we have plans to enter, who can then help us scale even faster than before.
At the same time, we are also looking at rolling out an even wider range of products and working on new products for commercial and new developments - more details will be released in the coming months!
Through starting the business, have you learned anything particularly helpful or advantageous?
One of the challenges we faced at the beginning stemmed from the fact that our previous product required a wifi connection to work. While there were pros of having an online product (eg. remote locking/unlocking and checking of lock status), there were cons as well (eg. when the wifi went down, the lock no longer responded). So even though the product itself worked well, it was dependent on wifi, which made it not so suitable for places where the wifi connection was not strong.
Focus on solving one problem first. Do not try to solve too many problems at one time. Startups have limited resources, and to maximise your chances of success, you need to focus on only one thing.
This helped us to think out of the box, and taught us to not rest on our laurels. While the product worked well, we wanted to make it accessible to everyone.
As such, we decided to do R&D to come up with a product that could work offline instead, which eventually led to the igloohome Smart Deadbolt. As the lock works offline, this means that there are no worries about wifi disruption or hacking. This makes the lock more reliable, more secure and also more suitable for deployment in places which had little/no internet connection.
On top of that, there are 300 million travellers into Asia Pacific annually, and 100 million units of secondary residences in Aisa Pacific, and these numbers continue to grow. Property owners spend lots of time and effort on key exchange for guests, especially during situations of flight delays and so on. It’s a trend that we managed to capitalise on as our products help home and property owners grant access remotely, thus helping to manage this problem.
We’re also Airbnb’s only technological partner in Asia Pacific. This partnership has opened doors for us, and we are now partners with other big players in the vacation rental industry such as HomeAway and Xiao Zhu in China.
What platform/tools do you use for your business?
What have been the most influential books, podcasts, or other resources?
I love to read biographies, and none are more inspiring than Jack Ma’s.
- He had the Insight to believe that the internet will be mainstream.
- Passion to keep going despite multiple setbacks and rejections
- Integrity - Jack ma would rather close the company than accept a bribe.
Insight, passion and integrity, I believe these are core to starting any business that has a chance to go on to be a runaway success.
Advice for other entrepreneurs who want to get started or are just starting out?
Focus on solving one problem first
Do not try to solve too many problems at one time. Startups have limited resources, and to maximize your chances of success, you need to focus on only one thing.
Igloohome faced this problem at the beginning - we were building a whole smart home for rental, including smart locks, lights, thermostats. This was impossible for a new startup to do, and we eventually focused on one singular problem - smart access for Airbnb hosts, which allowed the company to take off.
Do things that don’t scale
Paul Graham, one of the earliest investors in Airbnb, famously told them to “do things that don’t scale”. This is very important advice, especially at the beginning.
Founders tend to get impatient, and it is wise to rein that in. It is important that founders know everything about the customers that they are solving the problem for, and this means spending time with each customer individually. This will enable you to get to the product to market fit before you start thinking about scaling.
We learned this the hard way as well. In the beginning, we were all over the place, across 4 different countries with just 10 people on board. Things became inefficient, and we were stretched, even before we figured out what was the right product for our customers. We quickly scaled down and by focusing on the early few customers in one area, we began to regain traction.
Where can we go to learn more?
- Website: igloohome.co
- Facebook: facebook.com/igloohomeco/
- Twitter: twitter.com/igloohomeco/
- Instagram: @igloohomeco
- Email: [email protected]
- Blog: igloohome.co/blog/
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