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TRANSCRIPTION WITH SPEAKERS
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[00:30] SPEAKER_00: Welcome to Canada's podcast, the number one podcast for entrepreneurs by entrepreneurs.
[00:37] SPEAKER_01: Good afternoon, everyone. It's Bonnie LG here with Canada's podcast.
[00:42] SPEAKER_01: And today I am delighted to welcome Ed De Prado to our show Ed is an entrepreneur in Edmonton, Alberta,
[00:49] SPEAKER_01: and his company is sweetly. So Ed, thank you so much for joining us today. It's nice to have you.
[00:55] SPEAKER_02: Hi, Bonnie. It's great to be here.
[00:58] SPEAKER_01: So let's jump right in and I'm wondering if you can tell our listeners a little bit about your entrepreneurial journey and what has led you to establish sweetly in some crazy times.
[01:11] SPEAKER_01: We're going to dig deeper into that in a moment too.
[01:14] SPEAKER_02: I mean, yeah, it's terrifying times, especially having started a new real estate company right before COVID hit.
[01:20] SPEAKER_02: Man, the entrepreneurial journey, well, it's, it feels like you kind of started right out of high school.
[01:26] SPEAKER_02: I don't think I've ever really had a job. So I guess I've been an entrepreneur ever since day one.
[01:32] SPEAKER_02: Yeah, it's been, it's been an interesting ride. I think that right out of high school and for going, having gone to university,
[01:38] SPEAKER_02: I just wanted to be an entrepreneur, wanted to be a business owner right out of the gate.
[01:42] SPEAKER_02: And I just didn't really know what I was going to do.
[01:45] SPEAKER_02: I started investing in real estate pretty early on in my life after having sold a business that that I had started.
[01:54] SPEAKER_02: I started a alarm company when I was about 21 years old and sold that and had a little bit of capital to work with and not having ever grown up with money, per se.
[02:04] SPEAKER_02: It was, it was a bit of a different experience for me to have access to capital to actually put to work as an entrepreneur.
[02:13] SPEAKER_02: And I decided that I was going to invest in real estate because it seemed like a prudent thing to do.
[02:19] SPEAKER_02: And it, my timing worked out. I just happened to be in the right place the right time and the timing worked out and it went well.
[02:26] SPEAKER_02: And soon after having invested in a number of individual single family houses, I started buying apartment buildings and changing the structure of ownership into condominiums, then I became a broker myself so that I had more access to the markets and more access to the data to make more informed decisions rather than having to rely on other agents.
[02:47] SPEAKER_02: I never really wanted to be a real estate agent, but here I am.
[02:53] SPEAKER_02: So, so yeah, I kind of just sort of snowballed and sort of followed my passion and here I am.
[02:59] SPEAKER_01: And have you spent your entire career in the Edmonton areas that where your real estate is focused or where are you geographically?
[03:08] SPEAKER_02: Yeah, our business is based in Edmonton. We started here in Edmonton. We're currently expanding into other major centers throughout Alberta.
[03:17] SPEAKER_02: And we expect to be in other provinces within the calendar year 2021. But yeah, we were currently doing business and we have operations in Edmonton, Calgary, Red Gear, every major center throughout Alberta.
[03:31] SPEAKER_01: And so you mentioned that you you started sweetly, not that long ago and you've had quite a ride going through the pandemic and the economic downturn and all of those things.
[03:43] SPEAKER_01: I'm curious, what was the inspiration behind the name?
[03:47] SPEAKER_02: Well, the story behind the name is actually something that I can't take credit for. We actually worked with the marketing company and we just had a concept and idea, which goes back to probably about 20.
[03:59] SPEAKER_02: 2016, maybe 2017, I had sort of fallen out of love with with my industry and didn't want to follow the herd mentality into the race to the bottom with respect to the fees that are being offered to the public.
[04:12] SPEAKER_02: It's not that I'm against, you know, a more competitive fee. It's just that I'm not as supportive of the destruction and the erosion of the service that goes along with a reasonable fee.
[04:23] SPEAKER_02: And so I became disenchanted with our industry in about 2016, 2017, sort of took some time off and recalibrated, never really gave up my license, never really stopped doing deals, but I just was kind of putting my business in the back seat just because I've always believed that you needed to be authentic and it just wasn't, it didn't feel authentic anymore, didn't feel like something I was really passionate about.
[04:46] SPEAKER_02: And so in about 2018, 2019, I kind of heard about what was happening in the US market with respect to the advent of the I buyers and, you know, these websites that people can now go to and enter in a bunch of information about their property that they want to sell and essentially end up with an offer within a few few hours or a few days, you know, where with a seller accepts it, their home is sold.
[05:12] SPEAKER_02: And so the advantage, of course, for the consumer is to be able to sell their property without ever having to list it for sale, any realtor and not having to go through the for sale process and endure all the daily showings and keeping the home and show ready condition and eventually having to negotiate with some buyer on a possession date that may not work for the seller.
[05:31] SPEAKER_02: So we believe in that in the advantages of what the I buyers are doing, but we just don't believe in being predatory and we feel like if we're buying houses without seeing them, then obviously the business has to be profitable or else it's not going to be a business.
[05:48] SPEAKER_02: And so we think that the I buyer model, which is just generally a by low sell high model is just a little bit predatory and we just don't believe in it.
[05:59] SPEAKER_02: So we modify the model a little bit to come up with a solution that delivers the entire amount of equity to the original owner, but we just do it in two payments.
[06:08] SPEAKER_02: And so our model is a little bit different. We only pay 75% of what we anticipate home to be worth.
[06:14] SPEAKER_02: And then we resell it on the open market, determine what the actual market value is and then make an adjustment and a second payment to the original owner for the full balance of their equity.
[06:24] SPEAKER_02: So they get all their money less our fee is just that we do it in two payments. And so it's a lot more transparent and a lot easier for a consumer to take advantage of our product.
[06:35] SPEAKER_01: So that's a very different approach to to buy and selling homes. I'm wondering what has the response been in Edmonton like.
[06:43] SPEAKER_01: And I guess maybe we have to qualify that in pre COVID and then and then post COVID, but but how did the market originally react to your offering and what was the reception?
[06:54] SPEAKER_02: You know, the reception has actually been mixed. When we started this, we thought, wow, we know we've got we felt like we discovered plutonium. I have three partners here.
[07:05] SPEAKER_02: And when we when we rolled this out, we thought that this would be adopted immediately and we would be quickly overwhelmed with demand. And unfortunately that wasn't the case.
[07:15] SPEAKER_02: It took us some time. In fact, it took us about nine months to do our first hundred transactions, but it took us only three months to do our second hundred transactions.
[07:24] SPEAKER_02: And currently we're operating around 30 to 40 transactions per month. So we do expect that this is going to continue to grow. And as people, you know, have become more comfortable with our product.
[07:36] SPEAKER_02: And now that people have used the product and we've got some actual testing modules, the word of mouth is catching on and we're being invited more and more often to to make offers on homes to to people to buy it in selling.
[07:51] SPEAKER_02: But when we launched back in August of 2019, you know, we had no idea that this pandemic was going to come on. You see, nobody can see this coming.
[08:02] SPEAKER_02: And you know, once it hit, I mean, we were terrified. We didn't know how we were going to survive. We didn't know what the effect on our business would be.
[08:11] SPEAKER_02: But just because of the nature of the pandemic and how people just didn't want to have screeners coming through their house.
[08:19] SPEAKER_02: And the reluctance of buyers to actually two houses are model actually.
[08:25] SPEAKER_02: Unfortunately, as sad as it is to have to benefit from a pandemic, our model actually benefit from that because we allow sellers to sell their house with no public showing.
[08:35] SPEAKER_02: And so there's nobody coming through their house. And so our model actually got a bit of a boost from the pandemic.
[08:42] SPEAKER_01: Did you find that you had to pivot or rethink how you were doing things like you talk about it being a bit of a wild ride over the last number of months. And I'm just curious.
[08:55] SPEAKER_01: What were some of those those pain points that you had to adapt to? Did you see the market really decline for for a number of months or what what was happening that has contributed to that wild ride this year?
[09:10] SPEAKER_02: Well, we didn't see the market correct in terms of an average selling price. There was no material effect on that. But there was certainly a drop in the amount of activity and the amount of transactions that were taking place.
[09:23] SPEAKER_02: So so that definitely had an effect in our business. But as people became a custom. I mean, at first, we knew, we knew what was going to happen, we knew what to expect.
[09:34] SPEAKER_02: You know, there was talk of your dog having COVID. I mean, it was just it was pandemonium, right. But as people began to become adjusted to what was happening, there were people who still needed to, you know, buy home, there are still people who need to sell on home.
[09:51] SPEAKER_02: And so we made adjustments to our program. We tighten things up. We we work with our lender is extremely supportive of our business believes in what we're doing.
[10:02] SPEAKER_02: And we made some decisions, you know, to to make our our program a little bit tighter. So we had a little less risk involved in our transactions.
[10:13] SPEAKER_02: And so the things that we tightened up on were the closing period, we used to let us sell or choose the own possession date up to 90 days away.
[10:23] SPEAKER_02: So we cut that in half and said that the possession date has to be 40 within 45 days. And that's just so that we have a little bit of visibility when we tell somebody that their house is going to sell for 400,000.
[10:33] SPEAKER_02: We don't want it selling for 325. We want it selling for very close to 400,000.
[10:39] SPEAKER_02: And so we just wanted to cut that that possession date down just so that we had a little bit more sure in what homes is eventually want software.
[10:48] SPEAKER_02: We cut back a little bit on how much we were paying as a first payment. We used to pay 80% now we pay 75% and we adjusted our fee a little bit.
[10:58] SPEAKER_02: At that time, our fee was, I think we were at 5.75 or 6.7 or 6.5%. Our fee today is 6.75%.
[11:08] SPEAKER_02: We are talking about adjusting our fee again a little bit just act as a ballast against the demand that we have and pressure that we have on our resource.
[11:18] SPEAKER_02: Our resource is capital and obviously with more capital, we can do more deals.
[11:24] SPEAKER_02: Until we have that capital, we need to preserve it as best we can and deploy it as wisely as possible.
[11:32] SPEAKER_02: And so we're pretty selective with the properties that we'll get involved with. We'd love to be able to buy everything but we simply can't.
[11:39] SPEAKER_02: And so we're very prudent with the decisions that we make.
[11:45] SPEAKER_01: Today's podcast is brought to you by the cooperators. You can count on them to support you and your business with a full range of insurance coverage options.
[11:56] SPEAKER_01: Their products provide the flexibility you want with the protection you expect to find a cooperators advisor near you visit cooperators.ca.
[12:07] SPEAKER_01: And I'm curious that like you talked about your expansion plans earlier and moving into other markets.
[12:14] SPEAKER_01: And I think our listeners would find it really interesting like how how do you plan for growth and that longer term vision when there is so much uncertainty right now like what are maybe those guide posts that you have used it and as you worked with your partners to start to plan to expand to other markets and that type of thing.
[12:37] SPEAKER_02: Yeah, so we definitely are being asked to do more and more transactions. We're getting calls from all over Canada.
[12:45] SPEAKER_02: We're being invited to to do deals all over the place in towns and cities that we haven't heard of and you know we're sure that they're fine markets is just that we're not an expert in every market.
[12:58] SPEAKER_02: So we we're trying to be responsible with our with our growth strategy.
[13:03] SPEAKER_02: We feel that we can control what's you know what we do the decisions that we make within the Alberta market is sort of within reach.
[13:12] SPEAKER_02: But but we definitely are interested in talking to other entrepreneurs other real estate professionals in other markets that maybe want access to our program into our capital.
[13:23] SPEAKER_02: And we would be willing to to finance transactions at arms length for those people.
[13:28] SPEAKER_02: We do have an amazing relationship with our investors and and you know we've protected those relationships over the years and these people have not just invested in sweetly but they've also invested in other fields that have been over years.
[13:43] SPEAKER_02: And so our relationship is very very strong and so they've they've supported us and and they continue to support us and they encourage us to move into other markets. So when we're ready, we'll do that.
[13:55] SPEAKER_01: But like to talk a little bit more about you now as an entrepreneur and I'm curious. So you said you've been an entrepreneur your entire life.
[14:04] SPEAKER_01: I'm wondering what what have been the traits that that you think have made you successful and that you've been able to sustain a number of businesses and and have a long career doing different things.
[14:17] SPEAKER_01: So what what traits do you think you have that have allowed for that success?
[14:22] SPEAKER_02: Well, I think that the bottom line is I'm a shitty employee nobody wants to know.
[14:26] SPEAKER_02: You know, it was the voice of one like me, but I think the bottom line is that I feel like entrepreneurship has offered me a lifestyle that is sort of consistent with what I wanted.
[14:43] SPEAKER_02: And I've never wanted to be tied to a nine to five type job. It's just not who I am. I see a lot. I ride my bike a lot. I love to travel. I love experiencing different cultures and and seeing the world and it's part of the reason why I live and I, you know, entrepreneurship is a lot of me that freedom.
[15:08] SPEAKER_02: But entrepreneurship comes with a lot of responsibility. It's not just all you know being on boss and making rules of my needs. It's a lot of sweat equity, a lot of months without paychecks.
[15:21] SPEAKER_02: You know, and planning and you know, it's it's a lot of hard work. It's not for everybody. It's not, you know, a lot of people have a reservation and maybe leaving the corporate world.
[15:33] SPEAKER_02: The security of a study paycheck and a job that they go to and there's nothing wrong with that. I certainly respect that.
[15:43] SPEAKER_02: For me, the contribution that I feel most rewarded by is being an entrepreneur and being as creative as possible to offer different types of solutions that I believe in.
[15:56] SPEAKER_02: When I was doing condo conversions, you know, the market needed the inventory and in 2005, 2006, 2007, when I was doing condo conversions, the market needed inventory.
[16:08] SPEAKER_02: The reason that our prices were going up so high is because demand outstripped supplies by by such a huge margin that, you know, prices were going up $1,000 a day.
[16:18] SPEAKER_02: And so I saw the opportunity there to create inventory that the market needed. So I was buying apartment buildings and changing the structure of ownership without necessarily doing any work to the property that is physical work.
[16:30] SPEAKER_02: So we were basically inventing the inventory that the market needed. And so at this time what we're doing was sweetly we feel like we're offering a solution that nobody else is offering.
[16:41] SPEAKER_02: And it's an out of the box type thinking that is now catching on and we're benefiting from that and so are our customers.
[16:51] SPEAKER_01: So I'm curious as we start to wrap up here, thinking about our audience and we have entrepreneurs all across the country in various stages of their careers or business.
[17:03] SPEAKER_01: And I'm just wondering what advice would you have for somebody who's maybe decided, you know, I'm going to move away from that kind of nine to five employment and start my own business or, you know, someone coming out of university who is really feeling that that Bernie desire to do something on their own.
[17:23] SPEAKER_01: What advice do you have for someone who's maybe starting out on the path?
[17:28] SPEAKER_02: Well, I mean, I congratulate anybody who makes that decision. You know, it's it's worked for me.
[17:35] SPEAKER_02: I would encourage anybody to consider that, especially the younger that you are, the more naive you are.
[17:43] SPEAKER_02: I don't mean that in a bad way, but I remember when I started, like failure just wasn't an option. It just it just wasn't it was never something that I considered. It was never an option.
[17:52] SPEAKER_02: So I think that the best advice that I can offer is to stay humble and to continue to try to learn. I think that when you stop learning, you start to regress and, you know, I try to learn things from everybody.
[18:04] SPEAKER_02: I mean, I've learned things from different people and different walks of life. I ask a lot of questions. I mean, when I was a kid, I used to ask, it was silly, but when I was a kid, if I saw anybody, you drive a Porsche.
[18:16] SPEAKER_02: I because I thought that was the ultimate car for me. So I would walk over to that person and I would ask them, you know, what they do for work.
[18:25] SPEAKER_02: And I got I got every kind of answer.
[18:28] SPEAKER_01: Did you? Oh, I can imagine. Do you have a Porsche now?
[18:32] SPEAKER_02: I do. I have my second Porsche now and parked in my garage.
[18:38] SPEAKER_02: And it's more just a symbol for me of, you know, the person that I always wanted to be.
[18:43] SPEAKER_02: And so yeah, I think that the best advice that I would offer somebody is just that just to keep learning and ask a lot of questions.
[18:52] SPEAKER_02: You know, all of the advice that you get is not something that you always have to implement.
[18:57] SPEAKER_02: I think that, you know, I've been very fortunate to meet some people and I pull them very high esteem and consider mentors.
[19:07] SPEAKER_02: And have access to call and bounce ideas off of them.
[19:12] SPEAKER_02: And I value that. And I try to be that for for the people that work with us as well.
[19:17] SPEAKER_02: I mean, you know, my my associates often come with ideas and different energies.
[19:23] SPEAKER_02: And I encourage that. I think that everybody's got a different level of normal and a different level of a better way to skin a cat.
[19:32] SPEAKER_02: So to speak. And I think that, you know, we try to encourage that.
[19:36] SPEAKER_02: Now those conversations and and see if there's a win win somewhere.
[19:41] SPEAKER_01: Awesome. Well, how can people connect with you if they want to learn more about sweetly or get in touch with you online?
[19:48] SPEAKER_01: Where is the best place to find you?
[19:51] SPEAKER_02: You know, I am the worst person to try to connect with on social media.
[19:56] SPEAKER_02: But I do have a website. People can visit us at sellsweetly.ca or they can on the on Facebook.
[20:05] SPEAKER_02: My name is Ed the Prado. And yeah, I'm happy to connect with anybody any time and have productive conversation.
[20:13] SPEAKER_01: Right. Was there anything else you'd like to add before we we say goodbye today or?
[20:18] SPEAKER_02: I just want to say thank you for the opportunity. I am humbled and honored that you would even consider interviewing me for your podcast.
[20:27] SPEAKER_02: I've been a long time fan and I'm honored to be there. So thank you so much for the opportunity.
[20:33] SPEAKER_01: Well, thank you for a great conversation this afternoon. And I will look forward to seeing what's in store and all the markets that you expand to and and to following your journey.
[20:44] SPEAKER_02: Awesome. Thanks for having me.
[20:47] SPEAKER_01: Today's podcast was brought to you by the cooperators business insurance.
[20:52] SPEAKER_01: They're here to help make sure you and your business are protected today and into the future.
[20:58] SPEAKER_01: Visit cooperators.ca to find a local advisor today.
