Kyle's $775K barn and the Big Sky Barnhouse scale-up

Quick Summary

When Kyle last sat down with Jeremy in November 2023, he had one barn. By this recording he'd added barns two through six across Wisconsin, Kentucky and Michigan, though barn five wasn't open yet and barn six was still closing.

Barn one is the only barn with a full year of data behind it. Kyle bought it for $775K with 20% down, put another $100K in, and had it tracking toward about $350K gross for 2024. If you're eyeing a large group play in a small town, start with the market data rather than the barn.

Key Points

• Barn one in Arena, Wisconsin cost $775K with 20% down on a commercial loan, plus about $100K of renovation, so roughly $250K out of pocket. Kyle had it on pace to gross around $350K in 2024, with cash flow he put at "around 200, 210".
• Barn two, south of Lexington in Lancaster, Kentucky, came in just south of $600K and was trending between $225K and $250K gross, at what Kyle described as "somewhere between, I believe, a 60% cash-on-cash".
• The fourth barn, his third in Wisconsin, came in around $900K through creative financing with the owner, with Jeremy Werden as a partner. Kyle says that once the golf simulator's in he's confident it can flirt with $300K gross, which is a target he set on air rather than a result.
• The buy box is narrow. Five to seven bedrooms, three to 6,000 square feet, and a blank canvas outside, whether that's a garage, an outbuilding or a flat backyard he can fill with amenities.
• A barndominium with multiple structures leaves practically no conventional lending options, so Kyle pitches local community banks in person. He calls it a miniature Shark Tank, where you show them the numbers from your other properties and sell them on the vision.
• Social is the moat Kyle names himself. Close to 30,000 followers on Instagram, creeping up on 10,000 on TikTok, flirting with 40,000 across both, and 95% of that organic, with two posts past 2 million views.
• The back end was still manual at the time of taping. No PMS, PriceLabs paid for twice across Airbnb and VRBO, and check in messages sent by hand, with Hospitable, a direct booking site and VAs sitting on the Q4 list.

Full Transcript

Listen to the full episode on Apple Podcasts, Spotify, or YouTube.

Jeremy: And we are live with the Short-Term Rental Pros Podcast. Today I am back with my guy Kyle, who since he's been on the pod last has been very, very, very busy adding to his portfolio with not just any properties, but the definition of what I like to call mega properties. So Kyle, dude, where are you right now? It looks like you're in one of them.

Kyle: Yeah, I'm in Southwest Michigan right now. But yeah, thanks for having me on again, Jeremy.

Jeremy: Last time we talked, you were in the Smokies at your cabin. Now you are at, I see, Arcade written behind you. So I'm assuming this isn't your personal property?

Kyle: No, this is our newest and first barn in Michigan. We scaled pretty quick this year. I think last we talked, we only had one barn, but we had ambitious plans to scale into new markets. And we've had a busy year. We've scaled on some great partners and opened up barn number two, three, four, five, and six so far this year. So we've been head down and finding new markets and new barns and growing the Big Sky Barnhouse brand across the Midwest.

Jeremy: Okay, so let's take a step back. Last time I had you on the pod, tell me, where was your portfolio? How many did you have? And how long ago was that? And since then, how many have you added? Let's start with that. We have a lot to unpack here.

Kyle: Yeah, I think we spoke back in, I want to say that was November. It was close to Thanksgiving, so it was November of 2023, I believe. And I was sitting in our Smoky Mountain cabin and discussing plans where we were going to open up our second barn in Lancaster, Kentucky, down by the Bourbon Trail. That one was number two for us, off to a great start, and booked for the remainder of the year and well into the next year.

And then we opened up number three south of Milwaukee in Wisconsin. Those two openings were in March and April earlier in 2024. And then we opened up a fourth barn in Merrimack, Wisconsin with another great partner.

Jeremy: Let's go. Who's this partner? Who are you letting in on these deals?

Kyle: And then, yeah, number five, I'm sitting in right here now in Southwest Michigan. And number six, we're opening up soon. We're closing on it next week down in Kentucky again, but new markets east of Lexington, closer to the Red River Gorge.

So yeah, we've scaled pretty fast. And I know you and I have talked about the things we're focusing on next, and optimization and streamlining some stuff internally with our operations. But yeah, it's been a whirlwind of a year and we're still going.

Jeremy: There's so much to unpack there. I think we first ever connected probably over a year ago at this point. And then you got the first barn up, which, crazy Arena barn, totally hit it out of the park. Just to give context, if you guys want to listen about that particular barn, listen to the last episode I did with Kyle back in fall of last year.

But I just want to get the timing correct here. So that one knocked out of the park. You saw, holy crap, I'm on to something. I think it's cool that you took a lot of high level principles. And you did a lot of research, different podcasts, I don't know which ones, maybe different podcasts, different people who had kind of high level ideas of where the properties want to be, what is the customer avatar you're looking for. And the importance of amenities. And you just absolutely crushed it.

That property is, I mean, tell us about how much did you buy that one for, and how much did it do in its first, now that you have the first 12 month data, how much did it do?

Kyle: Yeah, we actually just celebrated our one year anniversary for the OG original Big Sky Barn in Arena, Wisconsin. That was September 1, a few days ago, actually. That was the one year mark. So we've stabilized that property fairly well, in my opinion, which is wild that there's still more juice to squeeze with some of the revenue management strategies that we put into place on the back half of this year.

But yeah, we bought it at 775. We leveraged equity in other properties and used that equity to purchase and then set it up and renovate it. And I mean, you stress the importance of amenitizing properties to be the optimal fit for your guest avatar. But there were a lot of great things that the original barn already had, the in-ground outdoor heated pool, the lap pool inside the second structure with a party shed. We came in and we added some really fun things like the nine hole mini golf course, slide off the back deck, extravagant fire pit, movie theater, indoor basketball hoop room, among some other things.

But yeah, our core avatar, we have a lot of groups that will stay at one barn, and then they get excited, and they'll go to the next barn. So it's really the three generational stay, kids, kids, kids and grandparents, groups from 20 to 30 people across the Midwest that maybe haven't seen family members in a while. They're celebrating a wedding anniversary, birthday, just a general family reunion. A lot of these groups just are coming together, and there's always people looking for large group accommodations with fun things to do on site. You don't need to go anywhere.

I get the question all the time, why are you going to Arena, Wisconsin or Mount Pleasant or Lancaster, there's nothing to do there. We make the things to do in these markets. So a lot of the times we find our groups that stay with us, they don't look to go do anything but stay at our properties and enjoy all the amenities that we put in place for them. They may go off and do a hike here and there, go to the city. But a lot of times the way that we're designing and setting up our barns, people are coming in there and enjoying all the things that there are to do on site for most of the time that they're there.

Jeremy: Yeah, it's funny. So tell us, that 775, right? That was the purchase price.

Kyle: Correct.

Jeremy: For the first one. How much did you put into it? And then how much is it looking to gross? And you don't mind sharing cash flow and its first 12 months?

Kyle: Yeah, yeah, we put 20% down as a commercial loan product. So whatever that comes out to, I think like 150, 160 down, and then we put another 100 into it. So total out of pocket, we're about 250 in, and it'll gross around 350 this year in 2024.

Jeremy: That's crazy. And then what cash flow? 200?

Kyle: Yeah. I think around 200, 210, I think, was last that I looked.

Jeremy: Yeah, that's nutty. And it's actually crazy.

Kyle: Beyond revenue management, some listing optimization, direct bookings, all that stuff we're looking to add to the arsenal.

Jeremy: There's also a commercial duplex on it, right? That's not a, you haven't even done anything with yet. Kyle told me that he was looking to add a bar to the property. And I'm like, hold up, what are you talking about? We won't get too deep into that, but how do you do that? What's happening there?

Kyle: Yeah, we still have a duplex. It's in really great shape. We have approval from the township and now going through county and state approvals at the moment to set up kind of like a higher end wine and craft beer bar on the lower level, and then get some renters who are also going to open up and close the bar that will live above it on the top floor to part of the duplex.

So yeah, it's been a great property. There's a lot of structures on it. I think there's four or five garages, the duplex, the party shed, and then the 7000 square foot barndominium. So it's a lot to keep up with. We have a lot of great local teams that help us upkeep and maintenance and clean it. But it's been fun for sure.

Jeremy: That's for sure. And yeah, they really, really are creating the things to do. You're literally adding a, I've never heard of anyone adding an actual bar to their property before. Like not like, yeah, there's a bar in the basement, a bar in the garage, but like a legit, like actual bar that serves customers beyond those guests staying at the house.

So that house obviously launched it. It's pretty obvious, all right, we're on to something. Guests are booking at what at the time seemed to be insane average daily rates, and which to now look like, d*mn, we priced too low. But I think, correct me if I'm wrong, you were still working at the time. So you still had your W2, and what, like a month or two went by? I mean, I remember you texting me being like, I quit my job. Tell us how that happened, or what prompted you to kind of take that leap?

Kyle: Yeah, it was never the plan to do that. But as the bookings started to grow, and we started to really look at the amount of attention that that property needed, and then we started to see it creep above 200,000, and then it got to 300,000 in gross revenue, we really thought we had something special that was deserving of our full time and attention moving forward. So yeah, we took the leap and found some great partners, and now we're scaling that concept in new markets, 1000% head down and full steam ahead.

Jeremy: And then, not to get personal here, but what was that moment where you were, what pushed you over the edge of actually putting in your two weeks or whatever it may be? Was there like a specific interaction with a colleague? I'm not trying to irk you or anything, but to me, I remember kind of those moments and the interactions I had with my colleagues that kind of pushed me to, alright, I gotta do something on my own. But was there anything like that on your end?

Kyle: Yeah, I could talk about this topic for [inaudible].

Jeremy: Yeah, I'm not trying to. You go.

Kyle: Really wanted to, Jeremy. If I had to dumb it down, distill it, I guess, to just a couple sentences: I remember just sitting, and it was one of my daughter's first birthdays, and I was submitting a PTO request. And I was like, why do I even have to submit a request to take time off to celebrate one of my daughter's first birthdays? I need something more, I need something that's more time freedom for my family, is essentially what it boiled down to.

I mean, luckily, I've had great bosses, mentors, colleagues, amazing companies that I've worked for in the past, Coca-Cola, Nestle, Numerator, have had nothing but great experiences and people that I've worked with. It really just came down to, why do I need to ask permission to take time off to celebrate my daughter's birthday. And it was just like a pivotal moment where I had all these things going on with the new property, and it was growing really fast and thought we had something really special, and kind of just boiled down to the time freedom and family life.

Jeremy: Exactly. So you had that push you over the edge, so to speak. I think that's something I like to kind of instill in folks, and something that I've seen working with people at this point, is their why. And based off someone's why and their inner motor, I can frankly, I'm obviously not 100% on it, and people definitely do surprise me, but I feel like I can kind of tell who's going to be successful. And when Kyle shared the story with me, effectively the day he quit his job, I was like, Kyle's a dog, he's going to be successful. And this was before you did six more properties in the span of like 10 months.

So tell me about, what did you do? You quit your job. What was the first thing you did? And fill us in on the last eight months.

Kyle: Yeah, I think we spoke about this a few months ago. I remember feeling a little bit empty, like you woke up and your calendar was empty, and it was like, what do I do with all my time? But now fast forward till today, and I'm like, I don't have time for anything. I need more time. I need more time. I need 48 hours in a day.

But yeah, from the outside looking in, it's not always the brightest days, being an entrepreneur and having all that responsibility and weight on your shoulders. It's a roller coaster. It really is. You have amazing days where you have huge wins and really big strides forward, but then there's days where you just have to fight with all you have to eliminate the self doubt, and you'll double down on that you're making the right decisions, and not just for your family, but financially and for your business too. So it's a roller coaster. But at the end of the day, there's nothing better than it.

Jeremy: So where was that first property post quitting your job? And if you can just quickly speed race us through, I know you said the locations of them before, but bought this property here, bought it for this much, just kind of the rough outline of the deal, got it stabilized, or got it renovated next period of time, now it's pacing for X amount. If you could just run us through them quickly, that would be awesome.

Kyle: Yeah, I mean, I've had a few long term rentals and the cabin in the Smokies when I was working my W2. And then the first barndominium really took off and it was like, alright, we need to scale this. I mean, we've kind of already went through the Arena financials for barn number one.

For number two, down to Kentucky, so the southern end of the Midwest, I know that's a topic of debate, some people think it is the Midwest, some don't. But yeah, we're down south of Lexington, purchase price was just south of 600,000. And that property stabilized pretty well. We opened it up in March, and we're trending for like between 225 and 250 gross. So somewhere between, I believe, a 60% cash-on-cash.

Number three, we opened up south of Milwaukee in Wisconsin. And purchase price was a little bit higher, the higher end of our buy box. We usually try to look for the two big things, I guess, without sharing too much information, is five to seven bedrooms, three to 6000 square feet, and a blank slate or a blank canvas to add amenities, whether that's a garage or an outbuilding or some sort of flat backyard where you can add a lot of the fun things that people like to enjoy on site. But the third purchase was around 800. And that property is still stabilizing. We opened up in May, I believe, the doors to the public. We're trending for somewhere between two and 250 gross.

Barn number four, third Wisconsin property, that was lucky enough to partner with the great Jeremy Werden on. We inherited a turnkey property that we're now optimizing and boosting the revenue on. So we purchased that again at the higher end of the buy box, around 900, via creative financing with the owner there. And I think once we get everything stabilized and up and running and the golf simulator in, I'm confident we can kind of stretch and flirt with 300 gross on that property, at least in the mid.

The barn I'm sitting in now, this one's not open yet to the public, this is number five. We're in Southwest Michigan, really great purchase price of 450, and then used a commercial loan and the bank to finance the renovations. We're adding three bedrooms, another full bathroom, and a bar and entertainment area, some outdoor amenities with a hot tub, covered pergola and fire pit. And then we're also turning this massive 40 by 40 garage with heated floors, spray foam insulation, commercial steel, 13 foot ceilings, we're adding a five hole mini golf course, a golf simulator that I'm actually setting up right now that I'll be finishing right after we hop off here, and a seven machine arcade game room area right behind me here.

And then we have barn number six, we're closing on next week down by the Red River Gorge in Kentucky. And really excited for this one, it is going to be a beast of a property. It's going to be the first one that we can actually accommodate 30 people. So we're making the jump from 20 to 30 overnight guests. It has seven bedrooms, 5000 square feet, and it has a five acre flat backyard, where we're doing a lot of exterior work on that one. So purchase price just south of 600, really great price for what we look for. And we'll be putting in around a buck 20, buck 40 post purchase to add in a full court basketball court, pickleball court, regulation wiffle ball field, flag football field with goalposts, and a soccer field with regulation nets, and a 30 person octagon fire pit outside, as well as two hot tubs and swings on the back patio. So really excited for that one. It's going to be a fun one.

Jeremy: So much to break down here. I mean, first, you say all those things, wiffle ball court, full basketball court, two hot tubs, and then you say it's going to cost between 120 and 140. And I go, no freaking way, no way. But again, it's been a year of seeing Kyle do this over and over again. So now I'm like, alright, you've got some good guys. I think they're in the basement right now, right?

Kyle: They are, yeah.

Jeremy: They are literally in the basement. Kyle's got his guys in the basement.

Kyle: We have a good crew of contractors and we found some efficiencies with, just my dad has been a great help. He's been a contractor for most of his career, and just some family friends and some partners that have worked in contracting. So we found some efficiencies to take on the role of GC on a lot of our properties and hire out subs, and find a way to make it work within the budget that we have and the vision that we have.

Jeremy: That's always the balance, right? You have a budget and you have a vision. You got to make both work.

Kyle: Exactly.

Jeremy: And we talked about, I want to kind of talk about the edge that Kyle has. I mean, someone listening to this might be, oh my goodness, like tomorrow I'm going to go find a barn in somewhere and add all these things to it. I would say, Kyle, it's great in this game to have an edge. That can mean a variety of different things, but I do want to break down a few edges I think you have. And you can agree or disagree with me, but one would be the cost of the renovations. Like you're getting so much. I mean, you're getting three bedrooms added to the basement, I'm sure, at very, very low cost. And then you're adding all the amenities that might take someone 250. You're getting it done for 140. I don't know if you've done that analysis or anything like that, but that's one edge.

Second, it's really hard to get financing for these structures, these barndominiums. I think you initially reached out looking for conventional financing on Arena and, shout out our guy Brian, he's a legend, but he has guidelines of what he can, Brian, Align Credit Union now. Shout out, Brian. He's been on the pod too. Listen to that episode if y'all want to hear about financing. But the barndo was, I don't know, it was multiple structures, and a barndo equals practically no conventional options. So you've been able to build relationships with local commercial bankers, who right now, like commercial banking is tight. They've closed a lot of these, small local banks have frankly de-risked heavily in the last few years after the whole Silicon Valley Bank and whatnot.

Jeremy: But you've been able to build great relationships with a couple local bankers. They've seen your vision. They've seen you execute. And they're comfortable working with you, not only in the case right now where you're in a property to help you buy, but also a property they helped you.

Third, I would say direct marketing. Kyle, Big Sky Barnhouse has 30,000 plus followers on Instagram. I'm sure you've gotten tens of millions of views. You have a video go viral and next thing you know, your calendar fills up. I'm sure it's not that simple. There's a lot more that goes into that. But I guess, would you agree that those are your three big edges?

Kyle: I think it's funny that you and I have never talked about this, but you nailed all three of those on the head pretty succinctly. I would agree. I think the sweat equity component and being here and managing the contractors, managing the vision and seeing it come definitely plays a huge role in the vision budget balance for sure.

The local lender piece too, just to touch on that. Local community banks, they want to invest in their communities. They want to improve and meet the local economy that they also reside in. So it is a different ballgame though. You go into these local community banks and you have to pitch them on your vision. It's almost like you're in a miniature Shark Tank. You have to show them the success of your other properties, and you have to sit there and convince them of the vision of where you're going and why it makes sense. Showing them the numbers of other properties, it's completely different than getting conventional financing.

Luckily, we've found some great local community banks that are awesome partners and they've seen the success. I've had a few that have come and said, are you looking at any others in the market, which is awesome. Having those partners for financing at our hip.

I would say probably the biggest moat or separator, however you want to phrase it, would definitely be the social presence. We have close to 30,000 Instagram followers now. I think we're creeping up on 10,000 on TikTok. I think we're flirting with 40,000 and growing fast. I would say 95% of those followers have come organically. We haven't paid for them.

We've partnered with some awesome social media influencers that have followings in certain pockets and feeder cities where our barns operate in. We've partnered with a great Ohio social media influencer that has almost 100,000 followers. Ohio is the biggest feeder city for Kentucky, for Red River Gorge and for the Bourbon Trail. Knowing which feeder cities come and where people are traveling from to the areas, we're not going to partner with someone down in Kentucky. We're going to partner with people down in the feeder city.

I digress a little bit, but I think the social presence and being able to market the portfolio of barns and all of the really fun things that we have, from golf simulators to miniature golf courses, pools, hot tubs, saunas, tiki bars. We put some really unique separators in our properties and we're really proud of them. I think we're able to showcase that really well on social media.

We've had two posts now that have gotten over 2 million views organically. It just went completely dumb viral. They're just simple kind of aerial drone shots, photo slideshows of how you can expect to enjoy our properties when you're at the barn. Long story short, I think you nailed it on the head with those three pillars.

Jeremy: Beautiful. Just two things here. This is not an Airbnb set it and forget it type of property. There's a lot more that goes into this than what someone in California, for example, might go, oh, I'm going to go buy a barndominium in the Midwest and get a local commercial bank. These commercial banks are not given...

Actually, I think I'm going to give a story. I talked to my commercial banker the other day. It's a new one, I haven't talked to him. The bank that I have a commercial loan with got bought out by another bank, so it's a new banker. The first question he asked me, he's like, oh, where are you? I told him New York. He definitely was not excited by that answer. I was like, oh, no, no, no, no. I'm from North Carolina. I went, oh, sorry, sir, I forgot my Southern accent for a second. I'm from North Carolina. I went to UNC, I'm a Tar Heel. I grew up going to the lake. I don't exaggerate my accent that much, but I'm just, for illustrative purposes here. And the reason I'm in New York is because I got engaged in September and my fiance is from up here. Otherwise, I'd be out there with you right now, man. I'd be in person shaking your hand. Again, I'm exaggerating. This isn't exactly how the conversation went.

But they want to do... The fact that Kyle's in the Midwest, the fact that you'll, frankly, do you meet these commercial bankers in person? I think you told me, we were talking the other day and you were like, oh yeah, I'm going to play golf with the one who's likely to refi our property. So would you say that's a hugely important aspect, is the fact that you're going to go shake hands and meet these bankers in person?

Kyle: Yeah. I can't tell you one contact from a conventional financing that I've actually met in person or played a round of golf with or grabbed a beer with. So I think the relationship aspect that you have, it truly is a partnership with the local lenders that you work with for sure.

Jeremy: Yeah. And they want to know that you are part of the local community. And they have choice. They have discretion. Local commercial banks, they can either give you a loan or not give you a loan. It's not like, oh, there's Fannie Mae, Freddie Mac guidelines and we want as much loans as possible, because that's what a conventional banker wants. They just want as much as they can do. And they have guidelines on what they're allowed to do. And if you meet their criteria, they're going to do it. Even if you don't meet the criteria, they're going to try to make it work.

Commercial banks say, I like this person, I'll make it work. I don't like this person, I won't make it work. That's obviously a simplification. But I think it's really great that you went out, met these people, got financing.

On the flip side, you've also gotten investors. I know you said you used your own equity. I think you refied your cabin in order to, or your long-term rentals in order to get Arena. Correct me if I'm wrong. And then how did you scale using other people's money?

Kyle: Yeah. I mean, we've had some friends of friends and extended family members that we've been able to partner with, and some mentors to partner on some of the barns that we're able to scale to this year, from two, three, four, five, six. And yeah, business line of credit, HELOC. I haven't pulled out any loans off of properties. I think the lines of credit give you more flexibility and you're able to pay those down and then rinse and repeat and use them again.

Jeremy: Okay. And then so investors, how have you structured? I know each deal has been different, but how have you raised that initial equity capital?

Kyle: Yeah. I mean, every deal is different, right? So there's not a one answer fits all for that question. Every partnership is unique based on the goals and aspirations of the partner coming into the picture. But I think some form of equity with capital distribution up front is kind of how we've structured it. So yeah, each time.

Jeremy: So this is something in hindsight. I think everything looks very obvious now. Hindsight's 2020. But frankly, I feel like one of the stupidest things that I have, or I haven't done, in the last year was get into Kyle's deals frankly earlier. Kyle shared with me, obviously I knew what was up with the Arena. Then he was like, oh, I have this one under contract. Used me as a sounding board in terms of going back and forth with investors. And I don't know why it took me like you doing three houses to be like, wait a minute, why am I not an investor? I don't know why I didn't have that light bulb moment earlier.

I think that was pretty, again, hindsight's 2020. I don't want to say I doubt, I didn't doubt him at all. Kyle was like, oh, you're getting this house, I think you can do 250. I'd be like, yeah, I think you can do it. And then he would do it. And I'd be like, oh, okay. But I guess, yeah, now I'm just, really I'm just saying I'm stupid is the whole point of what I'm saying now.

Yeah, tell us about, if you're going to break down two, three, four, I guess, what are the considerations, like you have people who are thinking about working with investors, what are the considerations you have? What are some of the common considerations investors have? And then how do you marry the two?

Kyle: Yeah, it's a great question. And I think from my perspective, finding partners that complement my weakness, finding a yin to your yang in a partnership, really crucial. For instance, your knowledge in revenue management and kind of streamlining operations and processes, things that we talked about, is kind of where I lack. So I think we have a great partnership in that sense.

Another great partner that I have on some of the Kentucky barns doesn't have the creative vision, but he has a lot of things that keep me in check with risk versus what you're looking at from the total picture. And also the contractor perspective and how we're actually going to be, like what material are we purchasing and what type of contractor should we hire? And how are we actually going to put this piece of work together? How are we designing the wiffle ball field, and all the way down to what is the scoreboard going to look like? And how far is the home run fence away?

So finding people that have strengths to your weaknesses, I think is one of the most important things that I look for when having those conversations.

Jeremy: And then how do you pitch them? If you're like, hey, again, it's probably easier because you have a track record. But I think if let's say you're going to do the third barn without having done one or two, you have a crazy idea. How do you communicate or convey what appears to be a crazy idea to investors?

Kyle: Yeah, to be honest, I haven't done much pitching. There's been a lot of people that have just been curious about what I'm doing. Like I've worked for the job for 10 years and now I'm like, what are you doing? And it's just more so the conversations have come from being inquisitive and just kind of asking conversations about the barn model and our buy box and what I'm focusing most of my time on and where we want to go with the concept, and total number of barns that we're going to get to and new markets we're going to and property potential.

And like I said, the square footage versus blank canvas versus number of bedrooms and number of people you can sleep, return on amenity, all those topics of conversation just come naturally through just kind of talking about what you're doing. So I wouldn't say per se that we've gone out and pitched and tried to find investors. The partnerships that have come into play kind of happened the way that they did. And I'm glad that they have, because we found some really great partners and they're going to enable us to kind of get to that next level that we need to get to.

Jeremy: All right. So let's talk about that next level. Let's go. This is the fun stuff. And we're not going to get too much into that because Kyle is going to come to New York. He also, one of his brothers, apparently has a few brothers. I also have a few brothers. You have one older, one younger, right?

Kyle: One older and two younger, and then also younger sister. So I'm one of five.

Jeremy: Got it. Got it. Well, one of them lives in New York. The older one lives in the New York area. So we're going to in-person plot it later.

But what we're going to do is we're going to hold ourselves accountable right now. We're talking about the future. So Kyle, he's got a lot of great things going on. He's been heads down, building, building, building. But at the same time, he's been, I don't want to say that you've been, I don't want to use the word like neglecting, but you would have been so focused on expanding that there's a lot of efficiencies, optimizations, there's juice to squeeze on what you currently have, as well as there's things you can do to make the logistical operations easier moving forward.

So while Kyle is building, building, building, we're looking to essentially help with the foundation. The three things that we've kind of identified that we can dive into over the next, call it like 10 months, I took my notes earlier. We broke it down into, frankly, revenue management. I mean, Kyle has these seven properties. They're doing, let's say they're doing average 250k a year. Seven times 250k, let's do this quick math. Seven times 250, 1.4 million, plus 350,000. Is that the correct math? I'm usually good at mental math, but they're talking behind me, so it's making us a little more... Yeah, okay, 1.75 million. So yeah, exactly, 1.4 plus 350k is 1.75 mil.

So if you even improved your, let's say 10%, you had a 10% improvement on a revenue standpoint, that's an additional 175 grand in a year. So that's like low hanging fruit. Also, things like, how do you have to give people refunds because certain things weren't working? Is that something you've experienced?

Kyle: So just to touch on your first point, I think, before I get into that, I think we've scaled as fast and as much as we can. With the growing pains that we've had, they're no longer like, I tweaked my ankle, have a growing pain. We have growing pains now, which is a good problem to have.

And I think focusing on the revenue management, setting up a sleek direct booking website, getting set up on Hospitable, hiring VAs, full time, part time videographers. Once we slow down in Q4, we're going to work on optimization in all of those buckets and making sure when we get to barns number 7, 9, 10, we're striving for double digits, we're going to be making carefully selective decisions on which markets and which properties we choose to enter as we continue to scale. But I think we need to pause this fall, this winter, really focused on those revenue management and things internally operationally that we need to streamline and kind of boost at the moment.

Jeremy: Yeah, and frankly, the reason I wanted to talk to Kyle today was to say, all right, let's put it out there that these are things you're going to focus on. Obviously, you've got the mission at hand, which is getting these beasts off. Every month they're not rented is another mortgage payment you have to pay. So obviously that's super important. But then, I don't know, three, four or five months from now, I don't know when you plan to come to New York. Let's hear it here. Let's get some dates on the calendar this year. All right, 2024.

But when he comes, then we can go through the list of things Kyle just mentioned and be like, there's been a lot of progress on this, there's been a lot of progress. So really, you guys listening today are our accountability partners. And we have you stay tuned five months from now to hear the progress and the learnings along the way.

So Kyle, tell us, how can folks stay in tune with your personal journey with Big Sky Barnhouse? How can they, you just mentioned you're going to hire, work with maybe some more social media content companies. They're curious about that. How can they watch all this unfold?

Kyle: Yeah, give us a follow on Instagram or TikTok. Our username is just at Big Sky Barnhouse. Exciting things in store for the rest of this year with some new content partnerships and new influencers and kind of a new refresh strategy for how we're going to be direct marketing to all of our really great guests that continue to stay with us.

Jeremy: Beautiful. Well, I look forward to seeing this. And then actually, I want to also, this is our four or five month plan. What is your two year plan? Or three year plan? Kyle's doing these, is launching all these properties, is getting them stabilized. Do you have like, is it just cash flow indefinitely? Or do you kind of have some specific exit plan?

Kyle: I think that it's always changing, right? Because the initial goal was find a way to leave my W2 job and create time freedom and have more time to spend with my family and my kids, my wife. And that's changed, right? It's always evolving. And the plan and the goal and everything that you have in place for what you're trying to achieve always changes, right? So if you asked me that question six months ago, it's going to be different from where we're at today.

But looking forward, I think getting to 10 barndominiums, and really stabilizing and optimizing not just revenue, but processes in place for getting set up on a PMS, which is crazy. We don't have it in place yet.

Jeremy: We're gassing you up today. We're not ripping on Kyle. We do that offline a little bit. I told Kyle earlier, I was like, I do not get how you've had so much success. I mean, Kyle and I, to this point, I feel like our conversations have been more largely focused on the setups, what amenities, and then how you structure deals, really, right? That's kind of been what we've gone back and forth. And then I didn't even realize, I just assumed you had the basics covered. Like if we're talking about the next level stuff, you would assume the one on one is covered.

But I'm like, what are you talking...? He showed me he's paying for PriceLabs twice, for Airbnb and VRBO. And he's doing the messages manually. I'm like, dude, what? How? How are you alive? How do you even, how do you send check in messages? And you're like, how do you send check in messages if you don't even have automated messaging for check in and check out? I still remember the look on your face. It was priceless. And I was like, I don't get, literally, this game is, this isn't the hardest game. It's not the easiest game. But you've got kind of the hard things figured out. But it was mesmerizing. But whatever. We're gonna make, again, I don't want to rip on you here today. This is, we're being nice.

Kyle: Lots of manual points. So we're trying to reduce those.

Jeremy: Exactly. Redundancy, we are creating redundancy, Kyle. We're building more Kyles through software, and then through offshore virtual assistants.

So you guys, make sure to give the podcast, if you don't already, give it a follow, hit us with a like, all that good stuff. And then, yeah, make sure to tune in by the end of the year. We're holding ourselves accountable there, because we're going to let you guys know how everything's going. Kyle, any last words for those listening?

Kyle: No, thanks so much for having me on again. Always a pleasure and looking forward to more growth in the future. For the first time here in a couple months.

Jeremy: So yeah, likewise. Yeah, we have a mini hoop. Kyle also was a hooper back in the day. So maybe we'll play a game of horse or something. And we'll wager a barn or something on it.

Beautiful. Thanks everyone for listening. And as always, stay tuned to the next episode of the Big Scott, or sorry, stay tuned the next episodes of the Short-Term Rental Pros Podcast.