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CommentaryKerfuffleMarketingMatterport CompetingMultiFamily

Should Matterport be in the Business of Buying Scans from MSPs?7307

WGAN Forum
Founder
DanSmigrod private msg quote post Address this user
Commentary

Hi All,

Should Matterport be in the business of buying scans from Matterport Service Providers?

It may be helpful to know that Matterport already is in this business in the multi-family home / property management company space.

I could imagine that Matterport would say:

✓ This is good for Matterport Service Providers.
✓ We are developing business that MSPs would not get on their own (and never will).
✓ We do everything except scan the space (letting photographers focus on what they enjoy).
✓ Because we do everything - other than scanning - it’s okay for us to pay pennies per square foot

If we’re not as busy as we would like to be, this sounds like found money, even if it does not pay as well as our regular Clients. That said ...

Matterport should NOT be in the business of buying scans from Matterport Service Providers.

✓ Matterport should be helping MSPs get the most money for scanning. When it buys Matterport scans from MSPs, Matterport wants to get the Matterport 3D Tours for the least amount of money.
✓ Is it fair that Matterport sells cameras and then competes with Matterport camera buyers for clients?
✓ Matterport creates artificially low market pricing for Matterport scanning services. As an emerging technology company, Matterport is interested in scaling market share rapidly: not profit.

I could imagine that Matterport would argue that multi-family homebuilders and property management companies want to place one order for many multi-family communities. I could imagine that Matterport would argue that it has hired senior executives that have trusted relationships with multi-family builders and property management companies.

In the long term, it would be in the best interest of Matterport, Matterport Service Providers and Matterport investors, if Matterport acted in support of thousands of Matterport Service Providers and of existing photography agencies that offer one order for many markets. Matterport could - and should - use its trusted relationships to develop the business and then either connect Multi-Family Home/Property Management Companies to Matterport Service Provides directly – or agencies that offer one-order for many markets.

It’s in the best long-term interest of Matterport, Matterport Service Providers and Investors if more national and global photography agencies included Matterport in their visual storytelling services.

It is harder for Matterport Service Providers to compete against Matterport – than with other Matterport Service Providers – in the multi-family communities/property management companies because Matterport has an advantage on processing and hosting costs.

It is harder for agencies to compete against Matterport – than with other agencies – in the multi-family communities/property management companies because Matterport has an advantage on processing and hosting costs. This means, fewer agencies will see the benefit of offering Matterport (other than to existing trusted relationships).

For Matterport Investors, it’s obvious that Matterport should not be in the business of selling scans:

✓ Labor intensive service business versus SaaS subscription business. Offering agency services will drive down the revenue per Matterport employee: a key performance indicator of company value.
✓ Selling Cameras to MSPs – and then competing with them for business, setting market pricing and driving down the price for engaging a Matterport Pro – is a flawed business strategy.
✓ Developing labor intensive services is a signal that the original SaaS subscription business model – processing, hosting and ancillary fee services – has challenges scaling as rapidly as all would like.
✓ Thousands of Matterport Service Providers will stop calling on multi-family home developers and property management companies knowing that as soon as it developments the business, Matterport will under-sell them and use a competitor to do the scanning. Unintended consequences.
✓ Matterport is signaling to potential Matterport Service Providers – Matterport camera buyers – that Matterport will compete for Clients and drive down MSP rates in their market. Fewer cameras will be sold as a result of this flawed strategy. Again, unintended consequences.

Matterport should take its existing business development team – that is working in the Multi-Family Home/Property Management Companies – and incentivize them based on processing and hosting by MSPs and agencies that they refer business. This would also re-align Matterport so that it wants its customers - those that buy Cameras and pay for processing and hosting – to get the most money for their services. This would also shift the messy, labor intensive processes - including scheduling and delivering digital assets – to Matterport Service Providers and agencies. Plus, MSPs and Agencies can service the same clients with video, aerial, photos, floor plans, etc.

When We Get Around bought our Matterport Camera in July 2014 and then started the We Get Around Network Forum (originally named the Matterport User Group Forum) in August 2014, we thought we would aggregate Matterport Service Providers to enable providing one order for many markets. I wrote at length about this vision here:

Analysis: How the We Get Around Network of Matterport Pro 3D Camera Photographers Will Accelerate Adoption of Matterport 3D Showcase Cloud Processing and Hosting

Now that the We Get Around Network has 11,000 monthly Visitors (many thinking about which camera and platform to invest in – and hundreds of WGAN Basic, Standard and Premium Members with monthly subscriptions for 40+ WGAN Membership benefits – it would not be in the best interest of the We Get Around Network to offer one order for many markets because we would no longer be in the business of helping our reality capture experts get paid the most money.

It’s time for Matterport to come to the same conclusion and be in support of its Matterport Service Providers – and agencies – rather than competing with us AND driving down fees paid to those that have bought (or are considering buying) Matterport cameras.

What do you think?

Is Matterport acting in the best interest of Matterport Service Providers by being in the business of buying scans from Matterport Service Providers?

Best,

Dan

P.S. I welcome an official response from Matterport to be published here.
Post 1 IP   flag post
3rd Party
Service
Metroplex360 private msg quote post Address this user
You'd be surprised at how many companies want to work with Matterport and flat out refuse to use the MSP program or engage MSPs.

There are companies begging Matterport to not only provide scans directly, but also to do it for pennies per square foot.

I imagine that Matterport says no quite a lot. In doing this, they are respecting and allowing MSPs to continue to succeed faster by being able to maintain a reasonable price point on their services.

The fact that companies trust Matterport, the manufacturer, speaks volumes to the fact that in 2018, there still is not a single trusted agency that offers Matterport services across the nation with a single point of contact, a single price point and a focus on maintaining quality standards and providing exceptional support to ensure that the relationship is a smooth one with very little that the client has to do.

I imagine that if someone had decided to form a massive agency and crowd-source the WGAN, develop scanning guidelines and setup some infrastructure that would include sales and support, that perhaps Matterport might not need to provide enterprise level support.


--

A few notes --

#1) Consider that Apartments.com was one of the first massive Matterport Customers. RedFin is another. These relationships also cut out the MSP, result in many camera sales, and generate a great amount of SAAS revenue.

#2) Consider that any direct sales that Matterport may make also feed into the SAAS revenue that this post imagines that the investors would be happy with.

#3) A rising tide lifts all boats. As Matterport adoption increases, so does demand. I posted last year about MSPs considering adopting a low price of entry model with a higher-than usual monthly hosting fee. This model is what many verticals are demanding - multi family included. It fits their marketing budgets that are already SET and do not leave room to pay up front several thousand dollars on investing in Matterport technology. If you do choose to sell at traditional one-time fee structures, then consider that you may be playing a long game as you will need to wait longer for budgetary approval and in the meantime, a larger agency -- dare I say Matterport -- might be willing to float the cost as a service in order to help adoption of True3D technology.

--

For some interesting references, please read:

https://matterport.com/blog/2018/04/20/best-way-build-competitive-advantage-multifamily-real-estate/

--

In closing, it's my attempt here to be the most official response that you're likely going to get. Matterport is constantly evolving and trying new things. There is great interest in continued development of the MSP program in order to increase camera utilization. Pilot programs that succeed as well as those that fail may ultimately lead to new opportunities down the road.
Post 2 IP   flag post
WGAN Forum
Founder
DanSmigrod private msg quote post Address this user
@Metroplex360

Respectfully, I disagree with you about the Matterport Multi-Family initiative. And, so does this Matterport Service Provider whom emailed me the following ...

Dan

--

Hi Dan,

… What I have found is that the Matterport Multi-Family group has been pursuing clients that we have been pursuing. They are undercutting us on pricing. Yes Matterport is selling our services at $300 per 5 models per location. At least that is what they are paying, and we get none of the residuals. ...

With most companies out there, the purchasing agents have to get multiple quotes on jobs. Matterport comes in super cheap and then gets them on the SAS plan, and that is where they are making their money. The clients purchasing agent can't give a thumbs up to Matterport without having multiple quotes to appease the corporate purchasing standards. So they reach out to me and I give them a quote, unknowingly they already have a quote from Matterport. So the time and effort I put into a proposal are out the window and well frankly I'm tired of the Matterport BS.

And my margins are too thin to come down any further. It sucks but Matterport is going to put me out of business at this rate. What I am afraid of is that matterport is reaching out to photographers in the area to get them to do these jobs, and the photographer is reaching out for Matterport photographers to do those jobs adding another layer of Middle Man BS.

Anything that looks like it is too good to be true...is a lie.

[name redacted]
Post 3 IP   flag post
Shakoure private msg quote post Address this user
@DanSmigrod ....Your post on this issue is absolutely correct, Dan. Unfortunately, this problem is still occurring, and I know because I've had recent/direct interaction with the Matterport team that manages these kinds of SAAS projects for real estate brokerages. Their aim is to 1) generate more money for MP by 2) offering real estate firms volume with 3) the cheapest scan rates, leaving 4) table crumbs for MSPs. And while this goes on, I can't remember the last time I got an independent referral from the "MSP Program." Moreover... @Metroplex360 ...I haven't seen any policy or opportunities for MSPs outside of tech development that tells me that MP really cares about us for other than buying cameras, subscriptions, and more bundles. How can we, as a community, change this to our benefit?
Post 4 IP   flag post
WGAN Forum
Founder
DanSmigrod private msg quote post Address this user
@Shakoure

Yes! Matterport continues to pursue the sweet spot for all Matterport Service Providers: Multi-Family Homes.

I noticed this Matterport job opening today (Friday, October 26, 2018):

Matterport Multifamily Sales Manager

Should Matterport be in the business of selling Cameras to Service Providers AND then under-selling scanning to potential Matterport Service Provider clients such as Multifamily Home?

Best,

Dan

P.S. Matterport Job Requirements include:

✓ Develop and execute strategies to grow multifamily adoption
✓ Consistently secure a high number of executive level sales meetings
✓ Meet quarterly sales targets
✓ Create strategy to increase penetration with existing accounts
✓ Develop and nurture relationships with key management companies within the assigned region
✓ Represent company at industry associations, i.e., NAA, AIM, NMHC.

Source: Matterport
Post 5 IP   flag post
WGAN Forum
Founder
DanSmigrod private msg quote post Address this user
Hi All,

Related WGAN Forum discussions:

National Multifamily Housing Council Conference in Orlando 14-16 Nov 2018
Matterport Competing with Matterport Pros?

Dan
Post 6 IP   flag post
WGAN Forum
Founder
DanSmigrod private msg quote post Address this user
Hi All,

I noticed this Matterport job opening today (Tuesday, 13 November 2018):

Matterport Multifamily Sales Manager

From the job opening:

Responsibilities

✓ Develop and execute strategies to grow multifamily adoption
✓ Consistently secure a high number of executive level sales meetings
✓ Meet quarterly sales targets
✓ Create strategy to increase penetration with existing accounts
✓ Develop and nurture relationships with key management companies within the assigned region
✓ Represent company at industry associations, i.e., NAA, AIM, NMHC.

Source: Matterport

---

So, what does this job posting tell you?

Best,

Dan
Post 7 IP   flag post
Shakoure private msg quote post Address this user
@DanSmigrod... You're 100% correct on this one, Dan. I am aware of someone who left their multi-family MSP scanning program for many of those reasons you outlined, particularly the embarrassingly low payout... just so they (MP) could undercut other independent MSP competitors out there. Who does that?
Post 8 IP   flag post
3rd Party
Service
Metroplex360 private msg quote post Address this user
I lost sight of this a few months ago.

If Matterport sells multi-family scans for $300 for 5 tours and then charges hosting fees, you can create a compelling argument that the client will pay more over time.

I posted a LONG time ago that stated that if you want to compete with this sort of pricing, one might consider offering a low cost of entry to clients with hosting contracts that make up the difference.

If you run a business and have people working for you, how much would you pay them to scan 6,000 SQFT for you?
Post 9 IP   flag post
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