Ashleigh Wilson 0:00
Elevator companies simply aren’t doing maintenance. In most instances, audit mate finds that elevator and escalator owners are only receiving about 50% of what they’re paying for from their elevator service contracts. So when I was in the industry, I saw, you know, high rates of cancellation, high rates of customer dissatisfaction. And and it wasn’t always the elevator company’s fault. But because there wasn’t this the an expectation there, there wasn’t the clear guidelines of here’s what you get, here’s what you’re supposed to get. Here’s what you’re not getting. There’s no transparency there was there was a general lack of understanding. So due to that, I was like, It’s not this hard. It shouldn’t be this hard. If customers had really clear and simple. This is what an elevator needs to be maintained properly. Let’s put it in your contract so that everybody understands it. And then let’s give you a simple platform to track if it’s done or it’s not done.
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J Darrin Gross 1:24
Welcome to Commercial Real Estate Pro Networks, CRE PN Radio. Thanks for joining us. My name is J Darrin gross. This is the podcast focused on commercial real estate investment and risk management strategies. Weekly we have conversations with commercial real estate investors and professionals who provide their experience and insight to help you grow your real estate portfolio.
Today, my guest is Ashleigh Wilson. Ashleigh is the CEO and founder at AuditMate. Ashleigh is open sold multiple small businesses by the age of 20. Until ultimately landing in the elevator business. And in just a few minutes, we’re going to speak with Ashley about AuditMate. It’s the world’s first elevator escalator auditing and management software.
But first a quick reminder, if you like our show, CRE PN Radio, there are a couple things you can do to help us out. You can like share and subscribe. And as always, we would love to hear from me if you want to leave a comment. Also, if you want to see how attractive Our guests are, be sure to check out our YouTube channel. You can find us on YouTube at commercial real estate pro network. And while you’re there, please subscribe. Without I want to welcome my guest, Ashleigh, welcome to CRE PN Radio.
Ashleigh Wilson 2:46
Hello, thank you for having me.
J Darrin Gross 2:49
Yeah, I’m looking forward to our conversation today. Before we get started, if you could take just a minute and share with the listeners a little bit about your background.
Ashleigh Wilson 2:57
Yeah, absolutely. So I’m Ashleigh Wilson. I’m the founder and CEO of AuditMate, as you first described, where the first ever elevator and escalator auditing software. This came about because I was raised in the industry self proclaimed elevator baby. My stepdad was in the industry about 50 years, I joined myself in my early 20s, I thought that I would surely be the first female CEO of one of the major elevator corporations. And it wasn’t until, my values and morals just kept me up at night and I could no longer stay in the industry. And so I left with literally no idea what would happen and then automate was born.
J Darrin Gross 3:45
Awesome. So he sounds like he had plenty of experience or I guess eye opening experience in the business of elevators and assume escalators to are they are they tied together as far as the the I guess the providers, the manufacturers and that is a little tied together.
Ashleigh Wilson 4:09
Yes. Absolutely. Elevators are is just searched more on Google. Okay,
J Darrin Gross 4:15
Gotcha. In the business that your your family had was it? Was it the sales installation service of the elevators and escalators?
Ashleigh Wilson 4:25
Yeah, all of the above. So, so we worked for one of the big four they call them there’s four major corporations that own you know, over 80% of the market share globally. And all four of those major companies manufacture install, maintain, modernize and repair elevators and escalators.
J Darrin Gross 4:48
And so, I mean, I think probably everybody in the audience has been on an elevator or an escalator so that’s I think we’re we’re at least have a base understanding of what they what they do take you from one level to another level. But but as far as the your business automate, I’m just kind of curious. What was it that you saw that was? What was the need that you were trying to satisfy?
Ashleigh Wilson 5:19
Yeah, so in my time in the industry, it’s wildly apparent that customers don’t understand their contracts. And, and for good reason, because they’re built to be extremely vague and confusing. So it’s no wonder that customers don’t understand their contracts. And coupled with that, elevator companies simply aren’t doing maintenance. In most instances, audit mate finds that elevator. And escalator owners are only receiving about 50% of what they’re paying for from their elevator service contracts. So when I was in the industry, I saw, you know, high rates of cancellation, high rates of customer dissatisfaction. And and it wasn’t always the elevator company’s fault. But because there wasn’t this the an expectation there, there wasn’t the clear guidelines of here’s what you get, here’s what you’re supposed to get, here’s what you’re not getting, there’s no transparency there was there was a general lack of understanding. So due to that, I was like, It’s not this hard. It shouldn’t be this hard. If customers had really clear and simple, this is what an elevator needs to be maintained properly. Let’s put it in your contract so that everybody understands it. And then let’s give you a simple platform to track if it’s done, or it’s not done. To me, it felt very, very simple. But in the industry itself, it’s just extremely complex, apparently.
J Darrin Gross 6:53
So I’m curious about that, you know, contracts, being an insurance broker, there’s, you know, contracts are what insurances, and you talked about the understanding of the contract. I get that. So it isn’t a matter of the the buyer, the the the building owner, not understanding what’s included in the contract, what, what they should be doing, is that kind of what I heard you say, and is it then upon them to request those services that they’ve paid for they’re not being delivered automatically by the service provider? Is that kind of the source of it?
Ashleigh Wilson 7:31
Yeah, that sums it up. But really, what it comes down to is, because there’s only four major companies out there, and they’ve been around for all over 100 years, there’s really not much education out there, except for from the elevator companies. They’re the manufacturers, they set the OEM, they write the contracts. And so it’s not like electrical or landscaping, that it’s like, the market is so wide, that you can go out and get educated from many different sources. Or you can hire generally, you can hire a handy person that knows like a little bit about electrical, a little bit about plumbing a little bit about this. You can go from one insurance broker to another insurance broker. Well, with elevators, you get really four companies. And they all operate in similar ways. And they’re all pretty vague and confusing. So when the when it comes down to it an elevator maintenance contract, it’s still what’s being sold, which says Your elevator should be maintained this many times per year. If the elevator breaks down, here are the components that covered are covered. And here’s what’s excluded. And then testing, here’s what testing is required by the state. It doesn’t tell you that in the contract, it just tells you whether testing is covered or not covered. And this is where it gets really confusing because just because it’s not covered doesn’t mean it’s not required, which you want to talk about risk there’s thinking being a big one. So customers have these contracts that say we will periodically maintain your equipment periodic to whom periodic to me periodic to you periodic to the mechanic, who what’s the period, and that’s where it starts to get really confusing. And then the components are covered or not covered. Well, you think the customer knows the difference between a door roller and a door operator or a door restrictor and a door give? No, exactly, no. And so there’s a lot of room for open for interpretation. And I once had a customer say to me, I rely on elevator companies to explain what the work is to me to price the work fairly. And then to complete the work with literally no checks and balances. The only way I have To check if what they’ve done or not done is if the elevator works or doesn’t work.
J Darrin Gross 10:05
Right. Right. So, so I guess one of the curiosities I have is the maintenance? You said that the contract provides periodic maintenance? Is there not a standard? I mean, it’s like, you know, you get your oil changed, it used to be 3000 miles now it’s five or somewhere, you know, beyond that, or whatever? Is there not like a standard? Is it number of hours? Is it days as his or any kind of a regular frequency on just the straight up maintenance that you should expect? On an elevator?
Ashleigh Wilson 10:43
Yeah, it depends on who you’re talking to. Really. Um, but yeah, there are standards, their standards, especially, I mean, if you’re talking to an old school mechanic, you know, they’re gonna want a lot of labor, they’re going to want to go in. More frequently, the elevator company wants to reduce labor. So it depends on who you’re talking to what the standard is, it also depends on the type of equipment, the age of the equipment. And so that’s really what we’re trying to do at audit mate is to give the customer that baseline that we have here is what you need here is the minimum amount of maintenance to get the life of the equipment. The full life of the equipment, I should say. But when it comes to selling periodic contracts, the reason that they say periodic and don’t provide the baseline in writing is so that periodic can change.
J Darrin Gross 11:38
Right, I can be held to the other feet held to the fire kind of
Ashleigh Wilson 11:43
Right. And you can ask for specified maintenance, which is something that audit may does.
J Darrin Gross 11:49
Gotcha. You mentioned that there’s there’s for manufacturers, as far as the the different types of elevators, I mean, you’ve got the I know, I’ve got some clients that own older buildings and have the old cages and and you’ve got the kind of the new shiny ones with the controls that only let you go to the floors you’re authorized to go to. Yeah, you got frayed elevators, which can be all sorts of kind of a crude thing from just a platform and, and, you know, to, to full on cage, do each one of those have similar maintenance needs? Or are each one of those different? And then if it if, if that is the case, are you at automate able to determine what that frequency should be based on those those different you know, types of elevators and and manufacturers and in the use?
Ashleigh Wilson 12:50
Yeah, that? Yes, they do vary on on the level of maintenance needed. Generally speaking, the older the equipment, the more maintenance is going to be needed to prevent breakdowns and prolong life of the equipment. Generally speaking, the newer the equipment, the less the less maintenance it’s going to need. Except for those fancy ones that you were talking about, they go to different floors, those have those have fancier computers. And yes, audit mate does provide clients with a vertical transportation strategy, we will write the service contract on behalf of the owner. So this contract is built to protect the owner to reduce risk and liability to increase specificity and transparency. It’s the only truly enforceable elevator service contract on the market. Because it is technology enabled, every contract term has a data point that we track using technology to ensure that that work is completed. So we do what’s called a free contract analysis. So we’ll review the equipment, the age of the equipment, the vendors performance, the legal terms and conditions, and we will provide an overview of our recommended scope of work for that equipment.
J Darrin Gross 14:16
Got it? So when when you audit a contract, I mean, that’s an existing contract between a provider and an elevator owner. Did I hear you say also that you write contracts? We do? Yes. Okay. So typically, I mean, I’ve always found that the the one selling the the product is the one that writes the contract. How is it? How has it been received with you providing the contract in reverse? I mean, I’m assuming that if you’re working with the elevator owner, right in the contract and then saying this is a contract we’re going to use with a maintenance company is that been well received?
Ashleigh Wilson 14:57
Well, you might guess that I was probably not In the industry, and I’m also problematic with automate. So it’s been pretty well received. But it there was some resistance at first, of course, because we require transparency. If the elevator vendor doesn’t do their job, we get the client their money back, we enforced with liquidated damages. But the difference in how we have have made audit make contracts accepted by the vendors is through the power of automate. It’s always been, customers have always felt like elevator companies have held the power. They are the ones who can get the elevator running, you have to pay the bill, if the elevators down, I don’t have the expertise to push back. I don’t know what my rights are in this contract, I just know, I’m about to get fined by the Housing Authority, unless I get this elevator running again, or my tenants are gonna leave or you know, enter XYZ, the pressing issue has always been getting the elevator running, and not knowing how to push back. And that’s really where audit mate comes in. By being able to leverage the power of audit mate, grouping customers portfolios together, instead of having individual buildings, we’re able to really transfer the power back to the owner, they’re the client, they’re the ones paying the bill. They’re the ones hiring the elevator company. And by by shifting that power back to the buyer, the elevator companies have agreed to sign the contracts.
J Darrin Gross 16:36
That’s awesome. I mean, it’s that’s kudos to you and AuditMate to be able to, you know, to win that, because I’m just thinking of other industries. It’s it’s kind of an add on I here’s here’s the contract you wanted this what we do kind of thing. Is this opened up any opportunities for additional service companies? Because I was thinking about it, like you mentioned, there’s like, basically four manufacturers of elevators. But I’m wondering, are there independent service companies that that can serve us all for different companies? Or is that pretty limited to? Like a franchise? Vendor service company?
Ashleigh Wilson 17:20
Yeah, absolutely. There are independent vendors. And we do work with independent vendors. They’re usually more regional, there isn’t really many like national level independent vendors. But AuditMate will help them generally one of the biggest cons to go in with an independent vendors, you don’t get an online portal, you don’t get virtual maintenance records. But with audit mate, because we digitize all of their paper time tickets and all of their paper records, the customer now can have an online portal, and still use an independent vendor.
J Darrin Gross 17:58
And in how long have you guys been in business?
Ashleigh Wilson 18:01
Two years, two years plus now. Okay, congrats.
J Darrin Gross 18:06
So, in that time, Have you have you found like certain providers that are more agreeable to it that have become almost like a referral source for you? Is there any build on that?
Ashleigh Wilson 18:22
You know, it varies really region to region. People ask me all the time, like, who’s the best elevator vendor? And I’m like, in what city? In what department? Right, and modernization and existing install? What are we generally speaking about? Because it varies wildly. I don’t think any one Elevator Company is better than the other when we’re talking in general terms of maintenance providers. Because really, the local management drives so much of the success of the of the local region, you know, having a super advanced troubleshooting mechanic that can work on a specific type of equipment means that’s going to be the best elevator provider for you in that area, if you have a certain vintage of equipment. So there isn’t really any one front runner when it comes to who’s the best store or who’s been the best partner. It varies state by state for us.
J Darrin Gross 19:22
Gotcha. So we’ve talked for merely about maintenance. In the maintenance contract. You mentioned the state. You know, and I don’t know what the governing agency is, is it the the building department or is it the Department of Transportation or who who governs elevators and escalators?
Ashleigh Wilson 19:44
There’s generally specific office for it. So it’s, you know, going to be your up elevator and escalator office, who then governs that office varies. I think in Louisiana, it’s the same office as amusement rides, which is hilarious to me. But yeah, it varies. It varies state by state. There’s no national elevator code. So each state has an elevator code, and then a city can adopt a code as long as it’s stricter than the states.
J Darrin Gross 20:19
Code. And so the the, the agencies that can find? Or I guess they are they also the ones that do the inspections and and is there a frequency of inspections that’s typical throughout the US or is that those vary widely by jurisdiction,
Ashleigh Wilson 20:43
it’s generally every year. Some states, you can get to your permits, but it’s generally every year. And generally, it’s a state inspector, and you’re an approved inspection company. And you can find a list on your state website. Like if you type elevator office, California and Google, you can generally find what you’re looking for. If they allow third party inspectors, you’ll be able to find the link of improved inspection companies.
J Darrin Gross 21:16
And then, as always, no the permit is on file and the Office for his or his or anything that you guys provide that for, for documentation digitally of those permits that are required to be listed or shown or are in the the elevator itself.
Ashleigh Wilson 21:36
Yeah, so we’ll track those expiration dates to ensure that the client either requests an inspection, or is inspected by that date. A lot of states are really behind on inspections. And even though the owner cannot perform the inspection, and they cannot do the safety testing, they are required to have them completed. So if the elevator company’s past due, which happens if the inspectors past due, which happened and then someone were to be hurt on the elevator, all of that risk and liability falls on the owner of the building.
J Darrin Gross 22:19
Gotcha. I’m trying to think just like on an insurance basis. I know we always ask are there elevators or escalators? But I’m not. I know, like fire escapes, or is like questions about like load inspections, and that kind of stuff? Are there any kind of what is it just a safety inspection to make sure that all the that it’s operating properly? Is there any kind of load inspection or anything like that? That goes with it?
Ashleigh Wilson 22:46
Yeah, so every year is a no load test. So you’re testing the safety devices, every five years is a full load test. We’re speaking generally here, where you load the elevator to capacity, and you actually crash the car to make sure all of your safety devices work. This is so it’s being crashed using that term lightly, but in a controlled environment, so that if anything were to break, it’s breaking during the test so that those items can can be fixed.
J Darrin Gross 23:21
Gotcha. And so for for this, I’m assuming that there’s like an ideal number of elevators that you would, where you would track or that a an elevator owner would lean towards working with automate, or is it from one to whatever? Is there a sweetspot?
Ashleigh Wilson 23:45
One to whatever, honestly, most small building owners and Matt Well, really, I mean, small building owner and manager. If you were to spend the time to manage your elevator vendor, and to be able to get the most out of your contract and not pay more than you should, you would be spending an obscene amount of time tracking all of the maintenance activities, tracking the duration, trying to understand what’s covered and what’s not covered, it would spend an obscene amount of time and guess what building owners and managers that’s not their job. It’s a small, small, small fraction of their job. So we charge $65 a month. So even if you have one elevator, it’s $65 a month and we’re ensuring we’re auditing all of your maintenance, all your invoices, all your proposals and your compliance for an entire week we do annual subscriptions.
J Darrin Gross 24:39
Got it. So when somebody has a subscription with with AuditMate, you new you you’ve reviewed my contract. You understand what the dates are or perhaps you said hey, no, no, let’s let’s use this contract. What is the the reaction between automate the owner of the elevator and then the service provider,
Ashleigh Wilson 25:07
were really the in between. So I like to think of us as like a property manager, but only for elevators and escalators. So we’re a vertical transportation manager. So we handle 100% of the vendor communication. And all of the invoices and proposals come in to us. So what the owner sees is they’ll see monthly checkpoints. So reports on what was done, what wasn’t done, what open items are outstanding. They will receive invoices, once they’ve been approved or disputed from us with recommended next steps. We do all of the heavy lifting, but we need the answer from the owner. So they’re still making all decisions. proposals will let them know if we’ve disputed them if we’ve negotiated them down. If it’s something that needs to be purchased now, or if it’s something that can be put into a future budget, they’ll receive annual reports on how much they’ve spent, how much they’ve saved, the compliance statuses. And the owner is still responsible to place service calls, we never want to get in the way of any sort of emergency. So we track data on the back end, but on site personnel still needs to place those service calls.
J Darrin Gross 26:23
And do you have any kind of data? Or is there any kind of a I’m just trying to figure out a way of recognizing a, a, an elevator that has only been serviced when when called upon versus one that has been, you know, follows a maintenance schedule? Is there any kind of a, like a percentage of downtime or fines or whatever that you can show that, you know, typically a person who only waits till it’s broken to fix it is down this much time versus somebody that maintains it? Will, you know, have X amount of time down? Is there any? Is it just too wide of a question or is there anything that you can point to that? That shows? Yes.
Ashleigh Wilson 27:13
Yeah, we’ve reduced invoices and proposals, so breakdowns. So breakdowns and then on cover breakdowns, I guess and not covered breakdowns. We’ve reduced those by 25%. And we’ve increased maintenance by about 30%.
J Darrin Gross 27:34
Gotcha. And then I represent that also the breakdowns, the downtime, what is the typical downtime for a breakdown?
Ashleigh Wilson 27:44
I, the typical downtime is quick is a few hours. But on a large repair will would be days and or weeks depending.
J Darrin Gross 27:57
Right. I’ve been in those buildings were stairs, the stairs there. So yeah, too tall of a building, or I gotta go too far up. So. But that’s fascinating. I think that’s really cool how, how you’ve been able to do that and, and insert yourself as an advocate for the the property owner, and, you know, help them maintain and, and keeps their building hopper. And And I’m assuming that if most of the building owners been pretty receptive to your to your opportunity.
Ashleigh Wilson 28:35
Yes, more. So now, it was interesting in the beginning, it’s one of those problems, it’s like way in the back of the closet, right? Unless you’re having current elevator issues that are causing you a big headache for the clients that things are like, okay, it was really interesting to, to get them to come on board. And we had to do the free contract analysis to show them what they were currently receiving from the money that they were paying before it started to click. And this was a problem that I’ve been trying to solve for years, right. I was like, Well, how are customers out rioting in the streets? How are people not so mad about all of the money that they’re losing? And when it came down to it, they didn’t know they were losing money? What do you what do you compare that to Intel, there’s a better way of doing something. That’s just the way and the more that I dug into it and dug into it. He talked to folks that are like, you just pay the bill. My dad just paid the bill. My grandpa just paid the bill. You call the elevator guy and you pay the bill. That’s just what you do. There was never another option for people and it’s back of mind and not thought about until it’s friend of mind and needs to be dealt with and you just want it off of your plate as quickly It’s possible to not think about it anymore. And so once auditMate did the free contract analysis and was able to show people how much work it is to get the full value of your contract, and how much they were actually losing, then AuditMate becomes this no brainer. But until you take a look and really dig into it, it stays back in mind and tell you, you know, the problem, really, if you go from your equipment lasting 35 years, to lasting 27 years, most people don’t look at that, that well, or property management companies have come and gone. But when you quantify it and put it in front of an asset manager, or an owner, it’s like, oh, I want those seven years back.
J Darrin Gross 30:54
Yeah, no longer you can have some some work, pray with that owner, you know, recapitalize and invest in that that’s maintenance is always a lot cheaper than an ordinary place. So I get it. He actually, if we could, I’d like to shift gears here for a second. By day, I’m an insurance broker, as I’ve mentioned, and I try and work with my clients to assess risk and determine what to do with risk. And there’s three strategies we typically look at. To see if we can or how to manage risk, the first we look at is can we avoid the risk. And if we cannot avoid the risk, then we look to see if we can minimize the risk. And when we cannot avoid or minimize, then we look to see if we can transfer the risk. And that’s what an insurance policy is. And I like to ask my guests if they can look at their own situation. Could be their clients, the markets, suppliers COVID interest rates, however, you see the situation. And I like as an airline, I’d like to ask you if you can consider what is the biggest risk? And for clarification, while I am an insurance broker, I’m not necessarily looking for an insurance related answer. And so if you’re willing, I’d like to ask you, Ashley Wilson, what is the biggest risk?
Ashleigh Wilson 32:22
Safety and compliance. Every elevator is is inspected, safety tested and inspected. So you need to make sure that your certificate is consistently up to date, and that your testing has been completed. Now the way that we can avoid this risk, start with your service contract, making sure that you ask your elevator company, what state required testing or city required testing is is what intervals and what tests; all of them. Because they’ll say they may say hey, you have to do this every one year in this every five years. And there’s fire service testing that the owner can do, or the elevator company can do get the elevator company to tell you everything that’s required and who can do it. And who if they can train the owner. Get that covered under your service contract, that’s going to be the cheapest way to do it. And making sure that you’re transferring that ownership or that responsibility on to the the elevator company. The second is going to be tracking that certificate expiration date, the state can be past due. So waiting for the state to come out and perform your testing is risky business, put a calendar invite on your on your schedule, so that you reach out to the state before your certificate expires, and send them an email, please come inspect my equipment. If you can’t come inspect my equipment on time, can you write me an email granting me temporary coverage or temporary certificate until you can come complete the inspection. Some generally the the state inspector will write you an email and say this email serves as your temporary certificate until we can come out and inspect your equipment. That way you have that in writing from from the inspection company and from the elevator company. So making sure passengers are safe on the equipment and making sure that your compliance is up to date with the state endorsee.
J Darrin Gross 34:34
That’s a great tip on the reaching out to the state ahead of time as opposed to waiting for them the fine because I know when you’re when you’re dealing on their schedule, it’s a it’s a urgent emergency kind of thing. Whereas if you can reach out to them and buy yourself some time and kind of be more of a planned inspection that makes a lot of sense. That’s that’s a great, great tip there. actually working listeners go if they would like to learn more connect with you
Ashleigh Wilson 35:05
AutoMate dot com. We also have a YouTube channel with a few videos for AutoMate. I’m on Twitter @elevatordad. And LinkedIn is probably where we’re most active.
J Darrin Gross 35:22
Got it? Actually, I can’t say thanks enough for taking the time to talk today. I’ve enjoyed it. Learned a lot, and I look forward to doing it again soon.
Ashleigh Wilson 35:33
Thank you so much for having me. All right. For our
J Darrin Gross 35:37
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