Housing To Help Staff Hiring and Retention Challenges - Nina Kleaveland, Lanyard

Josiah: 0:00

Today we're looking at a way that you might be able to attract and retain more talented team members, a way that's too often overlooked in our industry. We talk a lot about hiring in our industry, how hard it's been and how hard it continues to be, and I wanted to give you a fresh perspective from someone who is building an innovative solution to this challenge. Nina Kleaveland is the co-founder and CEO of Lanyard, and in this episode, you'll learn how she is helping hospitality providers find and manage workforce housing.

Nina: 0:52

Lanyard was actually originally founded as a hostel brand. The idea was a mix of private and shared rooms and seasonal destinations, giving younger travelers an entry point into markets that get really expensive during peak season, and then also taking underperforming assets and essentially employing a density play, getting more revenue per square foot out of those by packing people into rooms. I got about 18 months into that and a couple things happened construction costs were rising, banks were getting a little bit skittish and at the same time, I was having conversations with a number of employers in these seasonal destinations like Sea Towns and realized that there was a greater need for shared rooms, and that was for workforce housing. I ended up pivoting the company to be a tech platform no more real estate and now we help employers find and manage workforce housing. We are addressing industries that are really impacted by the skilled labor shortage. More and more they're hiring seasonal, temporary and traveling workers to fill open roles.

Josiah: 2:02

I want to talk a little bit more about this problem because you and I actually connected a couple of weeks ago after I saw you share a photo of an H2B worker from Michigan, which doesn't actually strike me necessarily as the place with the most acute housing shortage, but this person that you were talking with said this is a big factor. I wonder if we could talk a little bit more about this problem. You mentioned working across industries, but let's talk about the problem in hospitality, maybe both for the employer perspective and also from the talent perspective of the people who are considering a job in hospitality. Maybe starting with the employer perspective you touched on this a little bit, but obviously, talent is at a premium right now. What else were you seeing or hearing in the market from hospitality providers? That this was a problem to solve.

Nina: 2:51

Yeah, HLA did a study back in April and 87% of hotels said that they were experiencing staff shortages. The hotels that are able to overcome that have gotten really smart about how they build those open roles. They're doing it with H2Bs, J1s, hospitality interns. There are a lot of different potential solutions. A lot of those workers, in fact most of them, need housing, and so we hear from employers that they are increasingly hiring these workers, and housing is becoming necessary as a benefit or a competitive advantage when they're trying to attract the workers. Because, if you can imagine, if you're coming from across the world or across the country if you're a domestic worker and you're going to take a job for six months but you don't know where you're going to, live there is a percent chance that you're not going to show up on day one, and so what we see is that employers are increasingly providing access to housing as a benefit to their workers and it helps make sure that they can attract and retain workers more easily.

Josiah: 4:05

That's great, and from that photo it looks like you're also meeting some of these people that are benefiting from this. As somebody working in hospitality, what else are you hearing anecdotally from some of the people that are beneficiaries of you working with these hospitality organizations?

Nina: 4:21

Yeah, we've talked to many, many workers about their experience finding housing. It taking months being on Facebook groups and just having to constantly scroll through new local Facebook groups, new posts of people with housing, and then some situations that were not safe. There was one woman who told us she slept on the floor of the bathroom for two months because it had heat. So there's some pretty unfortunate stories and we think that our platform can help provide a benefit, obviously to the employers, because we're saving them time, we're saving them expense in terms of finding the housing and the discounts that we're able to get, but at the same time, we're also creating a much better living situation for workers.

Josiah: 5:10

Maybe just to bring how this looks to life. I wonder could we talk about one of your clients that you're working with and what the process has been to start your work together and what you've been able to do with them?

Nina: 5:21

Yeah, so we're working with a third-party hotel management company. They have hotels all across the United States over a hundred and we started with one request. We happened to reach out at a time when they were thinking about staffing up the hotel or a hotel in Saranac Lake for the summer season and they came to us and said we're looking for housing for May through September for 14 workers in Saranac Lake, and we were able to provide them with three different housing options that were close to their budget, close to the other parameters in terms of travel time, the amenities they were looking for, and the workers are now at that housing location. Since then they have submitted additional requests for other markets, like Savannah and Aspen and Tucson, and we continue to work with them and it's a great partnership. We have a champion within the company, we have a great relationship with that person and we've really been able to kind of address their needs across multiple markets. And we see that as a win-win right. They're not dealing with five different landlords and five different markets, they're not negotiating terms and finding state-specific leases and having to draft those. All of that happens on our platform, payments happen on our platform, and so the amount of time that they're saving, not just in sourcing but in the day-to-day management, both at the corporate level and the local level, is really the value that we provide.

Josiah: 7:02

It's fascinating because I've heard so many conversations around how do we bring more talent into the industry, and this is one of the more practical, specific ways that feels like it has high impact. I guess, since you started down this journey, has there been anything that surprised you about either the real estate or how kind of you set these up, or how hospitality brands are thinking about this.

Nina: 7:24

Yeah, a couple of things. The first one is that I thought that the needs would be limited to seasonal destinations, and that's because that's where we started, but what we found is that they are not in any way shape or form. There's quite a number of employers across hospitality and we're starting to expand into healthcare and construction and banks for summer interns. There's so many different use cases for this type of housing, but what we found is that, because of the skilled labor shortage and hospitality, more and more employers are hiring H2P's year-round as housekeepers or bringing in year-round J-1s, and so those needs span across markets like Boston and Dallas and Denver, and the list goes on and on, and so we're seeing less seasonal than I initially expected. The other thought saying that I thought would be a huge challenge was getting suppliers to be interested, and not so such a huge challenge that it wasn't insurmountable. But I thought we would have to do much more of a sale, and we now have suppliers approaching us saying how do we get on your platform? The combination of it being an employer-backed housing request and booking long-term stay, usually a group anywhere from four beds to 200 beds or more combination of all of those things makes it incredibly compelling, and so we've actually seen a tremendous response from suppliers.

Josiah: 9:03

That's great, and I guess I'd be curious where you see the business going, because, as you're describing it, I'm kind of reminded of many destination resorts that I've seen where they have actually buildings on the property for staff to stay in. I think it's been traditionally general managers, many general managers, that hotels will live within the hotel, but it feels like there's so many very large city hotels where the cost of living is so high you know whether it's New York or San Francisco where I'm based and people need housing, and so do you see your business and kind of the clients that you're surveying also being in these urban markets as well.

Nina: 9:43

Yeah, I do, and actually we've already fulfilled housing requests in a number of urban markets, new York City being one of them, so I absolutely see the potential for that. One of the great things about our platform, which is different from other corporate housing providers is that we serve not just primary and secondary markets, but tertiary and seasonal as well. And we can do that because of the types of inventory that we're tapping into. And that's really a differentiator. It's not just traditional corporate housing or extended stay hotels, but we really go deep and get creative. That's one of the things that we're really proud of. So that's everything from student housing to college and university dorms, co-living spaces, and the list goes on and on. That's really what enables us to service so many different markets. In terms of where we're headed, global domination Is that. I think. The way we see it is that there's going to be an increasing need for remote work, for traveling workers across the globe. Right, the expectation is that there will be 85 million unfilled jobs, skilled labor jobs by 2030. And so, making it possible for workers to go and work in another location and making it such that housing is not a factor or a constraint. We can do that, and increasingly, as I mentioned, employers are seeing housing or providing access to housing as a benefit, and so that also enables that sort of global mobility of the workforce. It's an interesting way and, I think, a very practical way of helping to solve the skilled labor shortage. It does sort of enable people to travel and find the best opportunities that they can.

Josiah: 11:32

When it feels like there's a big opportunity. Over the summer, I've been conducting research around people who are not working in hospitality, around what would get them to work in hospitality, and among the top of the areas of interest are housing provided, but also a big driver is an ability to kind of work in different locations, whether it's around the country or around the world, and so I feel like this is a big draw to hospitality meaning for hospitality companies. Their ability to offer this will become a differentiator and their ability to attract and retain talent. So I'm excited to see where your business goes. I think global domination is definitely out there Well, especially with so much changing in real estate, especially in cities. But places like San Francisco it feels like our downtown cores are going through a reinvention and it'll be interesting to see what you do there.

Nina: 12:19

I just wanted to add one point on that, which is that, well, we are not in the business of real estate and creating supply. We are starting to develop partnerships with some really interesting suppliers right who are adapting individual homes or big box hotels into interesting accommodation types. That he can leverage for workforce housing, and so I'm excited to see where they go. And with that, that helps grow our platform right. That helps us provide access to unique housing options that don't exist today and helps us kind of grow in markets where our supply is more constrained. So those are some great partnerships. I'm excited that there's focus on that as well.