I recently went one-on-one with Nathan Miller, founder and CEO of Rentec Direct.
Adam: Thanks again for taking the time to share your advice. First things first, though, I am sure readers would love to learn more about you. How did you get here? What experiences, failures, setbacks, or challenges have been most instrumental to your growth?
Nathan: Before founding Rentec Direct, I was involved in the computer service industry, and then later the Internet Service Provider (ISP) industry. Ever since I was a kid, my passion has always been technology, and growing up during the time period when the internet was becoming mainstream was very exciting to me. As soon as I could, I got a job in the tech field in my small community, working on computers. Eventually, I got a position at a sister company in systems administration for what would eventually become the world’s largest wholesale ISP. I learned so much during this time in my career and worked my way up in that organization to Chief Technology Officer and ultimately President of the company over a 12-year period. This experience equipped me with many of the skills and knowledge I would lean on when I founded my own company, Rentec Direct. I was able to branch out on my own because I already knew how to deploy servers, write software code, and operate a business on a day-to-day basis. These tools were invaluable in helping me create my own venture.
My early career experience also taught me a lot about what I wanted and didn’t want in a company. I highly value my time at the ISP company and am still close friends with the owner today, but we had several differences in opinion on how to best operate a successful business. One of the goals of that organization at the time was to outsource as many employees as possible overseas to save money, and I watched the vibrant and lively culture we had worked so hard to build evaporate as our in-office team got smaller and smaller by the day. For those of us left, there was a constant undertone of how expensive our salaries were compared to our offshore counterparts, which was a massive blow to employee morale.
When I started my software company, I brought many positive learning lessons from my previous work experience, but I also made many intentional decisions to do things differently. For almost 20 years, I’ve stayed committed to an entirely in-house, U.S.-based team, and to this day, every single employee lives in the area and works out of our headquarters in Southern Oregon. This has allowed us to build an award-winning in-person culture that often feels more like a family than a work environment, something that cannot be easily accomplished with remote teams.
I’ve also always valued maintaining independent ownership and avoiding outside investment, which has certainly been instrumental to our sustained growth over the years. In the software space, most of our competitors answer to a board of directors, ultimately at the mercy of their investment partners. Demand from investors is typically geared toward growth and profits over customers, employees, or even the product. I’ve experienced this in the past and seen it damage others in our industry, which is why we’ve remained committed to not accepting outside investments. It’s allowed us to focus on what matters most: the happiness of our customers and our employees. Our growth may not have been as “explosive” as other startups, but our clients choose us over the competition, our employees stick around and consistently say they love coming to work, our profit margins tend to outpace most of our competitors, and we’re still going strong after almost two decades in business. The formula seems to be working.
Adam: How did you come up with your business idea and know your business idea was worth pursuing? What advice do you have for others on how to come up with and test business ideas?
Nathan: I think I had the right idea, was in the right place, and at the right time.
I had the idea to create software that would save me time managing my own rental properties. During my time at the ISP, I had built up a portfolio of about half a dozen properties, all of which I converted into rentals that I was managing myself. I quickly learned that being a landlord is not for the faint of heart and requires quite a lot of time, on top of my full-time career. I wanted to be more efficient and knew that technology could help me.
I was also in the right place in my life to start a business. Throughout my career up to this point, I had already learned the basics of starting, building, and running a business, I learned how to develop software, I knew how to set up and run servers, and I knew how to do basic accounting. These skills gave me the ability and confidence necessary to create a new software that would help me manage my rental properties and eventually turn it into a revenue-generating business.
The timing was right because at the time, there wasn’t a solution that met all of my needs. Of the options that were out there, they were either missing key features I was looking for or were far too expensive for me to consider. It was at this point that I decided to create Rentec Direct, the software that would help me become more efficient as a landlord and would eventually help thousands of other landlords, too.
Surprisingly often, friends, family members, or other acquaintances share their great idea for an app and ask me what I think about it. My first question is always: Are there any apps out there that already do this? I’m shocked when many of them tell me that they don’t know, they haven’t looked into it. My very first piece of advice for anyone wanting to start a business, whether it be an app, service, or product, is to research what already exists and determine if there’s a place for your idea in the market. In my case with Rentec Direct, there was no suitable solution for small, startup landlords like myself, and being the first to focus on this market helped us become successful so quickly.
Adam: What are the key steps you have taken to grow your business? What advice do you have for others on how to take their businesses to the next level?
Nathan: One of the most important steps in growing my business has been automating as many processes as possible. Instead of hiring a huge team, we’ve found ways to make our existing team more efficient by automating processes wherever we can. While our competitors have teams as large as 1,000+, we operate with a lean, mean team of only 20.
Before I hired my second employee, our invoicing and accounts receivable for our software subscriptions were already 100% automated. That meant no invoices to create, no checks to cash, and automated reconciliations. At other software companies at the time, there were teams of personnel focused on this task alone. If you can automate it, do it. In my experience, the cost upfront to automate will return 100x or more.
Including synergistic products within your offering is another way we’ve grown our business over time. In our specific case, our clients are regularly moving in new tenants, so it made perfect sense for us to start offering tenant screening products built into our platform. Our clients were already paying for this service elsewhere, so we made it easier for them to get the product within our software platform and created a new revenue stream. If you can build the solutions your clients need directly into your product or service, there’s a strong chance they will choose your business rather than sourcing from separate vendors.
Adam: What are your best sales and marketing tips?
Nathan: Find a way to let your product sell itself. Selling a good product should not be that hard. The product value should outweigh the cost, and that should be obvious to your customers. As an example, we offer our software at a per-unit rate that we know, without a doubt, is a cost well below the savings our clients will find in time and money when using our software. It’s not enough to just know that you are helping your customers save time and/or money. You need to be able to demonstrate it to them quickly and clearly.
If your product doesn’t save customers time or money, or if you don’t provide a service that is absolutely necessary and not available elsewhere, keep searching for another idea. If you already have the magic formula of saving customers time and money, all you really have to do from a marketing standpoint is put the product in front of them and let them try it out. Of course, you need to know and understand your audience to market to them effectively. I’m a big advocate of free trials and demos, especially in the software space. Personally, I don’t like to be “sold” on products or services. I like to see it for myself and make my own decision as to whether or not it’s going to work well for me.
Adam: What are the most important trends in technology that leaders should be aware of and understand? What should they understand about them?
Nathan: In my two decades as an entrepreneur, I’ve watched society transition from physical delivery to electronic delivery wherever practical. This trend will continue for every product or service where electronic delivery is possible. Netflix is a perfect example. We used to receive our selected DVDs by mail (which I personally loved), but as soon as it was practical for Netflix to deliver the same product electronically, they did. No more DVDs today. In my world of Software As A Service (SaaS), our products are all delivered in real-time via the internet, and support is bundled in for a monthly price. We’ll continue to see more and more products convert to this SaaS model.
AI language models are also rapidly becoming relevant in every industry and in everyday life. We’ve incorporated AI into our software platform, which has benefited our customers, but we also use AI internally to do things like review code, which has saved our team hundreds of hours of time. No matter what industry you’re in, ask yourself how AI can save time or automate tasks. Ironically, you can ask AI this question, and it will probably give you an excellent list.
Adam: In your experience, what are the defining qualities of an effective leader? How can leaders and aspiring leaders take their leadership skills to the next level?
Nathan: An effective leader values people over profit. People include your employees, your customers, your vendors, and any other individuals or groups that are vital to your business. In my experience as a leader, I’ve found that if you put your employees and customers ahead of all else, the profits will naturally follow.
Being involved in the day-to-day operations of your business is also critical to success as a leader. I’ve seen too many good companies fail when the owner(s) decide to stop coming into the office and stop keeping tabs on the day-to-day. When this happens, quality starts to suffer, and morale can easily degrade, and customers notice. The beginning of the end of a business is often when leadership stops showing up.
I recommend being present and involved with your customers and your employees. Of course, you have to delegate and can’t be involved in every single aspect of the business, but take one day a week, or even one day a month, to jump in and really talk to your customers and have meaningful personal conversations with your team. In our office, we do this by hosting monthly games or competitions that I participate in, and weekly catered lunches that the entire team joins. The only rule at lunch is no shop talk.
Adam: What is your best advice on building, leading, and managing teams?
Nathan: I’m a big believer in having a close team that works together, physically. There has been a massive shift toward remote teams over the past decade, and when I speak with other business owners who have transitioned to remote work environments, the biggest challenge they all share is maintaining culture. Zoom meetings and annual get-togethers just aren’t the same as working together day in and day out. If you can have your team work together physically, even a couple of days a week, I believe it’s far easier to maintain a culture and workplace atmosphere that will keep your employees coming back.
Along those same lines, I’m not a fan of outsourcing. Our entire team is based right here in Southern Oregon, including our customer service and development teams, which many of our competitors have outsourced overseas. It goes back to prioritizing people over profits. Offshore employees might be cheaper, but the best way to prioritize our customers is to have our well-trained, on-the-ground staff answer the phones, emails, and live chats.
My final piece of advice is to hire for the personality first and the skillset second. Most people can be trained to do the job if they have the basic fundamentals, but it’s quite difficult to “train” someone’s personality. When we hire, we intentionally prioritize adding people to our team who are going to complement and get along well with our existing employees and workplace culture. If they like to play ping pong or corn hole at lunch, they’re probably going to fit in.
Adam: What are your three best tips applicable to entrepreneurs, executives, and civic leaders?
Nathan:
- Invest in relationships and trust. Success is rarely achieved alone. Build strong teams, empower your partners, and listen to the people you serve. Relationships built on transparency, reliability, and empathy will outlast any short-term gain and will carry you through the challenges.
- Stay adaptable without losing your core values. Markets shift, technology evolves, and communities change. Leaders who adapt with discipline, adjusting strategies while staying grounded in their core principles, will thrive in any environment. Agility matters, but values are what give decisions meaning and consistency.
- Prioritize impact over activity. It is easy to get caught up in being busy. The best leaders focus their energy on initiatives that create measurable value, whether that is innovation in business, growth in an organization, or meaningful improvements in your community.
Adam: What is the single best piece of advice you have ever received?
Nathan: When I was maybe 20 years old, my boss at the time was always telling me to buy a house instead of renting. He told me that my rent payment was just paying someone else’s mortgage, giving them all the benefits of home ownership and appreciation with my money. At 20, I hardly believed I could buy a house. That was for real adults making real money, and I was neither. But I found a way to do it anyway, eventually purchasing a very inexpensive condo that I financed 100% so I didn’t have to come up with a down payment. The payment on my loan was less than I was paying in rent, and now I was a homeowner building my own equity.
I turn to this as the best advice I’ve ever received because it got me started in real estate investing, which changed the trajectory of my whole career. That condo appreciated over 100% in the following years, and I was able to use my equity to purchase a second property, and then a third, and then a fourth. Before I knew it, I had a flourishing rental portfolio. Having that many rentals and managing them myself is what planted the seed for my business, which has turned into a massively successful software company.
Adam: Is there anything else you would like to share?
Nathan: As you start becoming successful, it’s a great time to think about how you want to give back to the community you’re a part of. Your community might be your physical city or neighborhood, or it might be a section of your industry or a cause you feel passionate about. You get to choose.
At my company, we’ve built philanthropy and community engagement into our core values, and we’ve chosen to support several local organizations that will, in turn, help the people who live in our community. On a larger scale, we also choose to use our research, data and knowledge for good, and share hundreds of articles, guides, and educational materials free for anyone to access through our company blog.
