I’ve always been of the mindset that you learn best from failure.
Lee Kaplan, 57, Snap.Build; Ponte Vedra Beach, Florida
Job title: Chief Executive Officer
Area of expertise or focus: Construction finance
What has been your biggest challenge in your particular role, and how have you overcome those obstacles? For me, taking on this role came with a learning curve as it relates to technology. I would say I “know enough to be dangerous”, but it has never been my forte. Fortunately, it’s not an ego thing for me – I don’t need to be the expert on my team in every subject. This is why I’ve got a team of leaders, like Brad David and Steve Stramm to support decision-making as it relates to the product and operations. Relationships have always been important to me, not only creating them but maintaining and nurturing them. Past careers have prepared me for the role of CEO of Snap.Build and I draw on these people and relationships for counsel and collaboration today. Hire great people and let them do their thing!
What about your current role/position at the company are you most happy with? It’s very rewarding to work with a builder for the first time and show them that the old rules of community banking and dealmaking is evolving. We have created a model that gives builders more autonomy and financial flexibility to enter new markets and juggle multiple projects at once. Disruption has been a key theme throughout my career and I’m excited to continue shaping the future of construction finance by rolling out a 2.0 version of our online platform in 2023. By harnessing the power of automation, we can minimize risk associated with investing in building projects and keep every stakeholder accountable with a digital tool that logs and tracks transactions in real-time. Transparency is always your friend whether you are the builder, funder, sub or vendor. We help facilitate that.
What is the best piece of advice you have received that has helped you succeed in your industry? I’ve always been of the mindset that you learn best from failure. And, most importantly, if you’re going to fail, you fail fast. The generation that’s entering the industry right now can sometimes be afraid of failure and the stigma that comes with it. It can almost be paralyzing and prevent a younger entrepreneur or business leader from taking a risk. If you do your homework, understand the motivations of people, and believe in yourself, you will ultimately have success.
Do you have any advice specifically for the next generation? There is no perfect blueprint. I took a non-traditional path to construction finance, working for years in sports marketing and helping Nike to launch into the golf vertical during the heyday of Tiger Woods. I founded a sports management company that represented D-1 college football coaches and was able to observe many different leadership styles and how people – whether other members of the coaching staff or student athletes – responded to criticism. When I’m in “deal mode” or trying to get investors to support our platform at Snap.Build, I work to understand motivations and driving forces that lead to decisions and as importantly, let them understand our Snap culture, which is special.
Would you advise any younger person to begin a career in residential construction? What would you advise them to do to get a foothold in the industry? Do your research, know your market. Pay close attention to industry trends. The economy isn’t the same in every region, state, or municipality. These are some of the basics you can get from a textbook.
Most of the time, a construction project’s success hinges on factors outside of funding. Unexpected variables like weather, rising cost of materials, or an underperforming contractor can stall or slow a new build. I’ve tried to eliminate some of these variables with a business model and technology that embeds transparency into the process (each transaction is logged and labeled). In addition, we do not employ traditional draw management for distribution of funds. Instead, Snap.Build deploys payments directly to subcontractors and vendors on the builder’s behalf, ensuring accurate and timely payments. It’s another degree of integrity we have built into the process and hope the rest of the industry begins to adopt a similar formula.
Please share with us the best lessons learned or a surprising component of your unique journey. In a previous life, salary and payment negotiation was a big part of my job description. I learned that even the most stubborn negotiators have a price and a driving motivation behind their ask. But if you can see someone else’s point of view, it gives you leverage and an opportunity to compromise. This is a skill that carries over to my work at Snap.Build. We needed a technology platform that could be viewed through a prism – each stakeholder had a purpose and motivation for using it. We want the builder to see how their capital is being allocated, in order to give them more control of the process. Each project has a projected delivery date and data that supports decision-making. This bit of data science was new to me, but it’s vital to the business and industry today.
In your opinion, what takeaways did we learn from the COVID crisis? The obvious one is that property values increased, as more people invested in home repairs and upgrades. More time spent at home lead to more renovations and projects. It also exposed some weaknesses in the supply chain and how we procure raw materials, including wood, for construction projects.
Today, I think we’re much better equipped to handle a slowdown in demand. Technology is the great equalizer, because it makes capital available to builders based on pre-qualifications and a standard set of rules, avoiding the nuance and delay of brick-and-mortar transactions. We’re no longer at the mercy of the Federal Reserve and institutional banking rates. With platforms like ours, there’s a new expectation and a validated process for ensuring there is no fraud in the system. That’s something we could have used during the housing crisis of 2008-2009.
What three words, phrases, statements or mantras would you use to describe your work mindset? Keep Moving Forward. It is critical to remain solutions-oriented when you run into roadblocks. Challenges will always be presented, but it is important to not give up and continue to focus on your original goals. Be nimble, be a great listener and challenge the status quo!