The company is calling the service the “Keyo Guarantee,” and it’s available to landlords in New York City for free. Landlords take advantage of the service by registering their vacant apartments on Keyo’s website. The company then finds tenants, who can also use Keyo’s app to pay their rent.
If those tenants then someday break their lease or default on their payments for whatever reason, Keyo steps in and covers the loss to the landlord for up to two months. At the same time, Keyo works to re-rent the apartment to a new tenant.
“No other brokerage offers a guarantee for New York landlords to combat vacancy,” Adrian Gross, Keyo’s senior vice president of marketing, said in a statement. “We’re thrilled that Keyo continues to grow at a rapid pace helping both tenants and landlords save time and money in one of the country’s most competitive housing markets.”
In a conversation with Inman, Gross further explained that the national rental default rate is about 5 percent. So while defaulting on a lease is “not something that’s super common,” Gross continued, it is a “concern that landlords have.” The Keyo Guarantee, then, is meant to offer those landlords a degree of certainty.
The Keyo Guarantee — which first became available to landlords last month — only applies to tenants that Keyo itself placed in an apartment. The company charges what it described as the “industry standard of one month’s rent” to place a tenant in a unit. However, the Keyo Guarantee is provided as a free, opt-in add-on to anyone using the company’s placement services.
Palo Alto-based Keyo was founded in 2017, and today claims 2,700 apartments in its portfolio, along with a 200-building waiting list. The company operates in both New York City and California’s Bay Area, though the Keyo Guarantee is currently only available in New York.
Keyo has also received venture backing from some of the most famous names in tech including Mark Zuckerberg, Bill Gates, Jeff Bezos and others, according to a company statement. The company uses both artificial intelligence and automation to quickly fill apartments, and said that “the average days on market for Keyo-listed rental apartments is only 15.”
In addition to the Keyo Guarantee, the company also sets itself apart from other rental firms by using “scouts” rather than brokers to show listings. Gross compared the scouts to Uber drivers; they work as freelancers and are notified via Keyo’s app that people in their neighborhood want to see an apartment. Scouts choose when they work, and get paid between $20 and $30 to unlock doors for prospective tenants.
Gross said this system has a number of advantages. For one thing, because scouts are already located proximate to listings, Keyo can “show units much faster” than a traditional broker who might have to traverse the city. The scout model also ends up connecting would-be tenants to residents of their new neighborhoods.
Keyo does not provide property management services such as maintenance, and is instead focused on using technology to find tenants, help them sign leases, and pay their rent. The company has plans to expand in the future, likely to other high-density cities, though it has not publicly identified its future markets.
In the meantime however, Gross said the response to the Keyo Guarantee has “been pretty crazy” among the company’s current clients.
“It’s a first in the industry,” he added, “People aren’t quite sure how to wrap their head around it. We’ve been really happy with the response so far.”