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The Innovators: Bullpen Founder Tyler Kastelberg

In this series, Bisnow highlights people and companies pushing the commercial real estate industry forward in myriad ways. Click here to read Q&As with all the innovators Bisnow has interviewed so far.

The gig economy comes to commercial real estate. Bullpen, an online CRE hiring platform, is working to change the way companies approach their growth strategies through the thick and thin of market cycles.

“I think that Bullpen is a place for people who are interested in having control over all their time and how their career looks,” Bullpen CEO Tyler Kastelberg said.

Burgeoning CRE industry players often face the challenge of how to approach hiring growth amid the natural waxing and waning of deal flow — an issue all too pertinent during the past year of elevated economic uncertainty. Over the last several years, the rise of the gig economy has lent unprecedented flexibility to both companies and workers alike for a range of industries in a model that has been strikingly missing from professional services roles in CRE.

Bullpen CEO Tyler Kastelberg

Enter Kastelberg, who founded Bullpen as the first online freelance work platform for CRE professionals to create connections between CRE companies that need analysts but aren’t ready to commit to hiring permanent positions.

After succumbing to burnout working as an investment banker for several years, Kastelberg decided to dive headfirst into the world of CRE investing — where he quickly made the salient observation that a huge opportunity existed to fill a need for analysis services while carving a space for those seeking a more independent working environment.

In April 2019, Bullpen was born giving industry professionals and companies a virtual marketplace to match talent with those seeking help making deals.

“I think that if in 10 years I look back and I see that our platform has allowed thousands of individuals to earn actual full-time income off our platform and have control over how they spend their weekends and family time — if that ends up happening, I'd say it was a huge win,” Kastelberg said.

This interview has been edited and condensed for clarity.

Bisnow: How did your interest in commercial real estate develop and lead to the launch of Bullpen?

Kastelberg: I became hooked on real estate while studying at Virginia Tech when I purchased a townhouse and leased it to my friends. The rent paid for the mortgage and left me with enough spending money for the weekends — a huge win for a college kid. I took jobs at GE and then Raymond James before realizing that I'd much rather build a business than have a boss. I left Raymond James and went all-in on commercial real estate, starting Kastelberg Real Estate and gathering equity commitments from friends in San Francisco for real estate investments in Richmond, Virginia. I brought the perspective of an outsider, underwriting and structuring deals in ways that you'd more commonly see in startups, which became a competitive advantage.

Small, local real estate firms started to take notice of my ability to underwrite and asked if I'd help run numbers on their deals. This snowballed into a consulting company that I called Bullpen Analysis Services, where I hired a few analysts to run numbers and a salesperson to dig up new business. In April of 2019, I realized that we were missing out on a huge market opportunity as a consulting business and pivoted to a freelancer marketplace dedicated to the CRE industry that we called Bullpen.

We launched our first piece of software in August 2019 and grew to around 200 users by March 2020. Then the world turned upside down. With massive layoffs in the real estate industry, interest from new freelancers exploded. Companies soon followed suit, opting to hire a more flexible, freelance workforce to manage the ebbs and flows in their business rather than rehire full time. Today, Bullpen has nearly 1,000 users scattered across the U.S.

Bisnow: You said that Bullpen is the first freelance platform for CRE analysts. Is this a model that can be replicated for other parts of the industry?

Kastelberg: Having worked as an analyst and with analysts, Bullpen grew out of that understanding of how analysts work, but we’re transitioning into a number of other verticals in the industry. That includes marketing, equity memos, amenity maps and neighborhood research. Our other focus that has taken off recently is deal advising.

So we’re branching out. Our focus has been on your more hard-to-hire-for talents. So underwriting, for instance, that takes a lot of experience, a lot of training, certifications. Our platform is focused on those harder-to-find talents versus platforms like Upwork or Fiverr that have your more entry-level talents.

Bisnow: How does Bullpen make money and has the strategy been effective?

Kastelberg: It's a hot topic on our team internally. At the moment our business earns a percentage of the overall volume on the platform. So if a person is charging $100 per hour on a project, our business earns on average 30% commission on that.

Our premium offering on our website is effectively a product of an observation that a lot of employers are really interested in our platform. However, posting a job and interviewing people is a big headache, and so our team is offering this higher tier service level in which our sales team helps with placement of an analyst and there’s a placement fee associated with that.

On our basic tier, there isn't any fee to sign up, everything is platform-based so it doesn't involve any sales people or anyone on our team in order to hire somebody. The premium model was launched in early January and we have been charging around $500 on a placement for that. However, our team has been toying with charging a much higher price because our customers have been almost too happy to pay that and it's kind of hitting us. I think we're leaving a whole lot of money out on the table.

Revenue models in our business are really tricky and our goal in this is just having a revenue model that users are excited to pay and I think in the next six months, our team will be testing a whole bunch of variations on that. And so it could be a membership model, it could be placement fees. I think there's a lot of change coming.

Bullpen CEO Tyler Kastelberg giving a product demo.

Bisnow: What was it like to launch Bullpen and then get hit by the pandemic less than a year later?

Kastelberg: Around April we ended up laying off a few of our sales people, and as a business owner laying someone off is the hardest thing to do. It’s just crushing as you’ve built a little community and you know your employees are counting on you to pay the bills. It was really hard on an emotional level.

A really huge blessing was that at the time our business was revenue-funded and we hadn’t raised any capital yet. It took a whole lot of the pressure off of us not having capital investors or board members who were pushing us into any hard choices.

We were revenue-funded up until Q4 2020 when we accepted our first angel investors.

Bisnow: How would you address concerns some may have about the quality of work through a virtual platform?

Kastelberg: Our primary difference from a platform like Upwork is that everybody on Bullpen has been interviewed, and so that tidies up around 80% of quality issues. It is a more tailored interview experience. Our team hops on the phone with you and you have to show us actual underwriting and our team peppers you with questions. And so individuals hiring on our platform have a lot of confidence — it's all high-quality people who have passed our interview process. At the moment only around 20% of applicants are actually accepted onto our platform.

Bisnow: Does the platform allow for collaborative work experiences and professional networking?

Kastelberg: Interesting, you're asking if there's a social aspect to it almost like LinkedIn. Our team has had a lot of conversations in the past two weeks actually, so it's a very timely question. It isn't implemented on our platform at the moment. So today it feels more like a curated Upwork experience. Everyone has profiles and they have examples of work and they write cover letters as they are applying for opportunities. However, a really huge opportunity in our industry and on this platform is in building an actual place in which individuals are able to connect over time and so it isn't only about a transactional underwriting project. It's about building a relationship, and I think it's really easy to talk about that. However, it's extremely hard to pull off.

It's important in that it helps in actually fostering a genuine connection with people and not more of a surface-level transactional one. So I'm on the same page with you about it being a really interesting opportunity. It isn't implemented at the moment, but it is on our radar.