Jay Michael: Why Only the Best Entrepreneurs Have Style in Their Business
“My business partner says I have the sensibilities of a woman with the negotiation skills of a man. I know that is sexist, but being a gay male in a mainly straight male industry gives me a different, and often more well-rounded, perspective. I see it as an upside.”
Tell us how you got your start in business and how you found your passion for real estate.
“One of my dearest childhood friends, Adam, always reminds me of when I came over to his house for our first play date. I was dropped off by my mother and was holding an old briefcase, filled with playing cards I had found in my basement. According to Adam’s mother, the first thing I said when I walked in the door was, “I am not here to play, I am here to do business.” Adam and I were five years old at the time. I was trying to sell/barter playing cards to/with him, of course. Fast forward about 16 years and I reconnect with another childhood friend to start a real estate business that’s almost in its 12th year of operation.
Real estate was a natural fit for me in that I always had an obsession with space and how it could be best used. I would design and redesign my dorm room almost monthly in college, but it never then occurred to me that my life could revolve around designing space as a career… As the years progressed I became more and more entrenched in Chicago real estate and began noticing that the trend among metropolitan cities throughout the US was that tenants felt unsatisfied with their landlords, and rightly so. Real estate, unlike most other industries, was sort of antiquated and stuck in the late ‘80s early ‘90s. And I don’t mean the tacky Vegas-style luxury rental structures popping up everywhere, I mean the sort of middle market housing stock that most of us live in. So, I decided to try to make a change in that arena, starting in the Northside of Chicago, by taking underutilized buildings and redeveloping them into high quality, amenity rich, authentic environments at approachable rents, called FLATS. My vision was to develop more than real estate but a living, breathing community… a sort of housing culture.”
Regarding #FLATSproject, what kind of companies do you think really add culture to the startup scene? What would you like to see ideally?
“If a company brings people together that may otherwise not have met, they are the sort of businesses we want to talk to. I know everyone wants an awesome café to drive their community but that’s just one of the many pieces. I think there are purveyors of all sorts of goods and services that activate community. It can be anything from a barber shop to a custom handbag artisan… the key is they need to attract the attention of people who are willing to meet new people and share their experiences and ideas. We think in terms of sociographics, never demographics—it’s not who they are but rather how they live and what they love.”
In terms if other entrepreneurs pitching their companies to you, what have been the most memorable or creative pitches you’ve seen and why?
“We get pitched a lot. I think many of the ideas I see are awesome, but we can only get involved in a very select few. I always find myself most intrigued by the rough diamond sort of deals. If you only need us to write a check, we aren’t the best investor for you. If you want to use us as a sounding board and are looking to develop a forum for creative exchange, we are your guys.
I am not sure I have a best or worse pitch, but If it were totally up to me and we were able to invest in anything, I would say yes all day long. The common thread among the many new business deals we pass on is one of two things: 1) they are not providing a solution to a problem we didn’t know we even had (like Uber…before they came around, we were all ok dealing with whatever taxi we could find—now our options and efficiency in shared transport have dramatically changed) and 2) their consumer experience is grim and they aren’t interested in making the changes to correct that. Often the best ideas come from poor marketers, but if they are convinced their methods are solid and they are unwilling to change, we pass. Consumer experience is a really important part of the equation to us.”
Throughout your journey as a business savvy entrepreneur, what has been the greatest lesson in business that has stuck with you today?
“I hate to use this aggressive quote, but it really speaks to the process of making change—
“First they ignore you, then they ridicule you, then they fight you and then you win.” -Mahatma Gandhi
My business partner and I always say our best and most fruitful deals have been the ones everyone told us wouldn’t work. FLATS is a great example. We still hear some noise about how FLATS isn’t working, but that’s part of making change and innovating an industry. The true judge is the consumer and I can proudly say we have many very happy tenants.”
In terms of a business partner, as well as a significant other, what would you say are some must have qualities in order to be a successful entrepreneur/ business owner?
“My business partner Alex and I have only one shared skill set, we both LOVE to find new ways of doing old things… like developing real estate. We ignore the old school rules and think through how we would like to live and that’s how we build. Otherwise, we are both on totally different wavelengths. A few days ago we were in a meeting with a potential partner who wanted us to explain why our company would add value (we were bidding on a large development partnership). A colleague who was in the meeting told me that when the question had to do with design, historical value, architecture, community etc., I would light up and give strong answers and when the questions were about the finances, debt, liquidity, etc. my partner would light up and offer strong answers. But the funniest part is that he also said that while the opposite partner would speak the other would be on his iphone responding to emails. We are sort of married (he has a real wife and three kids) and at this point, we know who does and says what. We focus on fine tuning what we do well and we don’t try to learn the things we aren’t passionate about.”
In terms of lifestyle, can you tell us a few things you are currently obsessed with?
“Anything that lets us use our time, money or space more efficiently is on my A-list at the moment. For time, it’s SaneBox… it sorts your emails based on your patterns. I have only had it for a month or two, but it’s a game-changer. For money, it’s UberX… I am totally cool cabbing around in someone I don’t know’s Honda Civic for nearly half the price of a taxi with a TON more efficiency. For space, I am in love with the new, totally sophisticated line of furniture at CB2… they understand big style in small space.”
How important do you think having a sense of style should be to an entrepreneur and why?
“To me, having a sense of style is one of the most important parts of a business. Someone who worked for a company like Unilever (this wasn’t the company) once told me that most all of their creams and lotions are the same, but each brand has a different scent, different packaging and a different brand identity – that spoke volumes to me. We will all live in housing of some sort, but why we choose one over the other will have a lot to do with the way it looks and feels and that’s all about style.”
Besides FLATS Chicago, do you have any future plans for development/ dream companies?
“Too many to list… I have ideas all day long. I will say this though, if my idea doesn’t find a solution to a problem I didn’t know I had… to me the idea will remain an idea and nothing more.”
