Leader Spotlight: Running product lines like startups, with Sumeet Howe

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Sumeet Howe is VP, Product at Hover, a mobile app for homeowners and professionals that translates photos into fully measured 3D models. She worked in app development before becoming a strategy consultant at IBM. Sumeet later transitioned to product management at GoodData before joining Hover seven years ago as their first PM, where she now leads the product, design, and operations orgs.

In our conversation, Sumeet shares how each of Hover’s product managers act as founders of Series A companies — they provide strong ROI cases on why they should invest in one product area versus the other. She talks about Hover’s marketplace model and the process of adding partners, such as manufacturers, retailers, and insurance providers, into the mix. Sumeet also discusses the transition to product-led growth as the pressure to reach profitability became more prominent.

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Solving for a black box problem

To start, can you talk about how Hover is changing what it looks like to be a homeowner?

Traditionally, when homeowners want to get something done to their home, the process involves talking to several contractors. They want to understand what it costs if they want to fix their roof or change the look of their home, for example. A contractor might say, “Oh, it’s going to take around $25,000,” and you have no idea why that is such a high cost. The whole home improvement industry is a big black box. It’s wrought with information asymmetry, inefficiencies, and uncertainty for both homeowners and pros.

Our mission is to empower homeowners at every step of their homeownership journey. Many companies help people buy a home, but no company helps you maintain and be the guiding partner throughout the homeownership journey. They’re constantly looking for information on what to do with their house, how they do it, and who they can rely on. We want to be that guiding partner. Our technology enables us to do that.

Can you walk through the technology and the user journey when they download the app?

The Hover app allows users to capture a few photos of their home without any special hardware — all they need is a smartphone. Then, we turn those pictures into comprehensive measurement reports and a 3D model. It’s essentially a digital twin of your space.

Anyone who comes to your home to do home improvement will also require all these measurements to order materials and to see where to place things. Users will have a fully measurable 3D model where they can change the design and look at different palettes and products, instantly.

We partner with key manufacturers and distributors so, because we know the exact measurement and the SKU of the products, we can spit out a dollar amount it’ll cost you. The home improvement industry is one of the few industries that’s not able to sell products on the internet. In our lifetime, someone is going to Amazon-ify this whole home improvement experience. And that’s what we’re getting at. We want to build that capability where homeowners can see the possibilities of their homes and then act on them by giving them the information that they need.

Again, the problem statement here is that if you have to do remodeling, both exterior and interior, what do you do now? Where do you go to get inspiration? You probably go to Houzz or Pinterest, but it’s really hard to imagine how inspiration will actually look in your home. With Hover, you can do that.

Building a marketplace model for home ownership

Do you consider it to be a marketplace model, then? There are end users, but you also work with manufacturers and distributors for supplies, furniture, etc.?

Yes, in this marketplace model, we already have the supply side intact. We have hundreds of thousands of contractors that use us on a daily basis. Every seven seconds, someone is Hovering a house. We are essentially building this database. And, ultimately, our vision is to create the spatial map of this entire planet and bring the world’s physical structure to life.

Hover is actually getting paid to build this data. It’s pretty rare to see that a company has figured out a business model where they are getting paid to build data. And this data is the underlying foundation for the next generation of the internet: the metaverse. And then the way we do this is basically becoming the partner to that homeowner throughout their journey.

As more people are putting more input into the software, do you partner with certain manufacturers and use that data to make recommendations?

Yes, think of us as more of a data company where we have all these partnerships throughout our ecosystem. The ecosystem is broad when you think about the entire home ownership journey. It starts with finance and real estate. Those players are up there. Ecommerce is a big player. We are currently working on a feature where you add an image of your home and then add a reference image — something inspirational, something you saw on your vacation. And you can say, “Show me the things that are in my home. What would it look like if my home were redesigned in this new style?”

Adding partners to the ecosystem

Do you use any other partners who are involved in the home-owning process, such as legal or insurance?

We also partner with insurance companies. Eight out of the top 10 insurance carriers use us. Several of them are investors in us. And the use case is that, instead of sending an adjuster to the place of the damaged house, you already have your data backed up digitally. You know exactly what things used to look like, what the dimensions were, and, in case any damage occurs, the carriers will send the link to policyholders and say, “Hey, just Hover your place. That’s all we need to reimburse your check.”

How did you figure out that you should start working with insurance carriers?

We got into insurance because the contractors were showing our reports to carriers. Oftentimes, when you get the reimbursement check for home damage, you show the check to a contractor. And the contractor is like, “This is not enough money.”

We saw a lot of arbitration going on where the contractors would show carriers that they needed more material because the measurements that the adjusters took weren’t accurate. They’d use our report on Hover, and the carriers would want to use it directly. So we removed that middle piece. Our contractor audience opened the door for an entirely new set of customers.

Since you’re gathering and using so much data, are there challenges that come with that?

Privacy is a big focus for us. The interesting part here is how we actually translate the unstructured data, which is photos, into structured data.

Right now, we get that data from users themselves and structure our privacy and data rights policies to strike the right balance on permissions from those users or homeowners. The derivative — the 3D structured data we create — is ours, but the images that they upload are theirs. We have mechanisms where they can ask us to not keep the images, or otherwise manage their personal data.

Product managers as startup entrepreneurs

You mentioned that you like to run a product line as a business line. Can you elaborate on that?

I run our product teams as though they’re founders of Series A companies. We have a bunch of these within Hover. There are so many opportunities that Hover can go after, and the hardest thing that I have to do, actually, is say no. I need to have a really strong ROI case from the product managers on why we should invest in one area versus the other. As the co-founders of Series A, they need to show impact. They need to show a three-year plan.

One exercise we do, which is pretty unique, is to come up with a three-year profit and loss statement. And it’s not like the numbers need to be fully accurate or you need to have an accurate roadmap for three years. But, like any founder when they are creating a Series A pitch deck, they need to show to the investors their path. This is how I’m going to make money. This is going to grow in the next three years. I have my product managers do that. To me, they’re business owners, not product managers.

A three-year plan, that’s interesting. Is that just a loose guideline for the resources and ROI?

The aim of the three-year plan is to paint a clear picture of the opportunity cost of investing in one aspect of the business over another. It’s not that we are actually building that entire roadmap, but it’s more for planning purposes. But the funding or the allocation, that’s pretty typical for how it happens in other software companies.

Right now, for example, we have two Series As within Hover. For the last few years, we’ve been focused on construction and insurance. We have a homeowner stream now, that’s one. Interiors is another Series A; we have the data I showed you for exteriors, so it’s the same value prop but on the interior side.

Identifying new Series A opportunities

What are the ways that the product line leaders of each Series A are identifying these problems?

They are constantly talking to customers in the adjacent world who are the end-users who are on the ground solving these problems. For the construction of the house, it’s very easy to take photos. But then we have the same customers who are saying, “Well, I also work on new constructions or new properties. How do I use Hover for that?” If we have the technology in place, it’s a combination of understanding what the market is like out there for that — what is the TAM? Is this worth investing in? And then of course, can we do this uniquely?

And what happens if the new Series A and product lines you’re developing don’t work?

Then we divest from that. That’s the beauty of Series A. It starts with a product manager, maybe one or two engineers, and maybe half a designer. And if we feel that, after investing for a handful of months, this is not going anywhere, then we don’t keep investing in that. The only way a team gets more people is when they show the impact and tangible growth.

Responding to pressure for profitability

Going from sales-led to product-led growth is a theme we heard a lot about in the last year. Can you talk through that transition and what that meant for Hover?

We always knew that we had to do it, but we were focused on creating new additional value and were relying on our sales team. But because the profitability puts pressure on as you grow, you can’t scale it that way.

That was a really great trigger to invest in product-led growth. There’s always the choice that if we have a team of four engineers, should we have them optimize and tie all the different existing products in a cohesive experience? Or should I use those resources to tackle a new market, like real estate, which is going to increase the TAM and increase the growth rate of Hover?

There’s always that trade-off. Because of the pressure on profitability, we doubled down on creating a cohesive experience for our existing product suite. And are making sure that the existing business is secure and growing by investing in this.

Finally, given how fast companies like Hover change, how do you keep everyone excited despite all the pivots?

We use this concept of Hover a lot called the OODA loop. It stands for orient, observe, decide, and action. The faster OODA loops you take, the faster you make decisions, and that becomes your competitive advantage. If you and your competitor have the same information, but you act on it quicker, then you win.

I feel that’s sort of ingrained in every Hoverite — as we get new information, we will change, we will evolve it. And sometimes it’s not easy because a lot of people get attached to the product but with the right context and focusing on deliberate communication, it can be done.