How a founder plans to use blockchain to bring equity, transparency to the “American Dream” – buying a home

ONEAfter back-to-back home-buying nightmares — where predatory practices left Louis Byrd with high bills from unexpected repairs — the Kansas City entrepreneur and creative force plans to launch a new blockchain-infused solution to increase transparency for homebuyers.

The first technological product from Byrd’s Zanago Design, Kataba expected to allow potential buyers to verify titles, repairs and warranties before making an offer. Set to launch in spring 2023, Kataba is expected to feature a marketplace built on blockchain technology for buyers and sellers to search for and post properties.

“It’s almost like the real estate equivalent of Carfax,” Byrd said, describing the use of Kataba’s digital ledger — called lejablox — to see what’s been done on the house in question.

The self-funded project follows two recent experiences where the Byrds were burned by contractors, lenders and sellers who hid significant problems with the houses they unloaded.

Byrd and his wife eventually had to sell their first home at a loss because of the challenges. Their second didn’t fare much better.

A newly renovated 126-year-old home with a new roof and updated plumbing and electrical passed inspections well — before an ignored repair need by the previous owners turned into $2,000 in damage from leaking sewers, Byrd said.

“So here we are again,” he said, noting a list of other problems that arose: pipes freezing due to lack of insulation, incorrect electrical voltage for the laundry, a bat infestation. “Round 2 is buying a home and a lot of these issues are taking place.

“We did everything right,” Byrd continued. – We had an inspection. We had a seller’s reveal. … But the inspector can only see so much. The inspector can see what is on the outside, but not necessarily what is behind the wall.”

Concerns also arose about the quality of repairs done by previous owners, he said, prompting the couple to question the home’s true history.

“That was the moment when I talked to my wife and I said, ‘there’s got to be a better way,'” Byrd said. “People shouldn’t have to go through this when they buy a house. Because in most other cases, if you buy something, if there’s a defect, if there’s a problem, you can obviously take it back. And you can do that with real estate. But the challenge is – the legal process – there’s so much to go through.”

Louis Byrd, Kataba

A direct data connection

Instead of just a standard seller’s disclosure that says electrical work was done, Byrd wants potential buyers to be able to see when the repairs were done, the identity of the company that did the work, the permits used and how much the repairs were done. cost, plus any warranties that are included.

“It gives me as a buyer a little more assurance that things were done right,” he explained. “They understand exactly what they are buying in this property.”

Unlike Carfax, a third-party platform for the auto industry, Kataba will be a direct contract between seller and buyer and provides more legal protection in case something goes wrong, Byrd said.

“It’s on the blockchain, which creates an immutable, meaning no one can tamper with it once that thing is imprinted on the technology, right on the blockchain,” he added.

When someone buys a home, the owners will be able to add their own repairs and maintenance to Lejablox.

“Now the property is more valuable,” Byrd said. “Because now I can sell it to someone else and they can see everything I did to take care of the house.”

Kataba is also expected to shorten the time between the sale agreement and closing, he added.

“Because we’re leveraging blockchain technology, instead of me having to wait 30 days, 45 days for closing and all these things, well guess what,” Byrd continued. “We can do it in 30 minutes.”

Another goal: Kataba envisions offering a fairer marketplace in a challenging housing market where inventory is low and many properties are snapped up by corporate businesses and investors who pay cash, make minimal repairs, and flip and rent them out at high prices. prices.

“Part of it is also creating a level playing field for people to actually be able to join the quote from the American Dream,” he explained, “to have property (and) to get that first level of wealth in the family.”

To get there, Kataba is expected to have guaranteed pre-financing, rather than the normal pre-approval process, Byrd said.

“The seller will know that everyone who is in Kataba has already been approved, verified (and) guaranteed financing,” he said. “If an investor comes in with a low cash offer, well, no. We have this marketplace where you can get what your house is actually worth. And the people shopping there can afford it because it’s all within one ecosystem together.”

This creates fairer results, he added; sellers are not taken advantage of with lowball offers and buyers have the opportunity to compete in the market.

But the Kataba marketplace isn’t for everyone, Byrd added.

“If you have sellers or flippers or property owners who know they’re not doing things right, they’re not going to list on Kataba,” he explained. “And that is part of the goal. … Again, that’s why it’s about transparency in real estate. People on both sides understand what they are getting into.”

From engineer to a technical start-up

Running a business is nothing new to Byrd, a Kansas City native and entrepreneur since 2010.

He earned an electrical engineering degree from the University of Missouri, but quickly realized the corporate world wasn’t for him, he said. So Byrd attended the Institution of Production and Recording in Minneapolis and earned a multimedia arts degree with an emphasis in sound production and engineering.

Returning to Kansas City, he began doing freelance graphics, cinematography and music production, which led to his first business, Nest Multimedia.

“Over time, I started getting a reputation around town for being able to do certain types of multimedia,” he said. “Then I got involved in branding and got really involved in multimedia and multicultural types of marketing and branding and did that for a while.”

Mellie Blue Branding then evolved into cross-cultural strategic branding, he continued.

“I started working primarily with engineering firms, architectural firms, law firms and really helping them understand culture,” he continued, “and how that can affect not only their business, but their brand in general.”

In 2021, Byrd was recruited to VMLY&R as director of experience design, but after a year, he said, he realized there’s nothing like running your own business and he wanted to focus on his passions.

“What I started to learn is that you can’t solve problems just by talking about it,” Byrd added. “And I realized it’s time to start building solutions to address some of the things that I care about, a lot of things that kind of revolve around systemic challenges in our society. So that’s what led to Zanago .”

He started Zanago Designs with the goal of building a world where equity is the norm, he said.

“How does Kataba fit in?” he said. “Well, it’s about creating, again, the fair outcomes for people.”

This comes in two ways, he continued: giving people a fair shake in the market and ensuring their investment in a house is worth it.

“When it comes to people who have historically been excluded — I’m talking about across race, gender, ethnicity, all these different things — one of the challenges is that a lot of times, certain demographics are biased against,” he said. “And system-wise, they don’t have an opportunity to get the same kind of preferential treatment in real estate.”

Kataba aims to remove much of that bias, Byrd said, by removing questions about race and gender that are on traditional mortgage applications. These issues may not directly affect your credit, he added, but they can affect your interest rate and insurance rates.

“We’re basically experimenting with: how can we approve or qualify people and look at the whole person?” he said. “Not just looking at these things that have traditionally been looked at.”

Byrd believes Kataba will revolutionize the property industry by going against the status quo.

“We want to give people an opportunity to really achieve wealth and do it in a way where they don’t get screwed at the end of the day,” he said.

This story is possible thanks to the support of Ewing Marion Kauffman Foundationa private, non-partisan foundation that works together with environments in education and entrepreneurship to create unusual solutions and empower people to shape their future and succeed.

For more information, visit www.kauffman.org and connect at www.twitter.com/kauffmanfdn and www.facebook.com/kauffmanfdn