Every scaled lien buyer I've talked to says pre-sale research is their bottleneck, so why isn't anyone selling it to them?

Question

I'm working through licensing on the service side and looking for something to build around. Three separate conversations in the last month with people buying liens at volume ended in the same complaint: they can't research fast enough before the sale, so they either bid on thin information or leave certificates on the table.

That sounds like a service business. Someone pulls the assessment record, checks access and improvement condition from public sources, flags parcels with obvious problems, delivers a scored list two weeks before the sale. Priced per parcel, maybe $20 to $40 depending on depth.

The argument against is that the research is the edge. If I sell the same scored list to four buyers in one county, they all bid the same parcels and the rate gets bid down for everybody, so the product destroys its own value. Buyers who understand that will keep it in house and pay a staffer instead.

The argument for is that most of this work is mechanical record pulling that doesn't contain judgment, and the judgment stays with the buyer. Plenty of industries outsource the data and compete on the decision.

I don't know which it is. If it's the first, the business is exclusive arrangements with one buyer per county and that's a much smaller business than I was picturing.

brandonlee36 · Answer

Wait, I think you've got my post. Either way, answering as the person with the small book.

I'd pay for the record pulling and not for the score. My last sale I spent eleven hours on 60 parcels and maybe two of those hours were judgment. The rest was assessment printouts, aerials, checking whether an address existed. At $25 a parcel that's $1,500 to buy back nine hours, and on a $140k deployment I'd take that trade without much thought.

The score I wouldn't buy, because I don't know how you built it and I'd have to check it, which puts the eleven hours back. Also the exclusivity worry cuts both ways. If four of us buy your data and all bid the same parcels, my rate compresses and I stop buying your data. So your product needs to be the boring layer underneath everyone's own screen.

One practical thing. Half of what I need varies by county in format, and about a dozen states don't make sale prices public at all, so any comparable value in your file would be estimated and I'd want that labeled clearly.

Every scaled lien buyer I've talked to says pre-sale research is their bottleneck, so why isn't anyone selling it to them?

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