Apartment leasing has a performance problem: top agents convert prospects at rates 10 times higher than their peers, yet most multifamily operators have no systematic way to identify what those top performers do differently or spread those behaviors across their teams. The industry’s default answer has been automation with AI chatbots, self-guided tours, digital screening but conversion data points in the opposite direction: the behaviors most strongly linked to signing a lease are interpersonal ones that scale poorly with bots. Grotto AI gives leasing teams a practical way to close that gap, analyzing every call and tour to surface what drives conversion at each specific property, then coaching agents in real time and after each interaction to reinforce those behaviors. Research underpinning the platform, built by AI scientists from Carnegie Mellon and Stanford across hundreds of thousands of leasing interactions, found that agents who created moments of laughter during tours were 48% more likely to sign a lease, while those who showed genuine curiosity saw a 35% higher conversion rate, figures that dwarf the impact of commonly prescribed tactics. The platform is already in use with major operators including Weidner Apartment Homes, which manages over 70,000 units, and ties its results directly to net operating income so customers can see the impact on their bottom line.AlleyWatch sat down with Grotto AI CEO and Cofounder Nick Deveau to learn more about the business, its future plans, recent funding roundthat brings total funding raised to $14M, and much, much more…
Who were your investors and how much did you raise?
We raised $10M Seed from ICONIQ and Asymmetric.
Tell us about the product or service that Grotto AI offers.
Grotto AI supercharges leasing teams during the human-to-human moments that drive conversion. We build real-time AI guidance and coaching for leasing teams, which listens to calls and tours, teaching teams what makes your top performers great, then guides every agent to deliver it in real time — across calls, tours, and follow-ups — ensuring every prospect gets a consistent, personalized experience.
What inspired the start of Grotto AI?
There are so many AI solutions in real estate being built to automate away grunt work. Those companies make the pitch “we automate away the grunt work to give teams time back for what matters most.” We saw that as whitespace, and decided to build technology for exactly those moments that matter most. We have the data to show that the most impactful parts of the prospect journey are the human-to-human ones where leasing teams build rapport and relationships. So we’re building technology that supercharges leasing teams during exactly those moments.
What market does Grotto AI target and how big is it?
We target institutional multifamily apartment owners. Our north star metric is reducing vacancy loss – the rent revenue lost from apartments sitting empty – and it erases about $500B of property value for these owners.
What’s your business model?
Per-property-per-month fee.
How are you preparing for a potential economic slowdown?
Externally, much of our customer-base feels these slowdowns as increased vacancy loss on their balance sheet. We help them reduce this. Internally, we run a very lean team with the help of AI.
What was the funding process like?
Fast. Quick process with lots of interest.
What factors about your business led your investors to write the check?
Quote from Tengbo Li at ICONIQ
“We had the privilege of working with Nick and Ben at EvolutionIQ and saw firsthand their ability to build and execute world-class B2B vertical AI products. What drew us to Grotto AI is that same combination of technical depth and commercial focus. We believe that they’re solving one of the most quantifiable problems in multifamily by driving real, measurable revenue growth. Grotto AI delivers results you can see on a P&L, not just a dashboard.”
What are the milestones you plan to achieve in the next six months?
Besides obvious revenue targets, building a highly referenceable customer base is our top priority. We’ve been told we’re “the best vendor I’ve ever worked with” by a key decision maker at one of our customers. Our plan is to earn that reputation over and over again.
What advice can you offer companies in New York that do not have a fresh injection of capital in the bank?
Focus on driving bottom-line impact for your customers. That always wins.
Where do you see the company going now over the near term?
We’re lucky to have great demand and a great team of builders. The main focus right now is building the right team to go implement Grotto out in the world so that we can drive as much impact as possible.
What’s your favorite winter destination in and around the city?
Massara, for a delicious Italian dinner.
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