SmartRent, Inc. (SMRT): Business Model Canvas [Dec-2025 Updated]

You're looking at the nuts and bolts of how SmartRent, Inc. makes its money, especially now that they've sharpened their focus; honestly, looking at their Q3 2025 figures, the story is clear: they're running a high-retention, enterprise-focused Software as a Service (SaaS) model layered on top of a massive installed base of over 870,000 units, driving $56.9 million in Annual Recurring Revenue. We've mapped out their entire operation-from key partnerships with major multifamily REITs to their aggressive $30 million annualized cost-cutting program-so you can see exactly where the value is created and how they plan to turn that scale into sustainable profit. Dive in below for the full, data-driven Business Model Canvas breakdown.

SmartRent, Inc. (SMRT) - Canvas Business Model: Key Partnerships

You're looking at the essential external relationships that make SmartRent, Inc.'s platform work across the massive multifamily landscape. These aren't just vendors; they are deep integrations and strategic feedback loops that keep the technology relevant and scalable. Honestly, the partnership structure is what allows them to claim leadership in the space.

Smart Home Device Manufacturers

SmartRent, Inc. maintains deep integration capabilities with a range of smart home hardware manufacturers. This open-architecture approach means they aren't locked into one vendor, which is key for property owners needing flexibility. The platform is designed to seamlessly integrate with compatible smart devices from top manufacturers.

• The platform supports integration with hardware including smart locks, thermostats, and sensors.
• The company's differentiators include purpose-built software and hardware that integrate with a wide range of devices.

Major Multifamily REITs and Owners (Advisory Council)

Product feedback is formalized through a strategic group of top industry players. This council provides direct input on the technology roadmap, ensuring features solve real-world operational pain points. As of late 2025, SmartRent, Inc. reports serving 15 of the top 20 multifamily owners and operators.

The Product Advisory Council, launched in November 2025, includes senior executives from organizations such as:

• AvalonBay Communities
• Equity Residential
• Essex Property Trust
• UDR
• Morgan Properties

Scale of Customer Deployment

The scale of deployment directly reflects the strength of these owner/operator partnerships. The deployed base is growing steadily, which drives the recurring revenue stream.

Telecommunications Providers and Third-Party Installation

SmartRent, Inc. relies on external providers for connectivity infrastructure and on-the-ground deployment. The company highlights its end-to-end implementation and support as a key differentiator, which necessitates strong relationships with service providers.

The professional services revenue stream, which covers implementation, saw significant growth, indicating increased reliance on these external support channels:

• Professional services revenue in Q3 2025 was $7.0 million.
• This represented a 113% increase compared to the third quarter of the prior year.

Connectivity infrastructure partners, such as major telecommunications providers, are critical to ensuring the reliability of the millions of connected devices across the deployed base.

SmartRent, Inc. (SMRT) - Canvas Business Model: Key Activities

You're looking at the core actions SmartRent, Inc. is driving right now to reshape its financials and scale its platform. Here are the hard numbers from their Q3 2025 operational snapshot.

Executing the $30 million annualized cost reduction program.

The execution of this program is complete. This effort unlocked more than $30 million of annualized expense reductions. As a direct result, operating expenses for the third quarter of 2025 declined by 34% year-over-year, landing at $16.6 million. This discipline is key, as the company believes this cost reset puts them on track to achieve adjusted EBITDA and cash flow neutrality on a run rate basis exiting 2025.

Expanding the installed unit base, which is over 870,000 units.

The installed base continues to grow, reaching 870,230 units as of September 30, 2025. That represents an 11% increase compared to the prior year. For that quarter alone, the company deployed 22,644 new units, which was a 49% increase over the same period last year. Furthermore, Units Booked totaled 22,080, showing a 30% increase, which reflects the investment in the sales organization.

Developing and enhancing the core Smart Communities SaaS platform (SMRT IQ AI features).

The focus here is on driving higher-margin growth, with SaaS revenue reaching $14.2 million in Q3 2025, up 7% year-over-year, now comprising 39% of total revenue. The platform enhancement is supported by a recent $10 million investment in innovation and new features. The SMRT IQ feature introduces a conversational AI layer to transform property-level data into instant insights using natural language input.

End-to-end installation and professional services delivery.

The Professional Services stream saw massive growth, increasing by 113% year-over-year to reach $7 million in Q3 2025. Honestly, this stream is now performing at breakeven, which is a significant operational milestone.

Hardware procurement, logistics, and supply chain management.

This activity is being strategically de-emphasized to favor SaaS. Hardware revenue for the third quarter was $11.5 million, a steep decline of 38% year-over-year, directly reflecting the move away from bulk hardware sales that were not aligned with customer implementation timelines.

Here's a quick look at the revenue mix shift:

The company exited the third quarter with $100 million in cash and a $75 million undrawn credit facility.

You'll want to track these operational metrics closely:

• Net Revenue Retention Rate: Well above 100%.
• Net New Units Added (Year-over-Year): 83,192 units.
• Q3 New Units Deployed: 22,644.
• Operating Expenses (Q3 2025): $16.6 million.
• Target for Neutrality: Run rate non-GAAP neutrality exiting 2025.

Finance: draft 13-week cash view by Friday.

SmartRent, Inc. (SMRT) - Canvas Business Model: Key Resources

The foundation of SmartRent, Inc.'s business model rests on several critical, quantifiable assets as of late 2025.

The proprietary ecosystem is a combination of purpose-built hardware and cloud-based Software as a Service (SaaS) solutions. This software component is increasingly central to the financial profile, with SaaS revenue reaching 39% of total revenue in the third quarter of 2025, up from 37% in Q2 2025.

The scale of deployment represents a significant barrier to entry and a proven market presence. The installed base has expanded to more than 870,000 units as of Q3 2025. This reflects an 11% increase year-over-year in the total deployed base. During the third quarter alone, SmartRent deployed more than 22,000 new units, marking a 49% increase year-over-year for that quarter's deployment pace.

Financial stability is maintained through strong liquidity, which is crucial for funding high Return on Investment (ROI) reinvestments. As of the end of Q3 2025, the unrestricted cash balance stood at $100 million. This is further supported by an undrawn credit facility of $75 million. The company completed a cost reset program unlocking more than $30 million of annualized expense reductions.

Market penetration is evidenced by deep relationships within the largest segment of the target market. SmartRent serves 15 of the top 20 multifamily operators.

Here are the key operational and financial metrics defining these resources:

The platform's capabilities are further supported by specific operational achievements:

• Net cash burn improved by 79% year-over-year to $5 million in Q3 2025.
• Operating expenses decreased by 34% year-over-year to $16.6 million in Q3 2025.
• Professional Services gross profit shifted from a loss of $3.5 million (prior year) to a profit of $200,000 this quarter.

Finance: draft 13-week cash view by Friday.

SmartRent, Inc. (SMRT) - Canvas Business Model: Value Propositions

You're looking at the core reasons why property owners and operators choose SmartRent, Inc. (SMRT) solutions. It's about turning operational headaches into measurable financial gains, which is what really matters on the balance sheet.

Automating property operations to reduce labor and maintenance costs.

The platform's automation directly targets the biggest drains on property budgets. Multifamily operators have reported direct operational savings ranging from hundreds of thousands to millions annually simply by deploying smart technology that reduces labor needs and helps mitigate disasters before they become costly repairs. SmartRent, Inc. is also actively working to enhance this value stream, having added a seasoned expert in Q3 2025 to lead internal process simplification and automation, with expected benefits to flow through starting in 2026.

Reducing energy and water utility costs by nearly 20% for properties.

This is a major driver for adoption, especially as utility expenses climb. The data shows real-world impact from integrated smart technologies. Here's a look at the reported utility savings:

The value here is clear: lower operating expenses without necessarily passing the cost to residents, who themselves are concerned, with 92% of renters saying cutting utility costs matters.

Providing an integrated, end-to-end smart home and operations platform.

SmartRent, Inc. isn't just selling point solutions; it's delivering a connected ecosystem. This scale is evidenced by their deployed base, which reached more than 870,000 units as of the third quarter of 2025, an 11% increase year-over-year. This scale underpins the recurring revenue model, with Annual Recurring Revenue (ARR) hitting $56.9 million in Q3 2025. The SaaS revenue component, which is the sticky part of the business, was $14.2 million in Q3 2025, making up 39% of total revenue.

Enhancing resident experience through smart home and community access.

The platform enables a modern living experience. This is what keeps residents engaged and willing to stay. The focus on platform capabilities and AI infusion is intended to deliver even greater Return on Investment (ROI) to property owners, which translates to better resident value.

Offering a high customer retention rate, above 99.9% over three years.

While the specific three-year figure isn't in the latest filings, the near-term metric for SaaS customers shows strong stickiness. For the second quarter of 2025, the Customer Net Revenue Retention rate was 108%. The CEO also noted during the Q3 2025 call that there is 'very little customer turnover'. This high retention, especially with net revenue retention over 100%, means the existing customer base is expanding its spend with SmartRent, Inc. year-over-year.

Finance: draft 13-week cash view by Friday.

SmartRent, Inc. (SMRT) - Canvas Business Model: Customer Relationships

You're looking at how SmartRent, Inc. (SMRT) manages its relationships with property owners and operators as of late 2025. The approach is clearly tiered, moving from deep enterprise engagement to scalable self-service tools, which makes sense given their scale.

Dedicated enterprise sales and account management for large clients is a core focus. SmartRent, Inc. serves 15 of the top 20 multifamily owners and operators in the nation. This high-touch approach is necessary when dealing with an installed base that reached 870,230 units as of September 30, 2025. This installed base represents an 11% increase year-over-year from September 30, 2024. The company's customer base collectively owns or controls nearly seven million of the approximately 44 million institutionally managed rental housing units in the United States. This level of penetration requires dedicated attention to ensure stickiness.

For the larger, more complex deployments, the company emphasizes high-touch, end-to-end implementation and support services. This is reflected in the financial performance of the Professional Services segment. In the third quarter of 2025, Professional Services revenue hit $7.0 million, a massive 113% increase from the prior year quarter, which management attributes to higher installation volume and improved project efficiency. This service layer is a key differentiator, supporting the purpose-built hardware and software ecosystem.

To ensure the product roadmap stays aligned with the most sophisticated users, SmartRent, Inc. formalized strategic co-development via the Product Advisory Council with top customers. This council was launched in November 2025, bringing together senior executives from major organizations like AvalonBay Communities, Equity Residential, and UDR. This forum is designed to gather direct input on features and functionality, helping SmartRent, Inc. validate concepts and resolve pain points for its largest clients. The company also backed its commitment to customer-facing innovation with a $10 million investment program announced for 2025 to fuel customer success.

For broader adoption and ongoing management, the relationship shifts to self-service and remote management tools for property teams and residents. This is the engine behind the recurring revenue stream. SaaS revenue for the third quarter of 2025 was $14.2 million, a 7% year-over-year increase, now comprising 39% of total revenue, up from 33% in the prior year period. The Annual Recurring Revenue (ARR) stood at $56.9 million as of the end of Q3 2025. New unit deployment velocity is strong, with 22,644 New Units Deployed in Q3 2025, a 49% increase compared to the prior year period, showing that the sales organization investment is paying off in driving adoption of the recurring platform.

Here are the key operational metrics supporting these relationship strategies as of the third quarter of 2025:

The shift in revenue mix shows a clear preference for deeper, recurring relationships over transactional hardware sales. The SaaS ARPU (Average Revenue Per Unit) for the second quarter of 2025 was $5.69. The company is defintely prioritizing the quality of the installed base over sheer volume of hardware shipped.

• Customer base includes 15 of the top 20 multifamily operators.
• Total installed base is 870,230 units as of September 30, 2025.
• Professional Services revenue grew 113% year-over-year in Q3 2025.
• SaaS revenue comprised 39% of total revenue in Q3 2025.
• Management is targeting run rate cash flow neutrality exiting 2025.

Finance: draft 13-week cash view by Friday.

SmartRent, Inc. (SMRT) - Canvas Business Model: Channels

You're looking at how SmartRent, Inc. gets its product-the smart community and operations ecosystem-into the hands of property owners and operators as of late 2025. The channel strategy is clearly pivoting, moving away from one-time hardware sales and doubling down on recurring software value delivery, which shows up in the numbers we see from the third quarter of 2025.

Direct enterprise sales team targeting property owners and operators

The direct sales force is the engine driving new contract acquisition, and the focus is clearly on securing the recurring revenue base. We see evidence of this investment paying off in the booking metrics, even as the overall revenue mix shifts.

• The company noted ongoing investments in the Company's sales organization leading up to the third quarter of 2025.
• This direct effort resulted in Units Booked totaling 22,080 in the third quarter of 2025.
• That booking volume represented a 30% increase quarter-over-quarter.
• The installed base, which is the ultimate measure of channel success, reached 870,230 Units Deployed as of September 30, 2025.

Professional Services team for hardware installation and system setup

The Professional Services team is critical for the end-to-end implementation, which is a key differentiator for SmartRent, Inc. What's interesting here is the margin improvement, suggesting they are getting better at this service delivery, or perhaps the revenue mix is shifting to higher-value setup work.

Here's a quick look at the Professional Services financial contribution for the third quarter of 2025:

Honestly, seeing the Professional Services stream move from a loss to a profit of $200,000 in the quarter is a big deal for operational efficiency. They believe this breakeven performance is sustainable, driven by ARPU increases and cost reductions.

Proprietary software platform (mobile and web apps) for daily use

This is where the long-term value is locked in, as indicated by the growing Annual Recurring Revenue (ARR). The platform itself is the primary channel for ongoing customer engagement and value realization.

• Annual Recurring Revenue (ARR) hit $56.9 million in the third quarter of 2025.
• This ARR now represents 39% of the company's total revenue for the quarter.
• SaaS revenue specifically was $14.2 million in Q3 2025, making up more than 39% of total revenue.
• The Average Revenue Per Unit (ARPU) for SaaS was $5.66 in the quarter.
• The company reports millions of users leveraging SmartRent, Inc. solutions daily.

Strategic relationships with key partners and distributors

While the company has strategically de-emphasized bulk hardware sales that previously went through channels, the underlying relationships with major operators remain a core channel strength for deploying the SaaS platform.

The scale of their existing customer base speaks volumes about the strength of these relationships:

• SmartRent, Inc. has its solutions running across 15 of the top 20 multifamily operators.
• The net revenue retention rate is reported to be well above 100%, indicating existing partners are expanding their use of the platform.
• The company is actively working with customers to evolve products through a newly established customer product council.

The channel strategy is now clearly about embedding the recurring software, not just shipping boxes. Finance: draft 13-week cash view by Friday.

SmartRent, Inc. (SMRT) - Canvas Business Model: Customer Segments

Multifamily property owners and operators represent a core segment for SmartRent, Inc. (SMRT).

• 15 of the top 20 multifamily operators leverage SMRT solutions daily.
• SmartRent customers collectively own or control nearly seven million of the approximately 44 million institutionally managed rental housing units in the United States.
• The Product Advisory Council includes executives from leading multifamily REITs such as AvalonBay Communities, Equity Residential, and Essex Property Trust.

The institutional single-family rental (SFR) home owners segment is served by SmartRent, Inc. (SMRT) solutions.

• A partnership was announced to integrate technology into 35,000+ single-family Build-for-Rent (BFR) homes.

Student housing and developer communities are also key customer bases for SmartRent, Inc. (SMRT).

Residents using the in-unit smart home technology contribute to the overall installed base and recurring revenue metrics.

The overall installed base expanded by 11% from the prior year as of September 30, 2025.

SmartRent, Inc. (SMRT) - Canvas Business Model: Cost Structure

You're looking at the cost side of SmartRent, Inc. (SMRT) as of late 2025, focusing on where the cash is going after the aggressive restructuring. Honestly, the story here is the shift from high variable costs tied to hardware sales to a leaner operational base supporting the SaaS growth.

The most concrete number reflecting the reset is the Operating Expenses. For the third quarter of 2025, these expenses were reported at just $16.6 million. This figure shows the impact of the cost-cutting efforts, as it represents a 34 percent decrease year-over-year.

The completion of the major cost initiative is a key structural change. Management confirmed they completed the actions necessary to reset the cost structure during the third quarter. This program was designed to unlock at least $30 million of annualized expense reductions. To give you context on the ramp-up, the initial phase implemented at the end of the first quarter was targeting more than $10 million in annualized savings.

When we look at the Cost of Goods Sold (COGS) component, it's intertwined with the revenue mix shift. Total revenue for Q3 2025 was $36.2 million, with Hardware Revenue specifically at $11.5 million, a 38 percent drop year-over-year due to the strategic move away from bulk sales. The overall Gross Margin for the quarter landed at 26 percent, which the company noted was impacted by nonrecurring inventory charges related to sunsetting the parking management solution. Research and development (R&D) for the SaaS platform and new features, along with Sales and Marketing costs to expand the installed unit base, are now absorbed within the significantly reduced operating expense base, contributing to the narrowed Adjusted EBITDA loss of $(2.9) million for the quarter.

Here's a quick look at how the core financial performance metrics tie into this cost structure as of Q3 2025:

The focus on operational efficiency is clear when you see the impact on cash burn. The company exited the third quarter with unrestricted cash of $100 million, down from $105 million at the end of Q2 2025, while maintaining an undrawn credit facility of $75 million. This strong liquidity position is intended to fund high ROI reinvestments.

The shift in revenue mix also changes the nature of the costs; SaaS revenue reached $14.2 million, representing 39 percent of total revenue in Q3 2025. This recurring revenue stream generally carries a lower variable cost component than the hardware sales they are de-emphasizing.

You should watch for these specific cost drivers as the company moves forward:

• Inventory Charges: Nonrecurring charges impacted the Q3 2025 gross margin.
• Accrual Reversals: Operating expenses in Q3 2025 were aided by approximately $2.5 million of accrual reversals that management does not expect to recur.
• Sales Investments: Continued investments in the sales organization are expected to drive future growth.

Finance: draft 13-week cash view by Friday.

SmartRent, Inc. (SMRT) - Canvas Business Model: Revenue Streams

You're looking at how SmartRent, Inc. (SMRT) is bringing in cash as of late 2025, which is heavily influenced by their deliberate pivot toward a more predictable, software-driven model.

The revenue streams for the third quarter of 2025 show a clear mix, with a strategic reduction in one area supporting growth in others, like the recurring software fees.

The recurring revenue base is the key focus here, which is why the Annual Recurring Revenue (ARR) figure is so important for valuation and stability.

• Annual Recurring Revenue (ARR) as of Q3 2025: $56.9 million.
• SaaS revenue represented 39% of total Q3 2025 revenue.
• Total Q3 2025 revenue was $36.2 million.

Honestly, the growth in Professional Services revenue to $7.0 million, more than doubling, helps offset the expected drop from the strategic move away from bulk hardware deals. This shift is defintely meant to strengthen the quality and predictability of the overall revenue mix.

Finance: draft 13-week cash view by Friday.