Why "3rd Party Management" Solutions Are Just A Band-Aid

For years, property managers have sought a different option from the manual chaos of traditional cash deposits and the high-cost "alternative" models. This gave rise to a new category: 3rd party management solutions like Roost, Rentable, and DepositCloud.

These platforms offer a seductive promise: “We’ll handle the mess so you don't have to.” They automate the emails, calculate the interest, and handle the move-out checks.

But for operators, these solutions solve only the symptoms while leaving the underlying challenges—escrow liability—untouched.

The Illusion of "Off Your Plate"

Most 3rd-party management tools act as a sophisticated "wrapper" around your existing bank accounts or an FBO (For Benefit Of) account.

• The Problem: In these models, the landlord or the management company is still the legal "holder" of the funds. Even if a software is sending the emails, the legal liability for commingling, missed interest, or late refunds stays with you.
• The Reconciliation Trap: Because these tools are trying to manage your escrow, your accounting team still has to reconcile the 3rd-party software against your actual bank statements and your PMS. You’ve added a "management layer," but you haven't removed the audit risk.
• The Hidden Fee Structure: Many of these platforms are "free" for the landlord but charge the resident convenience fees for ACH or credit card payments. This adds friction to the very thing they claim to streamline: move-in.

How Whale is different

At Whale, we didn't build a management tool to "fix" your escrow accounts. We built a platform that eliminates the need for them entirely.

Here is how the 3rd party management model compares to the Whale model:

Stop Managing Liability. Start Removing It.

Solutions like DepositCloud or Roost are "band-aid" technologies. They help you run a broken process more efficiently but don’t address the root causes of the administrative burdens and you’re still liable for non-compliance since you’re still holding the funds.

Whale is a structural change.

By allowing residents to open their own high-yield accounts, we remove the "escrow headache" at the source. There are no convenience fees to irritate your residents, no interest calculations for your accounting team to double-check, and no legal risk since you never handle the funds.

Best-in-class operators are realizing that the goal isn't to find someone to manage their liability—it’s to use a platform that ensures the liability never exists in the first place while providing an amenity to their residents.