Over the last several weeks I’ve had a chance to review Tracts.co, a software product that is focused on helping E&P land departments manage the title process. They claim to have developed a unique solution to allow in-house landmen the ability to proactively manage the process of determining mineral ownership by providing a tool that allows insight and control into:
They offered to let me take Tracts for a spin and I’d like to share my thoughts with all of you.
So What Exactly Does Tracts Do?
At a glance, Tracts may seem like just another flowchart and runsheet tool, but it is really a title management tool. The proprietary math engine is the software’s secret sauce. Instead of using multiple different tools for calculation, visualization, reporting and management, Tracts wants users to focus only on the information presented in each individual document. Instead of focusing on how a preceding conveyance affects your document, the user simply enters in the stated conveyance while the smart algorithm identifies and calculates for the related instruments.
A first impression may be that this is a broker tool. Not in my view. Because Tracts captures all of this data and stores it securely in the cloud, you now have project control and metrics at the project, tract, or instrument level. If an E&P can provide a tool for field landmen that will save time then they will directly benefit from that savings. The benefits go beyond dayrate savings though, through centralized ownership and storage of the data it can be easily accessed and updated at all times. With the new addition of a project dashboard and mapping feature Tracts provides a level of transparency that doesn’t often exist.
Using The Software
Instrument data is entered through a well-designed electronic notecard. One of the largest benefits of the tool is that all parties will work off this original data input - this leads to efficiencies through reduction of duplicate data entry. Only a minimal amount of data is required to make the flowchart functional (date, grantor, grantee, interest transferred) - but it also has the flexibility to handle the intricacies of what can happen inside of an instrument.
You can instruct the software to process the conveyance out of full 8/8’s, or as a percentage of the what the individual owns. It can also track which owners or leases are burdened by NPRI / ORRI interests - as well as the reservation of executive, bonus, or delay rental rights. I could go into more depth on the instrument card, but ultimately I want to convey that the product can handle the detail of a title runsheet and maintain automatic calculations / flowcharts.
My first thought after reading about the product was, “I bet I can break this”. I could bore you with all of the “what about this situation, what about that situation” scenarios -- but it’s easier just to tell you that it works. There are built-in solutions to handle the typical title issues like strangers to title, title assumptions, reservations, NPRI interests, etc.
One unique feature is that the application automatically generates the flowchart in real-time as you enter the data. You can instantly see how the data you enter affects the chain of title. It provides a way to visualize data beyond just text, which other enterprise products (like WellView, for example) have used successfully to significantly reduce data entry errors.
I found a quick YouTube video that Tracts published, so I'm including it below. I think it illustrates the functionality of Tracts very well, and shows how the product can handle complex title situations.
Access and Sharing
Sitting on top of the runsheet/flowchart software is a robust system to share and limit access to the data, so others can view or edit as required. This access is not only intended for an in-house landman to monitor progress - or quickly review data in the future… but also for in-line title review by an attorney.
Each company (in the below example "LandmanInsider.com") can have individual users which you can also share your Regions, Projects, or Tracts, as well as the ability to share with other companies. When sharing items, you can grant access to View, Edit, Create or Delete data.
Title Attorney Review
One concern I’ve heard from title reviewers is that they will not use “pre-built” flowcharts, they want to look at the chain without assumptions. Tracts has dealt with this concern through what they call a “Buildup View”. This view allows the examiner to view each document and the instrument card one by one for accuracy, and then see how that document affects the flow chart. At that point the reviewer can flag a document with comments, requirements, and set the document to “Reviewed” status. This allows immediate curative or further required research to begin in real-time.
The benefit to using a system like this is saving money and time, as well as reducing errors. If you have been managing title work for any amount of time, you’ve had (at least once) someone on your team lose a day or more of work due to “computer issues”. This product allows your team’s work to be saved in real-time, preventing those costly mistakes.
I’ve found that in the average title process portions of a chain-of-title or flowchart might be created by multiple individuals; the original field landman running the title, the landman’s supervisor who is reviewing their title, the actual title attorney, and then even occasionally the in-house landman (currently or at a future date when a question comes up). Having this information available to all parties in a standardized format provides clarity and insight into the work that was done. Beyond the simple time savings of preparing the same work product multiple times, the standardized format allows easier and faster review. I know when I’ve reviewed flowcharts prepared by others I always have questions:
- What does it mean when they highlight the box with green/blue/red?
- What is this dashed line? And this line over here has bigger dashes -- does that mean something else?
- Why didn’t they include the interest conveyed w/ this deed? Did they forget to type it in the flowchart, did they forget to account for it completely?
The point is… Ultimately I had to end up recreating the flowchart to make sure I was interpreting it correctly. If I knew (for sure) how it was laid out, and I trusted the manual calculation -- it would be an easier process. Unfortunately trusting OPP (other people’s product) is something you just can’t do in title work. However, you can trust an algorithm to draw and interpret data the same way, every time.
Even the most diligent title researcher or attorney can occasionally make calculation errors. While I would never suggest you leave your title calculation to a program, it certainly provides a great check and balance when the system makes calculations for you. Another benefit to introducing some automation to the title process is that discrepancies are easier to spot. Whether that is a stranger to title, a missing conveyance, or an over/under conveyance -- the system is equipped to identify those issues for resolution.
Not A Broker Tool
While there are several products out there to help manage field personnel, and even a few that incorporate the staffing and assignment of title tasks -- none of these solutions address the actual title process. Tracts isn’t trying to be a swiss army knife, but a solution targeting a specific problem. While it is designed to be easy to use for a field landman, the target audience is really an in-house landman.
The goal is to make the title process more transparent for the in-house landman.
Current Title Flow
- Landman reviews title
- Landman takes notes in courthouse
- Landman draw flowchart to visualize chain
- Landman manually calculates all conveyances
- Landman delivers runsheet to in-house landman or attorney
Tracts Title Flow
- Landman reviews title and enters individual instrument data
- All data and reports are viewable by all authorized parties in real-time
One benefit of having all of the title information in a database is that it allows the creation of a variety of reports and views. It allows the creation of a popup limited information runsheet. This report, and all of the reports, are updated in real-time as data entry occurs, and can be easily exported to excel. You can also, with the click of a button, download all the documents in the runsheet that have been uploaded.
The software will also generate a report of any warnings in the title. This might be an over/under conveyance, a stranger to title, or missing data that is required to make calculations.
One innovative feature that caught my eye, that is really only possible with a fully automated chain of title, is the ability to instantly get ownership calculations as of any date. Need to know the full ownership breakdown on Jan 1, 1938? Just select that date. I think this feature becomes increasingly useful for later research after a well is drilled and a property is in pay. When you consider the implications of complex trees of assignments, reservations, and conveyances -- it can really be beneficial to have the ability to easily “roll-back” the ownership to a certain date and see what it looked like.
It would be nice to see more configuration options for the reports -- such as what fields/information are included on the runsheet. As you can see below, the runsheet does include enough information. However, some users may want to include other details.
I’ve seen many technology companies try to break into the land business with varying success. One (obvious) thing that seems to separate winners and losers is the experience level of the team they build. Tracts has a good mix of contributors with technical and subject-matter skills. I’ve reviewed the employees via LinkedIn and find members of the team with experience in title review on both the field land and attorney side of the business. On the technical side, the team seems to be Seattle based - which is known as a vibrant, innovative tech community.
I feel like a review would be incomplete if I didn’t touch on the subject of pricing. That’s one area where (in general) enterprise software applications don’t publicly post information. In the same vein, Tracts preferred not to share actual pricing.
However, they did discuss their pricing model with me. Their philosophy on pricing is that companies should pay for their product based on the acreage size of tracts that clients are running title on (or alternatively the number of instruments in special situations). This eliminates the concept of paying per-user, which encourages users to grant access to anyone inside or outside their organization who could benefit from the information.
Ultimately, Tracts is working to deliver a product that brings transparency, cost savings, and accuracy to a workflow that is currently very opaque. There are also a few other benefits I’ve thought of as I’ve worked with the product:
- Standardization - The product will standardize the work product that brokers deliver so each runsheet, flowchart, and title package can look the same. This will drive efficiencies for the in-house land department.
- Collaboration - Efficiency will also come from the ability to identify and communicate issues to relevant parties faster. Title issues, complexity or time spent on a project will be much easier to catch earlier than in a typical process.
- Control - The security model designed for Tracts works well for E&P companies that work with multiple brokers, title attorneys and other vendors. The company administrator can allow full access, view only, or edit only to any individual tract, prospect, or area.
The product is also in active development, which is great for users. It means that if you have a suggestion for a useful feature, there is a high likelihood you’ll find it implemented. The developers currently have several features in the works that will continue to improve the user experience, and I expect those updates to continue.
I believe that companies can benefit from running a side-by-side comparison of brokers using Tracts alongside their typical progress. As always - cash is king. If using Tracts.co will deliver a better product, more efficiently, with a cost savings -- why shouldn’t you try it?