ButterflyMX CEO Aaron Rudenstine on Why the AI Advantage Starts at the Front Door

ButterflyMX began with a simple insight: opening a building door, gate or garage should be as easy as using a smartphone. The company’s name came from the idea of an intercom video “fluttering” to a resident’s phone, letting them communicate with visitors and allowing building access from anywhere.

Since then, ButterflyMX has expanded far beyond video intercoms into a complete, unified property access and security suite for multifamily and commercial buildings, student housing, gated communities, HOAs and other multi-tenant properties. Its platform powers building access, security and operational workflows through unified software, proprietary hardware and deep integrations with existing infrastructure to drive vastly improved experiences for property managers, residents, visitors and vendors.

This solves an urgent problem, since building access is no longer as simple as buzzing someone in. ButterflyMX helps lean property teams manage increasingly complex access and security workflows, while its embedded hardware footprint and continuous stream of building data create a powerful AI advantage. Over time, the platform can proactively identify unusual access patterns, reduce false alarms and automate manual monitoring.

FTV invested in ButterflyMX in January 2025, drawn to the company’s leadership in property access and security, consistent multi-year growth, deep customer relationships and the opportunity to expand into additional areas of building technology.

In a recent conversation with CEO Aaron Rudenstine, we talked about how AI gives ButterflyMX leverage, the importance of hardware as a moat and how he’s thinking about growth in a more granular way.

With AI commoditizing certain aspects of software, how do you think about the hardware and software moats for ButterflyMX?

While AI can absolutely commoditize parts of the software layer, it’s really difficult for AI to replicate the physical side of what we’ve created and provide to our customers. We’ve used more than 10 years of real-world data to create a system that operates extremely reliably under all kinds of conditions. Think about 10 p.m. on a Friday when it’s raining hard and the Wi-Fi network is down. Building a reliable system in messy environments takes a lot of time, experience and repetition.

We’ve always thought about our moat as the integration of hardware, software, networking and customer service into a single operating layer for buildings. That single layer matters and getting it right matters. Doing access is very different than doing access well.

Why is the hardware component so important?

We’ve always viewed hardware as a strategic asset, but it’s become even more valuable in an AI era. Owning the hardware layer physically anchors ButterflyMX inside buildings for years.

The hardware is ultimately the vehicle through which the software experience is delivered, so controlling the entire stack lets us diagnose issues faster, optimize reliability and create a best-in-class user experience. Owning the full stack also lets us solve really tricky issues.

Beyond the technology, reputation and customer satisfaction are important in our industry. Building owners and property managers talk to each other all the time, which creates a feedback loop that drives faster sales cycles, lower customer acquisition costs and expansion opportunities. Our churn rate is just 1%.

A 1% churn rate is impressive. Why is the product so sticky?

Building owners and managers are actively looking for technology to solve operational problems, but they often struggle to find truly integrated, end-to-end solutions. Instead, they end up stitching together multiple point solutions from different vendors.

The problem is that when something breaks, there’s no clear accountability. Vendors point fingers at one another, and the customer is left trying to sort it out. Our platform gives customers a single point of accountability. That simplicity and reliability are incredibly valuable to property managers and ultimately to residents and tenants who live and work in these buildings every day.

A lot about the macro environment has shifted since FTV’s investment in January 2025. What’s it been like working with your board through a period of rapid change?

The past year has been anything but predictable, and FTV has helped me think about growth somewhat differently.

Before, I was looking at the tip of the iceberg: revenue growth, bookings, customer count. Now I’m looking at everything below the surface. Which customers create long-term value? Which segments have the lowest acquisition costs? Where are we winning because we’re genuinely differentiated versus simply participating in a growing market?

Answering some of those questions has meant re-instrumenting our business from a data perspective so we can see the data in a more comprehensive, nuanced and, in some cases, granular way.

ButterflyMX CEO Aaron Rudenstine speaking at FTV Capital’s Annual Partner Conference in Newport Beach, CA.

How has FTV helped ButterflyMX identify opportunities and accelerate growth?

FTV investment partners pointed out something we had been missing for years, which is that parts of our go-to-market motion were working inefficiently. The FTV Propel team was then very much part of the diagnosis: why, what happened and what can we do about it?

One of the reasons I was so interested in FTV as a partner was FTV Propel. It’s a group of seasoned executives who bring proven operating experience and expertise from a variety of relevant functions. You, as the company management team, can pull them in when you feel like they could be useful.

Today, there are three big areas of connectivity between ButterflyMX and FTV Propel: go-to-market, tech and product, and finance. Our FTV Propel advisors share best practices, connect us with experts and add a second opinion on operational pieces.

We just felt like these are people who we could really partner with to grow a big business and be successful.

What do you think will be the biggest driver of your long-term growth?

Our biggest growth driver will be expanding from the layer of the building technology stack where we lead today into another layer where we see a major opportunity.

Buildings rely on many different technologies, but broadly, those fall into three layers of the stack: accounting, access and security, and operations. Today, we are one of the leading providers in the access and security layer, and we’re now expanding into the operations layer, which remains highly fragmented with no clear dominant player.

That creates a significant opportunity for us, and we believe AI can drive some of the most outsized value in our industry.

How has your management approach changed in seven years leading ButterflyMX?

I went from being someone who was doing a lot of the work directly to someone who focuses on creating clarity around goals and outcomes and making sure we have the right data to make good decisions. Now, I strive to empower the rest of the organization to make those decisions.

I’ve put tight feedback loops in place so that we can quickly learn from decisions and experiences and apply those learnings to future decisions. We’ve scaled to a much different place in seven years.

I’ve started to notice recently that the biggest challenges we have do not sit neatly within one team. They tend to happen at intersections between teams. For instance, the customer journey starts with marketing and sales, flows to our deployment and onboarding teams, and after activation, is then managed by our CSM and technical support teams. At any given point, a client might need specialized support from our solutions architecture team or have invoicing questions for finance. If we operate in silos, customer needs get lost.

A big part of my job is making sure the seams between teams are tight so that the whole organization can be collaborative and productive.