Years ago I moderated a conference panel on which Joel Singer, the CEO of the California Association of Realtors, said something that has never left me:
“Everybody wants to get to heaven, but no one wants to die.”
The panel’s topic: MLS innovation.
It’s so very true. The heart of the matter – why we still have 800+ MLSs, each with different policies, politics and systems – lies in the simple fact that so few are willing to put anything at risk. Their job, their territory, their system, their comfortable way of being.
Everyone talks about wanting a better way of doing things, but almost no one is willing to stick their neck out and go for it.
Joel was one who did. CAR tried to create a statewide MLS: CALREDD. It failed. Lots of people in the MLS industry delighted in this.
But the guy did it. He stuck his neck out. I’ll always respect that.
I bring this up because last week two really big MLSs – TREND and MRIS – announced their intent to merge. They’ve stated that other MLSs are welcome to join the fold, too.
This is at once a big deal and a small deal. Big because TREND and MRIS cover a large section of the east coast; small because there is still so much consolidation waiting to happen.
But it’s something to celebrate, nonetheless. David Charron, CEO of MRIS, is a friend and client of 1000watt. He’s always been one of the sharpest people in real estate. But here he’s put everything – his job, his territory, his status quo – on the line. His neck is out. Tom Phillips, the highly capable CEO of TREND, has done the same.
Profiles in courage.
I usually don’t like to pick on the little guy. But in the MLS world it’s the long tail of small MLSs that makes so much so slow in our industry. Most big MLSs have strong CEOs, sophisticated boards and modern systems. Most small and mid-sized MLSs do not.
Rolling up the long tail is going to require risk taking by the big guys and little guys. People will have to “die”, as Joel put it.
Because, really, heaven can’t wait.
A lot of people did a doubletake on this one: Compass, the startup real estate brokerage hatched a couple years ago in Manhattan, landed $50 million in VC at a valuation of $800 million.
$800 million. I don’t think they were using the same pencil on this deal that, say, NRT or HomeServices of America uses when they value brokerages, do you?
Anyway, what I think is interesting here is that Compass doesn’t seem to be working any of the usual “disruptive broker” angles here. No discounting. No salaried agents. No Kelman-Quixote vibe.
So what’s the deal? They seem to be hanging their hat on “data”, “algorithms” and “technology and tools” for agents, but have offered almost no details.
I think one of two things is happening with Compass:
- There’s not much here other than a startup real estate brokerage with a slick brand that has gained a bunch of funding because of top-shelf founders.
- Compass is building the “Smart Brokerage” I’ve envisioned here before – a real estate company that leverages data to know everything about their buyers, their sellers, their market and, most importantly, their agents.
I’m betting on #2. Keep an eye on them.
Enjoy the weekend.