Standing outside the real estate industry looking in, entrepreneurs sometimes take on the aspect of a lioness having come upon a herd of fattened, oblivious zebras.
It seems almost too easy.
Of course, it’s not.
The fragmentation and inefficiency that seems so ripe for change is the very thing that smothers change. The billions in commissions and fees that seem so outrageous, so incomparable, to many young MBA’s or VC’s are readily accepted by most consumers, who engage with the world of real estate only at years or decades-long intervals.
This is an industry defined by paradox. And so smart people make mistakes. Many fail.
But some do not. Among those who have made it to the top of the real estate learning curve, few have done so as triumphantly as Spencer Rascoff, Pete Flint, Austin Allison and Greg Schwartz.
Spencer Co-Founded Zillow. Pete Co-Founded Trulia. Greg built the revenue engine that made Zillow a multi-billion-dollar powerhouse. Austin founded Dotloop at a time when Docusign had already become the default e-signature and document management player in real estate. Now Dotloop is part of Zillow and touches over 50% of real estate transactions in America.
These folks all took a ton of heat from the industry. They made missteps. But they learned, and, whether you like it or not, succeeded.
I bring this up because all of these guys have either launched or backed new real estate ventures recently.
Pacaso, Spencer and Austin’s new company, seeks to make second home ownership possible for more people, while creating tons of new opportunities for agents and brokers. (Disclosure: 1000watt worked with Pacaso in the run-up to launch.)
Greg announced Tomo this week, which has already raised $40 million to untie the knots in the mortgage process. Pete’s VC firm, NFX, was one of the lead investors.
The “Paypal Mafia” — the group of founders and early execs from that company who went on to have big second acts — is a thing in the broader tech world. There is now a growing Zillow/Trulia “mafia” in proptech.
These are people and companies to watch.
OK, a few odds and ends for you…
No doubt you have heard a lot about artificial intelligence and big data these past few years. A company named Synthetaic raised $3.5 million this week to make artificial intelligence smarter with “synthetic data.” In this way, predictions about real things are made based on things that are… not real.
I am still waiting for synthetic real estate leads.
As of September 30th, there were 1,437,844 Realtors in America. That is 80,112 more than the pre-crash peak in 2006.
Think about that for a while. No comment from me needed.
Facebook is testing a Nextdoor-like product they’re calling “Neighborhoods.” I am sure this will be handled with a light touch by agents across America.
Compass is looking to hire a “Senior Leader of Demand Generation.”
Here’s part of the job ad (which, if you’re a broker, I encourage you to read in full):
This leader and their team will work closely with Strategic Growth (Sales), Product, Engineering & Operations to power growth of Compass’ revenue via agent recruitment. You will manage a team of Marketers and a focused team of analysts, and content creators that will drive the volume of agents, deliver highly engaged customers into the funnel, lower the cost to recruit and power future expansion into new markets.
We know lots of companies that were knocked back on their heels when Compass rolled into town with cash bonuses, stock options and marketing allowances. That may be settling down a little, but it looks like Compass is building a serious digital recruiting operation that could present an even more formidable and sustainable challenge.
Have a great weekend.