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Dec 9 20

Industry Relations Episode 56: Pacaso: A New Proptech Venture – with OGs Spencer Rascoff & Austin Allison

by Greg Robertson

What happens when real estate tech royalty get together to brainstorm business ideas? Not surprisingly, a general discussion of underutilized assets lends itself to a new proptech venture. 

Spencer Rascoff (former CEO of Zillow) and Austin Allison (founder of dotloop) are the Cofounders of Pacaso, a startup working to democratize access to second homeownership. On this episode of the podcast, real estate tech OGs Spencer and Austin join Rob and Greg to discuss how Pacaso solves the problem around the underutilization of second homes and explain how consumers, agents, and brokers alike benefit from the service.

Spencer and Austin describe how Pacaso manages scheduling and dispute resolution, sharing what differentiates their product from a timeshare or the traditional DIY co-ownership model. Listen in for Spencer and Austin’s insight on current events in the industry, including the radical acceleration of tech adoption through COVID, the long-term impact of the DOJ lawsuit against NAR, and CoStar CEO Andy Florance’s attack on Zillow.

What’s Discussed:  

How Pacaso solves the problem around underutilization of second homes

How consumers, agents, and brokers benefit from Pacaso

What differentiates Pacaso from a timeshare

How Pacaso handles scheduling and what happens if one owner uses the home much more than the others

Why Spencer & Austin don’t see Airbnb as competition

How Pacaso manages dispute resolution and governance of a property

Why friction among owners is less likely with Pacaso vs. the DIY model

Spencer & Austin’s response to the idea that Pacaso is ‘rich people solving rich people problems’

How COVID has inspired a demand for co-ownership in city centers

How the digitization of real estate has accelerated through the pandemic and what that means for the industry

Why buyer side representation will not go away (despite the DOJ lawsuit)

Andy Florance’s attack on Zillow and how CoStar’s acquisition of Homesnap will impact residential real estate

Connect with Spencer & Austin:

Pacaso

Connect with Rob and Greg: 

Rob’s Website

Greg’s Website

Resources:

dot.LA

Zillow’s Q2 2020 Earnings Call

Jack Ryan on Industry Relations EP055

CoStar’s Acquisition of Homesnap

Brad Inman’s Interview with Andy Florance

The FTC Suit to Block CoStar’s Acquisition of RentPath

Tomo

Our Sponsors: 

Cloud Agent Suite

Notorious VIP

Dec 9 20

Looking for a new gig?

by Greg Robertson

Sr. Professional, Marketing – CoreLogic

“This position will lead marketing programs for the high-growth Real Estate Solutions Marketing Group, supporting the associated business goals, revenue objectives, and product roadmaps. This insight-driven marketing position will have ownership for marketing programs across (paid/organic) channels and touch points to maximize engagement, conversion, retention to grow and scale products within the marketplace. The successful candidate will collaborate closely with the business and product teams to create compelling value propositions for our products and solutions, the foundational materials to drive innovative marketing campaigns and execute multi-faceted marketing programs. This role will report to the Senior Leader, Marketing for Real Estate Solutions.”

To find out about this job, and others or to post a position you are looking to fill please visit the Vendor Alley Job Board.

Dec 8 20

This is why I love this industry so much.

by Greg Robertson
Dec 8 20

I’ve got some big news to share.

by Greg Robertson
R+W

Dan and I are very excited about this new chapter. We notified the team at W+R Studios yesterday morning at an all-hands meeting.

I thought the meeting was important enough to be extra prepared so I wrote a kind of script to make sure we covered everything. Dan helped me edit it. I think it does a good job of explaining our thought process on our decision so, with Dan’s permission, I decided to share it with all of you.

TL;DR: W+R Studios has been acquired by Lone Wolf Technologies and have shared some of the proceeds of that sale (1 million dollars) with all W+R Studios employees and we are staying on with the team.


DAN

(SLIDE)

Hi everyone. Thanks for joining us today. We have a few important announcements.

First off I want to congratulate everyone.  We have faced many challenges this year and you guys have performed better than Greg and I could have ever wished for.  We successfully transitioned into a 100% remote workforce without skipping a beat, we lept in front of our competition with the launch of Cloud CMA Live and gave real estate agents a new way of doing business during a crucial time.  

We also successfully executed our first annual “best practices” survey, renewed our largest MLS customer, added a brand new MLS customer, with over 20,000 agents, and we are within striking distance of hitting our goal of 10,000 new direct sign ups for the year.

We did all of this without having to lay anyone off, and having a profitable year, all during a worldwide pandemic.

You guys are amazing, and should be very proud of yourselves.


GREG
(SLIDE)

2020 has also been an interesting year for the real estate industry as a whole. It has been said that the world wide pandemic has not really started any new trends but only accelerated existing ones.  

(SLIDE)

That is certainly true for real estate.  Ramping up to 2020 many new startups have been pouring money into real estate. Many of these new “proptech” companies seek to disrupt the industry by replacing agents and/or changing the way real estate is practiced.  Zillow has completely changed their business model and is becoming a broker.  These trends will only increase as more and more money is being bet on real estate, which venture capitalists and Wall Street look at one of the few economic bright spots during this pandemic. 

Adding to that we are seeing a massive amount of consolidation in the industry.  Many companies are merging with other companies, hoping one plus one equals three, or looking to pivot. A deal that personified this was announced recently. Homesnap was acquired by CoStar for $250 million dollars.  CoStar is a company that basically runs a private MLS in the commercial real estate industry.  They have been looking at residential real estate for quite some time.  This has only accelerated by the fact that the commercial real estate market (their main business) is facing pressure due to the “work from home” trend. Somewhat recently they bought Apartments.com and poured a ton of marketing dollars into it, you may have seen the television ads with Jeff Goldblum, making it the top site for rental properties in the country.  Guess who used to be the top site for rentals?  Zillow.  From my viewpoint CoStar represents the first real challenger to Zillow.  CoStar is worth $35B dollars, while Zillow is worth around $25B. But, many are worried about CoStar’s intentions and what it means for the MLS and real estate industry.


DAN
(SLIDE)

Organized real estate is also changing.  Recently the National Association of REALTORS was sued by the Department of Justice.  The lawsuit was centered around transparency of real estate commissions.  NAR quickly settled and made several concessions and we still don’t know the full consequences, plus other lawsuits are looming.

GREG
(SLIDE)

In a nutshell things are getting weird. And with so many companies with tons of cash, things are also getting pretty scary too for a small company like us.


As many of you know Dan and I started this company with our own money.  We opened a bank account in 2008 with just $2,500.  That’s very different from most companies in our space.  Some start with millions of dollars in the bank from venture capitalists before they sell their first product.  The fact we grew that tiny $2,500 dollars to a 9 million dollar a year business is truly remarkable and a testament to all of you.

I think we have also previously shared with you that over the years we have received many inquiries from companies about whether W+R Studios would consider being acquired.   We received so many of these inquiries we hired an investment banking firm to handle them.  We have typically responded, “W+R Studios is not for sale”. Recently those inquiries have reached a fever pitch, and for good reason.  

W+R Studios is a very attractive company.  

 (SLIDE)

We have been growing over the years, and we are profitable.  Our Cloud CMA and Cloud Agent Suite brand, our reputation, the quality and design of our products and our people are a huge draw to companies wishing to acquire to grow faster.  Not many companies in our space have accomplished what we have created here together.

DAN
(SLIDE)

About 2 months ago we received an inquiry from a company that caused us to pause and rethink our position of staying independent.  It was a company we respected and thought were doing some smart things.  After further talking with them, we grew more interested because we saw that our combined companies fit well together. 

1. They are focused on helping brokers and agents succeed, not replacing them.  

2. Their company mission is to “simplify real estate”, similar to ours.  

3. They had similar partnerships with MLS organizations and associations.

4. Their strengths fit a lot of our weaknesses and vice versa.  

We don’t know what is going to happen in the next few years.  
As we said, things are getting weird and scary. We still see a lot of opportunities, but it’s difficult for a small company like us to take advantage.

So, Greg and I have made the decision to join forces with this bigger company.


(SLIDE)

The name of this company is Lone Wolf Technologies.

You are going to receive more information about them in an email and we are going to hold a Town Hall with them later today where we are going to introduce you to their …. our….new CEO, Jimmy Kelly.  

But first we want to make a few things perfectly clear.

GREG
(SLIDE)

Number one.  Dan and I are not going anywhere.  We love real estate.  This is our life’s work.

One of the reasons we chose Lone Wolf is because we…they… wanted us to help them navigate the industry and continue to work here with all of you and set our sights on even bigger goals.  We are not done yet, and we have a lot more to contribute to the industry and tons of ambition left.

Number two.  Nobody is going to lose their jobs. Obviously things will change.  Right now they have their own culture and traditions and we have ours.  In time we will create a new company culture and have new traditions…together.

As we said, you will have a chance to hear directly from Jimmy later today and ask questions.


DAN
(SLIDE)

Now I know this is a big shock to you guys.  Change is always scary.  But we want you to know that we didn’t make this decision lightly and in doing so we thought of all of you.  It was a tough decision, we would love to stay independent.  But, being part of a larger company will give us resources to help us compete better, it will allow many of you to grow, make more money, and further enhance your careers.  Later, many of you will meet the rest of the Lone Wolf team.  They are good people, ambitious and smart, just like you.

Remember, your knowledge, experience and talent is why Lone Wolf was attracted to us in the first place.

Okay.  So that’s the first bit of big news we wanted to talk to you about today.  Here’s the next.

GREG
(SLIDE)

I think you will all agree we have something really special here at W+R.  Our company culture is more like family.  Dan and I really felt that you guys deserved to take part in our mutual success.  So we are happy to announce that we have decided to take the first one million dollars of the proceeds of the sale of W+R Studios and share it with all of you.

We are distributing the money based on your position, and how long you have been with the company.  I’m pretty sure that for most of you this will be the biggest check you have ever received in your lifetime.  Please accept it with our gratitude.

(SLIDE)

This is not the end.  The journey still continues.  We are proud of each and every one of you.  From the bottom of our hearts, thank you.  And remember we still have a lot of work to do, and we are going to need your help to get us there.

Right now I want to bring in Karl and Damien to say a few words and then hopefully we can answer your questions.

DAN

Hold on, hold on, Greg.  I’m sure there is one question a lot of people have, but are afraid to ask….

And that’s “When do we get our money?”

(SLIDE)

I’m happy to say, your money will be deposited into your bank accounts tomorrow morning.

Right Karl?


(Karl and Damien speak then Q&A)

Dec 4 20

I crack myself up

by Greg Robertson

Dec 3 20

Industry Relations Episode 55: Could a Commissions Drop Be Good for Real Estate? – with Jack Ryan of REX

by Greg Robertson
Jack Ryan, CEO of REX

It has come to light in recent days that REX was the ‘power behind the throne’ in the Department of Justice’s lawsuit against NAR (and subsequent settlement). The suit alleged that the trade group’s rules on commissions artificially inflate the fees paid to real estate agents and put illegal restraints on competition in the market. So, what inspired the upstart firm to take its concerns to the DOJ?

Jack Ryan is the co-founder and CEO of REX, the digital alternative to the residential real estate agent. REX uses big data and AI to provide consumers with significant cost savings and improved customer experience. On this episode of the Industry Relations, Jack joins Rob and Greg to explain why REX went to the Department of Justice and address the perception that his team is hostile to organized real estate.

Jack offers his take on why a commissions drop is not bad news, describing his libertarian vision of the future of real estate and how all involved would benefit—including MLSs, brokers, agents, consumers, and communities. Listen in for Jack’s insight on eliminating the friction from the home buying process and find out what would have to change for REX to join the MLS.

What’s Discussed:  

Why REX went to the DOJ with NAR’s ‘illegal restraints’ on competition in the market

What differentiates REX from other residential real estate brokerages

What’s behind REX’s decision not to join the MLS

Eliminating repetitive, standardized activities to make the real estate transaction more efficient

What the REX workflow looks like from a buyer’s perspective

Why Jack is more concerned with changing the system than making money

Jack’s argument that a commissions drop is not bad news

How Jack thinks about eliminating the friction from buying and selling a home

How a seller benefits from working with REX in terms of cost savings and level of service

The perception that REX is hostile to organized real estate and what would have to change for Jack to join the MLS

Jack’s libertarian vision around the future of real estate

How REX’s AI continues to improve and Jack’s intent to make the tech available to other brokers and agents

Connect with Jack:

REX

Connect with Rob and Greg: 

Rob’s Website

Greg’s Website

Resources:

Rob’s Piece on REX and the DOJ

Video of Jack on Vendor Alley

Jack’s article on Real Clear

NAR Code of Ethics

Our Sponsors: 

Cloud Agent Suite

Notorious VIP

Dec 3 20

Looking for a new gig?

by Greg Robertson

Data Quality Analyst – CRMLS

The Data Quality Analyst is an expert in the technical works of MLS data systems, services and support. This is a vital role in the onboarding and data quality maintenance of CRMLS and Datashare systems. Their deep understanding of the MLS operations and data practices are important in order to evaluate and identify data trends to create improvement opportunities.

To find out about this job, and others or to post a position you are looking to fill please visit the Vendor Alley Job Board.

Dec 1 20

Looking for a new gig?

by Greg Robertson

Media Specialist – CRMLS

The Media Specialist is both a social media specialist and a videographer. The Media Specialist will be responsible for crafting and disseminating compelling messaging and multimedia content via digital platforms and social media, including but not limited to Twitter, Facebook, Instagram, LinkedIn, and YouTube. The Media Specialist will stay abreast of current trends in digital communications and advise the Marketing and Communications team on technologies, platforms, and specific campaign ideas. The Media Specialist will also provide support on a range of related communications tasks, including event support, on an as-needed basis.

To find out about this job, and others or to post a position you are looking to fill please visit the Vendor Alley Job Board.

Nov 27 20

Invasion of the body snatchers – real estate edition

by Greg Robertson

Interesting perspective from Greg Fischer from a good thread on Twitter.

Nov 27 20

Watch this video

by Greg Robertson

I plucked this video out of a larger post from The Notorious R.O.B. blog, titled REX and the DOJ: Implications for the Future. You should read his entire post too.

The video is a panel from 2019 featuring Ben Harris (who is going to be on Biden’s econ. team and Jack Ryan, founder of REX). It’s over an hour-long but WORTH IT. It really covers a lot and gave me a lot of new perspectives on the recent consumer lawsuits, NAR policy changes due to the DOJ’s lawsuit, commissions, taxes, and housing in general. So if you are recovering from eating too much yesterday sit back and educate yo’ self.

“The times they are a changin’…”