21–30 of 97 posts
Don’t miss the part where they do a huge, splashy, expensive electronic redesign of the classic realtor For Sale sign only to trash the whole concept.
$270M loss on $3.7B in revenue. If they can get opex down, there's some serious money to be made and a lot of growth left here. In my neighborhood I'm seeing more and more houses go up for sale with Compass signs.
Their single biggest expense is “commission and other transaction related expenses” which clocks in at just over 3B. I don’t know how much control they really have over commissions.
Earlier quoted context omitted.
Their single biggest expense is “commission and other transaction related expenses” which clocks in at just over 3B. I don’t know how much control they really have over commissions.
True but maybe the “industry standard” agent cut is open for “disruption.” (Personally I can’t fathom what the agents do today that adds $10k-$100k of value). They’ll find some data to support that they make agents more efficient and then reduce their cut. And when the agents complain, there aren’t going to be many people crying for them, especially the ones on Bravo.
Compass is a real estate technology company that provides an online platform for buying, renting, and selling real estate assets. https://www.compass.com
I see Compass signs all over the place. What makes them interesting here? Are they doing something that every other large real estate company isn't also doing?
Yeah, they've raised a whole hell of a lot of VC money and are using it to buy up market share by luring top agents away from other companies. They also have also have a nicer tech platform and recommender system, from what I understand.
Its a little silly how easily a company can categorize itself as a technology company. Many of the IPOs from the past two years suggests having a website and/or having an app doesn't just make you into a tech company (WeWork is a good example of this). Compass is no doubt eager to foster unreasonable expectations for growth that surpasses the business they're actually in (as real estate brokers) and prefer to imbued…
> on average, 88% of our agent teams used our proprietary technology platform at least once per week,
This doesnt sound like they built some insane tech that everyone needs to use all the time. So how exactly is the a differentiator?
Our business has experienced rapid growth. In 2019 and 2020, our revenue was $2.4 billion and $3.7 billion, respectively, representing a year-over-year increase of 56%. Our net losses were $388.0 million and $270.2 million in 2019 and 2020, respectively.
Its a little silly how easily a company can categorize itself as a technology company. Many of the IPOs from the past two years suggests having a website and/or having an app doesn't just make you into a tech company (WeWork is a good example of this). Compass is no doubt eager to foster unreasonable expectations for growth that surpasses the business they're actually in (as real estate brokers) and prefer to imbued…
Earlier quoted context omitted.
True but maybe the “industry standard” agent cut is open for “disruption.” (Personally I can’t fathom what the agents do today that adds $10k-$100k of value). They’ll find some data to support that they make agents more efficient and then reduce their cut. And when the agents complain, there aren’t going to be many people crying for them, especially the ones on Bravo.
If you're making a purchase/sale of several hundred thousand dollars, having someone with you who has done this many times before is easily worth 5% or so. Is every agent good? Well certainly not. But it's a high-stakes transaction that most people have never done before, or have done only once before, so having a veteran of many such transactions walk you through it is easily worth a few percent of the total cost.
Easily worth a couple grand, maybe. A percentage like that? No chance in hell.