By York Baur | March 9, 2020
Mike DelPrete put it best at ICNY 2020: “The industry is moving very slow, but it’s never moved this fast.”
Franchisors are building their own technology at record rates. New proptech companies are popping up everywhere. Acquisitions and consolidations are becoming more common. There’s an electricity in our industry that’s been simmering for the last few years.
And, it’s exciting.
But it’s also been a time of uncertainty and, quite frankly, fear. Especially for the brokerages and agents all of this surrounds. I know there has been frustration, agents shuffling, lots of money changing hands, among other concerns. But, the best piece of advice I have during this age of transformative innovation and perceived disruption is simple:
Stop using the disruptors as a benchmark for your success.
Sure, they’re flashy. Sure, they’re mainstays in the news and claiming data that may or may not be true. But comparing your brokerage to their definition of success isn’t the way to measure your success.
Every brokerage is a tech-enabled brokerage
It’s true. Every brokerage is a tech-enabled brokerage, whether you build your own technology or not. And brokerages, both traditional and new, who are leveraging data and embracing the fact that they’re tech-enabled are seeing the benefits. We took a deeper dive into our data by looking at 10 of our largest client brokerages representing over 50,000 agents. We found that, on average, agents with a high usage of MoxiEngage CRM increased their transactions by 85.3% from 2018 to 2019. Even agents with a lower usage of MoxiEngage still increased their transaction count by 41.2% during the same time period. And while we believe our products are best in class, the reality is using whatever tools you have will make you better whether they’re from MoxiWorks or not.
Everything you need to be a “tech-enabled brokerage” already exists in the marketplace and agents at any brokerage with leading technology will see an impact on their business, even if your brokerage isn’t one of the “disruptors.”
A case for the mistaken market share
Market share is of course another way to reflect on your brokerages’ success, but make sure the data you are comparing it to is apples to apples and not apples to grapefruits.
For example, it’s easy to claim impressive market share to scare the competition when the sample size of that share is disproportionate. Compass made claims at the end of 2019 towards their 20/20 by 2020 vision that a number of their markets are close to 20%. But, 21.3% market share of Malibu, CA is certainly not the same as only 6.6% of LA county. And 33% in the concentrated D.C. market is not the same as only 7.3% in the DC metro area, just like 17.8% in Downtown Dallas is not the same as only 2.9% in the Dallas metro area.
While a lofty goal, there is still more than enough market share being held by other brokerages and to that we say keep it going. Instead of letting the disruptors distract you, focus on things that truly reflect success in your business. Focus on your team and your success.
The pomp and flash won’t last. Just remember, the data doesn’t lie. Big signing bonuses and other carrots being dangled in front of agents are sometimes tough to combat, but you should really be more concerned with yours and their retention rates, instead of recruitment rates.
Why? Because agents who left Compass in 2019 were only there for an average of 295 days, so less than one year. In the 2019 National Association of REALTORS® Member Profile report, they found that the median tenure for REALTORS® with their current firm was four years.
So focus on what you’re doing to recruit and retain your agents. If the industry average is indeed four years of tenure at a company, take a look at your data and see how long your agents are sticking around to determine whether you might need to make some adjustments to continue to have your agents remain at your brokerage. And remember that using technology to increase agent productivity can solve your recruiting and retention problems: productive agents are happy agents who stay at your brokerage and recruit others to it.
The road ahead
The quote written above my office from Marshall Goldsmith is a reminder to us every day and it should also be a reminder to you:
“What got you here won’t get you there.”
While I believe you have everything you need at your fingertips, I also believe you need to be proactive and provide an environment of ‘Training + Systems + Coaching’ to retain your agents and help them continue to succeed through the age of disruption.
And look, we have to give Compass credit. They set a lofty goal, and good on them for doing that. Every company should. Creating that mission, that rallying cry is a great way to not only motivate their teams but gives them something to measure.
So, instead of letting them distract you from your goals, take it to heart instead. What are your goals?
Their goal doesn’t say anything about anyone else, so think deeply about your brokerages’ goals for the company and for your agents and use that goal to measure your success.
And don’t stop there. Announce it to the team, bring it up in meetings with your team and with your stakeholders. Develop leading indicators of your progress and measure them routinely with a scorecard. Hold yourself accountable for the goals you set and what you are trying to achieve. We do this at MoxiWorks and I promise you that you will see better results by doing so as well.
There will always be disruptors. Don’t let them derail your focus. Instead, stay lasered in on your success metrics and your goals and continue to help your agents thrive with your brokerage as their home.
York Baur, CEO
CLICK HERE TO READ THE FULL ARTICLE. From Inman News: MoxiWorks CEO claims Compass agents become 16% less productive when they move to the company.
MoxiWorks, an open real estate tech platform funded by two of the top three regional brands in the country, took a sharp jab at Compass this week, claiming its agents report a 16-percent decline in productivity shortly after moving to the New York City-based national brokerage.
The charge comes on the heels of a June CNBC interview with Robert Reffkin, in which the Compass CEO made several claims that drew ire from many in the real estate industry, including a bold statement that agents at the tech-forward brokerage net a 24.9-percent boost in transactions in their first year.
“We’re the only company that is empowering agents,” Reffkin said during the interview. “Our only customer is the agent.”
The remark drew the suspicion of MoxieWorks Chief Executive York Baur, who promptly dug into the first six months of Compass’ agent productivity.
MoxiWork’s data scientist, according to a spokesperson for the company, took data from all listings sold on or after Jan. 1, 2016. The analysis only included agents who stayed with Compass at least six months and had “substantial” transaction records before or during their Compass tenure, but the company did not elaborate on what it considered “substantial.” The same six-month period was used year-over-year to adjust for seasonal market shifts.
By Jessie Trapp, Marketing Coordinator & Tiana Baur, Content Marketing Manager
This month has been a bit of a whirlwind. In just several weeks we’ve had Inman Connect, tons of tech news, and some announcements that continue to elevate industry pressures on a very real level. A lot of the news has been “hype” and had enough fluff to fill a million build-a-bears, but what are the main headlines we should all be focusing on? We put a little list together of the important news stories that came out in July and recapped them for you.
Here are the top five bites to know in the July Roundup:
1. “Cryptocurrency, Cyber Fraud Focus of Trump Task Force”
Don’t worry, we’re not getting all political. With a new-found focus on cyber fraud in the U.S., real estate will hopefully see less cyber-crime events, especially with cryptocurrency coming into the industry from all angles. Fraud in general, whether that be banks or cyber-related, has heavily impacted the industry. “According to an RISMedia survey, 27 percent of agents and brokers are ‘not sure’ if their brokerage has a cybersecurity policy, and 19 percent have no policy at all. The most common crime is phishing/wire fraud, in which buyers are duped out of their funds.” Hopefully this new focus will find a way to combat it.
2. “Gary Keller Slams Real Estate Startups, Refuses to Sit Down”
Gary Keller made moves at this year’s Inman Connect and made his agents across the nation extremely proud to be with his brokerage. He argued that many real estate tech companies, such as Redfin, Opendoor, etc. would get rid of agents if they could. Agree with his stance or not, he made it very clear and now everyone knows about it. Well played, sir.
3. “The ‘For Sale’ sign gets a modern update”
Well, it’s pretty obvious how we feel about Compass, but putting all that aside for a few moments, they had a major-ish announcement at Inman Connect and it deserves a spot as a top headline. Not only did they turn a rectangle into a circle, but they also illuminated the sign and added a connection to the internet so smart phones can connect. Sort of feels unnecessary for our industry, sort of feels like teenagers are going to go around vandalizing them, but who knows. To each their own.
4. “Overstock is making a push into real estate”
So, this is one we might have all overlooked. While July mostly focused on Inman, Compass, and other industry related news, this should’ve been a main discussion topic. The big boys are getting into real estate. Overstock announced they they’re relaunching Houserie, a property management website focusing on background checks, that basically helps landlords out. The juicy plot twist? It’s going to become a giant real estate platform in September for buying, renting, and managing properties. Alright, alright, alright Overstock.
5. Redfin announces $240M stock offering for potential acquisitions
Looks like Redfin has hopped into the dating pool. In their press release, the company stated that “it may choose to use a portion of the proceeds to invest in or acquire third-party businesses, products, services, technologies or other assets.” With this news, they’ll be looking for potential acquisitions, swiping right on dime piece businesses that catch their eye.
CLICK HERE TO READ THE FULL ARTICLE CEO of MoxiWorks claims his competitor has overstated its market share, agent retention rate.
CLICK HERE TO READ THE FULL ARTICLE RISMedia has obtained the following open letter from MoxiWorks CEO York Baur to Compass, a technology-centric real estate company based in Manhattan.
I have to call you out on your boastful approach to an industry that we all know and love. While we agree that there’s a great opportunity to employ technology in ways to make both the consumer and agent experience better, we don’t think you need to resort to the trash-talking and grandstanding that we’ve heard from you – you’re better than that, and frankly we don’t want you to tarnish an industry that has funded the creation of the very technologies you now claim credit for.
You claim to have started the tech talk in real estate. In your recent LinkedIn post titled Before Compass, Technology Was Barely Mentioned in Real Estate you said: “As it relates to technology, Compass truly revolutionized an industry that had become complacent and had fallen behind terribly.” In just a few words, you risk losing your credibility. The first wave of brokerage tech took place in the 1990’s. For instance, Windermere Real Estate, just one example of many, launched Windermere.com in 1995, creating the first known brokerage website, and added a complete suite of agent tools by 2000.
Since then, Windermere, Long & Foster and Howard Hanna have funded MoxiWorks, whose platform and tools now help make 60 brokerages and 110,000 agents better at what they do. Other obvious examples of innovative technology use in real estate include Zillow (founded in 2006), Redfin (2004), and the long list of startups that have been hard at work for decades, funded by hundreds of millions in capital that was invested prior to your founding.
And stated by your head of product Eytan Seidman in his recent Built In Chicago interview, Compass claims to be “the first and only company to bring engineers together with agents under one roof.” Yet Windermere, Long & Foster, Howard Hanna and countless other leading brokerages have had software engineers and agents working side-by-side in their brokerages to evolve real estate technology since the mid-1990s, developing the technologies, data exchange mechanisms, and standards you now rely on.
You claim to create all your own technology. And speaking of untruths, your CEO Robert Reffkin has publicly stated, “We build everything in house, and all the tools and support is in house.” But anyone can look at the websites you run and see that they’re licensed from MoPro, that you’ve licensed MailChimp as your email marketing tool, and that you licensed Honey for your internal social network. These are all fine choices, but you don’t “build everything in house,” so why the distortion?
Your CEO Robert Reffkin recently claimed in a live interview on CNBC that Compass “just launched Seattle five weeks ago and we already have 5% market share.” We took it upon ourselves to do a deep dive into the data – the Moxi Cloud Open Platform now contains the data for 90% of the home sale footprint of the United States, so like everyone out there with access to MLS data, we can calculate your actual market share in any of your markets. For example, that data shows that for the Seattle metro area, the best you could claim is 0.7% of transactions where Compass was either the listing or selling agent. That’s a far cry from the 5% you claimed. Your CEO Reffkin also said Compass “is the only company empowering agents.” That’s not credible, so why say it other than to antagonize the industry you’re clearly a part of, and in business with on the other side of many of your transactions?
You say that your goal is to “improve the lives of agents.” You pay six figure signing bonuses “to less than 10% of your agents” and claim 98% retention, yet notable agents flee to their former brokerage as soon as the contract is up. We did a deep dive into that data too. For agents that joined Compass any time after January 1, 2016 and have left Compass since, the average tenure was only 245 days.
Bottom line. The tech stack you tout is something every other brokerage can quite literally replicate on the open market – many already have. Compass may not be a brokerage that is great at building technology (that has yet to be seen), but you are a brokerage that is great at integrating the technology you buy, and you happen to build some of your own tools too. That sounds like Windermere, Long & Foster and others before they recognized that choosing the best mix of tools from the vendors that use the $1B of capital invested annually into real estate technology was a better strategy.
Side note to all the brokerages out there: You are investing in tech. Keep your independence. If you haven’t already, choose a platform, whether that’s from MoxiWorks or from any one of our worthy competitors and mix the unique set of agent tools that match your brokerage value proposition and business style. That’s all that Compass has done, only their platform isn’t open, which means they don’t have the flexibility you’ll have.
Compass’ strength of integration is one MoxiWorks has already built and established – nothing new here. The Moxi Cloud has been available to our customers for exactly this purpose for three years and has over 40 partner companies whose products work with it, sharing and contributing to the broker and agent data in the platform for the benefit of all. And we’re not the only ones – many of our competitors have similar abilities, and brokerages are mixing their unique blend of technology to support their value propositions just like you are.
We set out to better the industry, not terrify it or antagonize it. Consider this open letter an invitation. Consider it an opportunity for you to set the record straight.
York Baur, CEO of MoxiWorks
Checkout more of the data at moxiworks.com/compass.
By Tiana Baur, Content Marketing Manager
In their latest round of funding, OpenDoor scored $325 million in funding. Late last year, SoftBank invested $450 million into Compass. VC money is alive and well, and it’s found a home in real estate tech, pouring into the industry. And as we all saw at Inman Connect last week, the competition is as hot as five-star Thai food. It literally hurts to digest.
In a sea of change…
As all of us in the real estate world are saying, the industry is evolving quicker than most can keep up. It’s a treadmill that only seems to be getting faster and faster with no pause button in sight. What was super cool last quarter is the status quo today. There’s no room for lags and fear. What do these higher monetary stakes and complex competition mean for traditional brokerages? The value prop of your brokerage and its brand is key.
Question: Why should your agents stay at your brokerage?
Staying relevant and valuable to agents will continue to gain in difficulty. Without the money to offer six figure signing bonuses, your brokerage value proposition has to be hard as rock. If I were sitting across from you and asked, “Why do you think your agents should stay at your brokerage versus going somewhere else?” What would your answer be? Do you have a sophisticated tech stack? Do you train your agents on it or just hand it off and hope for the best? Do you continuously stay in contact with your agents or do you forget about them until they tell you they’re going to a different brokerage?
The magic of an open-door policy
There’s a top brokerage in Virginia – that will go unnamed – that is taking a very logical approach: They have an open-door policy. They’ll answer any and all questions – even about Compass. If an agent has concerns, they feel empowered enough to walk into the Managing Broker’s office and ask them, knowing they’ll get an honest answer. Because of that, their retention numbers are insane. They’ve invested in tech, and they’re investing time into their most precious asset: their people, their real estate agents.
- Don’t lose your current agents because you’re only focused on recruiting new ones.
- Don’t let any agent feel like they’re being left in the dark (including on the topic of Compass).
- Build on your existing relationships.
- Let your agents know you care and want them there.
- Implement an open-door policy if you haven’t already. It’ll be the best decision you’ve made all year.
- You can even try hanging a sign on the wall by your office, letting your agents know that they’re always welcome to come in.
- Have a proper recruiting system in place. This will focus your time on top talent inside and outside of your brokerage, making sure you’re getting the full picture and avoiding agents slipping through the cracks.
Brokerages today are worried about losing top producers, concerning themselves over the revenue and sales volume that those top producers take with them if they leave. It makes perfect sense. Losing one agent isn’t going to have a dramatic shift on market share, but it will impact a brokerage’s sales volume. This whole storm is why we created our Moxi Talent recruiting system in the first place. Too often, Managing Brokers don’t pay attention to agents until they threaten to walk. Moxi Talent helps you build relationships with the right people at the right time.
By Ringo Nishioka, VP of Human Resources & Operations
You met a great agent you would like to recruit or a potential home seller that you really like. For both of you, business and personal values align. You have a few great phone calls and face-to-face meetings. Suddenly, your colleague disappears and falls off the map. They don’t return your calls and may even miss a scheduled meeting with no heads up. Silence. Just a big echo chamber which leaves you wondering what you did wrong. We have all been there.
What happened? You were ghosted.
It’s happening in dating relationships, companies looking to hire new employees, and yes, in real estate, with both potential recruits and potential home sellers. Unanswered texts and phone calls that are not returned. It hurts. You have invested time, money and emotional energy into the relationship only to find it come to a very hard and dead end.
What is ghosting?
Ghosting refers to when someone in a relationship disappears without any warning sign. The term is a common one in our online world with the advent of dating apps, but we are hearing about it more and more in the professional world as well. We understand it might happen in potentially shorter term personal relationships, but in long term professional relationships?
“Dude, that candidate ghosted you? I can’t believe that. I thought for sure she would accept your offer.”
What are the signs you might be ghosted?
This isn’t our first rodeo here at MoxiWorks. We still get ghosted by candidates we are looking to recruit, but we know some of the signs to look out for. We are not surprised we are dropped like a hot potato when:
- There is a lack of engagement between MoxiWorks (the hiring company) and the candidate.
- When emails exchanges contain slow responses. When we email, we look for timely responses and hope to see a response by the end of the day.
- We look for courteous follow ups and thank you. If we took the time to interview someone or show them around our office, we take a follow up thank you as a sign our candidate is engaged.
Why does it happen?
We have a number of theories, but these are just theories and ours alone.
Bad Communication/Unreal Expectations
We believe that ghosting happens when the communication and expectations between two parties doesn’t match up. Most of us would take the time and effort to talk these differences through, but in an age of immediate gratification, for some it is easier to just walk away.
Your Compass is our Amazon.
We are competing for tech talent in a town where there is a shortage of talent. Every brokerage out there is living in fear of Compass. They have deep pockets, endless perks, and are the shiny object right now in the real estate industry. What’s our version? Amazon. We know what it’s like competing against a giant with endless amounts of cash. When candidates feel like they have opportunity, they can act very differently. There are more tech jobs than tech candidates in Seattle. Consequently, the candidate doesn’t feel the urgency to respond as quickly or respond at all.
How to avoid being ghosted:
- We explain what our interview process will look like in the very first interaction with a potential candidate. We explain how many interviews there might be, who the candidate will meet with and why we take it so seriously. I literally say the following: “Our process may be a little longer than others, but we want to learn what we can about you as the candidate and we want you the candidate to learn as much as you can about MoxiWorks. Ultimately, we are looking for a great fit for both parties because we want you to be as happy as we are with you.”
- Keep the dialogue moving. Nothing creates engagement better than engagement. If your candidate or potential seller has to wait days for a response, they will assume you are not interested in them.
- End your emails with a proposal to continue the dialogue. Give your seller something to respond to.
- “I’d like to meet next week and talk about talk about X. Coffee is on me.”
We mentioned that ghosting happens more in economies where the candidates feel they have choices. The way to overcome this is to make the candidate feel like YOUR SERVICE IS A UNICORN. There may be a lot of agents in town, but YOUR BROKERAGE AND SERVICE IS DIFFERENT. THERE IS ONLY ONE OF YOU IN THIS TOWN!
Benefits of being ghosted:
Believe it or not, there are benefits of being ghosted. You know the candidate’s true colors earlier vs. later and you didn’t find this out after investing in them for six months of training or showing half a dozen homes. Time is money, and they just saved you a lot of it.
By Nick Van Valkenberg, Director of Business Development, MoxiWorks
When lost, a compass is used to help you find your way, but what is a compass used for when you are already on the path to success? Could a compass force you to look in the wrong direction? Is there a need for a compass when you already know the terrain and have the map? While in the field I have been having a number of conversations about the “lion coming over the hill” that is Compass. Massively funded, technology forward, and making waves. It is hard not to look in their direction and wonder if the moat you have built around your brokerage will last.
Circle of Concern vs. Circle of Influence
To summarize Stephen Covey’s The 7 Habits of Highly Effective People, habit one says to be proactive. A great way to becoming self-aware is to separate your Circle of Concern and your Circle of Influence.
You do not have control over your Circle of Concern – it’s filled with topics like: what Compass is doing in regard to raising capital, building technology, or whether they move to your market or not. You can worry about these until your face turns blue, but you cannot control the outcomes.
Your Circle of Influence you can control, and this is where you should be spending your time and energy. Topics include: educating your agents on not only the negatives, but also the positives of Compass (you would be naive to portray all as negative), finding technology to compete with what they are building, recruiting new agents, and actively recruiting your current team members to raise retention within your brokerage.
Now that we have cleared the air, know where to focus and what can be controlled, let me tell you our (MoxiWorks) take on the situation. Technology is a big topic and a key point to Compass’ recruiting efforts. To compete with the technology that Compass is building you may need an upgrade. Now I’m not suggesting that you go and build your own, I’m suggesting that you look at a platform that is already being used by some of the nation’s top brokerages.
Compass says that their technology will: have a CRM that combines listing information, client information, and transaction information. Compass’ technology is said to be in “one place,” combining all tools, giving power of integration, offering insights, and easy to launch digital social marketing. At MoxiWorks we would recommend researching our open platform that encompasses (pun intended) these aspects and more.
Recruiting is another part of your Circle of Influence that you can control. The discussion of recruiting generally invokes the thought of trying to increase your agent count or better yet, maintain your agent count as attrition is part of the business. In the fourth quarter of 2017, MoxiWorks built an agent recruiting tool called Moxi Talent. Moxi Talent uses a two-pronged approach: recruiting new agents to your brokerage and recruiting your current agents. Trust me when I say if you are not congratulating your current agents, someone else is and that style of interaction will win them over.
In summary, the only thing that stays the same is change and those that do not adapt to the times will be left behind. The best option is to partner with a technology company known for innovating to future-proof brokerages. If any of this has resonated with you I suggest that you reach out to our team and at least do yourself the service to learn how we are paving the way. I, or one of my colleagues, would be more than happy to look at your current technology stack to show you how we can connect your current systems and upgrade others. Do yourself a favor and be proactive; now is not the time to take a reactive approach.