Last week on stage at the Marriott Marquis New York, Brad Inman gave the opening keynote address for the 20th anniversary Inman Connect New York (ICNY) event.
Watch the video:
He talked about how the ICNY community is “a community of doers, rebels, entrepreneurs, devil’s advocates, critics, innovators and disruptors.”
“Unless you adopt disruptive technology, you will be disrupted,” reiterated Inman — “but the people here won’t be.”
He reminisced about the very first Connect event, in the woods of Sonoma 20 years ago, when he and his friends wondered what the world of real estate might look like if every listing was online.
“The whole idea sometimes is to be a little uncomfortable,” he said. “That’s how we get ahead.”
What technologies (or other areas of real estate) should we be keeping a special eye on?
- Predictive analytics
- On-demand showings
- Instant offers
- The barrier to entry in real estate is too low — and something needs to be done about that.
Consumers and technology, ratings and rankings, productivity data, will be what changes the industry, he said.
And what’s the reaction to disruptive technology? You can fight it, you can adapt to it or you can partner, said Inman. Fighting looks a little bit like what happened between the taxi companies and Uber — unsuccessful until cabs decided to compete instead of trying to legislate Uber out of existence.
Sometimes, adapting can be partnering — consolidation happens when industries face disruption in order to maintain strength in share. And sometimes adaptation can be a system, something that gives you an advantage.
“Just adopt disruptive technology,” advised Inman. “The people who make it work are you. You’re not here because you’re unwilling to change; you are the change agents.”
And finally, he advised, “have a spirit of open-mindedness and willingness.” He shared a personal story about how he managed a difficult time in his life and how it led to a new way of thinking about everything.
Please see the entire transcript of Brad’s talk below:
From a Redwood Grove in California to Times Square in New York City Connect has come a long way in 20 years. Here’s the man that made it all happen. Please welcome the publisher of Inman, the creator of Connect, Brad Inman.
Greetings gang! Welcome to New York City! (Cheering) The home of the next president of the Unites States. (Laughing/Cheering)
That was bipartisan. (Laugh) Hillary lives here. Donald lives here. And Michael Bloomberg lives here. (Cheering) Bernie eventually he’ll have an apartment in New York.
So one I’d like to welcome the viewing audience from around the world. This is being live streamed. So check and make sure your zipper is up. Anyway great to have you gang from around the world. Great to see all of my friends and my family. These are my people. Welcome to the community of Inman. Welcome to a community that has the best and brightest in real estate, people that aren’t afraid of change. They’re making change. Welcome to the community of doers, of rebels, of entrepreneurs, of devil’s advocates, of critics of innovators and disruptors. I’m going to talk about disruptors and you are disruptors.
Change agents, givers, collaborators. I have the Inman (squeal). The bolo and the mic sometimes doesn’t work gang. (Laugh) I love my community. I love it so, so much. And you know what’s great about this community is I hear from you all the time. You text me, you call me and you’re all so serious or you have something funny or something offbeat. As I say real estate is meters, greeters, grinders, finders. It’s a real doing industry. And this is what I got last week. I’m going to play a video that just warmed my heart and made me laugh.
Video: What’s up guys. Terry Waggoner with Ferris Property Group and FC Tucker. Listen, is it cold outside? Yes. Can you hear the wind whipping into the microphone of the camera? Yes. Am I freezing right now? I can’t feel my hands. Yes, all these things are true. But it is no reason to be weak this weekend. It is still open house time. And I’m doing not one, not three, but two open houses this Sunday and yes it’s going to be cold, yes you’re going to freeze but I will make it worth your while with these incredible homes. When you get here I will blast your face and your hands with a hairdryer. I will shovel the driveway one shovel blades worth path right to the door. But I’m not scooping. I’m just going to shove it. Just so you know. I will make you a hot toddy. That’s not true. I will buy up all the bread and eggs and milk and clog up the checkout line at the grocery store so that we have supplies for Snowmageddon. Listen, I checked out the forecast for Sunday. It’s going to be 1o. One. So get here. Put on some Carhartt. 4295 Thompson Row, Cynic Row, or here, 6830 Whitetail Woods Ct. Don’t be weak. My hair is frozen solid. (Laugh)
Brad: (Laugh) Is that real estate? Do you love it? Yeah! (Clapping) I often say, I teach at Cal Berkeley sometimes, I would much rather spend dinner with a group of realtors than some boring faculty at Cal Berkeley. I love this industry.
So gang I want to do a shout out. My ambassadors right here in the front row. Who are ambassadors? Real estate professionals who volunteer for Inman to evangelize and support the mission of Inman which is independent news and information and events that help raise the real estate accue. So big round of applause for my ambassadors. (Clapping)
So we’re going to talk about the next couple of days? Well, we’re definitely going to talk about technology. Winston Churchill actually said the history of technology is one damn thing after another. And there’s a lot of damn things out here. There’s some crazy technology here because we welcome entrepreneurs. We welcome new ideas. We have, we are not politically correct. We don’t say oh no, no that’s going to go after realtors it can’t be here. Or no that’s not politically correct. It’s not going to be here. We welcome anyone that’s doing anything that’s innovating in this space. We put them on stage, we put them out there so you can tell us what’s real and what’s not. You’re the beta testers. Come to me afterwards. Come to the Inman team and say that’s BS. It’s won’t work. But I guarantee you there’s a pony out there for each and every one of you.
And by the way some of it, some of it is disruptive. But as I’ve been saying lately unless you adapt disruptive technology you will be disrupted. But the people in this room won’t be. Why? Because you’re part of that disruption.
The history of Connect. 20 years ago there were 50 of us, a couple of you still here alive. We went to the woods of Sonoma County in the middle of the redwoods. It was quite chilly. We had hand warmers. We had blankets. We had a fire pit. We roasted a pig. And we drank and we talked about how technology and the internet because that’s right when the internet began, commercial internet, how it was going to begin to disrupt real estate. And it has. And I look over those 20 years and what do we talk about here first and this is what’s so great about this community. We, from you, hear about the things that are happening. Back then 1% of listings were on the internet. And we advocated put them all on the internet. And people went frigging crazy. That was the end of real estate. Disruptive yes. But the people that embraced it and used it it created an entirely new marketplace. It didn’t kill anything. It created things. Since then we’ve talked about online leads, online search, mapping online. Brand new when we talked about it. Virtual walkthroughs, video, blogging, social, 3-D, and we always welcome new business models.
You’re going to do some stuff here, if you haven’t been here before you’re going to see some things that makes you uncomfortable. But the whole idea sometimes is to be a little uncomfortable. That’s why we get ahead.
Now let’s talk about some of the disruptive technology that I see ahead of us that I think we better be braced for. And some of it won’t happen this year, maybe next year. But it’s pretty obvious to me it’s happening.
One, predictive analytics. I told this story. My daughter found out she was pregnant by one day searching on Google and Google rendered ads of baby carriages and Pampers because the machine at Google, whatever she was searching that morning triggered that she was pregnant. She went into her husband, Phil, and said, “I think we’re pregnant.” That is called predictive analytics. Google predicted my daughter was pregnant and yes she was. And she’s a smart girl. Hi Lissie! She’s not watching, I guarantee. (Laugh) My kids say, “Get over yourself dad.” So, but predictive analytics by the way I think a year ago we talked about it and people went, “Yeah but I’m not a data scientist Brad. I wouldn’t know how to do that and that’s above my pay scale and.” But now guess what? Out there and on here you’re going to hear about how you can do it.
Like I just learned, you know Zillow has got a proprietary system and it’s got, you know it’s definitely got a wall around those that participate. But they actually let their data out to you folks. But there are software companies out here that are doing predictive analytics. Now why is that important? You can predict what people want to buy, when they want to buy. Are they real? You can predict, which you’ve been talking about for two decades, when sellers want to sell. And not collectively but when Brad Inman wants to sell in West Hollywood, like to the month, to the day, to the week. Because just like Google could tell my daughter she was pregnant someone’s going to tell you if you’re using predictive analytics when Brad Inman wants to sell.
On demand showings. My wife Yaz says, she uses Redfin app when we drive. Like you drive from L.A. to San Diego and she watches the market prices changes, house by house. You know downtown $887,000. We’re in Santa Ana $450,000. We’re in southern Orange County $10 million. We’re in north San Diego County and the listing are spattering all around. And she’ll see one. And she said, “Let’s go see that house.” And she doesn’t understand, and she’s smart. She’s Moroccan but she’s smart. Why (laugh), hi Yaz. She’s not out because she came in when I got up. She can’t understand why we can’t see that house. And we can. Think about it. What a stupid system. Hey Steve we’d like to see 7709 Wearing. Okay. I’ll call the seller agent. Seller agent, okay. I’ll check with the homeowner. Okay. Three days later appointments, calendars. No, no, no. That doesn’t work. On demand is here. We expect it. It’s going to happen. Software utilizing agents that need a few bucks. Real time showings using cameras. And I’m going to tell you in a minute why it’s all going to be safe.
Instant offers. Oh that’s scary. No, it’s not. Instant offer is I like this house. I want to make an offer now. Why not? Amazon two clicks buys something. Why not two clicks Brad wants to make an offer? And I’ll tell you why that’s going to be possible.
I saw recently a smart contract. I don’t know if you’ve seen this yet. But I took a deal I’m working on and I put it in this software and it came back in seconds. Not waiting for Tom my lawyer. When’s the contract coming? My potential partner saying, “Hey you’ve got. When’s the red line version coming?” I mean why should it take that long? Red line instantly using all the legal data that’s out there, using an algorithm at top of it understanding what I needed in this particular contract. Completely red lined in seconds. Right in front of me. Smart contract. I’ll tell you in a minute why that’s possible.
All of this is possible because of authentication verification of who we are. Buyers, sellers, homeowners, and property. Underlying this is something called blotching. And all blotching, you’ve heard about it. We’ll have some guys up here, pretty nerdy guys talking about it. Is desperate databases being connected. And think about real estate. We have the buyer database, we have the property database, we have the home database, we have the mortgage application, we have the approval, we have the pre-qual. All these databases, all owned, all proprietary, all not talking to one another. They’ll all be talking. And they’ll be talking instantly. Think of my profile, my digital profile in this world. Think of preapproval on steroids. Instantly.
Everything about my credits already there. Everything about who I am is there. By the way it’s all safe and secure as it is not now because my shits spread all over the world and anybody can get it. Russian you know, what do they call those guys? Hackers can get it. Now it’ll be secure. Blotching was invented by drug dealers to trade money to buy drugs. These guys, you know it’s hard to get El Chapo. They’re smart people. But it really wasn’t invented by them. It was invented by very smart software people. But now it’s being applied to financial transactions.
So what does this lead to? Deals in a few days, closing boom. When all of that information by all of these parties is ready boom. Two clicks for Amazon, three clicks to buy a house. Those that know me I go out and say stuff that seems stupid. Half the time I’m wrong, half the time I’m right. This is going to happen gang. It’s going to be good for the people that adopt the disruptive technology because you won’t be disrupted.
The last one I want to talk about is we’ve been talking about too many unqualified agents. And I’ve been arguing up the licensing requirements. We have to do something about a greater barrier to entry. We’ve got to get brokers to stop this insanity of hiring anyone who could walk through the door without falling down. (Clapping) But you know what? I had a breakthrough in my thinking, at least I think it’s a breakthrough, in the last few days. And I thought I used to cover public policy. I used to write a column for the L.A. Times called Policy. At one time in this world there was policy and then somewhere along the way the politicians just all got legally bribed by some special interest.
There is no public policy. And I got so discouraged because I always wanted to change the world. And then I saw the internet and I said the internet’s going to change the world. And I just realized why I’m barking up the wrong tree. Special interests are not going to raise the bar for requirements to be a real estate agent. Brokers aren’t going to change their model. You know what’s going to change it? Consumers and technology, ratings and rankings, productivity data, crack the doors of secrecy. And one of, once all that information is out there consumers are going to choose good agents not bad ones. The referral is still a great example of finding a good agent. That’s still going to be around. But we’re finally going to have data. And I look forward to the day when the franchise executive sitting up here in a half-an-hour are not saying, “We have the most agents.” They’re sitting up here saying and can be proven, “We have the best agents.” That’s the future I’m looking for.
So what’s the reaction to disruptive technology? One, you can fight it, you can adopt it or you can partner. Let’s look at an example of someone who fought it. Uber. What did they do? They, not Uber. What did the cab companies do? Not much. Uber had its one billion ride last month. One billion in five years. It started with one ride, one ride in San Francisco. And I want to remind you when the young entrepreneur sits up here and says, “I have one transaction” with some wacko new business model don’t make fun of him because he may have a million transactions someday. One ride, a billion rides in five years. Did I say five billion? One billion. What did the cab companies do? They had all these assets. They had a brand. They had yellow cabs everywhere. They lined the pockets of politicians to stop innovation at Uber. They lost four years of healthy competition. That’s why this election whoever’s elected is about we’re sick and tired of that.
We’re sick and tired of people who like the cab companies trying to hold on to their monopoly by bribing politicians. Legally bribing them. In other countries they call it illegal. Here it’s legal. You write big checks. Think of what might have happened if the cab companies said we have all these tires on the street. Like you all have millions of realtors on the street. And we leverage the assets we have and did what Uber did. And what did Uber do? Well one they went down to the basics like clean cars, nice drivers, right, basic stuff. It’s like real estate. Good service like, let’s just do good service. So they lost all this time.
Now what’s changed? About three months ago I was in New York and I got in a cab, which I rarely do. It’s like risking something. Germs you’re going to get. You know? Treated royally bad. Driver doesn’t have GPS. But I got in a cab. The cab was clean, it had GPS, there was a sign for their app which I checked out and downloaded, the driver wasn’t talking on his phone in a language I didn’t understand, and he was driving slower. Then I took another cab and another cab and another cab. Now what could be better than the cab companies leveraging these assets, cleaning up those yellow cars so we know they’re yellow and not gold and competing, all American competition, not leaning on politicians. So many lessons for the real estate industry here. Fighting, trying to meet in secret rooms and stop innovation. Puke. Let’s just compete like Americans. Let’s not line the pockets of politicians.
So what’s happening in this world of disruptive technology? Many of you are going to adopt this disruptive technology and succeed but there’s also a reaction that is not just a reaction, a necessary way to survive. Consolidation. And this is proof that disruptions going on. MLS’s racing to consolidate, scampering to come together. Why? Because they can kind of just sit around for 20 years and behave like they wanted because nobody was paying attention. Now brokers and others are paying attention. Disruption. So they’re merging, which is good. They’re making it easier. They’re making it possible for brokers not to pay taxes to multiple MLS’s. But it’s a reaction to disruption.
Broker consolidation. Steve Murray told me this week at Real Trends that the amount of MNA this year among brokers is three times what it was last year and the highest rate of MNA in over 30 years. Why? Strength in share when you face disruption. Why did Zillow buy Trulia? Strength in share.
And finally let’s look at consolidation of agents. Agents are consolidating. What are teams about? Oh they’re all polishing all these cool things and we all like teams. Strong and weak coming together. Consolidation. And some people don’t get to join in a team because they’re so weak and they’ll be out of business.
Online systems. Zillow, Realtor.com, Premier Agents. Consolidation. What are you talking about? We’ve always had systems in real estate. Those that have systems succeed. Agents that just show up, no systems, fail. We now have online systems. But there’s some cake in here. These online systems have leads. Those people that adopt these systems, that get customers and systems, discipline, process, everything else will win. What does that mean? Consolidation. The ones that don’t will fail.
Okay. What does this all mean for you? Just adopt disruptive technology. Not everything out there. Some of it’s silly. But you’re smart. You’re the best and the brightest. Pick it. Don’t be afraid. Push the envelope on on demand services. Here’s an example. If software guys are the only ones pushing it it’ll never work. The people that will make it work are you. The people that practice. People like the guy that had the open house in the middle of the cold weather.
You’re not here because you’re unwilling to change. You are the change agents. You’re not maintainers. You’re definitely innovators. Build lasting relationships too gang. This more than anything else in the community is about those relationships. They’re very personal. They’re very deep but they’re also business partnerships. If I could even begin to get under the history of the partnerships formed here it would be amazing what’s happened.
The most important thing is have a spirit of open-mindedness and willingness.
And let me finish with a story. Five years ago I moved my e-book company, one of my first authors was Seth Godin, from California to New York. And right about that time my two parents got sick. And I was commuting every week. I had, I think that year I had 200 hotel night rooms in New York. Commuting back and forth to Las Vegas with my two brothers trying to take care of my parents. A really tough time. And then they both passed away within 60 days which I told you all about from this stage. And it was hard. And that first year, I was really close to my parents, I couldn’t put one step in front of the other. I was really struggling that year. I tried everything. And one day, three years ago December, I walked into King Co. Bar which is a famous bar.
The first martini I ever had was with my dad when I graduated from college at the King Co. Bar. And I walked in there and I met somebody who completely changed my life. In one moment I was crazily liberated. Why did that happen? Well, luck of course. The magic of New York for sure. But more than anything I was just vulnerable. Did not know it but I was ready for a change. So my friends go forward, let the magic of New York take you over, let it work on you. Be open, be vulnerable, be ready. You never know who you might meet here or what you might see. Onward my friends. Forward my friends. Kaboom. Let’s go. Thank you for being here.