Approved scoured the conference meeting rooms and hallways (and a few after parties) to bring you a closer look at the most interesting real estate and mortgage tech that caught our attention at Inman Connect.
First an introduction
Howdy. I’m Greg Fischer, a community connector, real estate broker, and real estate tech specialist. I’ve spent 10 rewarding years in the industry, as a property manager, launching my own real estate company, joining real estate tech startup Doorsteps, and most recently as a product marketer for Move Inc. and realtor.com. My current endeavor is principal real estate broker at Fred Real Estate Group in Bend, OR. I write a lot about real estate at Nextinhousing. I’m also an advisor at Approved. This is me on LinkedIn.
Inman Connect San Francisco
Although we’re clearly biased on the matter (being a mortgage tech company), fintech and mortgage topics were strangely absent from the discussions at Inman Connect. It’s almost as if folks had forgotten that home loans are a huge part of the real estate lifecycle. But based on the number of new early-stage startups we heard about on the edges of the conference, we expect home financing to be one the the hottest topics in the foreseeable future.
We did notice a trend in real estate tech startups focusing on smaller niches of real estate this year. Founded by talented and proven teams (yet mostly outsiders to the real estate world), they’re poised to shake things up and are building the foundation to create much bigger businesses down the road.
Here’s a look at the ones who stood out the most.
New kids on the block
The latest tech press darling and talk of Inman Connect who everyone seemed to be sizing up was Haus. Launched a few weeks ago out of Expa, a startup studio led by Uber co-founder Garrett Camp, Haus caught the attention of tech enthusiasts and real estate agents everywhere, inducing a range of reactions from elation to contempt.
The real estate industry isn’t particularly well known for playing nice with outsiders, and Haus is no exception, but I was ‘uber’ curious to find out more about the team behind the product promising to be “an open and fair platform for buying and selling homes,” in spite of the (predictable) negative sentiments cast by real estate insiders.
The wave of favorable sentiment to Haus from tech insiders wasn’t surprising either, even though there isn’t a public facing product yet. While the real estate industry is routinely bearish about new product launches, the tech industry is even more notoriously bullish about new product launches so long as the press release promises outright anarchy for incumbents.
Even though the growth juggernaut that is Opendoor had similar launch coverage a few years ago, it would have been a fools wager to bet against their founding team. Which begged the question. Who is Haus?
Michelle Volz, strategic development at Haus, understands the real estate brokerage landscape inside and out, and effortlessly forged new relationships with tons of brokers at Connect like it was her job (it is).
Sarah Ham is the GM at Haus, and it was immediately evident to me that she is a top-notch executor. The team is a very thoughtful and talented bunch, and they’re enthusiastic about participating in the real estate space.
Nobody knows who the founder is, but let’s skip that minor detail for now.
Haus is an “offer submission and acceptance platform,” which could be particularly useful in markets where multiple offers are the norm, a much needed improvement over the stacks of hundreds of pieces of paper that most sellers are presented with when evaluating multiple offers on their homes. The product calls out some of the most critical offer components and clearly compares them side-by-side against others. Pretty straightforward.
While their narrative leaves room to ultimately becoming a consumer-first product, it’s going to be a very long road to scalability if they don’t partner with brokers and agents as product distribution partners. We’ve all imagined a world where homes are bought and sold online without agents, but this hypothetical future is still very far away — if ever realized at all. Haus has some other very serious hurdles in front of them, including meeting compliance standards for transaction documents, guaranteeing privacy and security for its users, and fully launching out of beta with any sort of meaningful inventory of homes for sale on its platform.
It’s important to note that Expa seems to be committing to the real estate vertical, as they quietly funded Chalet, a property management startup, back in June. Having founded several successful and rapidly scaled companies over the last few years, I think we’ll see a lot of investment and progress from the teams coming out of Expa. Do not write off Haus as simply just a niche play. I expect their progress to be agile and scalable with new features, products, and markets launched along the way.
The talent and passion of the team at Haus paired with Expa’s precision execution is an offering I’d be delighted to try out any time. It’s a lean startup world and Haus has barely even jumped out of the window yet.
The pioneers focused on expansion
We haven’t even scratched the surface on what the still very youngOpendoor is going to be when they grow up. They’re buying and selling homes at an astounding velocity in Phoenix and Dallas, at times putting 20 homes under contract in a single day this summer, and will be launching expansion markets in Las Vegas and other cities in the near term future.
The company set out to make homes a more liquid asset. They wanted to give homeowners an alternative experience to having strangers walking through occupied properties (requiring months of cleanings and showings) and hoped to remove the risk of contracts falling through. After raising over $100M and creating a systematized process for finding new opportunities, making cash offers, managing repairs, streamlining showings, and reselling their new asset for a profit — that dream has been realized.
My favorite thing about Opendoor is that they buy and sell homes in median market price ranges. Too many solutions focus on the top end of the market, but Opendoor is bringing their vision to mainstream American households.
While Opendoor was also honored at last years Inman Connect, they were noticeably present only on the fringes of the conference, heads down on the work in front of them, which was a huge difference from their participationthis year. The company was front and center with Arizona ops Jacqueline Moore giving a detailed talk about how the company views the transaction process, CEO Eric Wu participating in a fascinating one-on-one interview with conference host Brad Inman, also winning “Innovator of the Year.”
(Your handsome author took home runner-up for Most Innovative Agent, fysa)
— Opendoor (@Opendoor) March 17, 2015
Opendoor has executed their vision so quickly and so precisely that the concept doesn’t even seem very provocative or foreign anymore. They belong on the main stage. They deserve the spotlight. They are the future. And if they’re not in your market today they most likely will be tomorrow.
I visited their offices while I was in town and couldn’t believe how many people were working there. They’re actively hiring 5o more. Jd Ross is in charge of overall growth for the company and is clearly getting it done.
But most interesting to me right now is what new learnings are being created as a residual benefit to their model. Given they’re going to continue buying and selling homes at a higher frequency and in more markets than they do today — what opportunities are manifesting around the optimization of that model, what opportunities exist to help them scale, and how can the rest of the housing industry tap into their knowledge base or partner with them to help push the entire real estate process forward at the same time?
- Opendoor has done an amazing job introducing liquidity into the sell side of the transaction process. But in order for their model to really scale they’ll need to make it just as easy for buyers. The current average time to get a mortgage (49 days in Q1’16) isn’t going to cut it. What methods will they employ to get consumer sales closed faster in order to reduce their holding costs, freeing up capital to make more home acquisitions?
- Opendoor rehabs every home they purchase (to some degree) before listing it for sale again. How are they managing contractor relations and the bidding process using modeling and tech, and how might new home builders leverage it too? How can they involve buyers earlier on in the process so that they might have a chance to select colors and materials?
- Opendoor runs a sophisticated direct mail and prospecting operation they’re keeping data on. I’d love to peek at it, wouldn’t you? They manage hundreds (soon thousands) of homes on a “self-tour” basis. Can you imagine the system powering this process and comparing it to how most brokerages manage showings today? Just hearing them talk about the evolution of their systems might help brokers leap-frog decades of tired thinking and tech solutions that don’t cut it for modern consumers.
And these are just a few of the thoughts I had after the conference. Many other doors are going to open as this company relentlessly marches forward.
If you’re not first, you’re last
We were promised “smart leads” so many times over the past few years that my eyes have been glazed over more than a box of Krispy Kreme doughnuts.
But First is different. They’re not promising smart leads. They’re promising smart agents. Instead of qualifying complete strangers from the internet and trying to sell those leads to agents at a premium like so many did before them, First is focused on methodically qualifying existing contacts and suggesting touch points for agents that are sensible and backed by data.
After having a compelling conversation with their founding team, this is the ‘first’ time that I’ve actually believed that someone could actually make a predictive analytics tool focused on real estate without just faking it. The entire team has tech or data experience. Heck, even the advisors backing First are backed by data, with roles like Senior Data Scientist, Director of Algorithms Platform, and Engineer at Github lining their resumes.
— First (@FirstHQ) August 5, 2016
Mike Schneider is the co-founder and CEO at First, and has a clever energy about him that is impossible to ignore. He was part of a panel that I watched called “Predictive Analytics & Other Data: Figuring out What Buyers and Sellers are Doing Next.” Listen to, chat with, or internet stalk him for a few minutes and the depth of his experience becomes evident fairly quickly.
First pulls in useful data from a variety of sources, shedding light on contacts, but really focuses on micro-moments, which signal opportunities to reach out or deploy longer term marketing based on what’s happening.
But it will take a commitment from the industry to utilize much more sophisticated marketing campaigns in order for it all to work. Agents have to shift their behavior from sending the same old listing alerts or articles to their entire contact list, to rigorously segmenting and smartly touching contacts with the right messages based on individual circumstances.
Selling a predictive analytics tool to real estate agents might feel like an uphill battle, but First requires very little effort compared to its output, is designed with a mobile-first attitude, and has a great team behind it. I’m excited to see how their business evolves and hope to be a customer soon.
There were several other threads that we noticed in real estate tech, but these companies really got the wheels spinning about what the future holds.
And while we would have loved to see more fintech and mortgage conversations, we’ll be sure to be driving those discussions home here, so they’ll be more prominent at the event next year.
Got anything to add? Anyone we missed?