Gil Fleitas says that technology has already irrevocably changed the real estate industry. “‘Technology’ is nothing more than a word to describe the inherent human quest and drive to adapt, grow, prosper, fix things, innovate, make a better world that addresses the problems of today.”
Gil Fleitas is CEO/co-founder at Theo.
Describe what you do in one sentence: I lead, but mostly support, an inspired team of entrepreneurial real estate and technology professionals hellbent on transforming the home realty industry by bringing it into a 21st-century operating paradigm.
Time at current company: Almost five years. Theo was officially incorporated (Delaware) in June 2010, at which point I officially assumed the title of CEO/co-founder.
Degree, school (if applicable): Harvard, B.A., 1975; Stanford Law School, J.D., 1983
Location: San Francisco
Social media: LinkedIn
What do you do? Please elaborate and be specific.
When I started Theo, I was given the indispensable advice that a startup CEO has three main duties, which he/she must maniacally focus on. These are the three main things I “do”:
1. Vision/strategy development: Developing the vision and over arching strategy for the company. Where are we going? Why are we going there? What are ways to get there? Why does it matter? What strategy will we follow to get there? What values will be at the heart of what we do and who we are? I am constantly asking myself these questions, gathering feedback from my team, our customers, and third-party sources to help me fulfill this indispensable job responsibility … and then communicating the same to the team to help guide them, to help inform their daily decisions. Hopefully, it is working!
2. Assembling human capital: Find the people necessary to execute and implement No. 1 (above). I am constantly trying to identify the people who can execute the Theo vision/mission/strategy. This takes a lot of time and energy, and, in a marketplace that is as vibrant, busy and labor-tight as the San Francisco Bay Area, it’s quite a bit of a competitive battle to secure these resources. I wish I had more time and, more importantly, more financial resources to better execute on this job function of mine.
3. Assembling financial capital: Find the financial resources needed by the team (No. 2 above) to execute the vision/mission/strategy (No. 1 above). By far, this piece has been the most difficult and time consuming. No one is better positioned to execute this part of the business. Since June 2010, we’ve raised almost $3 million over four rounds of financing, primarily from friends, family and angels. Still, it has not been enough to hire the core team of in-house dedicated engineers we’d like to have in order to drive even faster engineering innovation and capitalize upon business opportunities when they have arisen (and continue to do so).
In short, my job primarily consists of optimizing the interplay of the above three items. Overall, I try to keep the team focused on the “true north” (our destination), providing perspective and the detachment necessary to balance and resolve internal (sometimes external) issues that arise and/or compete with each other — for example, engineering vs. sales, sales vs. investor/fundraising requirements, sales vs. marketing.
Finally, the “toughest decisions” almost always end up in my lap, albeit with the honest input from the team. When those critical decisions arise, it is my job to make “the hard call” with clarity, conviction, ensuring that the team is on board and committed to its execution and moving forward.
How’d you end up in real estate tech?
Between 1983 and 1999, I was involved primarily in commercial real estate, first as an attorney specializing in zoning and land use, and then as a developer with a national company called Trammell Crow Company (TCC), which is based out of Dallas. I worked as a leasing agent in TCC’s first office in the New York area, spending a lot of my time cold-calling warehouses along the New Jersey Turnpike.
I retired from TCC in 1999, and spent the next three years doing nonprofit work for San Francisco’s nationally recognized Homeless Prenatal Program (primarily as the board president). I also dabbled in a handful of startups, as an angel investor and/or in an operating role, learning a ton, but making no real money at it! I did, however, come to realize that I enjoyed technology in general, and especially that I loved the creative energy and challenges inherent to a startup enterprise.
Then in 2002, I joined forces with Steven Mavromihalis, at the time (and still to this day) one of San Francisco’s top real estate agents. He had a thriving residential real estate practice at Pacific Union. Steve was my agent when I relocated to San Francisco from New York City in 1997, and since then we had become the best of friends. We decided to form Byzantium Brokerage Services, with me bringing to the table my deep experience in commercial real estate. He would handle the residential side of the business and I would handle the commercial side.
As it turned out, I got more and more involved in assisting and supplementing Steve’s thriving residential practice, and together we went into a real growth spur, completing over $500 million in deals in less than eight years. It was lucrative, exciting … but, at least for me, maddening!!!!
The technology tools then available to agents were, and still are, atrocious. The “systems,” processes and fragmented databases were poorly designed and stuck in this legacy, old-school mindset. It was painful to constantly be running that transaction gauntlet, and not just for Steve and me (and our staff), but for our clients, as well.
They, our clients, some of whom were very tech-savvy and entrepreneurs themselves, began to strongly voice their disapproval, often their ridicule, about how our “industry” operated.
So, while Steven and I were enjoying financial success, we realized that we had a technology problem on our hands, and more importantly a looming and ever-growing “client relationship” problem to address. At the same time we saw the sweeping impact of mobile, and social, and how other established industries were being transformed and restructured by a technological tsunami of innovation coming from almost all quarters.
We tried to figure out how to cobble our own “system” from the dozens and dozens and dozens of “apps” and other tools that were emerging in our industry, but it proved to be impossible … too many interfaces and points of noninteroperability. Plus, one truly needed to be a tech genius to figure out how to do it, maintain it, and adapt it as new, often better, products landed on the shores of real estate.
One day in December 2007, after noodling internally, I had the not-so-unique insight that what our industry really needed was a “Bloomberg” equivalent. Michael Bloomberg had written a book (“Bloomberg by Bloomberg”) in which he described the genesis and development of his company and service, one that ended up transforming the daily work day of financial real estate professionals. I read the book three times, and found parallel after parallel to the real estate industry. It inspired me and my co-founders then, and to this day it is still our guiding inspiration.
Steve and I (and our other two Byzantium members, John Fitzgerald and Dan Bremer, both of whom are co-founders of Theo) asked why a similar system wouldn’t make sense for real estate professionals? Why couldn’t there be a comprehensive platform that could power a real estate transaction from beginning to end, utilizing fully mobile, social, the cloud and analytics. One that brought together into one common unified UI/UX a beautiful, easy-to-use, but professional-grade tech platform all of the data, documents and people that comprise the real estate ecosystem.
We vetted the idea with friends, tech folks we knew and trusted and venture folks, and everyone said the same thing — makes all the sense in the world, but know that the road will be long, hard and that you will likely fail because that’s what typically happens to most startups! But they still encouraged us to take the leap … and we did.
In June 2010, Dan Bremer, John Fitzgerald and I went full time, full board, toward realizing and building our dream of the Theo Platform — the Bloomberg for residential real estate.
That, in a nutshell, is how I ended up in real estate technology. And I, and my co-founders, are continuing to make progress in realizing our dream … and proving naysayers wrong.
What aspects of real estate are you trying to make better? Please be specific.
There are two major areas of real estate that we are trying to make dramatically better:
1. Deliver technological innovation that addresses app fragmentation and fatigue. Since day one, we have been focused on eliminating and rationalizing the technologically fragmented and inefficient landscape currently faced by real estate professionals, especially agents. (Note: Theo’s vision and customer targets extends beyond agents. We see any real estate professional who touches a residential real estate transaction as future potential customer, who will want to have a Theo subscription because they took can benefit from being part of a holistic and efficient ecosystem of integrated data, documents, realty colleagues and clients.)
There simply are way too many “one trick ponies,” and agents don’t have the time, experience or even desire to learn a dozen interfaces (and passwords).
Hence, we seek to provide an uber-platform experience, where Theo has done the “application integration” and delivers a beautiful, easy-to-use UI/UX that makes the technology accessible, even enjoyable. In short, we are striving to deliver the best comprehensive suite of functionality, that powers a transaction from “search to move-in.” We are inspired by what Michael Bloomberg did with the Bloomberg Terminal, how he revolutionized the daily workday of financial professionals; similarly, we seek to revolutionize the daily workday of real estate professionals (agents, appraisers, title companies, brokerage firm owners, lenders, contractors) — how they work together in coordinating and delivering to clients a 21st-century holistic transaction experience (something which such clients are increasingly demanding and expecting).
2. Agent/client innovation: Beyond the bits and bytes, we have added to our original vision the need to think about and drive innovation into the operating relationship between a real estate professional and their client. This item is more about the human collaboration aspects that permeate any successful business and the use of technology. Real estate professionals are as focused, if not more, on their client relationships than on the nature and quality of their tech tools. We’ve learned and heard loud and clear from our users that helping them build strong, trust-based, value-creating relationships with their clients is at the fundamental heart of their business needs. Great technology is not an end in and of itself. It must drive and support the relationship with clients.
What’s your favorite part of what you do?
Talking to or hearing from real estate agents who “get” and support Theo’s vision; seeing the smile on their face when they realize that Theo truly understands their daily pain and grind, that our primary goal is to enable, empower and help drive their professionalism; that it isn’t about “Theo” to us, but rather that it is about them, and working with them to create a service/product/experience they can proudly deliver to their clients. I love reading unsolicited testimonials that tell us how we added value to their business and encourage us to continue to execute on our platform vision.
And it inspires the whole team to continue to work hard and innovate, and add value to our customer’s everyday workday.
What products have you had a part in developing in the past? Describe the product — the idea and the execution.
Other than just everything at Theo, my prior “product development” accomplishments occurred while I was at TCC. In 1991, I joined a small core team of TCC professionals who had launched a division called Trammell Crow Corporate Services (TCCS), a product offering that involved TCC becoming the outsourced real estate department for corporate America. “Outsourcing” at that time was a novel idea, but TCC led the commercial real estate industry in designing the systems and processes that allowed Exxon, United Healthcare, PeopleSoft, University of Pennsylvania and hundreds of other firms to outsource some or all of their corporate real estate functions to TCC. In a very short period of time (about six years), we at TCCS built a huge and profitable business.
Our TCC outsourcing business drove enormous savings and operational improvements for our clients. Most importantly, it opened up a whole new paradigm and way for corporate America to think about its real estate assets, needs, strategies. I can absolutely say that my firsthand experience in helping to bringing about that transformative change in corporate America with respect to its real estate functions has and continues to inform me in my daily work at Theo. The real estate industry itself needs to rethink and change how it operates, and not be afraid of the consequences. The resistance I see in the industry today reminds me of the resistance we encountered at TCCS from corporate America to outsourcing their real estate needs to a third party.
What are you working on right now? What are the challenges?
We currently have three major initiatives underway:
1. Releasing a version of Theo that an agent can use to invite and connect with their clients in pursuing a transaction. Agents who use Theo have told us that this is their biggest need — a product that they can give to their clients to use that connects and strengthens the agent: client relationships. Agents want their clients to start to use a product that is better, more reliable, and more collaborative than their current reliance on Zillow. We are gunning to deliver that product to agents … and their clients, in the very, very near future.
2. Right now we are also starting to build the non-iOS version of the Theo Platform. We initially launched Theo with and now have two beautiful parts of our platform on the iPhone and the iPad. But as we have grown in our user base, and now are on the verge of expanding to some new markets, it is becoming more important and necessary that our platform be OS-agnostic. So we just completed our first Web app, making a part of Theo available on any device that has a Web connection. Very exciting.
3. Finally, we have made substantial progress in getting us ready to launch into a handful of new markets outside of our initial launch market here in San Francisco. Integrating the MLS data for those markets and making the necessary modifications to the front end of our platform is difficult work, but intellectually and professionally challenging/rewarding.
As typical for any startup, resource allocation is our biggest challenge in getting these projects completed. Our funding is still very limited, requiring us to rely heavily on third-party contract engineers, who are generally more expensive than an in-house engineer would be (on a “cost per line of code” basis) and not always available when you need them. It just takes longer and costs more than if we had our own in-house dedicated team.
Favorite Twitter account?
Ben Horowitz is generous, inspiring, and highly instructive with his posts to the venture community and world. A must-read for any entrepreneur.
My favorite food: sushi. (My favorite guilty pleasure: Kettle sea salt potato chips.)
“The Seven Habits of Highly Successful People.”
It is still my hometown, New York City, although with each passing day I fall more and more in love with the Greater Bay Area and everything that it offers.
Favorite band or singer?
I don’t think I really have one … but after checking my music on my iPhone, it seems Kelly Clarkson is the winner — I like to dance, and the wife and kids love her up-tempo beats.
When I look at my song count (how many times I have played a song or album), then “Chant,” a compilation of Gregorian music, is the runaway winner! I listen to it quite often when I am deep into a document and need to shut out the world around me.
What do you hate about technology?
Hate is a strong word. I am most frustrated by the general inability to truly predict with any certainty how much time and money a piece of engineering will require. Engineering may be a “science,” but when pursued in the context of a startup and true innovation, it can feel like a black box, making planning and resource allocation extremely difficult. It seems to be a widely accepted truism among engineers that whatever you estimate for a project, it will always end up being more. Very frustrating. My only “solution” to this has been to work with some of the best engineers I could find and afford, and generally assume that indeed it will take longer and cost more than projected.
It’s not a function of professional incompetence in estimating, rather that when venturing into the unknown and doing something that has not been done before, there aren’t any reliable road markers that one can use to measure the requirements for the journey.
What is one thing you would like to fix about the real estate industry?
The torturous, inefficient, innovation-stifling, process associated with “getting the data” needs to change, for it does not ultimately advance the interests of the industry nor the clients they are committed to serving. The industry has to stop believing that controlling and restricting the data is in its bests interests, that its value proposition will be largely undermined if it loses such control. It has to move from an internal command-and-control mentality to an outward consumer-friendly, innovation-driven culture.
Do you think technology can change the industry?
Can? It will, inevitably, as it has or is changing every other industry in our new global economy. The forces of the cloud, mobile, social, analytics and, most importantly and enormously, the new and powerful “consumer” are too great for the industry to resist forever.
“Technology” is nothing more than a word to describe the inherent human quest and drive to adapt, grow, prosper, fix things, innovate and make a better world that addresses the problems of today. Here is one way to think about it: If we were starting today with a complete blank sheet of paper, and building the systems, processes and infrastructure for an efficient, effective 21st-century residential real estate industry, does anyone think that what would be designed would look anything like what we have today?
In or out of real estate, is there one problem, large or small, that you would like to solve?
Continue the advance of equal treatment for women in our society. I believe that such progress will have the greatest impact on the health, welfare and functioning of our societies. It will also have the greatest positive impact on our children, our future.
What motivates you?
My deep sense of gratitude for the amazing life and opportunities I have been blessed with. I have been blessed with the most amazingly loving and supportive family, extended family and friends; I have been blessed with the generosity of financial aid contributors who made my high school, college and law school educations feasible; I have been blessed with a healthy body and mind; I have been blessed by being born in the United States, that, notwithstanding its imperfections, strives for individual freedom but still leads the world in volunteerism and charitable contributions reflecting our underlying sense of community. I have been blessed throughout my career with several mentors who have inspired and guided me, personally and professionally; I have been blessed by a loving and understanding wife that supports my inexhaustible drive to make Theo a success, even if it means enduring major sacrifices to our lifestyle; I have been blessed now with over 20 investors who have hung in with me and the Theo team to bring about dramatic, fundamental and value creating change to the residential real estate industry.
With all these blessings, how can I not be motivated to ensure that I live my life in a way that is meaningful and worthy of those blessings? I am motivated to both “pay it back” and “pay it forward” … to ultimately show my kids (Theodore, after whom Theo is named, and Emerson Grace) that life is to be lived with intentionality, curiosity, passion, fearlessly and an open generous heart.
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