- GoldenKey -- a marketplace that lets consumers hire agents to perform one-off or bundled services for flat fees -- has raised an additional $1.75 million.
- GoldenKey's investors include Lowe's venture arm and a venture-capital firm that counts Trulia founder Pete Flint among its partners.
- GoldenKey's most expensive service package costs $3,500 and contracts a real estate agent to perform a limited number of services, which can include listing one home and holding an open house.
Some real estate agents bristle at idea of working with clients on a fee-for-service basis, but Latrice McFadden says the technique helped her generate $10,000 in extra income last year.
The Durham, North Carolina-based real estate agent performed around 60 one-off tasks for customers in 2016.
One seller paid her a traditional commission for buyer representation after she entered the person’s listing into the MLS for a small fee, yielding a combined $4,500 in income, she said.
“They’re clients I probably never would have worked with, and they’ve since referred me to other people,” she said of some of these customers.
She says her experience demonstrates the value of GoldenKey, the marketplace that sent this business to McFadden.
The startup — a marketplace that lets consumers hire agents to perform one-off or bundled services for flat fees — recently nabbed an additional $1.75 million in funding, suggesting some investors also see promise in a startup that’s irked some in the industry.
Lowe’s venture arm and a venture-capital firm that counts Trulia founder Pete Flint among its partners (NFX Guild) were among investors that contributed to the funding round.
GoldenKey plans to use the cash, which brings its total funding to $3.4 million, to fuel brand awareness and grow its user base across the country.
Background on GoldenKey
Around 2,000 agents in 47 states have signed up to receive business through GoldenKey (formerly known as SoloPro), according to GoldenKey CEO Tommy Sowers. The company claims to have helped consumers save more than $700,000 in commission fees on more than $25 million in real estate transactions.
Chris Langford, director of Lowe’s Ventures, said in a statement that GoldenKey provides “home buyers with the first fully-custom solution for purchasing their next home” and allows real estate agents “to get paid immediately and directly for the services they provide.”
“We see this as a win-win and a shining example of how technology can create efficiency in the real estate market,” he said.
GoldenKey lets buyers pay flat fees for individual services from agents at brokerages around the country, including pricing a home ($100), showing a home ($100) and making an offer ($200).
But the startup now emphasizes the limited-service packages that it rolled out last year. While consumers must pay for one-off services upfront, those who buy service packages can wait to pay until 48 hours before a transaction closes.
Buyers who opt for GoldenKey’s most expensive service package, priced at $3,500, contract an agent to set up one home-search alert, price one home, show three properties, attend one event, make one offer and coordinate one transaction.
Homesellers who choose GoldenKey’s most expensive offering, also priced at $3,500, contract an agent to price one home, list one home, put on two open houses, attend one closing and coordinate one transaction.
Consumers who purchase GoldenKey’s service packages can buy additional one-off services from GoldenKey’s a la carte menu if they exhaust the set of services allotted by their package.
The agent connection
Whenever a consumer requests an individual service or service package on GoldenKey, the startup fires out the request to a gaggle of local agents who have signed up for GoldenKey. The first to claim the request gets the job.
Buyers and sellers who connect with agents on GoldenKey pay GoldenKey for an agent’s services, not the agent or the agent’s broker directly.
In order to comply with real estate laws, GoldenKey then passes those fees on to the agent’s broker, rather than the agent. It’s then up to the broker and agent to decide how to split the fee.
GoldenKey has drawn criticism from the industry for seeking to popularize low-fee brokerage services. At one point, the startup ran TV commercials that broadcast the startup’s ambition to “blow up” real estate commissions.
But like many other real estate tech startups, GoldenKey has toned down the rhetoric and adjusted its business model in ways that validate aspects of the traditional brokerage model, such as by rolling out bundled services, increasing pricing and rebranding to GoldenKey from SoloPro.
McFadden, broker-owner of Tyco Realty & Investments, says some agents at her previous brokerage told her they thought GoldenKey’s premise — that commissions are too high and many consumers don’t need end-to-end support — is borderline degrading.
But from McFadden’s perspective, “this is going to happen [GoldenKey’s service model] whether I agree to do it or not, so it doesn’t makes sense for me not to take advantage of it.
“As a Realtor I’ve been in the business for almost 20 years, and I know that you have to keep all of your options open, so I’m certainly open to multiple streams of income,” she added.