Archive for the ‘Most Comments’ Category
July 18, 2007
Redfin today announced its expansion to the Washington, D.C. area and a $12-million series-C financing led by Draper Fisher Jurvetson, the folks behind Skype, Overture and Hotmail.
The whole process of raising money from DFJ seemed to encapsulate the essential Redfin traits (persistence, serendipity, adventure, speed): Redfin wooed DFJ somewhat unsuccessfully over the course of a year; but it was a zealous customer who arranged the initial meeting; which we traveled to by plane, train and bicycle; demonstrating a website that had only been launched the day before; resulting in a closing that took just a few weeks.
In the DFJ bathroom, I remember seeing a photo of one of the partners being strapped (was it head-first?) into a go-kart for a big race and also a piece of artwork painted by another partner, and feeling sure we had come to the right place. And we had. Of all the investors we talked to, DFJ was the most committed to building a long-haul, consumer-centered business, which sounds like motherhood and apple pie but is increasingly unusual in an ad-addled world.
DFJ’s Emily Melton will join Redfin’s board; she shares the Redfin spirit of candor, dog-craziness and derring-do but also brings with her Silicon Valley’s smarts and values. In a pinch, she drives the wrong way down one-way streets.
The fund-raising itself was fun. We roared around San Francisco in a convertible Mustang; felt glamorous in big, drugstore-bought sunglasses; listened to dance music on the radio; sat around a Starbucks getting nervous in between meetings. For no reason at all, we wore cufflinks, ran demos that didn’t work, slept on a friend’s couch to save money.
Many thanks to the folks at Redfin now and before who got the company to this point, to our partners at Madrona, Vulcan, BEV and Orrick for their constant support, to DFJ of course for leading the round, and last but not least, to all our friends in Silicon Valley and San Francisco who gave us a little help along the way.
And now of course we have to celebrate, with the opening of the Washington, D.C. market, which includes Baltimore and suburban Virginia. We used to launch these markets with one guy in his basement, e-mailing a dozen of his neighborhood friends for our “viral campaign,” but now we’ve got a huge list of people to notify that we’ve arrived in the area, and a team of folks led by Catherine Jardine, and many promises to keep too.
July 13, 2007
A year ago, the Diddy spirit pervaded Seattle, resulting in a NerdPartySupernova led by an Ephod-clad Michael Arrington as the Grand Poobah. Beer-hauling trucks conked out, young men fell fatally in love, entrepreneurs with Hare-Krishna looks in their eyes rampaged through the ranks of venture capitalists.
This year, we’re doing something bigger. First of all, we’re bringing in the barbecue pit. More importantly, we’re on a mission to introduce journalists to entrepreneurs, so that little companies with big ideas can put themselves on the map, and figure out how they want to talk to the press. With a tip of the hat to Robert Scoble, we’re calling the event The Naked Truth.
Rebecca Buckman from the Wall Street Journal, Fred Vogelstein from Wired, Michael Arrington from TechCrunch, John Cook from the Seattle PI and Tricia Duryee from the Seattle Times will be on a pre-party panel to answer questions. And startup bigshots like Hugh Crean, Hadi Partovi, Jason Goldberg and Ben Elowitz will be in the crowd to ask.
Here are the details:
When: Tuesday, July 24, 2007. The panel starts at 5:30, the party starts at 6:30.
Where: The Havana Social Club, 1010 East Pike Street, Seattle
Who: every entrepreneur, dreamer, procastinator, narcissist, coder, starter, joiner, flim-flam man, gonzo PR guy, bigshot, littleshot and networking twizzler in town… please come!
Madrona Venture Group and Redfin are paying for the kegs and the ‘cue, and iLike, WetPaint, Farecast, Jobster and WildTangent are helping us put it together. If you want to come, you have to sign up in advance, or overpower our HGH-juiced Cambodian bouncer at the door. Panel attendance is limited to 200 people. We’ve tented a nearby parking lot so the party can handle 500.
Madrona’s Greg Gottesman, master of ceremonies for the panel, has already laid down the law for his approach: “I have come here to chew bubble gum and kick ass—and I’m all out of bubble gum.”
Edit the wiki to put your name on the list…
May 28, 2007
About a week after Redfin showed up on 60 Minutes, Century 21 started running an ad challenging the idea that you could buy a home online.
“Some people think they can do it all on the computer,” the actor says.
Find a home, sell a home. Except the computer can’t do what I do at Century 21.
Understand your needs.
The subtleties of the market, the neighborhood… the schools… the process!
To watch your eyes when you walk into a home and know right away that you’re in love with it.
No computer can do that.
I like the music, and the shy way she never quite stands in the center of the screen, or how she scrunches down as she talks about understanding your needs, even while the background darkens. The ad seems to be a self-conscious departure from the sinister tone of Century 21′s earlier efforts, which like most real estate marketing, oscillate between corn-pone dreams of home-ownership and scaring you to death.
But, since we still are one of the only online brokerages, it feels like a blunder for Century 21 to take us so seriously. Watching it, I was overcome with the elation of a high-school nerd after the prom queen noticed him enough for a put-down.
And the ad falls into the same old trap, arguing that customers need help picking out a home. Most don’t.
According to the market research we conducted before launching Redfin Direct, people value a broker for putting together a winning deal over helping them pick out a place, by a margin of about four to one. Buyers’ big anxiety is that their agent, because he’s paid by the seller, isn’t completely on their side. Negotiations, contingencies, legalities are of course where Redfin’s salaried agents focus all their efforts. The ad doesn’t really speak to any of that; it acts as if online brokerages don’t even have any agents.
Our CTO, Michael Young, disagrees. He thinks the ad is bad news for Redfin. In an e-mail, he worries that traditional brokerages “have a lot of money to spend… there’s a consistent FUD [Fear, Uncertainty, Doubt] attack against us that we’re just a bunch of low-touch clerks that we don’t combat well in our current marketing.”
Redfin spent peanuts on marketing last year vs. the traditional industry’s $12 billion. Mike suggested all sorts of guerilla tactics for getting the word out that we offer better service from offer to close than a traditional agent. Somebody suggested providing complete real-time access to customer survey results. My favorite was cinema verite of Redfin customers and agents working together. Our founder, David Eraker, once proposed picketing traditional real estate brokerages. (“What would we put on our signs?” I said.)
And so we’ve started to think about how we should change up our marketing, and could use a few suggestions. We’ve already got some raw material: Redfin customers have shown up on TV in Seattle, San Francisco, San Diego and nationwide. We’ve got heaps of agent and customer photos and testimonials buried somewhere in our site. We’ve also written an exhaustive overview of the home-buying process, more than I thought anyone would ever read, except we know from all the questions we get in web seminars that occasionally they do. It has been downloaded about 25,000 times in a few weeks.
If you know someone handy with home-movies, or you have an idea about what we should do to spread the word, let us know.
Bonus link, in honor of Memorial Day.
May 14, 2007
Redfin and the traditional real estate industry duked it out on 60 Minutes last night.
The segment aired second, after Mitt Romney took a stand against polygamy, but was the most popular video until losing out to a wayward penguin who swam 3,000 miles to Peru (Sasha Aickin just sent an e-mail around saying “we beat the penguin,” so I guess we’re back on top).
Here in Redfin Seattle, we watched the show in a conference room with a mixture of apprehension and desire; people brought their families and we all made fajitas. Seattle PI reporter John Cook showed up and began taking video with his digital camera.
Then the segment got rolling. Our favorite moments:
–> Rob McGarty wearing a blazer for the first time in his life, Kelly Engel stealing every scene, Fadi Hafzalla rolling up his sleeves and getting down to business.
–> The strange Borat-like moment when the traditional realtor was asked if she had refunded any commissions last year (“absolutely… NOT”).
–> The traditional agent’s explanation of why real estate agents charged nearly four times per transaction what they once did: increased postage costs…
–> The terrifying loss of perspective as the camera panned back on the National Association of Realtors’ sign as if it were a Star Wars spaceship.
–> B-roll of me complaining about our $4,000 copy machine, which is just so typical, cheap and mean-spirited (I HATE that thing).
Everyone in the conference room got quiet when the CEO of a company that had once embraced a business model similar to Redfin’s told Lesley Stahl he’d lost $33 million. Then we all cheered up when someone said we don’t have to worry about that because no one will give us $33 million.
And then the phones started ringing off the hook, and all of us — developers, executives, testers — scampered back to our battle-stations to answer them.
The website groaned under the load; first from 4:40 to 5:00 p.m., after the piece aired on the East Coast, and then again from 7:35 to 7:50 after the piece aired on the West Coast. Before our routers tapped out, we had served 40 times the volume of content that we normally do. We put up an emergency home page with search disabled. But without the Google Analytics tags on our standard home page, we could not see to see: we have no idea how many people saw that page.
It was fun working the front-lines. Many folks wanted to know if we could sell their property in Aruba, Italy, Mexico and Canada (Redfin’s dedicated agents immediately volunteered to handle Aruba, Italy and Mexico). One disgruntled 60 Minutes viewer called Donald DeSantis and told him he hoped he “died a slow, excruciating death” with one delicate body-part somehow wrapped around his neck.
A man with an ecumenical-sounding “SpiritJohn” e-mail address asked if I wouldn’t mind some constructive criticism; sure, I replied. Then he called me a “sissy” who “has been defrauding the American public for decades” (I started at Redfin just over a year ago; I wasn’t able to drive two decades ago). A third called and asked for Kelly Engel, then told her off. A very nice real estate agent e-mailed me offering herself as a corporate hair-stylist. A far-right radio show host asked me to name the “government bureaucrats” who blocked real estate reform.
Robert Scoble and Greg Swann reported a huge disturbance in the force, as hundreds of “60 Minutes” viewers descended on their site in search of Redfin (Robert’s blog about Redfin is the 7th Google search result for a Redfin search; we weren’t able to find Greg’s in the result set). A blog post that challenged Redfin’s facts began by noting I was a Harvard MBA (I never went to Harvard, I do not have an MBA). Another real estate blog argued for higher commissions (“6% is squat”) and lusted after Lesley Stahl (“what I wouldn’t do to have that blond hang out with me for one day as I go prospecting”).
For all the consumer enthusiasm, thousands of real estate agents and brokers have mobilized against CBS. The President of the NAR sent an e-mail to all 1.4 million members describing herself as “disappointed and dismayed” and encouraging agents to give CBS a piece of their minds. The real estate paper Inman News describes an industry in uproar. CBS News posted the text of the piece, alongside 46 pages (and counting) of comments.
Now it remains for us to sort through all the e-mail, call everyone back, and pick up where we left off building our little business. Thanks to everyone for all your kind wishes. If you have further thoughts on the segment, please just leave a comment below.
April 1, 2007
Redfin launched the real estate consumer’s bill of rights today, which Inman News is blasting out to its hundreds of thousands of real estate subscribers some time this morning. The premise of the bill is that consumers should have all the information the agent does about a house they’re trying to buy or sell, and about how the whole process works. Nearly a dozen Redfinners worked on it, from real estate operations, engineering and marketing.
Now we’re trying to recruit other brokers and real estate bigshots to support this idea. Already, we have our first, Kevin Boer, of 3 Oceans Real Estate, and we hope plenty will follow. So consumers can get in on the act, we’ve also started a petition that we plan to send to the National Association of Realtors and to all the local MLSs to which we belong; we hope you’ll sign it.
Maybe this can become a movement. Maybe real estate really can get better. The last time I circulated a petition, it was to get my beautiful but cruel high school French teacher fired, which involved premature exposure, humiliation, a year of intricate recriminations, and a very poor participation grade. Read the rights, and let us know if you think this stands a better chance.
1. Choose the services you pay for: Laws in more than a dozen states forbid brokers from refunding commissions to you, or require brokers to provide services you may not want to pay for. These laws protect the industry, not the consumer.
2. Know how your agent makes his money: In real estate, the seller pays both his own agent and the buyer’s agent a percentage of the sale; the agent earns more when his client pays more. If a house seems difficult to sell, the seller may even offer buyers’ agents an especially high percentage. Buyers’ agents should be required to explain to their clients how they are paid.
3. Know when you are committed to an agent: Often just showing a property entitles an agent to the commission for representing you, regardless of whether you intended to work with someone else or even preferred to represent yourself. The relationship between an agent and a consumer should always be explicit, so that both parties know when they’re committed to one another.
4. Know what services your agent will provide: Much of the work of a buyer’s agent begins after the buyer has agreed to buy a house. This work includes coordinating inspections, repairs, mortgages, title reviews and escrow services. But agents today are paid only to bring a buyer to a transaction. Once that happens, it is virtually impossible to fire your agent. In most cases, this is appropriate, as the agent who puts a deal together deserves the commission. But in becoming committed to an agent, you should know what services the agent will provide as part of that commitment and what recourse you have if the agent doesn’t perform those services. An open agreement between you and the agent protects the agent from being unfairly dismissed, and ensures you get the service you expect through closing.
5. Have an agent that represents only your interests: Most states allow an agent to represent the buyer and seller in one transaction, and get both sides of a commission. As a result, some sellers’ agents are on the prowl for unrepresented buyers to bring to the seller. It’s a solicitation neither side can easily refuse because the seller wants the buyer and the buyer wants the house. But an agent can’t fairly represent the interests of two parties to the same transaction. An agent should represent only one party, and take commissions for only one party.
6. Know the commission refund you can get before you buy a house: Depending on the service provided by the buyer’s agent, some sellers vary the commission offered to buyers’ agents. This flexibility is good in theory, but in practice it’s often used to thwart commission refunds: buyers expecting a refund of $10,000 or more from their agent discover on making an offer that the amount has been radically reduced in favor of the seller’s agent. Buyers should know in advance what circumstances let the seller’s agent keep more of a commission for himself. It’s fine to change the price but not at the cash register.
7. See all the houses for sale: Many of the multiple listing services set up to share listings between brokerages forbid participating websites from displaying for-sale-by-owner houses alongside broker-listed houses. As a result, home buyers usually don’t see all the houses for sale, and home sellers have to hire brokers just to get their house on mainstream sites. MLSs should not require exclusive display of listings.
8. Have an open discussion about a house for sale: On the web, you can openly discuss almost any product for sale except a house. That’s because sellers’ agents “own the listing,” controlling where and how it’s posted for their benefit. The rules of some MLSs discourage real estate websites from publishing independent reviews and preclude owners from distributing MLS marketing materials outside MLS-sanctioned websites. Once a house is for sale, everyone in the market should be able to discuss it.
9. See all the information available about a house for sale: Many MLSs make it difficult for buyers to see recent past sales data, how long a house has been for sale, or whether its price has been reduced. Once a house is for sale, you should be able to see all the information available about it on your own, without becoming anyone’s client. The only exception to this rule is information whose publication jeopardizes the seller’s safety, such as when the presence of children precludes a showing.
10. Be sure your agent will show your house to everyone: Some sellers’ agents selectively refuse to show houses to a buyer represented by an alternative brokerage, which hurts the seller and the buyer. If, as part of his service, a seller’s agent doesn’t show houses to all buyers, the seller should know it, and the buyer should be able to contact the seller directly. When agents don’t facilitate showing a house, they should at least stand aside and let buyers see the house on their own.
OK, now you can go hogwild with the comments…
March 21, 2007
The old way: explain your real estate needs and desires to an agent, he searches for listings, wait, wait, wait until he shares the details with you.
The Redfin way: search for real estate on your own terms, whether in your PJs or work duds, get immediate information.
The old way: once you fell in love with a place the only way to find out what other nearby homes sold for nearby was to call an agent and ask for a comparative market analysis, or CMA.
The Redfin way: DIY! Redfin let’s you figure it all out yourself!
Let’s say you’re looking at moving to Pioneer Square in Seattle because you just accepted a job offer at Redfin. After a few minutes searching on Redfin.com, I found 97 S. Jackson St. #402.
But is this a good deal?
Redfin.com will tell you everything you need to know to make that determination. First, I would look at the details page for the listing (click on “Full Details” in the listing pop-up box).
Does it have a Zestimate? This one has a Zestimate of $618,021.
Does it have any past sales information? Yes, it sold for $387,000 in 1999.
Next, I would go back to the search page and look for similar listings on the market. I search for 1,000 to 1,500-square-foot listings and find 12.
At the bottom of the list below the map, we can see that similar units have a median price of $521,975, average square footage is 1,189 and average $/sq ft is $535.
This gives you a good sense of similar units on the market, but what have other similar units sold for? Click on ‘Show more options’ and select a timeframe under ‘Show Past Sales’ such as ‘Last 1 year’ or ‘Last 6 months.’
Now we can see a list of the units we are interested in along with two previously sold units in the same building.
Clicking on these similar past sales, we can get a good sense of what other listings have sold for in the neighborhood and compare the listing we are interested in.
Happy CMA’ing :).
March 1, 2007
Thanks to McKinsey-trained Kevin Boer, one of several brokers who reviewed Redfin’s NWMLS data, Redfin has discovered that we screwed up the accounting for one transaction in our analysis of Redfin’s negotiating advantage.
Except for this transaction, Kevin seems to have corroborated our analysis.
We originally reported that our King County buyers got a final price of 99.329% below list, whereas King County customers of other brokerages paid 100.233% above list. This is factually correct. But one transaction should have been adjusted to account for a commission refund applied to the purchase price, so as to isolate the negotiating capabilities of Redfin and its customers. Making this adjustment leads to an average final price 99.340% below list.
With this adjustment, the negotiating advantage we claimed to be .904% is .893%. This reduces Redfin’s negotiating advantage by $54, from 4,474 to $4,420. This advantage is still financially meaningful and statistically significant, but we are nonetheless unhappy with ourselves for the error.
The source of the error was obscure: one, and only one, of our 170 King County customers offered to allow the seller to keep Redfin’s 2% commission refund if the seller would lower the price an additional 2% (on top of the 2% commission savings factored into the price, the house in question still sold for nearly 2% below listing price). The MLS # for the transaction was 26136978.
The NWMLS thus recorded the final price as being nearly 4% below listing price, but roughly half of this advantage came because the seller essentially received Redfin’s commission refund. Had we realized this when performing the initial analysis we would absolutely have added the commission refund on top of the final price.
And we would have identified this transaction earlier but for an error in our customer database indicating that the customer had qualified for a 2% commission refund. Before publishing our analysis, we double-checked this customer database against our financial records, but this only confirmed the amount of the commission refund, not that it was or was not offered to the seller to reduce the final price.
When Kevin inquired about the possibility that a commission refund was applied to the purchase price, we were about to e-mail him that this had not happened. Before we did, we decided to review the official HUD-1 forms for King County deals with exceptionally low prices as compared to list, and then, when we found a problem, for every deal included in the study. While I was wining and dining a college recruit in Berkeley, Rob and Cynthia were in the office Wednesday night pulling every file from last year.
We spent Thursday double-checking and re-calculating the data based on an error in one transaction, e-mailing Kevin later that day to explain the error.
Once we recognized the problem, we could have actually accounted for it in one of two ways, either by lowering our negotiating advantage or lowering our average commission refund. Lowering the commission refund amount would have allowed us to avoid making an adjustment to NWMLS data, which was appealing to us because the NWMLS data is a matter of public record for other brokers and agents.
We decided against this. Since the buyer got an extra 2% reduction in price only by using Redfin’s commission refund in the negotiation, we decided to reflect the change in a lower negotiating advantage. We also thought that lowering the negotiating advantage was the most conservative approach, since the negotiating advantage has been most hotly disputed.
Over the course of the morning, we will update our website, issue a corrected press release, and contact journalists and bloggers to whom we had sent the numbers that included this error.
In other news, the NWMLS report cited by various bloggers as contradicting Redfin’s data turned out to be wrong by a large margin. The NWMLS adjusted the ratio of the median final price vs. the median list price from 81.61% to 99.52%. When the NWMLS realized that a further adjustment upwards seemed to be in order, it re-published the report a second time with the table in question entirely removed.
Thanks again to Kevin Boer for finding Redfin’s error. After a week of intense scrutiny, the basic conclusion that Redfin’s King County customers got a price significantly better than customers of other brokerages still stands, but we are exhausted from having to re-analyze an already exhausting analysis, and apologetic to everyone we let down by making this mistake.
February 26, 2007
Redfin announced big news today, publishing MLS data that indicates our agents negotiate significantly better than their counterparts at traditional brokerages.
Last month at Brad Inman’s big real estate conference in New York, Realtor.com President Allan Dalton accused Redfin and other critics of a “massive level of disingenuous communication,” because we ignore the likelihood that traditional agents offset higher commissions by negotiating a better price (skip to minute 9:00):
Already our surveys had established that most of our customers get service that they believe is better or much better than what they got from a traditional real estate agent. But forget the touchy-feeley stuff: every day we heard that our customers would lose our commission refund and more at the negotiating table; it is the centerpiece of the traditional industry’s argument against Redfin.
And we agree, that the price of a home fluctuates with market conditions, increasing the importance of a real estate agent’s pricing guidance and negotiating ability.
But our problem with commissions is not simply that they’re too high; our problem is with the commission itself, because it pays the buyer’s agent more when his clients pay more. In other words, rather than being offset by better negotiations, the buyer agent’s commission actually causes worse negotiations.
This is why we decided to pay Redfin agents a salary with a customer satisfaction bonus, not a commission. Agents do what you pay them to do, we reasoned, and we believed our agents would be more likely to get the price our customers wanted.
After a year in the market, we decided to put our theory to the test, by querying the Northwest Multiple Listing Service for data on every home or condominium sold via a brokerage from February 6, 2006 (the date of Redfin Direct’s launch) through February 5, 2007. Since we didn’t offer a service for sellers or support areas outside King County until much later in the year, we limited the data to King County and we only evaluated our capacity as buyers’ agents.
But we still had the problem that Allan highlighted, namely that there is no “set base” price for a home.
So we compared what buyers’ agents negotiate for — the final price — to what the sellers’ agents ask for — the asking or listing price; some sellers’ agents may ask for too much, others for too little, but, since all our customers are all shopping in the same store, looking at the same listings, all King County brokerages are negotiating against the same set of asking prices (note that evaluating a seller’s agent is problematic, since the seller’s agent only competes against the prices she sets herself.)
The results were striking; Redfin customers paid on average under asking price, whereas customers of all other brokerages paid on average over asking price. The difference in negotiations was .9% of the home price, equivalent in King County to over $4,000, on top of a commission refund of nearly $10,000.
What makes this noteworthy is that the data did not come from Redfin, but from the MLS, from the brokers themselves who contribute to the MLS. Any brokerage can validate the data by following the instructions available in the appendix of our report.
Already, the Seattles Times reviewed the report and picked up the story in yesterday’s big Sunday spread.
Perhaps there is another way to evaluate whether traditional agents negotiate better than Redfin agents; until there is, the most likely conclusion is that Redfin agents negotiate better than their more expensive counterparts.
February 8, 2007
A friend descending into Southern California once looked down on the vast grid of tinkling lights and said it was as terrifying to see as the mind of God.
I used to dislike the way LA made me feel insignificant, but now it’s almost a relief. If Gertrude Stein once complained that the problem with Oakland is that “when you get there, you’re there,” she might have said about Southern California that you when you get there, you feel like you’re not there at all. What makes all the taco trucks, the Korean strip malls, the freeways, the birdbath pools and look-alike houses not only bearable but actually and suddenly quite beautiful is the ocean on the other side of it all, serene as far as the eye can see.
Now Redfin is launching in Southern California, the largest real estate market in the world. In one magnificent land-grab, we’ve more than tripled the area we have to cover: Los Angeles, Orange, Riverside, San Bernardino, San Diego and Ventura counties. To start, we’ve hired three new agents, who (if SoCal is anything like San Francisco was) will probably spend their first few months on the job waiting for action from the Web site, and e-mailing the rest of us to tell us they’re going loco.
Or maybe things will pick up a little faster: we’re closing a whopper deal in San Diego today, and we’ve already got a few others in progress. We’re supposed to show up on TV tonight in San Diego, and the LA Times published a nice spread about us today (smiling picture; intensely regretted & insanely provocative quote, which Kevin Boer has already called me out on); we got on the radio and a podcast too. Another positive development is the Southern California bloggers already are talking trash about us.
As usual, they call us discounters, when we’re not offering a discount on a traditional service, we’re offering an online service at a different price, with a different business model and 95+% customer satisfaction. Amazon.com is not a discount bookstore. Redfin.com’s goal is to be different and better too, not just cheaper.
And hey, did you notice that Redfin.com has smaller icons, and it’s running faster today? We put some serious hardware on company plastic, squashed our file sizes and got down and dirty optimizing our code. Some day, we’re going to have to write a post on the tradeoffs between Flash and AJAX, which we’ve had to learn about as we go. The big issue we’re still working on — crucifixion by comments, please — is Safari support, which we lost when we switched to Virtual Earth.
For now, please tell your Southern California friends about us, and thanks for all your support.
January 8, 2007
At real estate’s big Inman technology conference in Manhattan, Redfin squared off with Allan Dalton, Move.com’s President of Real Estate, in a keynote session entitled high-touch vs. high-tech, about the differences between online brokers and traditional real estate agents.
Move.com runs Realtor.com for the National Association of Realtors, publishing listings nationwide. It has also threatened to sue Redfin to change our logo, which, after some ineffectual begging, threatening and groveling, we are now changing.
You of course will be wondering only who won? Well I can’t say, for several reasons:
1. I’m not sure who, which probably means I lost.
2. I wouldn’t say I won if I had.
3. Allan and I both blathered, though he blathered well.
I met a few industry veterans in the morning for breakfast, who promised me Allan would toss chunks of ahi Redfin to the delirious crowd. They told me to watch a video of Allan comparing Zillow’s astounded Lloyd Frink to a carnival barker guessing someone’s weight:
This is probably why, the whole time I was under the lights with Allan, I found myself looking at Lloyd for support, who alternated between nodding sympathetically, and diddling with his mobile device.
In the green room beforehand, Allan was very kind, telling me in a wonderful Boston accent that his daughters loved my home-town. He looked comfortable in a tie, and a sweater over the tie, and a coat over the sweater (whereas I had just gotten my hair cut by someone who I am fairly certain had never cut white hair). Allan said he represented all Realtors, including Redfin, the way someone might say, “we’re all God’s children,” to a deranged child. Then he explained how we would destroy me on stage.
Allan went first, touting executives from Google and Amazon who have joined Move.com. He talked about negotiating skills, not service. He said he was in favor of consumer choice; then he said that anyone claiming a consumer could save money from reduced commissions was on dangerous ethical and legal ground.
Before I could pipe up, he told me don’t be defensive: he wasn’t talking about Redfin. Then he started bludgeoning me with “THIS IS THE MOST IMPORTANT TRANSACTION OF PEOPLE’S LIVES.” The rest of the conversation alternated between the boring (me) and the somewhat disparaging (Allan).
The moderator, Brad Inman, asked if Redfin had faced opposition from the industry; we said yes, acknowledging that sometimes we’ve made it worse for ourselves by stoking the controversy. Brad asked how Redfin could do better at negotiating a $2-million deal in the Berkeley Hills than a superstar agent: we told him we could do $40,000 better (but not that coherently).
The battle was joined. Allan and I wrangled over whether we could cost the customer more by screwing up the deal. I said the most basic premise of Redfin’s business is that we have to be the best, not the cheapest. It was an aspiration that seemed to settle Allan and the crowd; it’s something we all understand.
Then Redfin antagonized everyone by saying that what’s wrong with the industry is the commission structure that pressures agents to pressure clients, and the desk fees that pressure brokerages to recruit more agents than the market needs. If we don’t reform ourselves, and take out all the sales baloney too, people will come to hate real estate agents the way they hate tobacco companies or Big Oil.
Then it was over. Many people afterwards congratulated me, for nothing in particular, which was very kind. The floor cleared, and I started to chat with a New York board member whom I rarely see but was eager to impress. “How’d you do?” he said. A Hamptons broker with a magnificent head of hair and a Bluetooth embedded in his ear interrupted us to say, confidently and happily, that I had bombed.
Random bonus, from a friend of Redfin: this magnificent obituary of a frenzied gardener.
