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Compass

Topic: Company

 From HandWiki - Reading time: 10 min
Short description: American real estate technology company
Compass Inc.
TypePrivate
IndustryReal Estate
Founded2012; 12 years ago (2012)
FounderOri Allon
Robert Reffkin
Headquarters
New York, New York
,
United States[1]
Area served
21 areas in the United States [2]
Key people
Ori Allon (Co-Founder and Executive Chairman)
Robert Reffkin (Co-Founder and CEO)
Kristen Ankerbrandt (CFO) Rob Lehman (CBO)
Joseph Sirosh (CTO)
Websitecompass.com

Compass is a licensed real estate broker that utilizes the Internet as a marketing medium with the use of real estate technology. Compass employs more than 2,000 agents who earn a percentage of the selling price and give 15 to 30 percent on each sale to Compass.[3] The Company lures the industry's top talent with lavish signing bonuses[3] and specializes in high-margin, luxury homes in upscale, coastal markets. The much-touted technology is actually, according to several agents, not that different from what other brokers provide.[3] Founded in 2012, the company is headquartered in New York City .[1] The company provides software to real estate agents.[4] Compass is said to be the first company to have built a proprietary mobile app for real estate agents.[5] In September 2018, the company had a valuation of US$4.4 billion.[6]

Compass operates in 20 U.S. markets including New York, Philadelphia, Boston, Washington D.C., Dallas, South Florida, San Francisco, Chicago, Los Angeles, Aspen, The Hamptons, Santa Barbara[7] and Newport Beach.[8]

Compass has raised a total of US$1.5 billion[9] from investors such as Founders Fund, Wellington Management and Institutional Venture Partners,[4] Fidelity Investments,[3] Dragoneer Investment Group, Canada Pension Plan Investment Board and Softbank Vision Fund.[10] Compass was named Mid-Sized Business of the Year by the Manhattan Chamber of Commerce in 2015.[11] Compass was named to Crain's Fast 50,[12] Inc. 5000,[13] and Glassdoor's Best Places to Work[14] in 2018. Compass received a Webby Award for Best Real Estate Website,[15] and was named to Fast Company's Best Workplaces for Innovators[16] in 2019.

History

The Engineering Hub for Compass Real Estate in Seattle

Compass was originally founded by entrepreneurs Ori Allon and Robert Reffkin as “Urban Compass” in 2012. Allon had previously sold companies to Google and Twitter.[17] Reffkin previously served as the chief of staff to the president of Goldman Sachs[11] and worked in the White House.[18][19] The company raised $8 million of seed funding from Founders Fund, Thrive Capital, Goldman Sachs as well as several individual investors including American Express CEO Kenneth Chenault, and ZocDoc CEO Cyrus Massoumi.[19][17] The initial business model employed full-time, salaried brokers, with whom users of the platform could schedule appointments online after searching for listings on the company's desktop or mobile app.[20] The company publicly debuted at an event in May 2013, where then-New York City Mayor Michael Bloomberg helped celebrate the launch.[21][22] The company initially focused only on rentals.[22]

In September 2013, the company raised a Series A financing round of $20 million, at a reported valuation of $150 million.[23] Investors included Advance Publications, Salesforce.com CEO Marc Benioff, and .406 Ventures.[23][24]

At the beginning of 2014, Compass announced it would change its overall business model by contracting independent real estate agents and taking a portion of their commissions.[25] In July 2014, Compass raised a Series B financing round of $40 million at a valuation of $360 million, according to Bloomberg.[26] Shortly thereafter, Compass signed a lease on 25,000 square feet of office space at 90 5th Avenue.[27] The firm also hired Leonard Steinberg, a top-ranked real estate broker, from Douglas Elliman to serve as its president.[28][29] Steinberg was named the agent with the highest sales volume in 2016 by Real Trends.[30] The company reported having 125 agents and 70 staff at this time.[31]

In September 2015, Compass raised a Series C financing round of $50 million at a reported valuation of $800 million. The investment was led by Institutional Venture Partners.[32] The company also opened offices in Brooklyn, South Florida, Boston and the Hamptons.[33][34][35][36][32]

In August 2016, Compass raised a Series D financing round of $75 million, led by Wellington Management, which brought its valuation higher than $1 billion.[37][38] The company also launched a new mobile app that offers real-time data on the real estate market.[39] Earlier in the year, the company expanded into Aspen with the acquisition of Shane Aspen Real Estate[40] as well as Los Angeles.[41] Reports also cited Compass's expansion into Santa Barbara[37] and San Francisco[42] as well as several other smaller sub-markets of their other major metro areas.[43]

In 2017, Compass hired several new executives to its leadership team, including Madan Nagaldinne, a former Facebook and Amazon executive, as Chief People Officer,[44] and Craig Anderson, a former Flywheel executive, as chief financial officer.[45]

In November 2017, Compass announced $100 million in Series E investment by Fidelity Investments,[3] followed by the December 7, 2017 announcement of a $450 million investment by Softbank Vision Fund, bringing the company valuation to $2.2 billion.[10]

Compass also expanded into Chicago in late November 2017, signing the city's number-one real estate team.[46] Additionally, Compass announced aggressive expansion plans to 9 more cities.[47]

Less than a year later in September 2018, Compass announced a $400 million in Series F funding at a valuation of $4.4 billion.[48] In addition to Softbank Vision Fund, this series was led by Qatar Investment Authority,[49] which controls Qatar's sovereign wealth fund. Other investors included Wellington Management, Institutional Venture Partners and Fidelity Investments. Compass also announced plans to use these funds to enter international markets and double down on creating world-leading technology.[50] Compass planned to launch in Nashville, Houston, and Denver before the end of 2018.

Compass has promoted its "20/20 by 2020" plan, by which it would gain 20 percent market share in the top 20 markets by 2020. However, in January 2019 the company announced its intention to halt expansion, after encountering unspecified challenges. CEO Robert Reffkin acknowledged that the softening of the equity markets contributed to the decision not to enter new markets in 2019.[51]

In 2019, Compass announced a Series G investment of $370 million from the Canada Pension Plan Investment Board (CPPIB), Dragoneer Investment Group, Qatar Investment Authority (QIA) and SoftBank Vision Fund. This round brought the company's valuation to $6.4 billion.[52] In November 2019, Compass announced it's plan to open it's India Development Centre in Hyderabad.[53]

Services

Compass Concierge

The Compass Concierge program assists in selling a clients home faster and for a higher price by covering the cost of home improvements to prepare the home for market. There are no fees associated with the service and the cost of the improvements are collected after the sale closes.[54]

Compass Bridge Loan Services

Compass Bridge Loan Services provides access to competitive rates and dedicated support from industry-leading bridge loan lenders, with the option to get up to six months of the loan payments fronted when the home is sold with a Compass agent.[55]

Compass Coming Soon

The Compass Coming Soon program pre-markets properties on compass.com giving buyers and their agents a heads up that the home is about to hit the market.[56]

Technologies

Compass Collections

Called the Pinterest of real estate, this curated visual workspace allows agents and clients to collaborate in real time. Agents and clients can easily organize homes, centralize their discussions, and monitor the market by receiving immediate status and price updates.

Compass Insights

This personalized dashboard contains all the key data points agents need to craft a winning marketing strategy around audience and traffic information, uncover new lead-generation opportunities, and invest accordingly in the positioning of their listings.

Marketing Center

The Compass digital design studio features a library of sophisticated designs so that Compass agents can create customized, personalized and localized marketing materials in minutes.

Compass Markets

Compass Markets for the first mobile app that puts real-time residential real estate data at an agents’ fingertips, allowing them to instantly access the most recent transaction data as well as historic sales trends.

Compass CRM

Compass CRM is a customer relationship management platform that empowers agents to nurture relationships, close more sales and stay one step ahead with insights powered by artificial intelligence.

Acquisitions

The following is a list of acquisitions by Compass:

  • Lindsay Reishman Real Estate (November 2014)[57]
  • Bushari (January 2018)[58]
  • Conlon (April 2018)[59]
  • Northwest Group Real Estate [NWG] (April 2018)[60]
  • The Hudson Company (June 2018)[61]
  • Paragon Real Estate Group (July 2018)[62]
  • Pacific Union International (August 2018)[63]
  • Avenue Properties (August 2018)[64]
  • Wydler Brothers (November 2018)[65]
  • Contactually (February 2019)[66][67]
  • Alain Pinel Realtors (March 2019)[68]
  • Stribling & Associates (April 2019)[69]
  • Detectica (November 2019)[70]

References

  1. ↑ 1.0 1.1 Lunden, Ingrid. "Compass Raises $50M at An $800M Valuation Led By IVP To Supersize Its Real Estate Platform". https://techcrunch.com/2015/09/15/compass-50m-real-estate/. 
  2. ↑ Compass. "Our regional offices, from coast to coast.". Compass. https://www.compass.com/about/offices. Retrieved 2019-05-16. 
  3. ↑ 3.0 3.1 3.2 3.3 3.4 "Tech Startup or Real-Estate Broker? Fidelity Values Compass at $2 Billion". Bloomberg.com. 2017-11-08. https://www.bloomberg.com/news/articles/2017-11-08/tech-startup-or-real-estate-broker-fidelity-values-compass-at-2-billion. 
  4. ↑ 4.0 4.1 Brown, Eliot; Kusisto, Laura (17 February 2017). "Real Estate Is Latest Target for Would-Be Disrupters". https://www.wsj.com/articles/real-estate-is-latest-target-for-would-be-disrupters-1487327401. 
  5. ↑ Bourque, Andre (28 September 2016). "25 Inspiring Entrepreneurs Under 40 Who Are Creating the Next Big Thing". https://www.entrepreneur.com/article/281616#. 
  6. ↑ "Compass Is Said to Raise Funds at $4.4 Billion Valuation" (in en). 2018-09-27. https://www.bloomberg.com/news/articles/2018-09-27/compass-is-said-to-raise-funds-at-4-4-billion-valuation. 
  7. ↑ Lunden, Ingrid. "Maelle Gavet is the new COO at real estate startup Compass". https://techcrunch.com/2017/01/18/maelle-gavet-is-the-new-coo-at-real-estate-startup-compass/. 
  8. ↑ "Luxury real estate startup Compass expands to Newport Beach, scores top agent Rob Giem". 5 February 2017. http://www.ocregister.com/2017/02/05/luxury-real-estate-startup-compass-expands-to-newport-beach-scores-top-agent-rob-giem/. 
  9. ↑ Tabatabai, Arman. "Real estate platform Compass raises another US$370m on a 6.4b valuation en route to an IPO" (in en-US). TechCrunch. https://techcrunch.com/2019/07/30/real-estate-platform-compass-raises-another-370m-on-a-6-4b-valuation-en-route-to-an-ipo/. 
  10. ↑ 10.0 10.1 Jr., Berkeley Lovelace (2017-12-07). "Softbank invests $450 million in real estate tech company Compass". CNBC. https://www.cnbc.com/2017/12/07/softbank-invests-450-million-in-real-estate-tech-company-compass.html. 
  11. ↑ 11.0 11.1 "Why This Real Estate App Is Making New York Brokers Nervous". 18 June 2015. https://www.fastcompany.com/3047603/why-this-real-estate-app-is-making-new-york-brokers-nervous. 
  12. ↑ "Compass" (in en). 2018-10-14. https://www.crainsnewyork.com/awards/compass-fast-50-2018. 
  13. ↑ "Inc. 5000 2018: The Complete Rankings". https://www.inc.com/inc5000/list/2018. 
  14. ↑ "Best Places to Work" (in en). https://www.glassdoor.com/Award/Best-Places-to-Work-LST_KQ0,19.htm. 
  15. ↑ "Compass -- The Webby Awards" (in en-US). https://www.webbyawards.com/winners/2019/websites/general-websites/real-estate/compass/?/. 
  16. ↑ Company, Fast (2019-08-05). "The 50 best workplaces for innovators" (in en-US). https://www.fastcompany.com/90378273/best-workplaces-for-innovators-2019. 
  17. ↑ 17.0 17.1 "After cashing out to Google and Twitter, Ori Allon is going all in with Urban Compass". https://www.theverge.com/2012/11/27/3692738/ori-allon-urban-compass-twitter-google-goldman-sachs. 
  18. ↑ "Modernizing the New York apartment hunt". http://fortune.com/2014/10/13/modernizing-the-new-york-apartment-hunt/. 
  19. ↑ 19.0 19.1 Lunden, Ingrid. "With $8M in Seed Funding From Founders Fund, Goldman Sachs; Urban Compass Wants To Build A Hyper-Local, Human-Powered Database". https://techcrunch.com/2012/12/16/urban-compass/. 
  20. ↑ "Urban Compass: can a startup finally fix the nightmare of renting an apartment in NYC?". https://www.theverge.com/2013/5/7/4304374/urban-compass. 
  21. ↑ Lunden, Ingrid. "Urban Compass Comes Out Of Stealth with a Hyperlocal Social Network, And A Disruptive Rental Portal That Will Serve As A Magnet". https://techcrunch.com/2013/05/07/urban-compass-debuts-a-hyperlocal-social-network-and-a-rental-portal-to-serve-as-its-magnet/. 
  22. ↑ 22.0 22.1 "NYC tech start-up Urban Compass launches real estate focused site". http://www.nydailynews.com/life-style/real-estate/nyc-tech-start-up-urban-compass-launches-real-estate-focused-site-article-1.1337613. 
  23. ↑ 23.0 23.1 Lunden, Ingrid. "Hyperlocal Power: Urban Compass Raises $20M at A$150M Valuation; Adds Advance Publications And Marc Benioff As Investors". https://techcrunch.com/2013/09/25/urban-compass-series-a/. 
  24. ↑ "- New York City startup Urban Compass raises $20 mln in Series A funds". https://www.pehub.com/2013/09/new-york-city-startup-urban-compass-raises-20-mln-series-a-funds/. 
  25. ↑ "The big pivot: why Urban Compass has gone traditional". https://www.inman.com/2014/01/15/the-big-pivot-why-urban-compass-has-gone-traditional/. 
  26. ↑ Taylor, Colleen. "Urban Compass Raises $40M To Expand Its Apartment Marketplace Beyond NYC". https://techcrunch.com/2014/07/21/urban-compass-raises-40m-series-b/. 
  27. ↑ "Urban Compass Signs Lease at RFR's 90 Fifth Avenue". 22 July 2014. https://commercialobserver.com/2014/07/urban-compass-signs-lease-at-rfrs-90-fifth-avenue/. 
  28. ↑ "Leonard Steinberg exits Douglas Elliman for Urban Compass". 2 June 2014. https://therealdeal.com/2014/06/02/leonard-steinberg-exiting-douglas-elliman-for-urban-compass/. 
  29. ↑ "WHO'S NEWS – Real Estate Weekly". 20 June 2014. http://rew-online.com/2014/06/20/whos-news-17/. 
  30. ↑ "The Real Trends/WSJ Thousand list for 2016 has been unveiled". https://www.inman.com/2016/06/24/real-trendswsj-thousand-list-2016-unveiled/. 
  31. ↑ Hagey, Paul. "Urban Compass launches nationwide expansion push with Washington, DC, acquisition" (in en-US). https://www.inman.com/2014/11/15/urban-compass-launches-nationwide-expansion-push-with-washington-d-c-acquisition/. 
  32. ↑ 32.0 32.1 "Compass raises $50M in Series C; now valued at $800M". 15 September 2015. https://therealdeal.com/2015/09/15/compass-raises-50m-in-series-c-now-valued-at-800m/. 
  33. ↑ "Compass opens first SoFla office on Lincoln Road". 21 August 2015. https://therealdeal.com/miami/2015/08/21/compass-opens-first-sofla-office-on-lincoln-road/. 
  34. ↑ "Urban Compass picks up top team from Citi Habitats". 10 September 2014. https://therealdeal.com/2014/09/10/urban-compass-picks-up-top-team-from-citi-habitats/. 
  35. ↑ "Compass riding $50M funding round into Boston". https://www.inman.com/2015/09/30/compass-riding-50m-funding-round-into-boston/. 
  36. ↑ "Compass turns to the Hamptons, where rivals roam". 4 September 2015. https://therealdeal.com/2015/09/04/compass-turns-to-the-hamptons-where-rivals-roam/. 
  37. ↑ 37.0 37.1 "This startup that wants to blow up the real-estate market is now worth more than $1 billion". http://www.businessinsider.com/compass-raises-funding-worth-over-1-billion-2016-8. 
  38. ↑ "Compass Earns $1 Billion Valuation As New Unicorns Become Rarer". 31 August 2016. https://www.bloomberg.com/news/articles/2016-08-31/compass-said-to-win-1-billion-valuation-as-new-unicorns-become-rarer. 
  39. ↑ "This $800 million startup just launched an app to make buying a home easier". http://www.businessinsider.com/compass-real-estate-startup-launches-new-app-2016-7. 
  40. ↑ "Tech company Compass acquires Shane Aspen Real Estate". http://www.aspentimes.com/news/tech-company-compass-acquires-shane-aspen-real-estate/. 
  41. ↑ "Compass to launch LA new dev division on heels of Hana Cha hire". 18 July 2016. https://therealdeal.com/la/2016/07/18/compass-to-launch-la-new-dev-division-on-heels-of-hana-cha-hire/. 
  42. ↑ "Compass now claims its agents account for $8B in sales -- but what's that number made of?". 2 September 2016. https://therealdeal.com/2016/09/02/compass-now-claims-its-agents-account-for-8b-in-sales-but-whats-that-number-made-of/. 
  43. ↑ McAlone, Nathan. "This startup that wants to blow up the real-estate market is now worth more than $1 billion". https://www.businessinsider.com/compass-raises-funding-worth-over-1-billion-2016-8. 
  44. ↑ "Compass hires Facebook alumnus to steer recruitment strategy – Real Estate Weekly". 23 August 2017. http://rew-online.com/2017/08/23/compass-hires-facebook-alumnus-to-steer-recruitment-strategy/. 
  45. ↑ D'Amato, Peter. "Compass replaces chief financial officer". http://www.crainsnewyork.com/article/20170830/REAL_ESTATE/170839997/real-estate-tech-firm-compass-replaces-chief-financial-officer. 
  46. ↑ "City's top-selling residential broker team jumps to new-in-town firm". Crain's Chicago Business. http://www.chicagobusiness.com/realestate/20171128/CRED0701/171129920/citys-top-selling-residential-broker-team-jumps-to-new-in-town-firm. 
  47. ↑ "Compass reveals plans for massive expansion" (in en-US). Inman. https://www.inman.com/2017/11/07/compass-reveals-plans-for-massive-expansion-futuristic-signage/. 
  48. ↑ "Compass nabs $400M, valuing the real estate technology startup at $4.4B" (in en-US). TechCrunch. https://techcrunch.com/2018/09/27/safe-as-houses-compass-400m-real-estate-unicorn/. 
  49. ↑ "Compass Is Said to Raise Funds at $4.4 Billion Valuation" (in en). 2018-09-27. https://www.bloomberg.com/news/articles/2018-09-27/compass-is-said-to-raise-funds-at-4-4-billion-valuation. 
  50. ↑ "Compass raises $400M from SoftBank, QIA; brokerage now valued at $4.4B" (in en-US). The Real Deal New York. 2018-09-27. https://therealdeal.com/2018/09/27/compass-raises-400m-from-softbank-qatar-investment-authority/. 
  51. ↑ "Hitting the brakes: Compass won’t expand to new markets this year" (in en-US). 2019-01-29. https://therealdeal.com/2019/01/29/hitting-the-brakes-compass-wont-expand-to-new-markets-this-year/. 
  52. ↑ Azevedo, Mary Ann (2019-07-30). "Compass Raises $370M As Increasingly Crowded Real Estate Space Heats Up" (in en-US). https://news.crunchbase.com/news/compass-raises-370m-as-increasingly-crowded-real-estate-space-heats-up/. 
  53. ↑ {Cite web|url=https://www.prnewswire.com/news-releases/compass-unveils-plans-for-new-tech-hub-in-india-300951891.html}
  54. ↑ ZafarReporter, Nina Zafar closeNina; SourceEmailEmailBioBioFollowFollow, editorial aide for Reliable. "Real estate agencies put the spotlight on staging" (in en). https://www.washingtonpost.com/business/2019/06/24/real-estate-agencies-put-spotlight-staging/. 
  55. ↑ Olick, Diana (2019-10-21). "Brokerage Compass starts offering an easier, less expensive way to get a bridge loan" (in en). https://www.cnbc.com/2019/10/21/brokerage-compass-offers-easier-less-expensive-way-to-get-bridge-loan.html. 
  56. ↑ "Compass | Compass Coming Soon | Whisper Listings" (in en-US). 2018-09-17. https://therealdeal.com/2018/09/17/compass-deploys-sneak-peak-marketing-cue-the-raised-eyebrows/. 
  57. ↑ edition, V. Dion Haynes closeV Dion HaynesReal estate editor who oversees the weekly print; editor, Where We Live blog EmailEmailBioBioReal estate. "New York realty firm to open office in D.C." (in en). https://www.washingtonpost.com/news/where-we-live/wp/2014/11/13/new-york-realty-firm-to-open-office-in-d-c/. 
  58. ↑ "Compass acquires Bushari Real Estate" (in en-US). 2018-01-19. https://bostonagentmagazine.com/2018/01/19/compass-acquires-bushari-real-estate/. 
  59. ↑ "Compass acquires Chicago brokerage Conlon Christie's" (in en). 2018-04-25. https://www.chicagobusiness.com/article/20180425/CRED0701/180429918/compass-acquires-chicago-brokerage-conlon-christie-s. 
  60. ↑ "Well-funded real estate tech company Compass opens Seattle-area offices" (in en-US). 2018-04-25. https://www.geekwire.com/2018/well-funded-real-estate-tech-company-compass-opens-seattle-area-offices/. 
  61. ↑ "Compass buys Hudson Company, continuing Chicago expansion effort" (in en-US). 2018-06-25. https://therealdeal.com/chicago/2018/06/25/compass-buys-residential-brokerage-hudson-company-continuing-city-expansion/. 
  62. ↑ "Paragon Real Estate of SF acquired by Compass to form city's largest brokerage" (in en-US). 2018-07-10. https://www.sfchronicle.com/business/networth/article/Paragon-Real-Estate-of-SF-acquired-by-Compass-to-13061063.php. 
  63. ↑ "Compass buying Pacific Union - its second SF real estate acquisition in two months" (in en-US). 2018-08-22. https://www.sfchronicle.com/business/networth/article/Compass-buying-Pacific-Union-second-SF-real-13172961.php. 
  64. ↑ "Avenue Properties joins real estate tech company Compass". https://www.bizjournals.com/seattle/news/2018/08/14/compass-merger-avenue-properties-real-estate-tech.html. 
  65. ↑ "Compass | Wydler Brothers Real Estate | Robert Reffkin" (in en-US). 2018-11-13. https://therealdeal.com/2018/11/13/compass-acquires-dc-indie-brokerage/. 
  66. ↑ "Compass Acquires Contactually - Press | Contactually". https://www.contactually.com/press/press-releases/compass-acquires-contactually. 
  67. ↑ "Compass acquires Contactually, a CRM provider to the real estate industry" (in en-US). http://social.techcrunch.com/2019/02/27/compass-acquires-contactually-a-crm-provider-to-the-real-estate-industry/. 
  68. ↑ "Compass buys Alain Pinel to create Bay Area real estate behemoth" (in en-US). 2019-03-05. https://www.sfchronicle.com/business/networth/article/Compass-buys-Alain-Pinel-to-create-Bay-Area-real-13662639.php. 
  69. ↑ "Compass | Stribling & Associates | Residential brokerages" (in en-US). 2019-04-03. https://therealdeal.com/2019/04/03/compass-strikes-deal-to-buy-stribling-associates/. 
  70. ↑ Council, Jared (2019-11-19). "Real-Estate Brokerage Compass Buys AI Startup Detectica" (in en-US). Wall Street Journal. ISSN 0099-9660. https://www.wsj.com/articles/real-estate-brokerage-compass-buys-ai-startup-detectica-11574159402. 




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