Compass
Compass recruited 30,000 agents with equity and marketing budgets, hit $6.5 billion in revenue, and lost $500 million doing it. Buying market share in services with subsidies works until the subsidies stop. The tools must be worth paying for.
Robert Refkin spent two decades collecting credentials, Goldman Sachs, Columbia, a fellowship at the White House. Then in 2013, he walked away to start a real estate brokerage. Compass would give agents technology so good, they would leave their current firms and bring their client books. The agent acquisition machine worked. Compass recruited top producers with equity, marketing budgets, and a sleek app. By 2021, over 30,000 agents, revenue reached 6.5 billion. Compass became the largest independent residential brokerage in America by transaction volume. But the economics never caught up. Compass spent more to recruit agents than it earned from commissions.
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