Boston Real Estate

Compass Goes Public, CEO Says Capital Raise Goal Met

Compass Goes Public, CEO Says Capital Raise Goal Met

We are honored to congratulate Chairman and CEO Robert Reffkin, cofounder Ori Allon, and the entire team of employees and agents at Compass on a successful IPO.

Compass' First Day

Compass' first day as a publicly traded company is now in the books. This follows the residential brokerage reducing the size and price of their offering, with the price hovering between $18 and $22 per share throughout the trading day. The stock closed at $20.15 per share, giving the company an overall market cap of $7.7 billion. Including employee options and RSUs, the company says its valuation is closer to $10 billion.

Speaking on CNBC, Reffkin claimed that the firm would "earn a higher valuation over time."

"The way we're going to earn that is by creating value for agents," he added. "Compass is building the modern, one-stop shop to help them grow their business." In another appearance on CNN, Reffkin said that "the goal was never a valuation, the goal was successful financing, and this met that goal."

During another CNBC segment, Jeff Housenbold, who sits on Compass’ board through his position at its largest investor, SoftBank, claimed Compass helps agents increase their business by 19 percent. “Think about it as Shopify for small business owners,” he said. “They happen to be real estate agents.”

 

A Company with Big Plans

 

Robert and Ori launched Compass in May of 2013.  While many venture-backed start-ups had tried (and failed) to transform the painfully slow, antiquated residential real estate market by replacing real estate agents, Robert and Ori took a different path. They recognized, given the scale, complexity, and importance of real estate transactions to both buyer and seller, that agents were an absolutely essential and central component of the marketplace. However, these critical intermediaries didn’t have the technology platform they needed to conduct their business efficiently, and consequently, their clients and the agents themselves were faced with a complex and stressful process.

Today, the AI powered Compass platform is unmatched in its capabilities and more than 19,000 Compass agents use the state-of-the-art platform to manage their daily workflow and provide truly exceptional service to their clients.

The Compass platform helps agents to win more listings, obtain better priced properties, transact more efficiently, and ultimately generate more commission income than agents at traditional brokerages. Through 2020, Compass agents assisted home buyers and sellers with more than 275,000 homes worth more than $300 billion.

Over the last three years, Compass has grown revenues at a 105% CAGR generating more than $3.7 billion in 2020. It has now grown into the largest independent real estate brokerage in the United States.

Today, Compass operates in 46 markets across 20 states, and with just 4% market share, they are just getting started. 

As Compass expands its product lines and expands globally by streamlining and organizing the complex multi-party workflow of the massive $570 billion global residential real estate industry, we expect Compass to have a bright future of remarkable growth for many years to come.

Congratulations to all of our agents and employees!

 

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