Venture capitalists have been pouring investment into proptech over the past decade based on a belief that the residential real estate model is broken. Their contention is that consumers want the experience of buying or selling a home to be like renting a video on Netflix or buying a product through Amazon. Their objective is to capture a big chunk of the approximately $80 billion collected in commissions each year by agents and brokers.
Many of these outsiders have missed an essential fact that undermines their basic premise, which is that most homebuyers and sellers see tremendous value in having a trusted advisor to get them through the process safely. Sure, they want the most cost-effective advisor they can get, but a chat bot doesn’t give them the confidence they need.
The goal of broker innovation today is creating a consumer experience that leverages technology to remove complexity and make the experience simple—one that engages consumers when and where they want, while also injecting human advisory services that give them the confidence to act. This is the end game pursued by enlightened insiders in the industry today. As brokers embrace technology to make the process easier and deliver a more valuable experience to homebuyers and sellers, agents gain tremendous productivity, allowing them to out-compete would-be disruptors. Inside Real Estate is “all in” on this end game as well. We’ve bet our business on providing the tech that helps brokers, teams and agents make this vision a reality.
What the market needs now is not to destroy the broker/agent model, but to accelerate technology enablement and innovation across the entire home transaction cycle, removing the remaining points of friction and delivering a new wave of productivity gains for real estate professionals. That’s why we are doubling down on innovation at Inside Real Estate, investing an additional $10 million over the next 18 months on top of existing budgets and the $200 million already invested in our flagship platform, kvCORE. These efforts are not solely directed at building new, innovative products, they are also focused on simplifying, automating and supporting our existing capabilities even better. Our customers deserve a tech partner that not only meets today’s needs, but raises the bar, establishing new standards for what technology can and should deliver. They deserve a partner with the staying power to support and help drive their business growth long term.
As innovation accelerates and technology plays a more prominent role in the real estate transaction, software solutions need to provide more than just a comprehensive set of features. They need to empower brokers and agents to differentiate their business. Tech providers must have the breadth of capabilities and depth of resources to properly support and scale with customers. A strong list of features is simply table stakes. Real product management, QA (quality assurance) resources, cloud infrastructure capabilities, knowledgeable customer success teams and structured implementation programs are some of the capabilities that many small point vendors lack given their resources and experience.
The pain and distraction of switching vendors is plenty to justify building a long-term relationship with the right tech vendor. Choose a partner that wins only if your business wins—one that is dedicated to continuing to innovate and help you beat back those new entrants that seek to disintermediate brokers and agents, and has the resources and scale to deliver.
Ned Stringham is the chairman and CEO of Inside Real Estate, and a recognized entrepreneur, business strategist and technology investor. To learn more about Inside Real Estate, visit insiderealestate.com.