He is a Berkeley kid raised by a single mom, who happened to be a Realtor. Robert Reffkin saw her change brokerages three times, always looking for a better deal, each change a struggle. So as soon as he got into the business world, he decided to do what he could about it: disrupt!
According to Everipedia, “Robert Reffkin was known as DJ Zahav, the Golden Hebrew. Columbia University undergrad and M.B.A. he’s one of New York’s leading philanthropists and hottest startup players, angling to change the real estate market forever.”
First the rental disruptor. He co-founded Urban Compass in 2012 (along with Ori Allon, who has sold a tech company or two) as a residential rental firm designed to blow up the murky NYC rental market with it’s cloistered listings and high fees:
Renters typically pay a 15% fee to brokers for commission. With Urban Compass, the typical broker’s fee is cut in half.
To execute the local vision, Urban Compass employs “neighborhood specialists.” Armed with red backpacks, iPhones and hyperlocal knowledge, specialists have real estate licenses and are paid a salary based on customer satisfaction, rather than a commission.
“I realized rentals were pretty specific to New York City,” he told me last week. “New Yorkers rent, the rest of the world buys homes.”
Like in Dallas.
His background is quite impressive. Robert is 38 and has worked at Goldman Sachs as Chief of Staff to the President & Chief Operating Officer, where he served in its private equity arm for five years. Prior to Goldman Sachs, he worked at Lazard and McKinsey & Company. In 2005, he was appointed as a White House Fellow to serve as special assistant to the Secretary of the Treasury. He is also the Founder of
A year or so after Urban Compass shifted to sales, the two were building a platform for Realtors that would simplify their lives and satisfy all their needs, to enable them to make more money doing what they do best: sell homes.
“The agent is our customer,” Robert told me over coffee at Hotel ZaZa, where he stayed recently on his first trip to Dallas to meet The Collective, the brokerage firm with which his company had just merged. “Realtors are the most underserved base of customers in this country. 1.2 million of them. Every day we ask agents, what can we do to make your life better, how can we help you save time, sell more, and have a greater quality of life?
So the disruption, this time, is not with the process but with the ones doing the actual selling. Which, he says, will ultimately help the consumer.
“The industry actually works,” he told me. “But it is overwhelmingly fragmented: 800 MLS’s, 10,000 brokerages, 300 or more software products.”
The average agent, he says, has to do so much — too much — log in to 11 different companies in a single day to get their job done. Compass creates a better world for agents with Compass-specific software. And yes, one log-in.
Show me, I said.
And he did: the Compass phone app measures ad performance (on line, of course,) and even alerts the agent when clients are looking at real estate in other markets. It retains every listing, every home toured, every comment, every metric. Client communication is prioritized and a swipe. It’s almost Alexa for real estate.
“The energy in the world is focused on the consumer — Zillow, etc.” says Robert. “Consumer search is easy and getting easier all the time, but that’s not helping the 1.2 million agents out there.”
I almost wanted to call his firm the anti-broker broker, but that’s not quite accurate. What Compass believes is that real estate has changed dramatically, and every part of it is metamorphosing except one: the broker. Brokers still want traditional splits in a non-traditional world — what is it exactly they do for that money?
Compass has one service staff per every seven agents. The average in the industry: one per 50. Every office has an IT department. Every office has an in-house marketing and advertising agency. There is no outsourcing.
There are offices, big, beautiful offices. The company has raised $775 million and has no debt.
“We ask agents what they want, what they need to do their job better,” says Robert.”And we deliver. Redfin isn’t asking them this, and most brokers are just not responding fast enough.”
Splits? Wherever the agent comes from, Compass takes the same split, matches it. Early agents have a chance to participate in an equity split should the company go public. New agents fresh from school need not apply; and you must have the recommendation of three agents before you’re hired. The result is a collaborative, low ego atmosphere where everyone is always striving to improve together.
Sources in NYC have told me that Compass lures agents with huge sign-on bonuses. Rory Golod, Reffkin’s Chief of Staff, says they do not offer sign-on bonuses to agents. They also say Compass is more of a Wall Street culture than most brokerages, but Robert disagrees with that assessment.
“I don’t think anything about us is a Wall Street culture,” he says. “And we certainly didn’t start with that in mind.”
It has always been about service. In 2016, Ori Allon told TechCrunch:
“We are going to expand into new markets and continue developing transformative technologies, unmatched agent support and marketing resources to our agents and clients across the country.”
In the future, says Robert, he sees two kinds of real estate brokers: the “keep 100% of your commission” Keller Williams model or a version there of, and Compass: traditional broker splits from a broker who provides the agent with true supportive service.
This wasn’t Robert’s first rodeo in Dallas.
“I was fortunate to visit Dallas a number of times before,” he says, “while working at Goldman Sachs and when I ran the Dallas Marathon.”
Why Dallas? Compass just opened Chicago a month ago, pushing its ambitious bid to gain 20 percent marketshare in the top 20 metropolitan U.S. markets by 2020.
“When evaluating new markets to go to, we look primarily for collaborative and entrepreneurial agents who are looking to grow their business. We were lucky to find that in The Collective and realized there was a large number of talented agents in the Dallas market who would be great partners for Compass,” he said. “That enthusiasm from the local market encouraged us to move quickly into the market.”
And what most impressed Robert about our city?
“The agents!,” he exclaimed. “The agents I have met with have all been incredibly impressive and they are not only smart and successful, but are committed to their local community. Our mission is to help everyone find their place in the world and Dallas has a number of agents who are helping their clients find their place in the world every day.”
Oh, and the food. Sammy’s BBQ is his favorite thus far. Christy and Jonathan do, however, plan to take him to Fort Worth for boots. Reffkin sees Dallas/Fort Worth Plano continuing to grow and become more cosmopolitan:
“I see the city continuing to grow and attract people from around the world who want to come here to grow their career and raise their families,” he said. “With a market that appears to be on the rise over the coming years, I think Dallas will grow significantly as more and more people see it as one of the great cities in the U.S.”