‘Tech brokerage’ continues non-tech strategy
Compass has acquired residential brokerage Pacific Union International. This is on top of its acquisition of Paragon four months ago.
The Good: The firm boasts 54 offices and 1,700 agents throughout California, and closed on $14 billion in sales last year. This will help Compass increase market share in core U.S cities.
The Bad: With deals like this, Compass continues to brand itself as a traditional brokerage.
The Ugly: When SoftBank invested $450 million, the intention was for the money to go towards technology that would transform the industry. Simply poaching brokers and acquiring firms is not disruptive.
Heard on the Street: Zephyr’s CEO Randall Kostick told the SF Chronicle: “Compass is not attracting agents and managers with their fabulous products and services. They are attracting them with money… They offer signing bonuses, marketing subsidies, technology subsidies, and exceptionally high agent splits.”