[quote=Coronita][quote=sdrealtor][quote=svelte][quote=sdrealtor][quote=svelte]All I own are mutual funds…I’m not into the legalized gambling of individual stocks. 🙂
I think Redfin will be a stronger and stronger player going forward. Time will tell which of us is right.[/quote]
I’ll take that bet but advise you against it as I only take bets I know I already won like this one way back when. [/quote]
Ok but let’s define the parameters. When I showed you data with their sales up and their stock price up, you batted those down as not applicable because they didn’t fit your criteria of a successful company for some reason.
What criteria can we use? Their number of homes sold per year higher in 5 years than today? I think that’s a fair estimation of “stronger”.[/quote]
I only use one criteria. Profitability. Buying market share is easy when you are playing with VC/IPO money but it only last so long. To be viable as a going concern you need to be profitable. Eventually you have to make money. I think we’d all agree on that
Like seriously. They have a $4B market cap, never made a penny and probably won’t. Some joker in Carlsbad is more profitable then they are or will ever be[/quote]
Wait, so basically the Compass business model is like the business model of CarOrder.com and MoviePass where you sell (give?) a loss leader product away in exchange for the right to name you as a customer with the hopes that your business will reach critical mass and have a huge pool of customers that you can sell much more lucrative business or services to, like Google ads.[/quote]
Not quite, Compass came to the industry loaded up with VC money and a promise to change the industry. They recruited an incredibly strong pool of agents initially with promises of wealth through stock options that agents watched their clients profit from. Realtors are an easy target for the sharpest salespeople on the planet. To their credit they have assembled a very impressive collection of great agents and have quickly built a very strong brand.
Compass has a very high internal cost structure with hundreds of Coronita’s creating software. They are trying to position themselves to be valued as a tech company rather than a real estate brokerage which is worth far less. The sales pitch to the agents is they are going to change the industry. The reality IMO is they have been building a company from day 1 they can sell through public equity markets or leveraged buy out. The minute the founders and initial investors can cash out with FU money they will be sipping cocktails on a beach. They will leave the change the industry part to the greater fool that buys them.
