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The traditional role of the actual estate agent has long been challenged as the net has made it easy for people to search for , and tour of duty , homes .
Historically , agents have received 6 % commission on home sales — a practice that is progressively being address into motion . The argument against it is that oftentimes purchaser have already done much of the legwork when identifying a home to purchase so the work of an agent is not what it once used to be pre - internet days .
Over the year , real land tech party such as Redfin have seek to upend the poser by rent factor as salaried employee but that has n’t always raise successful .
That has n’t deter a figure of startups in the space , though . New York – basedPrevu(pronounced preview ) is one such inauguration . It hires agents as salaried employee with healthcare benefits and retreat program , and mesh under the premise that “ the role of an agent is changing . ”
“ It ’s becoming much more of an adviser in an important dealings more cognate to wealth management , ” say Prevu co - founder and co - CEO Thomas Kutzman . “ So the federal agent really becomes an extension of a brand as oppose to being their own short byplay . ”
Further differentiating Prevu ’s stage business is its offer of a rabbet to buyers if they purchase a home using its program .
In an surround where interest rate are sky high — bulk large between 7.5 % and 8 % — and there ’s a famine of home available in most grocery store , the ability to get cash back when buying a home can be attractive .
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Since launching its digital home - buying platform in June of 2017 , Prevu has help over 1,200 home buyers buy home totaling over $ 1.5 billion Charles Frederick Worth of real estate . Homes have drift in price from $ 250,000 to an $ 8 million apartment in New York City .
Over meter , the ship’s company say it has save consumer an norm of $ 23,000 per rest home leverage with its rebate program .
Prevu aims to modernize the client experience by allowing home buyers to look for menage , schedule hitch , draft offers and collaborate with a consecrated agentive role through its digital offering . About 50 % of its customer issue forth on to the platform quick to make a verbatim offer on a home , and seek expertise with the more complex parts of the leverage process .
“ citizenry come for the rebate but detain for the user experience , ” Kutzman say . “ Prevu offer an Amazon - like feel with up - to - the - instant updates , such as text messages when tours are support . It ’s much more of what masses are habitual to in every other upright of their life , but they have n’t been receiving it in existent landed estate . ”
Today the company is harbinger that it has advance $ 6 million in a Series A financial support round that included participation from newfangled investor Citi , Alpaca Ventures , Winklevoss Capital , RiverPark Ventures , Metropolis Ventures , Simplex Ventures and Liebenthal Ventures . They joined existing angel Alpaca VC , TYH Ventures and Blue Ivy Ventures , all of which put money in Prevu ’s $ 2 million seed round in late 2019 . Since that round , the startup has seen its one-year tax income grow by nigh 10x , according to Kutzman .
Prevu ’s geographical footprint has grown to 12 major metropolitan grocery from its initial market of New York City at the time of that seed rung , with six of these market launching in the past six to nine months . It presently go in New York City , Boston , Philadelphia , New Jersey , Washington , D.C. , Maryland , Northern Virginia , South Florida , Southern California , San Francisco Bay Area , Seattle , Denver and Austin .
The startup currently get gross from direction on each real estate of the realm transaction — tot 1 % to 1.5 % of dealing value , meshing of client rabbet .
The buyers ’ agent commission alter from transaction to transaction depend on what is offered by the seller . In a scenario where the buyer ’s broker mission is 3 % , for exemplar , the abode buyer would receive up to 1.5 % as a rabbet and Prevu as a company would retain the other 1.5 % . Prevu agent do earn a “ small ” commission on every dealings in addition to their salaries .
Buyers receive the commission rebate via check after closing .
Down the credit line , Prevu plans to begin offering access to more services foresightful - condition associate to mortgage , title and other vendee - related services . In fact , last year , it purchased mortgage engineering science from the now - defunct proptech Reali , whichshut down last year . Part of its Modern majuscule will go toward that , as well as to accelerate development into new markets and expand in exist mart such as Texas and Florida . Long - term , it draw a bead on to be a nationwide stain .
Making home buying “more attainable”
So besides rebates , what is Prevu doing that ’s different from its competitors ?
It boil down to its proprietary technology , Kutzman believes .
“ A lot of multitude have tried to change the cost of the service , but they do n’t actually introduce on the factual technology that tolerate them to service the concern , and ultimately they had major problems scale , ” he said . “ We create a expert consumer experience , but also it ’s really also the back conclusion of ‘ how does that collaboration pass between the consumer and the agent ? ’ ”
That engineering , too , has help the ship’s company abide skimpy from a hiring standpoint . Prevu currently has 25 employee , the majority of whom are agents .
“ We ’ve charter as we ’ve gone to fresh market but we have n’t had hiring be a constriction like a lot of other rival , ” Kutzman said . “ If you attend at traditional brokerages , it ’s all about hiring other agents . Our average agent does 40 deals per yr , whereas a top - tier brokerage house will do somewhere between five and eight deals per year . So we have a higher level of efficiency where the wage can work . ”
conscientious objector - founding father and co - CEO Chase Marsh tell buyers are using the rebates in a salmagundi of ways .
“ With the affordability crisis , interest rate having done what they ’ve done , and home prices not hail down to a large degree , people are using hard cash back to do thing like furnish their new home base , win bidding wars , or to lower mortgage rates by buying point on their mortgage , ” he said .
Jeff Meyers , a director at Citi ( which wrote the largest halt in the Series A round ) , told TechCrunch via email that he was absorb to a few things about Prevu , including its Smart Buyer mission rebate because it “ make menage purchasing more attainable . ”
Plus , he was impressed with “ its purchaser - focused platform , ” which provides individuals with “ more dominance and greater memory access to enhanced digital tools . ”
Daniel Fetner , a cosmopolitan collaborator at Alpaca VC , noted that his firm was also an early investor in real acres company Compass and has watch out “ tight ” as the residential home purchasing experience has changed over the years .
“ We believe that Prevu ’s value proposition is a no - brainer for today ’s ‘ chic buyer ’ who want to practice Prevu as a champion in the early miles , and as an expert at the terminal of the dealing , ” he said .
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