The shear volume of mergers and acquisitions in the US last year was record breaking, and the real estate industry was no exception.
The Washington Post recently reported that “Smaller and privately-owned real estate firms struggling with the rising costs of technology are increasingly looking at mergers with larger companies in order to remain competitive.”
Just like any business, the smaller and less-funded companies often times get absorbed into larger businesses. “The [real estate] industry is very fragmented, [and] with the costs of business continuing to rise, having scale is critical,” says Ron Peltier, Chairman and Chief Executive of HomeServices.
But what could this mean for smaller, private, and local agents? Should they just surrender and consolidate because of rising costs?
Most local and mid-sized realty shops see the problem in a different way. Instead, they’re partnering with companies in the real estate tech sector to decrease the costs of business, all while stepping up their competitiveness in the face of industry consolidation — and it’s working.
Overall, real estate companies across the US, now faced with an unprecedented degree of competition, are taking sides: actively seeking acquisition from a larger player before finding themselves on the wrong side of an accelerating trend or embracing technology to cut costs and sharpen their competitive edge.
With a growing number of motivated Realtors turning away from the possibility of acquisition in favor of embracing technology, there has been an increase in demand for digital advancements and innovative new solutions available to small to mid-sized Realtor organizations. This has led to huge growth of real estate tech companies.
According to TechCrunch, “Real estate-focused startups in North America have raised seed or early-stage rounds in the past year, securing more than $400 million, according to Crunchbase data,” up more than 30% year-over-year.
One of these forward thinking startups is Verse.
Verse’s engagement and qualification platform is tailor-made for businesses of all sizes. This scalability of service is an example of the adaptability of new technology. Verse has created a solution to help agents save money and increase their competitive edge by eliminating the alternative cost of having to hire an in-house ISA improving lead response times and the overall volume of qualified leads.
Verse’s US-based team of highly trained ISA’s engage and qualify leads generated by agents 24/7, 365 days a year, leading to increases in lead conversion rates by up to 300%. It’s innovative services and technology like this that allows Realtors to compete with large competitors for a fraction of the price of a single dedicated employee.
The premise is simple — agents are sinking cash into lead generation, and companies like Verse are driven to make the most of that investment.
The tech boom in real estate will only create more opportunities for all; with companies creating innovative new solutions for agents at an unprecedented pace, Realtors still have the opportunity to maintain a fair playing field in the face of rapid industry consolidation.