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Exclusive: eXp World Holdings CEO Glenn Sanford On Reinventing The Real Estate Industry

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Exclusive: eXp World Holdings CEO Glenn Sanford On Reinventing The Real Estate Industry

Real estate tech company eXp World Holdings Inc (NASDAQ: EXPI) is dedicated to building a "different type" of residential real estate brokerage model by offering cloud-based platforms for its agents instead of physical retail office space.

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Rapid Growth: CEO Glenn Sanford entered the real estate market by leveraging his prior entrepreneurial experience and knowledge of technology, he said Thursday on Benzinga's "ZingerNation Power Hour."

When the real estate market crashed in the late 2000s, Sanford saw an opportunity to build a new model better suited for the environment.

"Our old model wasn't working," he said.

Office space was too expensive and total transactions were a fraction of what they were just a few years ago, the CEO said. 

These were among the more major "pain points" many of the 2 million licensed brokers across the U.S. felt, Sanford said. 

Instead, Sanford created a new virtual model with a handful of agents in 2009 that offered a revenue sharing program that compensates agents on income earned by other professionals they attracted into the company.

Many brokers resisted the new model and felt that office space is a requirement to operate, the CEO said.

Even when eXp became a public company in 2013, it still had many doubters who felt the business model was unsustainable, he said. 

After 2014, the company's growth accelerated to nearly 200% year-over-year after it introduced new agent ownership initiatives.

Taking On Bigger Players: The real estate company continues to build itself out to better position against larger real estate peers like Zillow Group Inc (NASDAQ: ZG).

Specifically, eXp expanded a joint venture to offer title, escrow and settlement services in late 2019, and it also has a separate mortgage joint venture, Sanford said. 

"We have been trying to figure out how to make all these attach to the real estate transactions," the CEO said. "If we can crack that code then, as you might imagine, our revenue per transaction goes up dramatically for the brokers."

The company's ExpressOffers service is another example of how it can counter similar instant offer platforms from rivals, he said.

Unlike its rivals, eXp isn't assuming any of the "balance sheet risks" by working with buyers on the back-end who are motivated to buy properties across the U.S., Sanford said. 

 

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