Proptech Place Raises $100M at $1B Valuation - Goldman Sachs Leads Funding

The Rise of Agent-Focused PropTech: Place Secures $100 Million

A growing number of real estate technology firms are developing solutions that either compete with, or have the potential to supersede, the traditional role of real estate agents.

Place, a startup focused on empowering agents through technology and comprehensive business services, has recently secured $100 million in a Series A funding round, achieving a valuation exceeding $1 billion.

Investment Details

The investment was spearheaded by Goldman Sachs Asset Management’s growth equity division, with additional participation from 3L Capital.

This funding round and the company itself garnered attention due to several factors. Notably, Place had previously operated without any external capital investment.

Impressively, Place has openly shared its financial performance, reporting profitability since its inception. In 2020, the company generated over $85 million in revenue, alongside more than $11 million in profit. Projections indicate exceeding $150 million in revenue for 2021.

Place: A Broker-Agnostic Solution

Place explicitly positions itself not as a brokerage. Instead, the company defines itself as a “broker agnostic technology and business services solution.”

It collaborates with leading real estate professionals affiliated with various independent brokerage brands throughout the U.S. and Canada.

The core mission of Place is to facilitate the transition of real estate salespeople into business owners, regardless of their brokerage affiliation. Currently, over 10,000 agents utilize its technology platform.

Targeting Top Producers

Place specifically targets the “top 20%” of real estate agents, recognizing that this segment serves the majority of consumers involved in real estate transactions.

The company’s co-founders and co-CEOs, Ben Kinney and Chris Suarez, bring extensive industry experience, each possessing two decades as licensed real estate agents.

Comprehensive Support Services

Place offers agents assistance across a wide spectrum of business functions, including administrative support, marketing, branding, lead generation, accounting, legal counsel, human resources, and back-office infrastructure.

This support aims to free agents to focus on client service, ultimately leading to increased production, improved agent productivity, and a doubling of profitability.

Technology and the One-Stop Shop

“We provide a technology platform that delivers every tool and service top agents need to manage their business in a single location,” Suarez explained to TechCrunch.

The company’s objective is to streamline the homeownership experience for both agents and consumers.

Place also provides access to property search, mortgage, title, and insurance services, functioning as a comprehensive “one-stop shop.”

Unique Agent Benefits

Unlike many real estate agents who lack traditional benefits, Place offers “industry unique benefits,” such as health insurance for agents averaging two sales per month.

Additional benefits include stock purchase plans and revenue sharing opportunities for agent referrals, designed to facilitate recruitment and retention.

Luxury Market Presence

In the luxury real estate sector, Place supports brands like The Bucher Group, Elizabeth Olcott and Associates, The Level Up Group, PDX Property Group, and Spinelli Residential Group.

Future Expansion

The newly acquired capital will be allocated to product and service expansion, continued technology investment, and workforce growth.

Place currently employs 300 individuals, an increase from 200 at the close of 2020, and anticipates expanding its team to between 700 and 1,000 employees by 2022.

The company also intends to broaden its reach into new markets and deepen its presence in existing ones, currently operating in 100 markets across the U.S. and Canada.

Goldman Sachs’ Perspective

Paul Pate, a vice president within Goldman Sachs Asset Management’s growth equity business, highlighted the firm’s appreciation for Place’s initial focus on software development for top agent teams.

He noted the strong market acceptance of this software, sold independently under the Brivity brand.

Pate emphasized that Place recognized the need for a comprehensive solution beyond just software, providing a “full-stack offering” that simplifies business operations for agents.

Goldman Sachs also values Place’s ability to serve agents regardless of their brokerage affiliation.

“You don’t need to leave your current brokerage to join Place,” Pate stated.

Competitive Landscape

Place is not alone in this space. Side, another real estate technology company focused on transforming agents and brokerages into boutique brands, raised “$50 million-plus” in funding in late June, more than doubling its valuation to $2.5 billion and preparing for a potential IPO.