Amping Up the Acceleration for Aspiring Real Estate Companies
Accelerator programs that help get start-up companies off the ground have been becoming increasingly prevalent with the rapid growth of technology use in our daily lives. New technology is essential for growing a real estate business, and hundreds of companies are popping up to help, which can be overwhelming. Fortunately, there’s REach, a program launched by the National Association of Realtors and Second Century Ventures, which is geared at helping create a unique “vertical acceleration” program to connect real estate professionals who want to take their business to the next level with innovative technology companies. Wired City spoke with Mark Birschbach, principal at REach and Second Century Ventures, about why their program stands out from the rest.
What exactly do you accelerators help companies do?
Lately, we’ve seen an increase in technology accelerator programs that provide entrepreneurs with education, guidance and investment capital in exchange for a small stake in their companies. Essentially, a founder who joins an accelerator needs a lot of help. Typical accelerators like Techstars work with early-stage companies and bring in outside advisers to help a company get their idea off the ground and usually run for about three months. The goal is to get these companies funding and help get them to the next level. The guys running these accelerators are often serial entrepreneurs who have a lot of experience starting and building companies and add value to the venture of a first-time entrepreneur who may not know how to do start-up 101 stuff. They help someone turn their idea for a technology program or software into an actual business.
What makes your program different?
We’re helping our companies learn about and penetrate the real estate industry with a nine-month program that has a specific focus on the real estate space. We structure it to help our companies figure out how it all works, who the players are and what’s the difference between a broker, an MLS (multiple-listing service) and an association. We also provide unique mentorship. We have over 150 mentors who are senior executives in the real estate industry, heads of large state or local associations, MLSs, and some are senior executives at real estate brokerages or franchises. Mentors give guidance to companies in one-on-one meetings and provide insight about what fits best with their firm and where they’ve seen other companies fail with similar technology and product.
Tell me about the report that NAR released last week about real estate firms’ utilization of tech.
The use of technology is becoming more prevalent in real estate. Larger real estate firms are becoming more and more likely to utilize technological tools in order to grow their business. Of these large firms, 89 percent are likely to encourage comparative market analyses, e-signatures, document preparation and management, and more than half of these largest firms promoted the use of graphics and presentations, transaction management, and social media management tools. On average, they spent $1,225 per month on technology. Larger real estate firms are 85 percent more likely to advertise their company websites on other sites, and real estate agents are 74 percent more likely.
You’re super-selective about who you bring in to help your REALTOR® members.
There are a lot of tech companies out there that help REALTORS® with products or services that benefit their businesses— we had over 130 applications to review this year, so we had a lot of companies to talk about and evaluate. The seven companies we picked for 2013 were carefully chosen, because we believed that they could help our members grow their businesses or make them more efficient. Currently, in the “class of 2013,” we have companies that help enhance communications with video email and real-time chat, companies that help with social media by curating content and collecting testimonials and companies that help to enhance brands with website tools that help a consumer during a real estate transaction.
And the results?
Companies have grown their customer bases three to five times larger in just six months, and several companies have raised funds from investors as a result of their success in REach even before the program has concluded. NAR provides preferred access to the real estate industry, with over $1 trillion in annual sales, 12 million consumers and over $7 billion in annual ad spend.
In order to expand on its success from 2013, REach is currently accepting applications for the class of 2014. Technology companies that would like to be considered for REach should apply at narREach.com/apply.