Startup Compass attracts billion-dollar valuation; skeptical incumbents say software can only go so far
By Eliot Brown and Laura Kusisto | The Wall Street Journal
A real-estate startup called Compass Inc. has hired hundreds of sales agents away from older rivals, collected $225 million from marquee investors and amassed a valuation of over $1 billion, all with the pitch that its software can make brokers more efficient.
Real-estate veterans say they’re baffled by how the four-year-old firm, active in only a few cities, could be considered one of the most valuable brokerages in the U.S.—a skepticism increasingly familiar to incumbents in old-line industries facing well-funded startups. Property brokerages typically command modest valuations on Wall Street, as they have few assets and limited growth prospects.
