This is the third in a four-part series of articles chronicling notable real estate disrupters fueled by property and neighborhood data from ATTOM Data Solutions.
A completely self-funded startup, Offrs.com has not needed to raise capital thanks in large part to the success of its predictive analytic-driven products for real estate agents and others in the industry, according to co-founder Rich Swier.
“It’s been very rapid growth for us over the last few years,” he said noting that since the company launched in 2013 its customer base has grown to more than 10,000 agents accessing its predictive analytics and marketing platform, designed to help those agents identify inventory of homes for sale before those homes are listed or the homeowner even knows they are going to list.
“Most of the market today is looking at a transaction-based model,” Swier noted. “In order to predict that transaction you have to have predictive analytics. In order to get to that transaction before others do, you have to have predictive analytics.”
Many real estate agents still fear that discount brokerage models such as Purplebricks and iBuyer models such as Offerpad will eventually push them out of the real estate transaction, according to Swier of Offrs.com
“There’s a natural disruption that’s happening on many levels,” he said. “If real estate agents embrace the data we provide, they can solidify their place in the real estate transaction.”
In the simplest terms, Offrs.com predicts future real estate transactions so that agents and others in the industry can identify these transactions further upstream, before they flow into the discount brokerage and iBuyer business models.
“It really depends on who comes to the table first,” Swier said, citing a statistic that 70 percent of soon-to-be sellers choose the first real estate agent they meet. “Predictive analytics is the name of the game. If you predict future listings, you’re going to be first in the door. That’s one of the reasons we sell our data exclusively because it’s so powerful that whoever has that data is going to be in a great position.”
Offrs.com pulls data from more than 25 data providers, including consumer, demographic, financial, and behavioral social media data — all appended to property data.
“We have a unique combination of machine learning methods, and we base it on geography,” said Swier, who has a degree in mathematics and built out the technology driving the company’s predictive modeling. “That’s what makes us really special. We score parts of Florida completely different than we do in New York.”
Democratizing Big Data in the Real Estate Space
Swier claimed that Offrs.com is disruptive not only because of the accuracy of its inventory-predicting model — he said the model accurately predicts 70 percent of all U.S. property listings in advance — but also because the model is made available to the masses of real estate agents at an affordable price point.
“We democratize big data,” he said. “Our customers might buy a very small zip code and it might be very affordable to access this valuable data and analytics. … Before it would be very time consuming and costly for them.”
Swier also noted that Offrs.com provides marketing assistance for agents to help them put big data into action.
“We provide templates and campaign systems for them to use,” he said. “You could effectively create a digital postcard on Facebook to the homeowners who score high on our algorithm for very little money.”
Although Offrs.com is primarily applying its predictive analytics to disrupt access to future housing inventory on a transaction-by-transaction basis, the model could eventually disrupt real estate housing inventory on a macro basis, according to Swier.
“We are predicting the single transaction, and by predicting the single transaction we are also predicting the broader market,” he said. “This will be a living a breathing machine … and that will impact the way people will look at the market.
“The long tail of predictive analytics is this is really going to drive the entire industry,” Swier continued, noting that while predictive analytics is newer to real estate, it’s long been used in other industries. “The entirety of how these hedge funds drive everything based on quants … it’s computers doing the trading … and this is going to spill over into the real estate market.”