New Listing: Real Estate Brokerage Compass Aims At $10 Billion Valuation In IPO

Compass, a real estate brokerage backed by SoftBank, is looking at raising as much as $936 million for an initial public offering (IPO), Bloomberg reported.

With the proposed IPO, the company’s shares would be set between $23 and $26, and the company’s top range would be valued at $10.3 billion, according to Bloomberg.

The company is the latest in a series of property tech startups to consider going public amid the pandemic, which has bolstered U.S. housing demand, Bloomberg reported.

Compass is led by an ex-Goldman Sachs banker Robert Reffkin and has previously raised over $1.5 billion in capital, including hundreds of millions of dollars from the SoftBank Vision Fund, Bloomberg reported. In 2019, the company was valued at $6.4 billion in a funding round.

Last year, Compass lost $270 million on $3.7 billion in revenue, compared with a loss of $388 million on revenue of $2.4 billion in 2019, according to Bloomberg. In addition, the company was involved in residential real estate transactions totaling $152 billion in 2020, which comes out to around 4 percent of the U.S. market.

Last year, Opendoor Technologies went public through a merger with a special purpose acquisition company (SPAC), according to Bloomberg. Last week, Offerpad had a blank-check merger as well.

With the pandemic’s digital shift and its wildly unstable dynamics in 2020, HomeLight CEO Drew Uher told PYMNTS he’s seen “real estate fatigue,” with a genuine lack of housing supply on the market. People are ready to buy, but Uher said he’s seen much fewer people ready to sell.

Uher said he thinks the market will somewhat get back to normal by summer, and there will be a new level of digital tools and technological advancements in the field.

He said there are now more tools cropping up to help deal with how homes are financed, negotiated, titled and transacted, with customers now getting acclimated to the new reality, which could feature Amazon-esque innovations.