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Podcast with Redfin.com CEO Glenn Kelman: “We’re looking for nerds living in nice houses”

Last week I had the pleasure of meeting with Redfin CEO Glenn Kelman and his Senior Communications Director, Cynthia Pang. Let me begin by saying that I waltzed into my local Starbucks anticipating a date with the devil. While I exited no more enamored with their business model, I have to admit that both Glenn and Cynthia were a delight. No horns, no forked tails and no speaking in tongues (well, not exactly).

My impression of Glenn was one of a passionate entrepreneur who genuinely believes in his work. He struck me as honest and sincere, and I thoroughly enjoyed our brief time together. Having said that, I don’t get the impression that he entirely understands the depth of our business or of our duties as agents and fiduciaries. Some of his core premises strike me as fundamentally flawed from the standpoint of end game success or, worse, as ingredients in a recipe for future liability claims and outright failure.

I could be wrong. Divergent opinions and perspectives are what make our world go round. So, I would like to thank Glenn and Cynthia for their time. It may surprise some to know that I honestly wish them much success, as I believe their success will only be found (if it is truly realized at all) in a niche market sense.

So, Redfin, welcome to San Diego!

More: Kris Berg’s husband, Steve, has a very thorough Redfin post at The San Diego Home Blog. Los Angeles Times. Redfin.com’s weblog. (Ahem. Gertrude Stein’s ungrateful whine about Oakland was “There is no there there.”) Kevin Boer at The San Francisco Bay Area Real Estate Blog illustrates the demographics of Redfin’s move. The Future of Real Estate Marketing. More from Kevin Boer.

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Related posts:
  • Glenn Kelman at Inman – He Hits a Home Run
  • The Carnival of Real Estate . . .
  • Redfin.com’s Glenn Kelman comes to Scottsdale to beard the MLS lion.

  • 37 comments

    37 Comments so far

    1. [...] Kris recently got together with the CEO of Redfin, Glenn Kelman, for a chat. Redfin is the most recent of the “discount” brokers to hit the area. The backdrop of this meeting was the impending rollout of Redfin in SoCal this week. Glenn also made the rounds to visit Roger Showley, real estate writer for the San Diego Union Tribune, and Channel 10 to spread the gospel of yet another discount model. Most of Kris’ discussion with Glenn was recorded (by mutual agreement) and is presented on podcast at the Bloodhound. With so many fish to fry, Kris didn’t have time to get to what I find to be the meat of the issue, so I will chime in here. Given that the meeting took place last week and Glenn imposed an embargo on the broadcast until 7:00 AM this morning to coincide with the debut of their San Diego website enhancements, and given that I had the opportunity to hear the taped interview before going “live”, I have had some time to gather my thoughts. [...]

    2. Drew Nichols February 8th, 2007 9:07 am

      Thank you for also posting the blog entry on your blog. That was a good piece. I’m glad we in South Carolina are watching from a distance. Redfin will never come here; our median sales price is like $170,000. :)

    3. Jeff Brown February 8th, 2007 9:31 am

      ‘Niche market’ indeed, Kris. Does that refer to markets with median prices in excess of half a million bucks with a large portion owned by folks who share their misunderstanding of our biz?

      Another great job, Kris.

    4. Cathleen Collins February 8th, 2007 10:11 am

      Wonderful interview Kris. While the mainstream media has been throwing Kelman softballs, you dug into all the areas that are truly pertinent to the Redfin model. Thank you for making him “think” for this interview! Thank you, too, for clarifying that the distaste Realtors have for Kelman doesn’t result from fear of his model, it is a natural reaction to his vilifying us, painting a broad picture of our profession, which really describes the inept agent.

    5. Kris Berg February 8th, 2007 10:21 am

      This from LATimes.com this morning:

      “Regular folks resent what agents charge. Soon the industry will be seen as bad as Big Oil or the tobacco companies,” said Glenn Kelman, Redfin’s chief executive.

      Despite the friend-of-agents face Glenn put on at our meeting, and assuming this is an accurate quote, this is another example of that vilification, Cathleen.

    6. Greg Swann February 8th, 2007 10:37 am

      > Despite the friend-of-agents face Glenn put on at our meeting, and assuming this is an accurate quote, this is another example of that vilification, Cathleen.

      He cops to the quote, remorsefully, in his post this morning. Steve gets a link. You and I are personae non gratae, apparently. Actually, this seems certain. The first-published version of the post mentioned the podcast without a link. Current version omits mention of the podcast entirely.

    7. Kris Berg February 8th, 2007 10:45 am

      Oops! Steve’s post has the podcast included as well. Wonder if his link will go away?

      I actually thought I was quite respectful. :(

    8. Cynthia Pang February 8th, 2007 11:55 am

      Greg and Kris – I must have accidentally deleted the podcast mention when I tried to add the link for Glenn. Sorry about that! I’ll go see how I messed it up and fix it.
      Cynthia

    9. Redfin Hits the Beach February 8th, 2007 11:57 am

      [...] San Diego Home Blog and BloodhoundBlog contributor Kris Berg snagged an audio interview with Kelman, in which he reveals, amongst the coffee house chatter, that this expansion is due largely to pressure to build their profitability. [...]

    10. Kris Berg February 8th, 2007 12:00 pm

      Cynthia, I didn’t think a little healthy banter was a bad thing from a marketing standpoint. Thanks for putting the link back up. In any event, bet you’re having a busy day!

    11. Cynthia Pang February 8th, 2007 12:19 pm

      Kris, healthy banter is good! I just had to acknowledge my snafu. Good thing I’m not on the dev team :). And, yes, today is a busy day, but I love it!

    12. Caleb Mardini February 8th, 2007 12:42 pm

      Kris,

      Thanks for posting this interview. It gives an interesting perspective on the company. From what I can see things haven’t changed much since they originaly started> They’re still trying to find a business model that produces.

    13. [...] After a several month-long “make nice” campaign — including 1) several t?te-?-t?te sessions with numerous bloggers, like yours truly at Inman and Kris Berg in San Diego; 2) a lively and entertaining drinks-on-Glenn event last night in San Francisco; 3) winning accolades at Inman for having the guts to take on Alan Dalton; 4) refraining from praying mantis allusions … Glenn Kelman apparently just couldn’t resist taking another potshot at the real estate industry — his peers, really. [...]

    14. Phil Hoover February 8th, 2007 4:29 pm

      Redfin’s claims of saving buyers money reminds me of the old saying “oats are cheaper after they have been through the bull”.
      When these guys run through their venture capital, they will be gone.
      The only way they can survive is to trash Realtors and try to compete in high-dollar markets ~ yet, they try to cozy up to Realtors at the same time?
      It is difficult to see how they can tap enough of the market to survive, especially when much of the national market is in the tank and sellers want competent, experienced, full-service Realtors with a proven track record.
      If you’re a seller of a high-dollar home, are you really going to want a Redfin sign in your yard that screams that you are cheap and appeals to bargain-hunting buyers?

    15. Josh February 8th, 2007 8:50 pm

      Kris –
      I am interested to know what “niche” you are talking about? Is this “niche” the 77%+ home buyers using the internet to find their next home, or is this “niche” the 100% of cosumers that like saving money. WHAT NICHE MARKET?

      -Josh , openthehomeblog.com

    16. Brian Brady February 9th, 2007 1:26 am

      Kris:

      Great interview. As we know, Redfin is behind the curve in San Diego; ipayone has been offering that fee model since 2004 (albeit unprofitably).

      Does Glenn’s online persecution complex make you wonder if they ever really want to be in the real estate brokerage business or if they always want to be the “misunderstood ones”? What if the Realtors in San Diego treated them well? What would Glenn do to generate PR then?

    17. Caleb Mardini February 9th, 2007 1:36 am

      Brian I hadn’t thought of it that way.

    18. 360Digest » Thank you Mr. Kelman February 9th, 2007 4:20 am

      [...] It was a slow news day and I was almost tempted to write about Anna Nicole Smith, but between your interviews with Kris Berg, Annette Haddad and Tina Wood and your other comments and interviews here and there, we’ve got material for days. [...]

    19. Kris Berg February 9th, 2007 7:28 am

      Josh, The vast majority of my clients are among both your 77% and your 100%. The niche is the small percentage of the subset that enjoy driving uninsured.

    20. Brian Brady February 9th, 2007 11:33 am

      “are you really going to want a Redfin sign in your yard that screams that you are cheap and appeals to bargain-hunting buyers”

      That’s been the challenge for the discount models here in SD. “Hey, the owners are cheap and should be a mark”

    21. Roberta Murphy February 9th, 2007 2:55 pm

      Kris: Despite the background noise, yours was a five- star interview. I agree with Brian that Redfin’s biggest challenge in San Diego will be other real estate “discounters” who perhaps offer more elevated levels of service.

      It is also interesting that Redfin’s San Diego agent who repeats their mantra (see Redfin website), comes not from one of the discounters, but from Coldwell Banker. In fact, he is still listed on Sandicor rolls as an agent with CB (as well as Redfin).

    22. Kris Berg February 9th, 2007 4:08 pm

      Roberta,

      Thank you! I saw the double Sandicor listing. Any idea how that could happen? I know from experience that when you take your license from one office to another, you cannot be activated for your new office in the MLS until you are deactivated from the other.

      Second question: Why haven’t I seen your very good blog before and why haven’t you included SanDiegoHomeBlog.com in your blogroll? :)

    23. Erik van Joosten February 9th, 2007 4:38 pm

      Kris,

      I “think” that the double listing may be a product of the local boards not being linked. Before this week I was a Broker Associate at Coldwell Banker Del Mar with membership in NSDCAR. Redfin holds its San Diego board membership at SDAR. Therefore, until CB Corporate turns in the board/MLS release forms I will have two separate login ID’s with SANDICOR.

      I hope that this clears up any confusion!

    24. Kris Berg February 9th, 2007 5:07 pm

      Erik,

      What an honor! How are you enjoying your celebrity? BTW, your name is spelled wrong in the Redfin entry.

      Duh – Your explanation of course “explains” it. Embarrassed I missed that.

    25. Jeff Turner February 9th, 2007 5:11 pm

      “The vast majority of my clients are among both your 77% and your 100%. The niche is the small percentage of the subset that enjoy driving uninsured.”

      So incredibly well said. That’s exactly how I feel. Not having good representation in the real estate transaction is liking driving without car insurance. The only difference is that there is a greater chance I’ll have an accident in the real estate transaction.

    26. Roberta Murphy February 9th, 2007 6:00 pm

      Kris: Consider it done! Your podcast lured me in; great commentary will keep me returning. Thank Brian Brady for the introduction.

    27. [...] Kris Berg, our beloved San Diegon, posted a podcast with Glenn Kelman [...]

    28. NYCJoe February 12th, 2007 3:24 pm

      Having said that, I don’t get the impression that he entirely understands the depth of our business or of our duties as agents and fiduciaries.

      I thought that agents were not fiduciaries, in the legal sense of the word.

      Am I wrong?

    29. Kris Berg February 12th, 2007 6:04 pm

      Joe,

      I’m not an attorney, so I won’t attempt to speak to the “legal sense” in the legal sense. Once agency has been established however (through a valid listing contract, BBA, through a Buyer signing the disclosure regarding agency relationships or through presumption based on conduct), the agent has:

      A fiduciary duty of utmost care, integrity, honesty, and loyalty in dealings with the (principal).

    30. Kris Berg February 12th, 2007 8:15 pm

      And, yes, from the attorneys – In California, an agent is a fiduciary – in the “legal sense”.

    31. NYCJoe February 13th, 2007 12:51 am

      Ah, thanks.

      I think I remember now – on another thread it was Brian that told me that loan officers were not technically “fiduciaries.”

    32. Jim March 27th, 2007 7:18 pm

      What’s wrong with a little competition between agents? If someone is willing to do the same work for less, so be it. If the client is willing to agree to the level of service offered, so be it. Isn’t the market the driving force for home prices? I think it might also be the driving force for commission on those prices as well. The commission should be equal to what the client is willing to pay – let the market decide…
      With the commission wars in full force and rumors of agents not even showing homes that offer them less than 3% commission something has to give. Is it even ethical for an agent to not show a home to a prospective buyer because the commission offered may be lower??? I would think not, but from what I hear, it’s happening. Buyers should be shown every home that fits their criteria, even those that the agent will make less showing. Unless that happens, the agent is not performing his contractual obligations. Or at least it seems that way to me!

    33. [...] I started by Googleing myself (Stephen Jagger) and found the Ubertor blog, my Meetup.com profile, one of my personal websites, a few Meetup.com groups that I’m part of and the Yankee Blog Swap that I took part in a few months ago. I Googled “Kris Berg” and found her blog, her website, a blog she contributes to and a few music references. [...]

    34. [...] I am not a fan of podcast because they are usually boring and the quality is often terrible, but this is a a pretty good one. [...]

    35. [...] Then just when we really needed him, Allen Butler came on board as we began exploring podcasting. Just in time to pull Kris’ music out of her interview of Glenn Kelman from Redfin. Just in time to capture the gifts that Russell gave us with his Sales Success Seminars. [...]

    36. [...] I’ve been sworn to secrecy by Redfin’s PR maven Cynthia Pang until 9:01pm PST tonight (under pain of death, I’m told — though Redfin’s own Matt Goyer apparently broke the embargo early.)  It will, of course, be a live event, so we’ll see how Glenn Kelman holds up under the klieg lights.  (Fortunately for him, Kris Berg is not, as far as I know, conducting the interview.) [...]

    37. [...] Podcast with Redfin.com CEO Glenn Kelman: “We’re looking for nerds living in nice houses” [...]