A Technology-Powered Real Estate Company - Investor Presentation | February 14, 2019 - Investor Relations
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A Technology-Powered Real Estate Company
Investor Presentation | February 14, 2019
Important Legal Information
This presentation contains forward-looking statements. All statements In light of these risks, uncertainties, and assumptions, the future events
contained in this presentation other than statements of historical fact, and trends discussed in this presentation may not occur and actual
including statements regarding our future operating results and financial results could differ materially and adversely from those anticipated or
position, our business strategy and plans, our market growth and trends, implied in the forward-looking statements. Accordingly, you should not
and our objectives for future operations, are forward-looking statements. rely on forward-looking statements as predictions of future events.
The words “believe,” “may,” “will,” “estimate,” “continue,” “anticipate,” Although we believe that the expectations reflected in the forward-looking
“intend,” “expect,” “could,” “would,” “project,” “plan,” “potentially,” statements are reasonable, we cannot guarantee that the future results,
“preliminary,” “likely,” and similar expressions are intended to identify performance, or events and circumstances reflected in the forward-
forward-looking statements. We have based these forward-looking looking statements will be achieved or occur. We undertake no obligation
statements largely on our current expectations and projections about to update any of these forward-looking statements for any reason after
future events and trends that we believe may affect our financial the date of this presentation or to conform these statements to actual
condition, results of operations, business strategy, short-term and long- results or revised expectations.
term business operations and objectives, and financial needs.
This presentation also contains information using industry publications
These forward-looking statements are subject to a number of risks, that generally state that the information contained therein has been
uncertainties, and assumptions, including those described under Item 1A obtained from sources believed to be reliable, but such information may
of our Annual Report on Form 10-K for the year ended December 31, not be accurate or complete. While we are not aware of any
2018, which is available on our Investor Relations website at misstatements regarding the information from these industry publications,
http://investors.redfin.com. Moreover, we operate in a very competitive we have not independently verified any of the data from third-party
and rapidly changing environment. New risks emerge from time to time. It sources nor have we ascertained the underlying economic assumptions
is not possible for our management to predict all risks, nor can we assess relied on therein.
the effect of all factors on our business or the extent to which any factor,
or combination of factors, may cause actual results to differ materially
from those contained in any forward-looking statements we may make.
Our Story Our Market
Invented map-based real estate search $80B in 2018 estimated U.S. real estate commissions
Hired our own agents 86,000 U.S. brokerages
Mission: redefine real estate in consumer’s favor Broken customer relationship
SOURCE: $80 billion: National Association of Realtors 2018 existing-home-sales data, assuming 5% commission. 3
Our Strategy: Vertical Integration
#1 Most-Visited Low marketing costs: 27M monthly average visitors
Brokerage Site
Employee Consistent customer experience
Agents
Customers save thousands, margins improve
Automation
Mortgage Long-term goal: completely digital closing
& Title
SOURCE: Google Analytics, web and mobile application visitors, for twelve months ended December 31, 2018.
4
Value Proposition
Agents on On-Demand More Exposure Tech at Save
Your Side Service for Your Listing Every Step Thousands
5
Customers Save Thousands
Save $12,000*
$500K $500K
Sell with Redfin Buy with Redfin
1% or 1.5% Commission Commission Refund Varies
*Cumulative average savings when a customer both sells a $500,000 home and buys a $500,000 home via Redfin, assuming the traditional listing-agent fee and
buying-agent fee are each 3%.
6
Redfin Sells Homes Faster, for More Money
% of Listings Sold Sale to List %:
within 90 Days $2,800 Difference
82.8%
79.8%
100.5%
99.9%
Industry Redfin Industry Redfin
SOURCE: SSRS study commissioned by Redfin and dated January 18, 2019, comparing 19,825 Redfin listings to 84,742 comparable non-Redfin listings.
Approximately $2,800 is the average difference between the sale and list prices of Redfin listings versus that of comparable listings by other brokerages.
7
49% Higher Customer Satisfaction
Net Promoter Score
Other Redfin
Brokerages
SOURCE: November 2018 survey commissioned by Redfin of 911 people who bought or sold a home in the past year.
8Service Drives Durable Growth
Higher Repeat Rate Repeat Business Growth
Buyers Using the Same Brokerage 2018 YoY Growth Rates in Closed Sales,
to Sell The Home They Bought Segmented by Source of Sale
35%
58%
20%
Other Brokerages Redfin Online Repeat
SOURCE: Multiple Listing Services, homes sold in 2018.
9#1 Brokerage Website
5x More Traffic than the Second-Largest Brokerage Website
Average Monthly
Unique Visitors
Other Leading Brokerage Sites Redfin
SOURCE: comScore, Advanced Media Overview report for web and mobile applications covering the twelve months ended December 31, 2018.
10Technology-Driven Results
Of listings appear on Redfin within 5
> 90% minutes of their MLS debut
6x Recommended listings click-through rate
> 80% Home tours scheduled automatically
Agents can write offers from their phone
> 40%
11Revenue and Share Growth
Revenue in Millions; YoY Growth U.S. Market Share by Value of Homes Sold
32%
$487 0.81%
38%
0.67%
$370
43% 0.54%
49% $267
0.44%
0.33%
37% $187
$125
2014 2015 2016 2017(1) 2018(1) 2014 2015 2016 2017 2018
(1) Includes revenue from RedfinNow. SOURCE: NAR Existing Home Sales and Redfin data
12Scale Makes Us Better
More listings More local Faster
awareness expertise service
13Tours Service
Agent Offers
Redfin.com Escrow
Buyer A New Life
Big Data
Machine
Learning
Find 87% Say Which
Customers Chance Homes Will
Who Close Move Here Call Joe Sell
Test Close Faster
Messages CALL
Optimize Rate Offers
Hiring Recommend Personalize
Listings Service
Our Goal: The Most Successful Customers 14Better Agents, Better Service
Agents Earn More Redfin Agents Close More Agents More Likely to
with Redfin Sales per Year Stay with Redfin
84%
2x 68%
3x
Median Agent Pay Median Redfin Agent Average for All Redfin Average for All Redfin
Pay Brokerages Brokerages
SOURCE: Median pay for 2018. Industry pay is a Redfin estimate SOURCE: NAR Existing Home Sales, NAR Membership, SOURCE: Multiple Listing Services, agents completing deals
based on MLS data; Redfin agent pay from internal payroll system. Redfin data, deals completed in 2018.. with the same brokerage in Q3 2017 and Q3 2018.
15New Ways to Sell a Home
Redfin Concierge Redfin Now
We fix up the home We buy the home
for a 2% listing fee outright
16Redfin Concierge Service
All the benefits of Redfin’s 1% BEFORE AFTER
listing service, plus Redfin will
handle improvements to prepare
the home to sell.
A custom home improvement plan
Vendor work supervised from start to finish
Costs of cleaning, staging, and more covered
by Redfin
Redfin Concierge is currently
available in SF, LA, DC, and Seattle.*
More markets expected to launch in
2019.
*Redfin Concierge service is available for homes priced at $500K and above
17RedfinNow
Customer requests an RedfinNow assesses If the offer is accepted, Customer chooses closing
offer online the home & makes an RedfinNow arranges an date* and receives cash
offer inspection
RedfinNow customers pay a RedfinNow currently available in Dallas,
service fee of 7%, compared Inland Empire, Los Angeles, Orange
to a typical brokerage County and San Diego. More markets
commission of 6%. expected to launch in 2019.
18Long-Term Goal: Complete Solution
Redfin Brokerage Redfin Mortgage Title Forward
Redfin Deal Room
19Mortgage & Title
Fully digital closing Redfin Mortgage
available to all Launched in 2015
customers using Available in 11 States + DC
Redfin Mortgage #1 Lender for Redfin
and Title Forward, Homebuyers in TX
and to all Title 30-Day Closing Guarantee
Forward customers
for cash deals
Title Forward
Launched in 2012
Title Forward
Available in 12 States + DC
Redfin Mortgage
#1 Title Company for Redfin
Title & Mortgage Homebuyers in MD, DC, VA,
WI, PA, FL, NJ, GA
20Thank You
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