REAL Trends Editor in Chief, Tracey Velt Interviews Eric Eckardt, US CEO of Purplebricks. They discuss where his passion for real estate came from, the move to Purplebricks and how his past roles with three different banks including JP Morgan, Bank of Tokyo and ABN AMRO have prepared him for his role at Purplebricks.
This is Tracy Velt, Editor and Publisher for REAL Trends. We’re interviewing real estate industry leaders to get a glimpse of what drives them to achieve as well as have them share insights about the industry and its future. Today, we’re speaking with Eric Eckardt He’s the US CEO of Purplebricks.
Welcome. Thanks for having me.
Yeah. So tell me a little bit about what brought you to Purplebricks.
Yeah. Again, thanks for having me. What brought me to Purplebricks was really the opportunity to work with great people, the culture, and simply the product offering. We believe here that we truly are in a flexion point in the industry today given the change in consumer behavior. We feel that Purplebricks is uniquely aligned right now to align with consumer trends. If I kind of step back over my career over the last 22, 23 years, at the time I joined Purplebricks, they were only two, three years into market since they were founded in 2014. They had tremendous success in the UK. They scaled into Australia, and once they made their announcement they were going abroad, it showed that they had appetites. So I actually reached out to the founders of the company, Michael Bruce, one of the founders, Michael and Kenny Bruce, and we started to collaborate. Again, given the platform, the culture, the people, it was really an easy decision, probably one of the best decisions I’ve made in my career.
Okay. Great. So for those who are listening who don’t know exactly what Purplebricks is, why don’t you go ahead and describe your business model?
Sure. So we’re a licensed real estate brokerage. We are a full service brokerage. I guess what we really do different and I guess what would differentiate us from a “traditional” real estate firm … Now define a traditional real estate firm really based on the conditions and fees that are charged in the marketplace … is that we offer great value and great service. For example, a home seller uses Purplebricks to sell their home, not only would they get a full service real estate professional, they’ll get 3D virtual tours, professional photography, 24/7 customer support, but they’ll also pay a nominal flat fee allowing them to preserve their equity, save on the commission expense, and still get that great service offering. Just to validate that statement since inception 2014, you look at Purplebricks from a macro view, global view, we have over 50,000 favorable five star Trustpilot reviews across the UK, Australia. Here in the US, we’re approaching 1,000 just in the first year of operation, and even our counterpart in North America, in Canada rather, we’ll do a recent acquisition, all sharing the same principles around what we do and providing great service to the consumer.
Okay, and obviously there’s a lot of talk about the new business models that are dramatically changing the real estate industry and Purplebricks is often in that discussion. What do you say about that as a disruptor? Do you feel like you’re a disruptor?
No, we’re really just providing a viable alternative to the consumer. So, again, if you look at our model versus a traditional real estate firm within the definition I provided earlier on fee structure, we’re giving consumers an option to preserve their equity, save on commission, and still get that full service offering. I wouldn’t actually say, “disruptor,” I think that term’s used very loosely in the marketplace. Again, we do things differently. We use technology to help facilitate the process to make it more cost effective, transparent, convenient. But we still use a licensed real estate professional that’s centered each of the transactions we work with, and they’re hyper local. They reside in the markets that they operate in. If you’re looking at it from the perspective, they’re still getting that common or a similar product offering. Again, it is getting better value.
Okay. I know you recently moved into Florida so tell me a little bit about your growth and expansion plans with the company.
Sure. We made our announcement last year in February of 2017, and our official launch date in the US to be exact, was September 15th in the LA designated market area. So if you fast forward to today, we currently operate in seven states. Florida was our most recent expansion, and that occurred last week across Orlando and Tampa. Right now if you look at the US in general, the top five states typically represent about 25% of total transaction volume. The top ten represent about 50% of total transaction volume. So for us it was really, it was more important to be in select markets and have that consumer adoption, then it was to scale through “expansion” in multiple markets. On Day One we could have launched in 10, 15 states, but we opted to launch in one regional market to really introduce our brand, refine our offering, drive adoption, and then start to scale based on certain key components indicators.
Okay. There are so many new opportunities in real estate from analyzing big data to growth and expansion, what are you most excited about as it relates to the future of the real estate industry?
I think first and foremost we’re excited about the opportunity that we have today. The US Marketplace is over seventy or eighty billion dollar marketplace, depending on how you want to believe based on what’s being referenced out there, and for us it does provide a viable alternative that’s consumer driven, but at the same time has a very attractive offering for the agent. We spoke earlier about what are ways Purplebricks is definitely … Spoke more about the consumer perceptive, but if you look at it from an agent perceptive, we offer them exclusivity, meaning they have ownership in the territories that they work in. We offer lead gen. They still get the broader offering with the training, leadership and support so we’re excited about that. I’ll just leave one last comment, you kind of look from a tech perceptive, we’re intrigued by some of the things we’re seeing called blockchain and how that might impact title records, transaction management, smart contract, MS property data, artificial intelligence, that kind of thing used today. We’re looking at all of the above so I think over the next three to five years you’ll start to see more adoption across some of the newer technologies that are in the market today.
Yeah, definitely. There were only a handful of companies using AI in their products, and I recently did some research, and that’s exploded in real estate specific products. It’s an interesting industry. Yeah. We’re going to switch gears just a little bit, and talk about you so what was your aha moment, kind of the moment you realized you wanted to make a change in your business or take things to the next level or came up with an idea that you expanded on?
Yes, as I mentioned earlier my career stands over 20 years, and I’ve been a licensed real estate broker, an active licensed real estate broker since 2004. When I started in the industry I started with a traditional brick and mortar model, a room in a house, a single office space I shared, and was able to build that business over five years and sell it to a top 20 brand. I guess you could say my “aha moment” within the real estate space was once I crossed over to a larger firm at that time I really got a chance to look at their operation and what their product offering was, I really realized a lot of what the industry was doing at that time around 2009, 2010, given quite frankly today, was really, the proposition was primarily around the agent. I really never heard a lot around the consumer. Happy to offer a better service offering, happily helping consumers save on fees, it was all about retention and recruiting. That’s how I look back at the traditional model. You can go look at real estate events today, a lot of consistent themes around that so for me that’s where I personally made a pivot in my career to get involved with several stops around that initiative to have more of a consumer driven model, a Purplebrick. I was learning about Purplebricks and looking for the next career path forward, the champion model I truly believed in and worked with folks that shared the same principles. That was a model that was aligned based on where we believe trends are going around the consumer. Again, the short answer to your question, I say right around 2009, 2010 if I had to pinpoint that.
Okay. Great. As you know real estate is all about building relationships. You can offer as much technology as possible, but you still have to have someone face to face at some point, or I guess you don’t have to, but it definitely helps for referral business. Tell me about some of the more interesting or inspiring connections that you’ve made along the way, people who may have inspired you.
Yeah, with regard to connections I could say everyday you meet a new connection that you value and appreciate, but if I had to point to one person, it’s not a political figure, it’s not a leader of, a household name, it would be my father. I look at my father who was entrepreneurial, hard working, operated with integrity, character, a blue collar work ethic, had a large family, eight, seven siblings, so I just look at what he’s done in his career, his life, and more importantly, the type of person he is, being very humble. He’s the one that inspires me every day to this day. That would be the number one first person I’d point to.
Yeah, that’s great. This one is a little more difficult for some people, but some people have the answer right away. What childhood or teenage experience really shaped the person you are today?
Yeah, for me, really, I’d have to point to family again. Again, I grew up with five sisters, two brothers, and I think all different personalities. I think they helped shape who I am as an individual. I think being the youngest I got to see them go through school, choose various careers and kind of access that. It helped shape who I am and influence decisions that I made them throughout my life, even today.
Also, if you can provide brokers with just one tidbit of information that they could use to improve their businesses, what would that be?
Yeah, I think one thing I would do if I was an operator of a larger regional realty brokerage firm is look at the assets you have today, look at the model you have. Just step back and reassess. Look at trends. Look at ways you can adapt, maybe do a slight pivot. Leverage success you’ve had already in the market to the relationships you have today, and I think through various degrees of “changes” or “tweaks” relative to the proposition, the model, there’s a lot they can do to continue to remain relevant and have success in the foreseeable future.
To wrap up we’re going to end with something fun, so tell me three things you can’t live without, and you can’t say phone, family or friends.
All right. Well you just took probably my top three. I guess I’ll go for safe answers and I’ll say food, water and oxygen.
No, come on, you got to be more specific than that.
All right. We’ll both do the necessities. I can’t live without wifi today obviously to help which I guess is back to the initial one, you just kind of saying, I can’t say phone. Family is very important to me as an individual. I know I mentioned that a few times on your call.
It’s really what we do for a living and what motivates us every day. So yeah, I’ve got to go back to food, water and oxygen.
Well, Eric, thank you so much for speaking with REAL Trends today. We really appreciate you taking the time to give us some information about Purplebricks and share your thoughts on the industry.
Yeah, likewise. Thank you. On behalf of the team we appreciate the opportunity. Thanks.