Redfin CEO Glenn Kelman provides new insight into the growth of the Seattle-based online real estate company in a new report in The New York Times. Kelman said he believes his approach in hiring agents as full-time employees has been vindicated and he revealed that the company projects about $200 million in revenue this year, up about 50 percent from last year.
Kelman’s practice of hiring agents full time and giving them benefits defied the conventional mode of operation for the tech industry in which companies rely on independent contractors as a cheaper workforce.
The Times reports that Redfin’s approach slowed the company’s growth and “contributed to what Mr. Kelman calls a ‘near-death experience’ after the 2008 economic crisis.” But he believes full-time employees allow Redfin to offer better customer service.
Seattle Redfin agent Karlyn Goetz told the Times that because she gets a salary, she didn’t feel the same pressure to close deals the way typical agents, who work entirely on commission, do.
“I’m not going to lie — we’re motivated to sell homes,” Goetz said in the report. “But it’s always in the context of the client and wanting them to have a good experience.”
Kelman has previously made a point of stressing that as a startup CEO, it’s good to know when to be a bit “crazy.”
“It takes confidence to ignore numbers, to set aside focus groups and advisers, and do what you believe in, because then the only person you’ll have to blame for your craziness is yourself,” Kelman wrote in 2012. “But if I met my old self, the one just starting out in a consumer Internet business, the first advice I’d give him would be: have the courage of your convictions.”