Threshold Ventures
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Threshold Ventures

Avenue 8: Building the Best Home for Today’s Real Estate Agents to Thrive

by Chirag Chotalia

Avenue 8 empowers agents with both cutting edge technology and the economic alignment to be their customer’s strongest advocates.

In 2021, real estate agents face a much more challenging market than their predecessors. Consumers search for homes online and are increasingly more self-directed. Agents must look beyond their brokerage to build and maintain robust personal brands.

What consumers value in their agents has also changed. With listings directly available to browse 24/7, the best brokers differentiate themselves to buyers by showcasing their breadth of knowledge: the nuances of each neighborhood, inventory of homes coming up for sale and area comps, and insight into passive sellers to approach. They also need to be savvy about execution support — including how to construct a winning offer in an increasingly competitive market, and ways to navigate the numerous activities required from the initial signing to final close of a property. This is equally true when representing sellers: in addition to traditional activities like pricing and staging, agents now need to showcase homes online and across multiple channels to attract buyers.

For many years, Threshold has held a front-row seat into the technology-driven transformation of the residential real estate market with investments in Redfin, Loftium, and Divvy.

These companies enable consumers to dramatically improve how they live, where they live, and how they engage in the home buying and renting process.

Given our knowledge of the space, we spotted a gap in the market for solutions supporting agents. We historically saw several approaches that were looking to disintermediate agents, but didn’t believe that these solutions were positioned for success, particularly in more competitive and complex markets. In speaking with real estate professionals, we repeatedly heard, given commission pressures, agents were often selling more but making less. Only the largest “rainmakers” had the scale to leave their incumbent brokerages and, even then, those who did struggled to manage back-office functions. They needed better support to integrate the many technology point-solutions to be successful in their evolving jobs, which required more than the solutions traditional brokerage agencies offered.

Michael Martin and Justin Fichelson, co-founders of Avenue 8

This is why we are so excited to back Michael Martin and Justin Fichelson, the co-founders of Avenue 8. Michael and Justin have deep industry expertise and a fresh, modern approach. Michael brings a strong financial background to Avenue 8, and Justin has established himself as one of San Francisco’s top real estate agents. When the two first met, they realized they shared a contrarian view relative to other market approaches: the real estate agent wasn’t going to be disintermediated by technology, but the brokerage model needed to fundamentally change to best serve agents.

Based on their shared insight, Michael and Justin built Avenue 8 to be the most scalable, efficient and user-friendly digital real estate brokerage.

Leveraging best-in-class technology, the platform makes it incredibly easy to manage all elements of their business — from their social media presences to generating industry leading comps, to seamlessly closing transactions –while on the go.

What’s more, the Avenue 8 business model aligns with what users need. In the historical brokerage model, agents pay a percentage-based rate to the brokerage. Avenue 8 charges a fixed fee, so they can keep more of their commissions, insulating them from changes in fluctuating industry rates.

The massive organic growth Avenue 8 has seen in a very short time is beyond impressive. Even prior to its launch, the company attracted top real estate talent in San Francisco and Los Angeles. Fundamentally, we believe that, while technology is allowing consumers to take a more informed approach, great agents will always be what drives the buying and selling process.

We are thrilled to be partnering with Michael and Justin, along with investors Zigg Capital, Craft Ventures, and Good Friends. Avenue 8 empowers agents with both cutting edge technology and the economic alignment to be their customer’s strongest advocates.

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