Side raises $150M at $1B valuation to help real estate agents go it alone
Side, a real estate technology company that works to turn agents and independent brokerages into boutique brands and businesses, announced Monday that it has raised $150 million in Series D funding.
Coatue Management led the round, which brings San Francisco-based Side's valuation to $1 billion and total funding raised to over $200 million since its 2017 inception. Existing backers Matrix Partners, Trinity Ventures and Sapphire Ventures also participated in the new financing.
The round is notable in that the amount raised is significantly higher than the $35 million Side raised in a Series C round in November 2019. Valuation too increased nearly 7x compared to the $150 million valuation at the time of its Series C. Sapphire Ventures led that investment and managing director Paul Levine, who was previously president and COO of Trulia (through its IPO and multibillion-dollar acquisition by Zillow), joined the company's board of directors at that time.
The startup pulled in between $30 million and $50 million in revenue in 2020, and expects to double revenue this year. In 2019, Side represented over $5 billion in annual home sales across all of its partners. Today, the company's community of agent partners represents over $15 billion in annual production volume.
Side was founded by Guy Gal, Edward Wu and Hilary Saunders on the premise that most real estate agents are underserved and underappreciated" by traditional brokerage models.
CEO Gal said existing brokerages are designed to support average" agents and as such, the top-producing agents end up having to do all of the heavy lifting."
Side's white label model works with agents and teams by exclusively marketing their boutique brand, while also providing the required technology and support needed on the back end. The goal is to help partner agents predictably grow" their businesses and improve their productivity.
The way to think about Side is the way you think about what Shopify does for e-commerce...When partnering with Side, top-producing agents, teams and independent brokerages, for the first time in history, gain full ownership of their own brand and business without having to operate a brokerage," Gal said. When you spend years solving the problems of this very specific community of agents, you are able to use software to drive enormous efficiency for them in a way that has never been done before."
Existing brokerages, he argues, actively discourage agents from becoming top producers and teams, because agents who serve fewer clients can be forced into paying much higher commission fees on every transaction, which means the incentives between brokerages and top agents and teams are misaligned.
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Top producers want to grow and differentiate, and brokerages want them to do less business at higher fees and be one more of the same under the same brand," Gal said. Side, rather than discouraging and competing with top producing agents and teams, enables them to grow and scale their own business and brand."
Today, Side supports more than 1,500 partner agents across California, Texas and Florida.
The startup plans to spend its new capital on significant hiring" and toward an expansion outside of California, Texas and Florida - the three markets in which it currently operates. It also plans to boost its 300-plus headcount by another 200 employees.
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