Listhub Acquires Point2; I Think of TS Eliot


[EDIT: Please see the clarification posted below.]

I’ve been hearing rumblings about a big game-changing deal for a couple of days, and this morning, it’s been confirmed. Listhub, a Move entity, has acquired Point2 from Yardi, bringing all listings syndication in the United States under one roof.

From Celeste Starchild, General Manager of Listhub:

Move has acquired the Point2 U.S.-based syndication business to further our shared vision of delivering a single listing aggregation, storage and distribution service.  As one of our key partners, we wanted to make sure that you were among the first to hear this good news.

Point2 realized the benefits to the industry of having a single platform, and ultimately worked with ListHub to help bring it to fruition.  The ListHub vision is to provide the industry with a single platform to improve data synchronization between systems, organize appropriate data licensing provisions for participants, and solve for the fragmentation and duplication of efforts that occurs throughout our industry today. Combining the Point2 and ListHub technologies into a single platform is a giant leap forward in reaching these goals.

Benefits to the industry of the single platform include:

  • Better access to listing data for thousands of brokers and franchises who operate across multiple MLSs
  • Increased accuracy for online listings, as agent-entered listings will be transitioned to MLS-connected solutions wherever possible
  • Enhanced customer service to the industry through a single help desk
  • Ability to better measure the results of online marketing across sites and across MLS markets 
  • Leading data protections for all brokerages through ListHub’s comprehensive publisher agreements
  • Ability for software and website technology companies to focus efforts on innovation for REALTORS®, not managing data from multiple sources

How will the acquisition work?

  • The ListHub platform technology will be provided to all of Point2’s previous MLS customers (in the U.S.)
  • ListHub and Point2 will work collaboratively with each MLS to cutover all of Point2’s U.S. based MLS customers to ListHub over the next six months.
  • The MLS-connected Point2 syndication service will operate unchanged for each MLS market during the period prior to their ListHub cutover date to ensure no disruption in service.
  • Once an MLS market is transitioned, the Point2 syndication service will cease operations.

NOTE: While it’s nice of Celeste to say I am a “key partner”, I assume this was a blast email that went out to their actual key partners. 🙂 As the main thing I partner with Listhub on is karaoke with their people, I doubt the phrase applies to me.

In any event… a couple of thoughts.

Is This Significant?

I guess my first thought is a question… because I’m trying hard to see if this is a Big Game Changing Event in the first place.

For one thing, the terms of the acquisition are not disclosed. I suppose eventually, Move will have to file some disclosure or another telling us what they’re paying for Point2, but if the money involved were a large sum, I’d imagine we’d have heard about it in the release. So… this feels like a small little deal, maybe a couple of million bucks… which is a lot of money to you and me, but not to Move and Yardi Systems.

For another, I’ve learned that the acquisition is a straight-up market share purchase. There are no employees and no software involved. Listhub doesn’t want Point2’s software, nor does it want any of the people. (Note: Saul Klein left Point2 as of three days ago to boot.)

This doesn’t feel like a major strategic acquisition that will change the landscape forever. This feels like an opportunistic little purchase to scratch an itch.

Thinking About the Big Picture

The interesting angle, if there is one, is what the acquisition says about the state of syndication today.

Consider for a moment that when Yardi Systems bought Point2 back in 2010, Saul Klein saw the deal as a significant software play:

Saul Klein: Thanks Greg. The acquisition of Point2 by Yardi will result in Point2 being able to offer more value to all of our Point2 customers… agents, brokers, MLSs, and Associations. As many may note there are apparent potential synergies and yes, lots of potential cross marketing opportunities as well. I know this is what all acquiring companies say when consolidations or acquisitions of this nature occur, but the timing is different, the market place is different, and the players are different..

A major consideration for anyone trying to figure out “what this all means” is the fact that, Yardi is a software company (as opposed to a media company). Point2, is also a software company. So what you have is a software company purchased by a software company and a resulting management team with some of the deepest and longest communication channels and relationships in the industry. [Emphasis added]

Well, apparently, the software company that purchased a software company saw little future in syndication software, despite the deepest and longest communication channels and relationships in the industry. What’s the value of the management team with that depth and length? Apparently zero, since Listhub isn’t bringing any of the management team over.

Furthermore, there is this from the same interview:

Saul Klein: Syndication and the ability to provide syndication services is getting interesting thanks to Move and its acquisition of Listhub. There is conversation in some circles that it may not be in the industries [sic] best interest for all syndication of MLS data to be controlled by Move. That may be one of the reasons our acquisition seems noteworthy to many. We have been and will continue to be an alternative to Listhub. Both acquisitions did nothing to change that. Some MLSs use Point2, some use Listhub, and some use both.

I gather that it may now be in the industry’s best interest for all syndication of MLS data to be controlled by Move. Why? What changed in four years?

Well, for one thing, syndication went from The Great Satan to Grin And Bear It. Recall that even Clareity Consulting recently suggested that instead of fighting syndication, folks ought to engage in “responsible distribution”. That is to say, syndicate to the Big Guys with significant traffic, but cut off the wee little sites.

For another, despite all the boohoo’ing and the “OMG, Zillow will kill us all” that accompanied the height of the Syndication Is Teh DEVIL hysteria… it appears that no real estate agent has ever been disintermediated by a website. Yet.

And over the past four years, it has become eminently clear to those with eyes to see that being a software company in residential real estate is a thankless, dangerous endeavor. Again, Saul Klein from 2010:

VA: What can we expect to see now from Point2?

SK: Innovation. Syndication and our product offerings will continue to evolve. At Point2, we will continue to strive for the creation of an “eco-system of innovation” around the data and work to include our partner MLSs and Syndication Portals in the conversation. Look for our products to have more capability and choice and more in the future.

Point2 may have tried their damnedest to create an eco-system of innovation around listing data, but they ran into the Berlin Wall that is the MLS in America. Yardi Systems, not being idjits, apparently has decided to cut its losses in the innovation-free zone that is residential real estate, and has sold off the syndication operations to Listhub. Sans software.

This end to Point2 seems a bit… hollow. It is, however, inevitable given that the past decade or so can justifiably be described as the Era of Fighting Innovation by the real estate industry. What innovation we do have today is the result of entrepreneurs fighting through the headwinds that brokers, MLSs, Associations, and agents have blown against them… not the other way around. (And let’s keep in mind that even Dotloop, an entirely agent-friendly product that is widely beloved by the “industry”, has had to deal with “headwinds”.)

Meanwhile, as noted above, the entire syndication game may very well be over, since Zillow’s acquisition of Trulia would create an entity that has 89% of all traffic to the Top 15 websites in the real estate category in the United States. So while congratulations are due to Listhub for removing the thorn in their foot that was Point2… I’m finding it hard to think of this as the Big Game Hunter that some have been waiting for.

We’ll see if this ends up a big thing. And I may have more on the subject after further thought, but as of now, this deal feels more like an indictment of the real estate industry than a celebration of success. Plus, I have to catch a plane….

More to come, I’m sure.


PS: And here’s the first of the “More to Come”

I just got off the phone with Gordon Morrell, the COO of Yardi Systems, who wanted to clarify a couple of points.

  1. It isn’t 100% clear from the way that Listhub’s press release is written, but for that reason, he wanted to clarify one thing. Listhub did not buy Point2, the company. Yardi did not sell Point2, the company. The reason why there are no people and no software involved in the deal is that the deal is strictly for the U.S. syndication business. Essentially, Yardi/Point2 sold the American “territory” to Listhub, nothing else.
  2. Yardi remains excited about the software businesses of Point2 — the broker/agent websites, the MLS public websites, etc. Gordon said that in fact, they added to the Point2 team to service those businesses.
  3. Point2 will remain in the syndication business in Canada and elsewhere; Listhub only acquired the US businesses.
  4. There was no relationship between Saul Klein’s departure and this transaction; he did not clarify further, but suggested I speak directly with Saul. I plan on that.

So all in all, the message is that Yardi has not abandoned the software business. It is abandoning the U.S. syndication business, because as Gordon put it, “it didn’t really fit” and Listhub does a better job there.

Obviously, Yardi isn’t going to comment on my big picture conclusions. I stand by  them, however, as nothing I’ve heard changes my mind about the resistance to innovation and change.

Many thanks to Gordon for reaching out to clarify the error.

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Rob Hahn

Managing Partner of 7DS Associates, and the grand poobah of this here blog. Once called "a revolutionary in a really nice suit", people often wonder what I do for a living because I have the temerity to not talk about my clients and my work for clients. Suffice to say that I do strategy work for some of the largest organizations and companies in real estate, as well as some of the smallest startups and agent teams, but usually only on projects that interest me with big implications for reforming this wonderful, crazy, lovable yet frustrating real estate industry of ours.

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