BOSTON — Billions of venture capital dollars are pouring into real estate and the largest real estate trade group in the nation is seeking a bigger piece of the action.
The National Association of Realtors, which has more than 1.3 million members across the U.S., already boasts part-ownership of 50 real estate-related companies through its venture capital arm, Second Century Ventures, NAR CEO Bob Goldberg told attendees at NAR’s annual conference, the Realtors Conference & Expo, Thursday.
One of those companies is electronic signature provider DocuSign, which went public in April and resulted in a dividend back to NAR of $20 million.
Is Second Century Ventures, a wholly-owned subsidiary of NAR, looking to grow from that success?
According to NAR Treasurer Tom Riley, yes.
“It hasn’t been released yet, but Second Century Ventures – watch out. They got a new program coming next year,” Riley told about two dozen attendees at the conference’s Treasurer’s Forum on Saturday.
“It’s a whole new revamping of Second Century Ventures,” he added.
Riley was responding to a Connecticut Realtor who suggested that NAR raise venture capital from its members.
“I think that the new [NAR] Finance Committee coming in next year should actually put together a fund, funded by members,” the Realtor said.
If NAR were able to convince 500,000 of its members to chip in $1,000 each, the trade group would raise $500 million, he said.
“You can also solve the problem of transparency because you would invest the members’ dollars, which would help towards their retirement … and everyone would know who invested, what the investments are going to,” he said.
NAR Treasurer Tom Riley. Credit: NAR
“We could go to ourselves to get the money, other than SoftBank, Zillow, Google and all the other trillion-dollar companies that are trying to take our business away.
“We could invest in all these companies ourselves, right along with Second Century, so the association gets the benefit and maybe 500,000 members will make a few bucks too.”
Riley thanked the member and said the new SCV program will “be looking at local – exactly what you just said – national and global.”
After the forum, Riley told Inman that he anticipated further details on the program would be disclosed in May 2019.
He framed the revamp as the next step in NAR’s reorganization for fiscal responsibility and innovation.
“Every single subsidiary, every single rock, every single structure of the organization for the past year and a half, two years, we dug deep, deep, deep. We kept drilling down, drilling down. That [the SCV revamp] is the next one. And it’s going to be amazing,” he said.
Riley cautioned that SCV, which NAR founded in 2008, is a separate corporation with a separate board of directors.
“We’re just the parent. We don’t get involved in that. We only can report what they tell us and we haven’t been told, other than I know stuff is happening. And that’s only a teaser,” he said.
Inman reached out to NAR for further details on the revamp, but NAR spokesperson David Greer declined to comment, saying, “As a for-profit entity SCV will not be disclosing our next moves for competitive reasons.”
