Their first day at Roofstock started with a few people sitting around my dining room table. I’ve always believed it is important to dream big, so I started the meeting by telling everyone around the table that Roofstock would someday be a billion dollar company. If it was less than that, it would be a failure given the market opportunity before us. Of course, my co-founder Gregor Watson then proclaimed, in typical Gregor form, that I was being way too conservative. Anything less than $10 billion would be a failure in a $3 trillion market! Let’s go! Then, my co-founder Rich Ford discussed his vision for Roofstock really becoming a marketplace that would level the playing field, helping both institutional as well as everyday Americans and mom and pop landlords participate in the real estate market with the same insight, access and technology as major institutions.
Although Roofstock has grown and evolved a lot since our founding, that original vision remains constant. I’ll borrow an analogy that Ming likes to use: Roofstock’s journey, and the journey of really any startup, is kind of like watching a kid grow up. On that May day in 2015 around my dining room table, our company was born. And as we enter our seventh year, it’s kind of like that kid is starting high school – we’ve led our team through massive growth, but still have so much to learn and do.
A monumental year of change
This month we announced that we’ve surpassed $3 billion in property transaction value since the platform officially launched in 2016. The growth we’ve seen just in the first quarter of this year has been tremendous, with gross merchandise value (GMV) in Q1 2021 of more than $380 million, a 569% increase over Q1 2020. In Q1 2021, we also doubled the amount of traffic to our website over the same period last year. One of my favorite metrics is that 30% of our buyers are repeat buyers and 50% of retail closings are from repeat sellers. This demonstrates the clear value proposition that Roofstock provides to both sides of the marketplace, and there’s no question that more and more investors, brand new or seasoned, see Roofstock as the digital platform of choice.
While COVID-19 certainly presented a shock to our business initially, we remained nimble in our approach and the result has been unprecedented demand for single-family rentals over the past two quarters. As it turned out, Roofstock’s digital transaction process was crucial at a time when in-person meetings posed a health risk. In fact, over 90% of single-family homes purchased on Roofstock today are more than 250 miles away from where the investor lives.
There’s much more to come – think of how much you’ve achieved since high school! This summer, we’re looking forward to relaunching Roofstock One with a new and improved program and structure to allow investors to own shares of rental homes, much like shares of stock. We’re also increasingly open to strategic acquisitions. Our recent acquisition of Stessa is a good example of the sort of companies we like which provide synergies across our business in addition to being a great stand-alone opportunity. We will continue to make deep investments in technology to achieve our ultimate vision of becoming the definitive digital real estate investing platform, initially in the U.S., and ultimately globally.
We have, to a degree, bucked conventional wisdom by embracing a strategy focused both on retail and institutional clients. Most companies pick one or the other, and stay in their swim lane. We always viewed both segments as having enormous potential, and that we could leverage the same tech and data platform to service each, which is exactly what we have done. The result is we have built a platform that can service clients with as little as $5k to $500 million or more. We’ve made a lot of progress so far, but I can’t wait to see what the next six years will bring!