Four of the nation’s largest multiple listing services are acquiring real estate software company Remine and replacing its CEO, Mark Schacknies, the MLSs announced Friday.
The four MLSs — the Austin Board of Realtors’ ACTRIS MLS, First MLS in Atlanta, Heartland MLS in Kansas City and Miami Realtors’ MLS — formed a joint venture incorporated on Oct. 4 called MLS Technology Holdings LLC in an effort to acquire Remine and for potential future investments, Austin Board of Realtors CEO Emily Chenevert told Inman.
“MLSs have taken a backseat to advancing technology that serves our subscribers and consumers for far too long,” said Chenevert, MLS Technology Holdings’ chair, in a statement. “At a time when consolidation is occurring across the industry, this investment ensures Remine remains with a team that’s dedicated to keeping brokers and agents empowered in the real estate transaction, for the benefit of the consumers they serve.”
The deal closed on Friday, the company said. Combined, the four multiple listing services boast approximately 140,000 subscribers.
Remine launched under the name “Real Deal” at a November 2015 hackathon hosted by Zillow Group, winning runner-up for “best use of public records data.” A month later, the company incorporated as Remine LLC, later Remine Inc. Former real estate agents Schacknies and Jonathan Spinetto, as well as Remine president Leo Pareja, along with Daniel Huertas and Jad Meouchy, are the company’s co-founders.
Remine offers an MLS platform whose components the company sells as individual modules, including a front-end public records and search tool called Remine Pro, an Add/Edit listing creation tool, its Docs+ transaction management platform, a single sign-on dashboard, MLS websites, a back-end database, a mobile app and an application programming interface (API) for data management.
Remine’s customer base is made up of nearly 60 Realtor associations and MLSs representing 1.2 million real estate professionals. So far, no MLS has signed up for all of the components of Remine’s platform. FMLS uses Remine Pro, Add/Edit, Docs+ and MLS website, while Miami Realtors uses Remine Pro and Remine Mobile. ABoR uses Remine Pro and Heartland will be adding on Remine Pro in 2022.
“We really believe in the way that Remine is building out its technology,” Chenevert told Inman in a phone interview. “We see the potential to change the way that MLS operates with regards to the vendor-MLS relationship, the way that the technology is built out in a modular form versus end-to-end that is somewhat restrictive. There’s just a lot of potential in this company and they’ve already proven themselves to be effective in the tech that they’ve provided to date.”
Because Remine offers its technology in modules, that allows for flexibility and interoperability across different platforms, according to Chenevert.
“It’s not in a box that only Remine’s products can play with,” she said. “It allows for flexibility in the MLS market to offer Remine and offer other technologies alongside it or are integrated with it if that’s what’s most effective for your marketplace.”
She added, “The workflow and the product are built by former agents. I think that that makes it an efficient tool for Realtors and real estate agents working across the country because it’s consistent with what their experiences are in the field.”
Few details on how the deal happened
The deal has been in the works for the last couple of months, according to Chenevert. She declined to discuss who approached who regarding the deal, the deal’s purchase price, how much each MLS contributed to the deal or what each MLS’s ownership stake is in MLS Technology Holdings, which is now Remine’s sole owner and parent company.
The company has named Liz Sturrock, Miami Realtors’ chief of MLS and innovation as interim CEO while the company conducts a national search for a permanent CEO. In a phone interview, Sturrock said the deal came about when “a group of MLSs were looking at a way to take technology into our own hands.” Asked whether the four MLSs got together specifically to buy Remine or were discussing different companies and landed on Remine, Sturrock said she helped put the deal together but was “not prepared to speak on how this deal came to us.”
Spinetto also declined to discuss how the deal came about but said Remine “had a series of several conversations with companies” about buying Remine and he could not disclose which companies.
Speaking generally about MLS budgets, real estate consultant Victor Lund of WAV Group told Inman that MLSs keep a minimum of six months of dues but many MLSs have reserves and other assets that far exceed three years of dues.
“Moreover, these companies rarely have debt unless it is on their building,” he said via email. “You can assume that they have plenty of capital. The large MLSs may have more than $20 million in reserves.”
A “catch” is that corporation bylaws stipulate the use of funds, according to Lund.
“For example, some bylaws restrict the use of reserves to only being able to invest in notes of the U.S. federal government – like bonds,” he said. “Others are a little more liberal and restrict the investment of funds to services that benefit the participants and subscribers (some MLSs are investing in Second Century Ventures with a small percentage of their reserves).”
“MLSs who have excessive reserves will often give members a ‘dues holiday’ and not collect member dues for 1 to 3 months,” he added.
The new and old owners
In February 2019, Schacknies told Inman that Remine had more than 100 private investors. On Thursday, Schacknies said via email that the shareholders are rolling forward into MLS Technology Holdings. “So this is not an ending for them but rather an exciting next chapter for the business,” he said. MLS Technology Holdings declined to disclose the number of investors, or which investors, rolled their equity over to MLS Technology Holdings. The company is majority-owned by the four MLSs that created the venture.
MLS Technology Holdings spokesperson Danielle Hammett told Inman that no investor is retaining direct ownership in Remine.
“Several existing investors, including Ayrshire Group, are rolling over a small portion of equity out of Remine and into MLS Technology Holdings, LLC as investors in that company,” she said.
“Remine and MLS Technology Holdings, LLC legally remain separate entities.”
Chenevert declined to discuss who Remine’s previous investors were or their ownership stakes, whether the deal involves any earnouts whereby the sellers would earn additional compensation if the business achieves certain financial goals, the implied valuation of the company, and whether investors lost or netted money in the deal.
In February 2019, Inman received separate anonymous tips that multiple MLS execs and board members (current and former) were private investors in Remine — either directly or through an investment vehicle. Attempts to identify the tipsters were unsuccessful and Remine and 33 MLSs Inman reached out to denied the allegations, including FMLS and Miami Realtors. ABoR and Heartland were not Remine customers at the time.
This week, Chenevert declined to say whether any current or former MLS executives owned part of Remine either themselves or through another company, including the executives on the MLS Technology Holdings board.
According to Chenevert, MLS Technology Holdings will not run Remine, but will oversee the company.
The joint venture’s board is comprised of Chenevert as chair, Miami Realtors’ CEO Teresa King Kinney as vice chair, FMLS President and CEO Jeremy Crawford as secretary, Berkshire Hathaway HomesServices Georgia Properties President and CEO Daniel Forsman as treasurer, Kansas City Regional Association of Realtors and Heartland MLS CEO Kipp Cooper and Ayrshire Group Executive Chairman Phil Swift as board members.
Forsman is FMLS’s current treasurer and neither he nor his brokerage has a financial stake in MLS Technology Holdings, but rather is on the board for his personal financial expertise, Hammett told Inman.
Remine’s valuation plunge
Ayrshire, a Canada-based boutique investment firm, is staying on as a minority investor, according to Chenevert. Last year, Ayrshire and New York-based growth equity firm Stripes LLC agreed to invest about $2 million and $4 million, respectively, in Remine as part of a Series B round in which Remine raised a total of about $14.1 million from new and existing investors. That Series B round brought Remine’s total funding raised to $64.22 million, according to private capital market research firm PitchBook.
Remine’s valuation plunged by more than half in that round. Remine’s post-money valuation after its Series A round in February 2019, when the company raised $30 million, was $120.7 million, according to PitchBook. The Series B round put Remine’s pre-money valuation at $45 million and raised its post-money valuation to $59.1 million after the round, PitchBook said — a 51 percent drop from the Series A round. Companies typically increase in valuation from a Series A to a Series B.
In March 2019, Remine laid off 42 members of is sales staff a month after raising its Series A and in October 2019 pulled an agent-matching feature after blogger and software entrepreneur Greg Robertson voiced concerns about the company’s use of MLS data. In February 2020, a security blunder left Remine’s system wide open to hacking, potentially exposing private agent and consumer information. On March 9, 2020, Remine laid off 38 employees. At the time, rumors swirled that the company was running out of money and the layoffs were an attempt to both stay afloat and position the company for a sale.
A term sheet obtained by Inman in May 2020 indicated that Remine’s Series B came with hefty strings. According to the term sheet, Remine’s board of directors shrank from seven members to five — two chosen by Stripes, one chosen by Ayrshire, and the remaining seats held by Remine co-founders Mark Schacknies and Jonathan Spinetto. The move turned over control of Remine’s board from the founders to the investors.
According to the term sheet, Remine’s founding shareholders — Schacknies, Spinetto, Leo Pareja, Daniel Huertas and Brian de Schepper — agreed to a re-vest of 80 percent of the shares of common stock that each founder received in connection with the founding of the company. This would have taken the unrestricted shares the founders gave themselves when they started the company and essentially made the founders earn them over a four-year period.
This week, Spinetto declined to comment on his ownership stake in Remine and whether the acquisition would net him any money. Former Remine board member Ron Shah at Stripes, Schacknies, Pareja, Huertas and de Schepper did not respond to requests for comment. Through a representative, Swift said he was unavailable for comment.
Asked whether the deal had to do with financial struggles at Remine, Chenevert said, “This really is not about any financial issues as much as it’s about the opportunity to just continue to build on the success of Remine. This gives us opportunity to allow strategic guidance from MLSs. We’re building technology for MLSs by MLSs.”
In July 2020, Inman published an investigation into Remine’s work environment that revealed public exchanges on the company’s Slack platform between Schacknies, Spinetto and former Remine executive Jon Ferris that referenced cocaine use, “dick pics,” “boners” and a declaration from the CEO that “I must fire one person per week to live. It’s my fuel.” Former Remine employees told Inman the company fostered an unhealthy culture that resulted in an overworked staff and flagging morale.
At the time, in the previous 16 months, the company’s personnel rolls had plunged from 185 employees, about 100 of them software engineers, to about 68 employees, of which about three dozen were software engineers. Other than the two mass layoffs in March 2019 and March 2020, about 40 other employees had also left, including Sina Iman, senior director of engineering; Andrew Sheh, chief technology officer; Won Yoo, vice president of development; Riley Slitor, vice president of people; Jeff Lord, executive vice president and general counsel; Rikki Williams, vice president of finance; Bill Andrews, director of MLS and industry relations; and Quinn Nichols, vice president of marketing and communications.
Since then, Remine has also lost Chelsea Goyer, who was Remine’s chief of staff for less than a year and a half and had previously worked at Redfin for 12 years, and Joe Kazzoun, who was Remine’s vice president of MLS for a year and had previously worked at Instanet for 13 years.
In November, Remine added on Tim Dain, former CEO of Missouri-based MLS MARIS, as vice president and general manager of MLS services. The company now has about 60 employees, of which about 40 are software engineers, according to Spinetto. Asked about Remine’s gender ratio, MLS Technology Holdings said that information was not readily available.
Regarding Remine’s work environment, Chenevert said that staff culture is “hard to curate and really critical to the success of a company. Remine has clearly been doing something right because they’re in over 60 markets across the industry. They’ve done that very quickly. They’re serving 1.2 million real estate professionals and there’s a team of people that are making that happen each and every day.
“In terms of the perspective of MLS Technology Holdings we want to support that staff team, ensure that they feel excited about the vision that’s coming from this transition, and just continue to crank out good work.”
Asked about the Slack screenshots, Chenevert said that the culture of MLS Technology Holdings would be “one of safety, of security, empowerment, excitement about their future. We will ensure that that staff team is in an environment that is productive for them, and in which they can succeed.”
In a blog post following the publication of Inman’s article, Schacknies said the conversation in the screenshots “was in poor taste, highly inappropriate and we apologize.” He committed Remine’s executive team, including himself, to undergo “advanced sensitivity training,” which Spinetto confirmed had indeed occurred through a third-party company in third-quarter 2020.
“My personal takeaway [from the training] is that you always have differences on how people see you and your motivations to do better as an organization and deliver a quality product to your customer,” Spinetto told Inman in a phone interview.
“I think when you look at what I saw personally from that understanding the different viewpoints of many different individuals on the team to holistically take in those viewpoints and make sure that we get the insight and the opinions of everyone to make the best decision for our customer is something that sometimes requires you to step back and just say, ‘Hey, let’s slow it down. Let’s take a little extra time and make sure that we’re reviewing what needs to be done and what everybody is going to do to get that, holistically, as a group.’”
Regarding the Slack conversation captured in the screenshots, he said, “That type of a commentary in a company Slack channel is not appropriate. That is my full stop answer on that. I do regret any of the information that anybody saw in that or read in that. I do regret putting that in there. It’s not representative of who I am.”
He said the training had given him a general sense of “how as an executive, your work has an effect. And as an executive, you have a responsibility to double-check those words before they’re consumed and read, by whether it be your employees, your vendors, or your customers.”
For his part, Schacknies said that by the time Inman’s article was published, “it was somewhat ‘old news’ internally. We had addressed it already and done significant work with internal and external partners to strengthen our team.”
The Slack screenshots were from 2019 and had been circulating for several months among Remine’s employees before Inman published its story. Schacknies declined to comment on why the executive team did not commit to and undergo sensitivity training before Inman published its story.
Last year, Remine filed a lawsuit against unnamed current and former employees for violation of confidentiality agreements. Schacknies and Chenevert declined to comment on the status of that lawsuit and whether Remine is currently suing anyone or being sued.
Spinetto, formerly Remine’s chief operating officer, will stay on as chief of staff operations with the product and engineering teams reporting to him. Remine President Leo Pareja will also stay on as chief of strategy.
“Jonathan is at the center of the company as a founder obviously and someone who’s intimately familiar with the operations of the company and the trajectory that we’ve been on,” Chenevert said. “We’re excited to continue to see him be an effective partner, and someone that can continue to move that technology forward.”
“Leo is still deeply engaged in the company as an initial founder as well and we’re excited to work with him and include him in the continued operation of the company,” she added.
Schacknies has resigned from Remine and will no longer be Remine’s CEO as of the acquisition closing.
“We appreciate the success that’s been built under the current leadership, but we’re looking forward to a new chapter for Remine as well,” Chenevert said. “We think that we have the opportunity to continue to move that forward with a fresh take on the company and a continued look forward so that we continue to expand on that success.”
Schacknies framed his departure as part of the evolution of the company.
“I’m a founder CEO,” he said via email. ‘I go from zero to one. I take an idea from the problem/solution thesis to product/market fit. The team has built an amazing product with a clientele that is so passionate about it that they wanted to co-own it. I can’t think of a better way to end this chapter. And, now, the new CEO will do a great job from here, scaling Remine to its ultimate potential and helping to transform the industry. The team is in great hands with her, and I truly wish her the best. I will always remain at the service of the company.”
He said he was “extremely proud” of Remine’s team and that he expected the acquisition to be “transformative” for the real estate industry.
“Everyone in prop tech is making bold chess moves,” he said. “I’m impressed by the strategic vision of these MLSs.”
After leaving Remine, Schacknies said he looked forward “to spending time with my family, reading, and thinking.”
Sturrock, as interim CEO, said she planned to assure the current staff that there’s opportunity for them at Remine and that the culture would be one “of respect and success.”
“We absolutely want no loss of momentum, and to make sure that all of our customers are well taken care of and we all move forward together in this new venture,” Sturrock said.
“As a technology person at heart, I want to make sure that any outstanding software issues that there may be to get as many of those taken care of, and make sure that our customers — the MLSs and agents — all have the products they need on a day-to-day basis. The most important thing is for us to identify a CEO for the long term.”
“We’ll be looking for an experienced and seasoned technology professional that is familiar with both running a software as a service software company, and managing a distributed staff and ensuring the highest level of customer service, data privacy and data security,” she added.
Chenevert and Spinetto declined to offer any specifics on future plans for Remine products, including any plans to re-launch a consumer listing portal.
Asked whether the four MLSs buying Remine would continue to offer products that compete with Remine products, Chenevert said, “I can’t speak to the intentions of the marketplaces of our partners at MLS Technology Holdings LLC and at this time Austin has no announcements related to the technology that we’re offering.”
Speaking for Miami Realtors, Sturrock said, “Miami will always offer choice to our members.” Her MLS is currently looking at its technology roadmap to see if it will be offering its members more Remine products, she said.
Remine’s software will be available for anyone to purchase for their members, including MLSs who may be competitors of the MLSs that own Remine, according to Sturrock.
Chenevert agreed. “We’re excited for any market across the country to use the technology, to adopt it in their marketplace,” she said.
MLS Technology Holdings confirmed that PropertyFlow, Remine’s joint venture with Canadian real estate tech and title insurance firm FCT, would remain in effect and would continue to be spearheaded by Remine’s team in Toronto, which is in charge of Remine’s Docs+ platform.
MLS Technology Holdings will be launching an MLS Advisory Group “to provide direct input on the future of the MLS and how Remine’s MLS 2.0 can continue to anticipate and alleviate pain points in the homebuying, selling, and renting process,” the company said. The company has not yet worked out the details for who will be on the advisory group or how big the group will be, Chenevert said, but those interested in learning more can email JoinUs@ABetterMLS.com.
Editor’s note: This story has been updated to note that the deal closed on Friday.