Compass’ S-1 filing includes details on acquisitions dating back to the headline-grabbing 2018 purchase of Pacific Union International.
Compass spent much of 2018 and 2019 growing through headline-grabbing acquisitions, the details of which had been scarce with the company’s status as a privately held firm. But as the company prepares to go public and lays its financials bare, for the first time, it’s revealing what it paid for some of its biggest acquisitions.
“We will continue to evaluate potential acquisitions in the real estate technology ecosystem that can bolster the value of our fully integrated platform and accelerate initiatives in our product roadmap,” the company wrote in the filing. “For example, in 2020 we acquired Modus, a title and escrow software company, expanding our capabilities into a critical component of the transaction.
“Additive capabilities will allow us to continue to provide our agents with the most relevant technology solutions and value-added services to help them drive maximum efficiency and close more transactions.”
Here are all the details on the company’s biggest acquisitions, according to its S-1 filing.
The company’s largest real estate brokerage acquisition to date shocked the real estate world in August 2018, giving Compass an even bigger presence in San Francisco and Los Angeles.
The filing revealed that Compass has paid a total of $83 million to date for its acquisition of the brokerage firm that boasted 54 offices and more than 1,700 agents at the time of the deal. Compass paid $64.5 million in cash upfront, as well as $3.7 million in Class A stock and $15.1 million in other contingent considerations.
Preceding the acquisition of Pacific Union, Compass’ first major play in San Francisco was the acquisition of Paragon Real Estate. At the time, agents affiliated with Paragon had closed 1,591 transaction sides in 2017 and the deal grew Compass’ San Francisco team to more than 500 agents.
The filing revealed Compass has paid a total of $18.9 million to date for its acquisition of Paragon Real Estate, which included $15.8 million in cash upfront and $3.1 million in contingent considerations.
In what would eventually become a lynchpin of the Compass technology platform, Compass announced in February 2019 it was acquiring Contactually, one of the top customer relationship management tools on the market.
The filing revealed Compass has paid $26.1 million to date for Contactually, which included $24.5 million in cash upfront and $1.6 million for the “elimination of existing relationships.”
Compass signaled a move into the closing services business with the October 2020 acquisition of Modus, a title and escrow software startup. Like the Contactually move, the aim brought Compass closer to its goal of building an end-to-end platform for real estate agents.
The filing revealed Compass has paid $49.7 million to date for Modus, including $27.7 million in cash paid at closing, $2 million in cash paid after closing and $20 million in additional contingent considerations.
The company’s most recent buy, which closed just last week, was Compass’ acquisition of KVS Title, a further expansion into title and escrow services. The move expanded Compass’ closing services capacity to Washington State, California, Florida, Washington D.C., Maryland and Virginia.
Compass completed the acquisition on Feb 24, 2021 for $52.2 million in cash and up to an additional $26.4 million of cash in connection with other certain contingencies.
The filing also broke down the cost of other small acquisitions by year but only two by name. Compass’ recent acquisitions of Rhode Island-based brokerage Lila Delman Real Estate cost the company $6 million in cash and up to an additional $3.7 million of cash upon the meeting of certain requirements.
The company’s recent acquisition of New York City-based leasing firm Bold cost Compass $2 million in cash and an additional $2 million of cash upon the meeting of certain requirements.
In 2018, Compass paid $20.5 million for other acquisitions, which included “an acquisition of engineering talent in addition to the acquisition of smaller residential real estate brokerages in connection with ongoing agent recruitment efforts in key domestic markets,” according to the filing.
In 2019, Compass paid a total of $22 million for the acquisition of “several residential real estate brokerages.” The company’s 2019 acquisitions included Alain Pinel Realtors and Stribling & Associates.
In 2020, Compass paid just $900,000 for the acquisition of several smaller brokerages.