EP07: Survival Is Not the Same as Relevance

Episode Transcript

Amy Gorce  0:00  

The old bare minimum was meet the NAR mandates. You know, have an agreement with a vendor. You can deliver MLS services. I feel like that model is dead. For the first time, I think the MLSs are being forced to move a little bit faster than feels comfortable.

Katie Smithson  0:16  

Now, one of the key pillars that really defined what the MLS was, you know cooperation and compensation? Well, compensation is gone.

Amy Gorce  0:24  

250 of the MLSs represent 3% of the revenue. The math just doesn’t matter.

Katie Smithson  0:29  

How do we make the MLS more cooperative and more beneficial? Welcome to REpod, the organized real estate podcast for the industry by the industry. This is where MLS leaders, association executives, and brokers come to rethink operations, simplify complexity, and build systems that actually work together. Join the RECORE team as we challenge outdated processes, explore smarter technology, and have honest conversations about the future of real estate. Let’s get into it. Hello, and welcome to another episode of REpod. Today I have a very special guest with me. Next time we will do this like in person with champagne and at the lobby bar. But yeah, I mean you’re one of my all-time favorite people in this industry. I will never forget like going to my first Clarity conference and seeing you on stage and just hearing you talk and I was like, I want to be like her when I grow up. Here we are, and here we are. Yeah, I don’t know about all that, but I guess let’s just start off for for those who may not know you. I mean, to me, your industry royalty. But please, just go ahead and give us a little bit of your background. I think it’s just so impressive how many different roles you’ve had in this industry, which obviously just gives you a wealth of knowledge and experience. So, just give our viewers just a quick rundown of all the different roles you’ve held and all your expertise.

Amy Gorce  2:04  

Sure. Well, I joke that I haven’t had a job interview since 1997, so I don’t really feel like I’ve had a ton of different jobs. But but through a series of fortunate events, I have had the opportunity to serve in a lot of roles. I started in this business in 1997 as the CEO, then it was just actually an MLS director role. It wasn’t even a CEO role at what is now known as Intermountain MLS. They had a name change during my tenure, and ultimately I served as the CEO of Intermountain MLS for almost eight years. At which point, Greg Larson and Troy Reck and Kevin Hughes came to me and said, “Hey, let’s go do a thing. And we started what ultimately became Clarity. Clarity Consulting had existed before that, but Clarity Security hadn’t. We combined those brands ultimately into the single brand called Clarity. I joke all the time that it was a 13-year startup. We did restfully exit that business in 2017, selling it to who was at the time CoreLogic, now known as Totality. I spent about four years working for Chris Bennett, who’s my business partner now at Presta Team Consulting. But but then was my boss. I ran business development. I ran sales. I ran the Trestle product for a while. So I kind of bounced around inside there as a utility player, trying to just help figure out how we took you know each product to the next level. I rolled out one home for them initially, and so I’m always grateful for that experience. Right? It was never. I don’t think any little girl says when I grow up I want to work for a publicly traded company that goes

Amy Gorce  3:43  

because there are a lot of lot of drama there, you know, during the what ultimately resulted in Stone Point Capital acquiring them. I made a very personal decision to leave at that point. Private equity is just not something that’s all that interesting to me, but I understand why it was done, and and so I made the decision at that point to go back to my original love, which was just more advisory service. I’d had the opportunity to do that in my role at Clarity a lot. I’d always stayed connected to MLS policy, even though it wasn’t my job anymore. So you know, I’d I’d always just been you know, so super interested in sort of the outcome and the impact of these policies that back then were mostly about NAR mandates, you know, and their impact. So it always stayed connected. So you know, I really was just interested in continuing to collaborate with MLSs and technology providers about how, you know we can continue to move the industry forward. So in 2021, Chris Bennett and I launched Presta Team Consulting, and one of our initial projects was to help Art Carter and Ryan Donlin write a business plan around kind of the value of MLS data and future monetization, specifically as it relates to institutional buyers. So. Folks like the GSEs, banks, insurance, things like that. The business plan resulted in Chris and I being hired to both pursue funding and execute on the business plan. So I’ve been the CEO of Re Distribute now for four years, roughly four years, and that’s been a fulfilling role because I’ve been able to maintain my role at Presta Team and do that as well. Most recently, I just completed a very short stint, about three or four months, as interim CEO of the Council of MLSs, with really just the goal of kind of helping them through the transition from one CEO to a new CEO, and I’ve got a heavy focus still on helping make open house successful for them. In fact, just got off an open house planning call where I’m getting more and more excited about the content. That there is nothing like the level of activity that we’ve seen this year to produce really good conference content for sure. And so, yeah, I don’t know if I missed anything there, but those were the highlights. Yeah, I mean, like I said,

Katie Smithson  6:03  

you are industry royalty. That is like a very impressive resume, especially since you haven’t interviewed in a very long time.

Amy Gorce  6:10  

97 was my last decision. There you go. Largely unemployable at this point. Grateful that the industry has accepted my capabilities without me having to demonstrate them too much beyond showing up and doing my best.

Katie Smithson  6:28  

Well, I think you are a certified badass, so you just continue doing what you’re doing. But I will say, I mean, I think part of the reason that I I wanted to have you here is because a few months ago, I’m losing track of how long ago it was actually, but we were both at the ICE customer conference, and you and Lucy Fortier did a just a fireside chat, and I thought you did a really phenomenal job of just addressing, like you said, I mean, CMLS is going to have no shortage of content to discuss at the open house coming up end of September. So I think maybe just to like level set. I mean, again, you’ve been in the industry for a long time, and there’s been no shortage of changes technology wise, policy wise in that time frame. But do you see what’s been happening over the past year? Does this feel different to you than maybe some other bigger challenges that have occurred in the past?

Amy Gorce  7:31  

I mean, it definitely feels different this time, just given both the scale and complexity of the change. And I think a few years ago, you know, when we initially saw the settlement that took compensation out of the MLS, there was so much focus just on getting agents retrained, getting the systems cleaned up, that we weren’t necessarily thinking about what the next generation of the MLS looked like without compensation in it. But now we’re there, right? We’ve seen, you know, we’ve seen sort of this massive consolidation on the broker side that’s certainly driving a lot of the change. And for the first time, I think the MLSs are being forced to move a little bit faster than feels comfortable. And I’m, I don’t want to put every MLS in that bucket. I’ve seen plenty of MLSs out there that are moving quickly. That five years ago we’re building the what if plans and now they’re just executing on those plans right and and those are the ones I think that are you know that are doing really well but then we’ve got kind of this really long tail of MLSs that have been heavily reliant upon NAR policy mandates and things like that to determine how their business gets run, and now I’ve sort of talked about this in my strat planning this year. Now we’ve sort of got this fork in the road where MLSs are deciding: Am I just going to continue to sort of, I’ll say, manage the decline, if you will, of this business, or am I going to reinvent myself into something that adds a lot of value to my subscribers, my brokers, you know, things like, and I’ve seen both out there. Frankly, I’ve, you know, it’s not, it’s not, not one or the other. I think, you know, it’s forcing the consolidation conversations to move more quickly. We certainly saw that show up in things like beaches in Miami, where the right thing to do isn’t always the easy thing to do, and I still just you know that’s a that conversation’s been going on my entire 30 year career, but I see a lot more real energy around it, and I also see there being real business problems around the management of the risk that many MLSs just regardless of size, aren’t prepared to handle. You know, I look at organizations, you know, like CRMLS, like Bright, like you know, some of the art like Emred, like, and they’re really prepared to handle the risk associated, right? And they’re not going to sit on the sidelines and let someone else manage their risk for them. They’re proactively out there. Managing their own risk, trying on you know trying on new and modernized policies, trying on new and modernized technology as a way to deliver more value, and I think that’s kind of going to be the new bare minimum. The old bare minimum was meet the NAR mandates, you know, have an agreement with a vendor, you can deliver MLS services. I feel like that model’s dead, and that’s going to be unpopular opinion. But I think you are, if if that’s your model moving into 2027 and beyond, you really are just making a decision to manage the decline.

Katie Smithson  10:32  

Yeah, yeah, and I, I mean, I want to kind of go back to what you were saying about consolidation because, I mean, to your point, there has been quite a quite a lot of broker consolidation, but I don’t think we’re seeing that move as quickly on the MLS side. I guess from your perspective, is there? Do you think that’s something that is needed for the MLS industry to continue to grow and evolve, or is it possible for some of these MLSs who are kind of stuck in this mindset of they want to stay independent, individual? Do they do they have the toolset to really evolve and and start addressing some of the broker needs and dealing with some of the the policy changes or you know lack there a you know lack of of new policies coming out from NAR just because you know NAR is kind of taking a step back.

Amy Gorce  11:28  

Yeah, I think now more than ever scale matters, and I know folks don’t want to hear that. And that’s not to say that there’s not some niche MLSs you know that maybe have a little bit smaller membership that are very well run that happen to be. I see this often in sort of the resort communities, things like that, right? Where they’ve got sort of this very you know closed loop system that works for everybody, and, you know maybe a few of those will be okay. But the bottom line is, if you don’t have the scale to deal with everything from the legal risk to the technology risks, I mean, I’m looking at the number of not just MLSs but technology vendors that have faced serious breaches in security. That’s a core, you know, that’s a core service the MLSs should be prepared to step up and manage, and and the majority are heavily reliant upon their vendors to do that, but you know, and I’m listen. All the vendors, I think, do a do a good job here, so it’s not a criticism of the vendors. But the bottom line is, we’ve always been able to just sort of assign our risk to someone else along the way, whether it was NAR through policymaking, whether it was your vendor through the technology delivery, and I don’t think we can assign that risk so much anymore. We’re still holding the bag for it, which means you have to have

Katie Smithson  12:48  

great time out. If you’re ready to put AI to work for your staff and your membership, it’s time to check out Navigator. Articore is the exclusive reseller of Navigator by Lindy. Head to recore.net forward slash navigator to learn more. All right, back to the show. A

Amy Gorce  13:05  

reasonable amount of scale so that you can spread that risk across more business opportunity. And you know, I was presenting to a group a few weeks ago about kind of what consolidation looks like today. And yes, from the time I started, when there was 1,100 to today, where there’s you know 480, we’re arguing about how many there are. I think right now, but you know between 460. Yeah, exactly. That looks like a lot of progress. That’s over a 30 period. So if you do just long division, it’s okay.

Katie Smithson  13:40  

Yeah, right.

Amy Gorce  13:42  

But if you also look at the economics, you’ve got half 250 of the MLSs represent 3% of the revenue, and so when you look at it that way, those 250 trying to take that 3% of the revenue and spread it across their risk, it the math just doesn’t math, right? And so you know you look at kind of those top 250, and my personal opinion is 250 is still too many. But if you look at those top 250, they’re able to somewhat better manage the risk, and the numbers get even better at at 50. You know, I do believe the MLS is competing with each other is ultimately going to produce more high-quality services. So I’m not a big national MLS advocate, though I think there. I think there’s so many areas where the MLSs could be more collaborative for the benefit of brokers, for the benefit of institutional buyers that that need access to this data. I think these, you know, this idea of a walled garden is, you know, really outdated in terms of value. So, so what I see is even if you’re not going to necessarily, you know, have merger discussions or consolidation discussions, you should be having discussions about the ways in which you can collaborate with your. Fellow MLSs to deliver a better experience for brokers, a better experience ultimately for consumers through access to the data. And so, you know, when I think of consolidation, it’s not always hey, you guys should merge. Sometimes it’s hey, that one should just go away. Sometimes it’s hey, we should just you know make it easier for to serve the brokers in my market, whether that’s data sharing in a more modern way than we do today, you know things like that. So I think the consolidation topic can’t just be a merger topic; it has to be a more collaborative discussion.

Katie Smithson  15:35  

Yeah, yeah, and I think to your point, I mean, honestly, at the end of the day, like looking at what is most beneficial for the membership, because ultimately, that’s how the consumer benefits as well. And I think that’s one thing that just, especially since the the NAR lawsuits have been settled, and just talking to my friends who are outside of the real estate industry, don’t live and breathe it. Don’t understand like all the ins and outs of what agents and brokers experience. I think there’s just a real disconnect between the value of working with real estate professionals as you’re navigating buying or selling a home to the general consumer, and I think that’s a big opportunity that I see where MLSs, brokers, agents can all, I think, work more collaboratively together to demonstrate what their value is to the consumer. So it’s not this perception of, you know, they’re just out to make a commission off of the sale of the transaction.

Amy Gorce  16:37  

And I think if you look at the headlines today, it sounds so much worse than it actually is, right? Oh, of

Katie Smithson  16:43  

course. Yeah, really

Amy Gorce  16:44  

arguing. We’re sort of airing our dirty laundry on the internet every week, which is a little bit embarrassing to me in some ways. And you know, my ultimate wish was that we didn’t have to fight all these things out in in court because I do think they represent such a small portion of the total value that gets delivered to a consumer, if you think about the way agents work every day and the use of, you know, the the the collaborative system that is the MLS empowers them with the data to do everything from pricing, you know, to you know to marketing, and and the argument really is kind of right now very focused on the marketing, but when we think about the value of the MLS, it goes so much further than that. All the way through getting loan approval, getting insurance, you know, things like that. That I think people don’t really think about sometimes. You know, I when I was giving a presentation yesterday, I was still talking about the MLS infrastructure being the envy of the world, like well, we’re here trying to fight to keep it. You know, most of the European countries are trying to figure out how to implement it to begin with. Yeah, irony that we’re going across the pond and teaching them how to do it while we’re still trying to figure out how to. I know. Yeah.

Katie Smithson  18:01  

No, I feel that too. It’s it is a little comical, and I think you know, like I always enjoy hearing Damian Eels talk about his experiences and Australians. Like, can everybody just listen to this because we don’t want to go to this market? Yeah, exactly.

Amy Gorce  18:19  

Infrastructure. I just don’t think so many people realize how much that infrastructure feeds the entire transaction process. So if we start to think about going to, you know, Fannie or Freddie or or any of the you know lenders and saying, sorry, you’re going to have to go source this information from 5000 brokers in order to get the same sort of value that you’re getting today, then we start to see a real breakdown in the system where appraisals get more expensive, and you got to have one. You know, all of a sudden, all this progress we’ve made on desktop appraisals or appraisal waivers and things like that that have really benefited not just the consumers but the agents. Right, we’re getting faster closings, more efficient closings, all of that breaks down very quickly if we start missing 1020, 30% of the transactions inside that system that we’ve all come to rely upon. I sort of have been, you know a likening it to imagine if you know the New York Stock Exchange was all of a sudden missing pricing for you know 30% of the stocks or something like that. Like, how would we function? Our economic engine in the U.S. is largely tied to this aggregate data set being available that we can take our temperature on how we’re doing, not just as a country, but regionally and locally as well. And so, you know, I think that’s the part because we’re arguing so loud about the marketing piece that we’re not really paying attention

Katie Smithson  19:48  

1. No, totally, totally agree.

Amy Gorce  19:50  

Yeah,

Katie Smithson  19:51  

I think I want to just like kind of shift gears a little bit because all of this, these conversations, I think, are so important, and a couple. Years ago, Presta joined forces with Giant Steps to create a new conference, and I feel like the name of the conference itself-it just really speaks for what you all are trying to accomplish. So, MLS Reset first year-it was-it was 2024, right? Was the first year that y’all did

Amy Gorce  20:21  

it? 24 was our first year.

Katie Smithson  20:22  

Okay, yeah, and and

Amy Gorce  20:24  

we weren’t sure if that was going to be our only year, right? So we’re we were really grateful when everyone showed up and we got to do it again. And now we’re gonna now we’re gonna do it again, February 22nd to the 24th, same old place. We still all call it the Scottsdale Plaza, but it does have a good name.

Katie Smithson  20:42  

everything is changing. So

Amy Gorce  20:45  

It’s a much more beautiful hotel. It continues to go through a beautification process at the Kimpton Maralina Resorts in Scottsdale. But yeah, I mean, Greg and I have been friends for a very long time. He was one of the very first people I met. He and I have always talked about how fun it would be to do an event where we could say whatever we wanted, and that has sort of become the theme for MLS Reset. We don’t have as much political sensitivity, if you will, in terms of a topic being off the table, and so you know we’re just really grateful to the industry that they’ve showed up and participated, and we’re excited to do it again in 27.

Katie Smithson  21:24  

Yeah, and I think that candid conversation that you had that the first conference was that was just a really nice way to kind of I think clear everybody’s minds from like how things have been previously and be able to talk openly and say things that might challenge the status quo and get people to just. I think too, it’s really easy when these challenges are facing the industry, like particularly with the lawsuits. I feel like there were a lot of people who were just burying their heads in the sand, and it’s oh, it’s going to go away, it’s going to be fine, but I think that was a little bit of a wake up call to people to say like, “Hey, things are changing, and now one of the key pillars that really defined what the MLS was-you had cooperation and compensation. Well, compensation is gone. So, how do we make the MLS more cooperative and more beneficial? And so I think y’all have done a really great job with that conference, and really I think getting people to kind of reset their thinking as how this industry can operate, what we can do better. Like I said, just kind of challenging the status quo. So I guess with that said, like I think you mentioned, the dates of the conference are February 22 through the 24th, 2027. I can’t believe we’re already talking about 2027. That’s insane. But we will put some more information about MLS Reset in the show notes. But courtesy of Giant Steps and Presta, there is a promo code for $100 off to get your ticket to MLS Reset, it is RECORE100. Again, we’ll put that in the show notes so everybody can use that. It is valid through the end of August, so get your tickets early. I know y’all sold out the last two years. We sold out last year.

Amy Gorce  23:15  

We’ve made the room a little bit bigger, but we’ve also had feedback that people kind of like the intimacy of you know keeping it in that, you know, three to 400 people. We’re all used to going to these 1000, 2000, 3000 you know, attendee conferences where it’s kind of hard to connect. And so you know this has been built with some of the DNA that we brought forward from Clarity. We’ve had Cotality, you know wrap up their old version of the Clarity Conference and join us as a headline sponsor this year. Thank you, Kevin Green and team. I think it’s going to make it that much better. People don’t feel like they have to make a choice between the two, and so we’re merging, you know, Kotali and the gang in this year. But it will sell out. The hotel sells out every year. There are lots of nice hotels within range, but just know if you want to be in this hotel, you need to be registered with your hotel by August. It won’t. There won’t be a whole lot we can do about the hotel. We’ll do our best to squeeze as many chairs into the room as we can, but we are trying to keep it, you know, intimate enough that the conversations are still meaningful. And if you’ve ever been to the plaza, you know their common areas are nice sized, but they don’t hold 1000 people. So we will at some point have to say no to folks, and we hate that. Greg’s a good cop, and I’m a good cop, so we have to like send Stacy and Chris after them when we have to. Right? Doesn’t really work that great.

Katie Smithson  24:41  

Well, yeah, I. I think it’s probably one of the most valuable conferences that people could go to. So I highly encourage everyone to take a look, put it in your budget, your travel budget for next year. It is well worth the conversation. Amy, I could talk to you the rest of the day, but we’ll have to do this again. Find different part two for sure, and bring

Amy Gorce  25:03  

champagne because you never know what I’m going to say. Yes, absolutely,

Katie Smithson  25:06  

yes. Yeah, I think when we’re drinking champagne, that’s when our best thoughts come out. Well, thank you, thank you so much for joining us. This was awesome. Great to see you as always. Yeah, I hope the industry continues to listen to your expertise. So

Amy Gorce 25:26  

Well, just. I guess my parting comment there is that I hope as MLSs they’re listening to their local marketplaces because if you’re just relying on the headlines to sort of help you decide what to do, in my experience that’s not kind of where the real value is. I’ve looked across kind of what you know what what MLSs have been doing, and the ones that are being successful getting the right policies in their marketplaces are having meaningful conversations with the brokers in their local marketplaces, and then making the adjustments and tweaks that they need to make to make it work in their local market. So you know, talk. We’ve been saying this for years, but you know, talking to your brokers in your local markets is critically important. Identifying where you can collaborate with initiatives that are out there that benefit the whole industry is really important. So I’d say those are my two kind of key takeaways. If anybody cares,

Katie Smithson  26:17  

Awesome, perfect sound advice. I love it. Thank you again for joining us. All right, we’ll see you

Amy Gorce  26:24  

soon.

Katie Smithson  26:25  

That wraps up this episode of REpod. If this conversation made you think differently, don’t keep it to yourself. Subscribe, share with your network, and sign up for our newsletter to stay in the conversation. The future of organized real estate gets better when leaders engage.