Presentation on theme: "Agents’MUTUAL Agents’ Mutual Limited. A Company limited by Guarantee. North Wales – Anglesey 1 st April 2014."— Presentation transcript:
Agents’MUTUAL Agents’ Mutual Limited. A Company limited by Guarantee. North Wales – Anglesey 1 st April 2014
Agents’MUTUAL 100% agent-owned property portal Serious competitor to the existing major portals NOT to maximise financial returns to shareholders High quality property search service Minimum listing fees consistent with achieving and maintaining leadership For ALL bona fide Sales and Letting Agents ALL segments of the residential market. Company limited by Guarantee. No shareholders or shares. Directors approved and re-elected by the Members. They are unpaid. All firms listing on the portal are Members. Maximum liability = £1. All Member firms get one vote and an equal interest in the Company, irrespective of firm size. 90% vote required to approve a Sale.
June 2013 – 6 member firms January 14 - 550+ member firms - 1850+ offices Large national brands – 2% Prominent regionals – 20% Small firms (1-3 offices) - 78% Agents’MUTUAL £6M Funding
Rightmove set to raise income to £200M by 2017 - Zoopla needs to treble income to match Rightmove. Agents’MUTUAL Agent now have to list with both portal groups a duopoly with no real constraint on prices 2013 - Income £65M - Costs £35.5M - Profit £29.5M - Margin 46% 2013 - Income £140M - Costs £36M - Profit £104M - Margin 74% We are persuaded by the arguments that the creation of a strong competitor to Rightmove will restrain price increases.. 2012 Zoopla prices will rise to meet Rightmove’s – there will be no price competition ZPG CEO, 2013
Agents’MUTUAL -Vendor direct -Landlord direct -Multi-listing -Agency software -Franchising ? The Threat
Strategy Our portal Entering alongside the two giant players won’t work No reason for consumers to switch Extra cost to agents Too much marketing investment required Too risky to attract commitments and funding We have to create some disruption. Agents’MUTUAL
Strategy Use agents’ control over where they place their listings: Medium term commitment to list with the new portal – 5 years Members to list with maximum of one other portal of their choosing Effective on launch in January 2015 Fully exclusive listing ideal but not viable for agents Agents’MUTUAL
Strategy Agents’MUTUAL Neither Rightmove or Zoopla will have all the agents and properties we will have. creates a unique set of listings for our new portal a reason for consumers to use us Agents can publicise their switch and promote the new portal No net increase in cost of portals to agents. in some cases, total outlay on portals will fall. Reduces investment requirement and risk.
CORPORATES INDEPENDENT AGENTS INDEPENDENT AGENTS Anchor tenants - before CORPORATES INDEPENDENT AGENT MEMBERS CORPORATES INDEPENDENT AGENTS INDEPENDENT AGENTS Anchor tenants – Jan 14Agents’MUTUAL CORPORATES INDEPENDENT AGENT MEMBERS INDEPENDENT AGENTS INDEPENDENT AGENTS Anchor tenants - Jan 15? INDEPENDENT AGENT MEMBERS Agents’MUTUAL 7 Agents’MUTUAL The 3 major corporates are the ‘anchor tenants’ for both Rightmove and Zoopla: - Advantageous terms - Share interests (Zoopla). Independent agents are just rent-payers. Agents’ Mutual now has its own ‘anchor tenants’ – the first 500+ members and they will take listings and fees away from the others. They own and control the Company. Every firm which joins Agents’ Mutual becomes a member on equal terms with all others - one of the ‘anchor tenants’ - taking listings and fees from the others.
The objective Costs £30M* 12,000 agent offices £250 per month 10,000 agent offices At full scale Agents’MUTUAL
Strategy Agents’MUTUAL Raise development funding from member agents – the Gold members 5-year commitments from Gold and Silver members – in return for fixed fees. Fees lower than the big portals – but high enough to allow reinvestment for growth. Once full scale is reached – 10,000 offices – fees can fall. Pre-launch subscription Year 1Year 2Year 5Year 9Year 8Year 7Year 6Year 4Year 3 £400 £200 £50 20% discount for 6-year commitment Full scaleGrowth Average monthly fees Average £4200 per office per year
Strategy Agents’MUTUAL If agents get behind it, Agents’ Mutual can deliver much quicker. £250 average listing fees or less – sustainably. Pre-launch subscription Year 1Year 2Year 5Year 9Year 8Year 7Year 6Year 4Year 3 £400 £200 £50 20% discount for 6-year commitment Full scaleGrowth Average monthly fees Average £4200 per office per year
Three membership schemes during the ‘Growth’ phase No commitment Higher pricing Not fixed Pricing and funding Agents’MUTUAL Firm sizeOffice Location Offices in Firm Volume Discount Prime London Other London Prime Country Other Country 1-3 0% £595£495£395£295 4-6 5% £565£470£375£280 7-12 10% £536£446£356£266 13-19 15% £506£421£336£251 20-49 20% £476£396£316£236 50+ 25% £446£371£296£221 No pre-launch funding Commit for five years Prices shown are fixed ? Price shown include lettings. Lettings-only 50%
Pricing and funding Agents’MUTUAL Firm sizeOffice Location Offices in Firm Volume Discount Prime London Other London Prime Country Other Country 1-3 0% £595£495£395£295 £506£421£336£251 4-6 5% £565£470£375£280 £480£400£319£238 7-12 10% £536£446£356£266 £455£379£302£226 13-19 15% £506£421£336£251 £430£358£285£213 20-49 20% £476£396£316£236 £405£337£269£201 50+ 25% £446£371£296£221 £379£316£252£188 ENTRY TICKET Pre-launch subscription 8 months x £75 = £600 > non-refundable Loan Notes of £2000 per office (£1000 lettings-only). annual interest of 10% repayable by 2020. Commit for 5 years Fund the development Fee discount v Silver Firm sizeOffice Location Offices in Firm Volume Discount Prime London Other London Prime Country Other Country 1-3 0% £595£495£395£295 4-6 5% £565£470£375£280 7-12 10% £536£446£356£266 13-19 15% £506£421£336£251 20-49 20% £476£396£316£236 50+ 25% £446£371£296£221
Agents’MUTUAL Funding and financials £6M+ Pre-launch funding 3000+ offices 1850+ offices Listing fees £7M pa Listing fees £14M pa £21M+ Post-launch annual income 12 months Launch6 months Become the No.2 Portal take listings and income drive awareness & traffic
Agents’MUTUAL Funding and financials £21M+ annual income 3000+ offices First year 3000+ offices 1850+ offices One year to Launch £35M+ annual income Become a credible alternative to the No.1 Portal Match cost base and capability Undercut prices 6 months