Jarred Kessler, a 15-year Wall Street veteran and former head of US equities at financial services firm Cantor Fitzgerald, came up with his big idea when a friend lost his job.
His friend was in a tough spot and thought about putting his house on the market, but didn’t want the associated “public scrutiny” of a “For Sale” sign on his lawn or neighbours talking.
He wanted to keep it discreet, and he wanted to know the value of his home in case he needed to sell. He wanted to test the market without being in the market, Kessler told Business Insider.
Kessler realised that no other services currently on the market offered potential sellers a chance to quietly assess the value of their homes. Then, trouble with regulators at his Wall Street job pushed him to leave Cantor and create one.
EasyKnock is a residential real estate technology startup on a mission to change the process of listing and selling one’s home. It should be up and running by February.
“What’s going on in the real estate market is what happened 35 years ago on Wall Street,” Kessler told Business Insider. “People said this is how business is done, things are never going to change.”
“I think finance is in the seventh inning,” he said, “and the residential real estate market is still in the first inning.”
People normally turn to a professional real estate broker to list their homes, and the broker’s goals aren’t always aligned with the seller, according to Kessler.
“Once the pressure is on, the buyer, seller and broker will all have competing agendas, and it’s hard to know if you are getting the right price, or just the ‘right now’ price,” the EasyKnock website reads.
He aims to connect buyers and owners directly and create a platform that’s broker-free. “We think there’s a place for empowering people to do it themselves,” said Kessler to Business Insider. “We don’t see it as a matter of if but a matter of when. And we want to be the first to do it.”
The direct sales platform pulls in real-time market data on homes that are both listed and not yet listed. On the site, homeowners can set a price and “test the waters,” and buyers can potentially gain access to a large number of homes that are not currently on the market, “but might be if the price was right.”
“We think because of obstacles like public scrutiny and days on the market, a lot of people would love to know if people are interested in their houses but don’t want to go all into the commitment,” said Kessler. “So we started with the question: what would compel you to sell your house?”
EasyKnock takes buyers though an intent-based search, or a series of tailored questions to match them with their dream houses. If a buyer and seller connect, EasyKnock aims to streamline the process by providing third party referrals of surveyors, inspectors, mortgage advisors and lawyers. Kessler says buyers are vetted and that there is a “policing process” where bad actors are kicked out.
Kessler resigned from his position as head of US equities at Cantor Fitzgerald in December 2015 after the firm faced allegations over the sale of unregistered microcap stocks. The brokerage industry’s regulator, Finra, said he had failed to set up a system of properly overseeing the sales in his role there. He settled the case without admission of guilt, and was fined and subject to a principal capacity suspension.
Although he had come up with the idea of EasyKnock while he was still at Cantor, he doesn’t know if he would have otherwise left to pursue this opportunity. Kessler previously served as an executive director in global credit strategy at Credit Suisse, head of credit focused equities at Morgan Stanley and a VP in risk and portfolio management at Goldman Sachs.
“I left the firm because I felt like that the regulatory and technology environment was impacting the promise of business and that it’s harder to make money in finance,” he said.
Kessler and co-founder Ben Black have raised an angel round and are in the process of closing a seed round. EasyKnock will charge a transaction fee in the range of 1.5-2.5%, third party referrals fees and advertising fees. The duo aim to pilot the app in New York, starting in Long Island in June.