Q&A With Stephen King from REX
1. What makes you believe a global listing marketplace is needed?
Real estate has traditionally been a local business. However, the world is quickly globalizing. Citizens in developing countries are migrating to cities as an astounding rate. Technology is providing a new subset of jobs to these migrants increasing their overall economic standing. China alone will have 76% of their population considered middle class by 2022. India will expand their middle class from 127 million in 2017 to 567 million by 2025. The combination of wealth, transportation and remote access will redefine where and how people purchase real estate. In order to cater to a global demand, there needs to be a global standard for data. One database (or IDX like environment) where people can access data in any market in the world.
Today (2017), real estate data is fragmented over 1,000’s of MLS’ in the United States alone. On a global scale, it’s even more splintered. If you’re a Chinese citizen looking to purchase an investment property in New York, you have two options:
- Research the local local databases and pay the subscription fees (if they allow non-broker signup)
- Blindly hire an agent (most investors like to do their own due diligence before hiring a broker)
This proves inefficient and inconvenient.
Let me take a step back, focusing on how we got here:
Before the internet, data was distributed from the content provider (the few) to the consumer (the many). Then, in the 1990’s, the internet was introduced. The internet represented a new communication tool that could decentralize traditional content distribution. Although HTTP has been a net positive for society, the economic benefits have been asymmetrical. We (the user) provide the value, albeit a Facebook post or real estate listing but the financial beneficiaries are the gatekeepers (Zuck and the other head honchos).
The MLS is a superb example of asymmetric benefits. They are comprised of prodigious databases that silo data and dictate price.
Agents and firms are tired of paying exorbitant fees for poor service with no ability to control the communication flow.
Now, the centralized distribution model has proved a phenomenal business to the server owners, leaving the user the choice to pay or sucede. Individuals worldwide have developed new systems to combat price but ostensibly fail due to the circuitous cycle of the business model. However, data dissemination is at an inflection point: Ethereum and IPFS redefine the communication channel.
Here is what I mean on a basic level:
I decide to send you an email from my gmail browser. Using HTTP, the data is sent from my browser to Gmail’s server then to your browser. We could be standing right next to each other but that email is still going to be routed hundreds of miles away then back to where we’re standing. IPFS says, let’s send that same email from my phone to your phone (the shortest route). Why have the middleman?
Welcome to the future. Without a middleman, the user can maintain ownership of their data. This cuts cost exponentially. REX is applying this technology to real estate listings and transactions. The listee maintains ownership of their listing, can monetize their data and has exposure to a global pool of buyers and sellers.
2. Can you explain your token currency in more detail, and how you see it working for listing agents?
REX has four distinct phases:
- Global MLS
- Filtration & MLS Curation (machine learning/crowdsourcing data)
- Tokenized Ownership
I will focus on Phase 1 & 2:
First, to scale and incentivise global participation, REX distributes listing rewards in the form of REX tokens. The listing rewards are distributed to verified users for each listing they upload to the database. The REX token can be utilized to access specific features on the platform (market sponsorships, listing promotions, data exchange) or they can transfer to an exchange and sold for other cryptographic tokens or FIAT.
Second, REX tokens are utilized for spam or what we call the Listing Spam Reducer (LSR): Each listee is required to post “x” REX ($.10-$.20 cents worth) per listing to reduce mass data dumps to the platform. If the listee is not submitting spam, they will receive the Listing Reward offsetting the LSR fee.
Third, REX tokens are used for data exchange and advertising: Users can exchange data (custom market reports, inspections, property history) or offer third party advertising using the REX token as the medium of exchange. Since the user owns their listing page and data, they can monetize as they see fit.
Fourth, REX tokens handle payments on Curation Feeds: Users have the ability to create custom curation feeds (spam/comparable property) from REX’s raw database and accrue a following. If the user gains a large enough following, they can monetize their feed through promotion and advertising. REX crowdsources local data and the contributors are rewarded. The REX token acts as a medium of exchange between users.
By default, when a user signs up for REX they are subscribed to REX’s spam feed. Local users may feel they can do a better job weeding out spam listings in their city or geographic region. Therefore, they can create a custom spam or comparable property feeds. Now users have the choice to select the users feed or REX’s default feed for that region. As the user gains a following, they can monetize their feed by offering their followers listing promotions and advertising.
Fifth, the REX token is utilized to create broker profiles and market sponsorships. Users pay REX tokens to establish professional broker profiles that are searchable in the database and to sponsor markets around the world (ie New York City). REX tokens collected through Broker Profiles/Market Sponsorships will be redistributed into the listing rewards contract.
3. What’s your strategy to build a critical mass of listing inventory? Are you targeting specific cities or countries?
We are focused on the US and Australia to start. First, we identified and mapped REX’s two types of users:
- Individual (broker, mom/pop buyer & seller, investor)
Both have different pain points. The individual is impeded by cost and listing exposure while the firm struggles with data interoperability and transaction efficiency.
For the individual, cost decreases from an average $35/listing to $0.10 – $0.20/per listing. The individual is also fully in control of their data and leads. In addition, we’ve implemented bounty and reward programs to incentivize scaling.
For the firm, we’re offering hardware pre-installed with a REX/IPFS/Ethereum node. This will provide the firm global access to download any market in the world with low latency. We will customize their interface with their name and logo. In essence, they have their own MLS. You can kind of think of it like the intranet in the early days with outside access to internet. We’re in the midst of assembling global partnership participation.
4. What’s the differentiator for buyers? Why would they use your site instead of one of the many alternatives?
First, it’s important to understand what we’re building. We’re building an engine (think of it as an IDX) that will accumulate raw data by enticing those that contribute. Second, we’re laying an application layer on top of the engine (mls) so that users can interact with the engine. The mls comes equipped with tools that allow the user to own all their interaction with the engine. Third, we’re providing transaction software that will (over time) reduce time and cost through the use of cryptographic transactions.
Why would a buyer want access to this engine? Access. Why does a buyer visit any online MLS? Data, selection and a good user experience. Through partnerships, incentive programs, bounties and user experience, REX will offer these traits. Users will have the ability to participate in the benefits offered by the blockchain and digital assets without even knowing they are doing so.
We recently traveled to China, the US and Australia. We spoke to buyers and investors from both the commercial and residential sector. The number one complaint was access, the number two was data relevancy (spam/expired listings).
Access is tackled through data distribution and ownership and relevance is covered through local support or the curation feeds listed above.
5. What’s the next step for REX? What do you need help with?
We recently attended RECon in Las Vegas and AREC in Australia. The response from the real estate community was humbling. We’re focused on educating the real estate industry on the technology and platform.
Over the next month, we’re temporarily shifting focus to releasing our pre-alpha and token sale (late July). Subsequent to the token sale we will expand the team and look to hire global REX Ambassadors. Global REX Ambassadors will receive REX bounties for marketing/signing up users in their local markets.
We will test and market through December then go live on the main chain in December/January.
REX is a global effort. We want to include anyone and everyone who believes in the mission of decentralizing real estate data so industry at large can become more efficient.