The New York Stock Exchange

© lucky-photographer - iStock Editorial/Getty Images Plus

Compass Files for IPO as Revenue Surges

March 2, 2021

A booming housing market led the tech-powered real estate brokerage Compass to announce on Monday that it’s going public through an IPO.

Compass reported a 56% growth in revenue over the last year. Compass has benefited from venture capital money fueling its rapid growth in the residential real estate business. Its revenue grew to $3.72 billion last year compared to $2.39 billion in 2019. Compass’ net loss declined to $270.2 million from $388 million a year earlier.

When the pandemic initially came to the U.S. last spring, Compass—like other real estate firms—braced for a downturn. Compass cut its staff by 15% in March 2020, but real estate rebounded quickly in the second half of the year.

Compass’ total transactions rose 66% in 2020, despite the pandemic, according to the brokerage’s IPO filing.

Compass has been backed by SoftBank Group Corp. It was last valued at about $6.4 billion in a 2019 financing round led by SoftBank’s Vision Fund, CNBC reports. The SoftBank Vision Fund also has invested in other quickly rising firms, including iBuying giant OpenDoor and co-working office firm WeWork. OpenDoor went public in 2020, and its net worth has since grown to more than $17 billion. SoftBank owns 35% of Compass’s Class A shares, CNBC reports. Other investors in Compass include Goldman Sachs, Canada Pension Plan Investment Board, and Dragoneer Investment Group.

Compass has raised $1.5 billion so far, Reuters reports.

Founded in 2012, Compass has grown to more than 19,000 real estate professionals across 46 metro areas.