Crowdsourced leasing database CompStak launched a new on-demand service, signaling a major shift in strategy aimed at winning over more customers and catching up with rival CoStar.
According to co-founder Michael Mandel, the new offering is meant to address a major issue for the firm: the high price of subscribing has scared off smaller real estate companies.
CompStak, which allows users to upload and look at leasing comps online, relies on a corporate subscription model for its revenue. In return for annual fees averaging $35,000, companies gain access to the entire database. More than 50 firms, including the likes of Wells Fargo, Tishman Speyer and Carlyle Group, have subscribed, Mandel said. But he added that smaller companies that may only need comps for a single property have been reluctant to cough up the hefty annual fee.
The new on-demand service allows firms to pay for individual comps on a one-off basis. This, Mandel hopes, will open up a “whole world of real estate investors and lenders where our product hasn’t made sense for them before.”
CompStak, founded in 2011 by Grubb & Ellis veteran Mandel and Vadim Belobrovka, has grown rapidly over the past years, raising $14.4 million in venture funding.
The firm challenges the dominance of commercial real estate data firm CoStar, which last year reacted with a lawsuit. In April 2014, CoStar sued a number of anonymous CompStak users for copyright infringement, claiming they had uploaded proprietary CoStar data onto CompStak’s platform. Although CompStak was not a defendant, the suit forced it to hand over the identities of the accused users. CoStar subsequently dropped its suit.