When VTS merged with Hightower in November 2016, two fierce competitors became one. But VTS’ co-founder Nick Romito dismissed the suggestion that his company, which runs an online commercial lease and portfolio management platform, emerged as a monopoly.
“We have many competitors, so definitely there’s no monopoly for us,” he said. “Our biggest competitor, still today, is Excel.”
Romito sat down with The Real Deal to dish on his father’s boxing days, his own rise from broker to entrepreneur, and the tech industry’s obsession with venture funding.
“Business is there to make money,” he said. “In the modern, startup-y world people lose that. They think raising money is the successful part — it’s not. You’re borrowing money or diluting yourselves.”
He added that the valuations of real estate startups would always be questioned as long as they are being compared to tech companies.
“Compass is a brokerage firm. WeWork is effectively a landlord. They’re getting the multiple of a very high-margin tech company,” he said. “I wish I had their multiple.”
Asked about his own plans for an IPO, Romito said his team hasn’t made a decision yet.
“There are companies that are public today, like Altus/Argus or CoStar, that maybe shouldn’t be public companies if you break them down a little bit,” he said. “So I think we’re still kind of looking at all of our options over the next couple of years.”
Romito said he envisions VTS ultimately replacing the traditional office lease with a transaction that can be done online, on its platform. “That is 1,000 percent where our platform goes over time,” he said.
Romito also chimed in on CoStar, which emerged in a dominant position in the real estate data business after its rival Xceligent filed for bankruptcy late last year.
“Are they invincible? The answer is no. Nobody is. We all loved Blackberry for along time. We all probably BBMed our friends every single day,” he said. “I don’t know how many people you BBM on a daily basis, but probably not many.”
Video produced by Jhila Farzaneh and Ben Heitmann