Commercial real estate data startup CREXi is eyeing a future public offering as it staffs up while continuing to battle it out in court with industry juggernaut CoStar Group.
CREXi recently hired its first chief financial officer and chief legal officer and intends to double its headcount over the next 12 months, said founder and CEO Michael DeGiorgio.
“We have ambitions to be a big company,” DeGiorgio said. “And a public company in the next three to five years. And with that kind of growth comes the need for operational expertise.”
DeGiorgio declined to provide earnings figures; the firm has raised a total of $54 million across four rounds since 2016, according to Crunchbase. Its investors include New York City-focused Prudence Holdings, Mitsubishi Estate, Industry Ventures and Jackson Square Ventures. CREXi last raised $30 million in equity in a Series B round that closed in summer 2019; it wasn’t publicly announced until early 2020.
Founded in 2015, the Los Angeles-based company now has 185 employees and 1.6 million users. Even if it doubles headcount, CREXi’s gains would still be modest in comparison to CoStar, which has almost 4,700 employees and reported $480 million revenue last quarter.
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Back in court: CoStar sues rival over “massive” copyright infringement
But CREXi has gotten its rival’s attention. Last September, CoStar sued, alleging CREXi built its business off of stolen data from the larger firm. CoStar said CREXI employees engaged in “flagrant and widespread” copyright infringement. CREXi has denied the charges and countered sued in June. The cases are ongoing.
CREXi is also looking ahead. Its new CFO, Tim Laehy, is a Silicon Valley veteran. He held the same position at social web platform Livefyre in the runup to its 2016 acquisition by Adobe, and served as Coinbase’s first interim CFO for a year starting in 2017.
Laehy began working at CREXi in July; he and DeGiorgio had bonded over a shared interest in cryptocurrency, Leahy said. The CFO’s main task is to prepare the company’s books and internal controls for a public offering to draw institutional investors, he said. That will involve bolstering its finance teams and eventually staging mock earnings calls.
“Quite frankly, I think this could be bigger than Coinbase,” he said.
Kris Cheh Beck officially joined CREXi as its chief legal officer in January. She was the chief legal officer at boutique wealth manager United Capital Financial Advisers, which Goldman Sach bought for $750 million in 2019.
Part of her job will be handling the CoStar lawsuit.
At the time it filed the suit, CoStar CEO Andy Florance told Bisnow the case against CREXi was “actually larger than the copyright infringement we had with Xceligent.” That sordid legal saga ended with the rival declaring Chapter 7 bankruptcy and shutting down in 2017.
The two hires follow CREXi’s launch of several new products, including a mobile app released and a database subscription.