As national brokerages continue along the path of consolidation, will locally-owned indies be able to compete? Or is acquisition the way of the future?
Mike Deasy and George Penner — chairman and CEO, respectively, of boutique firm DPP — say: Indies can absolutely continue to have a competitive advantage. Their own indie has been a leader in the Los Angeles market for years. And with an unprecedented partnership in place, they expect their market share to continue to grow.
The value of independence
Since founding Deasy Penner and Partners in 2005, which would become Deasy Penner Podley after the acquisition of Podley Properties in 2018, Deasy and Penner have leveraged their “home as art” ethos to become the premier firm for architectural homes, estates, and properties of historical significance in the greater Los Angeles area. Their commitment to agent satisfaction has bolstered the company with 300 service-driven partner agents, extending its reach from Malibu all the way to Palm Springs to become one of the largest independent brokerages in Southern California.
Needless to say, Deasy and Penner have received quite a few offers to cash out to a national chain. And while the two owners did think carefully about those offers, they steadfastly declined every single one.
“We’ve always wanted to be a small, boutique firm,” said Penner. “We’re a family. We want our agents to be able to call us on the weekends and actually reach us. We want to continue to be entrenched in our communities. We wanted to be able to shape our own future. And we knew that to be able to continue doing all that, we had to stay independent.”
But running a fully independent brokerage brought its share of challenges — most significantly with respect to technology.
Keeping up with the changing tech landscape as an indie
As an indie firm, Deasy Penner Podley couldn’t dedicate the same resources to researching and developing new technologies for agents as their national, one-size-fits-all competitors.
“It’s been hard for a boutique firm like ours to keep up with the immense growth of the technology landscape,” said Deasy. “We have used third-party vendors to accommodate the various needs, we have our own IT department, but still it was difficult to compete.”
This is not to say the firm was analog; far from it. Deasy Penner Podley actually won the “Most Innovative Brokerage” award from LeadingRE in 2020 in recognition of plumBid, the firm’s patent-pending online bidding engine for real estate. But when it came to powering their agents with the tech tools they needed to go head to head with their competitors at other brokerages, Deasy Penner Podley was struggling.
During the pandemic, when agents were thrust into the world of remote working, the tech gap became harder to look past. Sherry Carr, an agent in Sierra Madre, decided she needed to move to a brokerage that could offer her stronger tools and an enhanced digital presence.
“It was heartbreaking,” said Carr. “I loved it at Deasy Penner Podley. There aren’t many brokerages where you can bring one of the owners with you on a listing presentation.”
Her new brokerage, a franchise office of a national chain, had the tech she was looking for but none of the cultural benefits of her Deasy Penner Podley experience.
“I missed the camaraderie,” said Carr. “I missed loving the office I’m in and the company itself. I missed feeling like I was really a part of my community, which is something Mike and George care deeply about.”
Ultimately, Carr didn’t stay away for long. Because Deasy and Penner, recognizing that their agents deserved the best technology on the market, set a plan into motion.
Said Carr: “A few months after I left, I heard through the grapevine that there might be a partnership between Deasy Penner Podley and Side. So I said, yes! It’s time to go back.”
Choosing to bring on a trusted partner in Side
On September 14, 2021, Deasy Penner Podley rebranded to DPP and inked a groundbreaking partnership with Side, a Silicon Valley-based technology company that offers a comprehensive real estate brokerage-as-a-service platform. Through the partnership — Side’s largest to date — DPP agents receive access to Side’s proprietary tech stack that saves the typical agent 62 days per year on average.
It’s critical to understand that DPP did not sell to Side; DPP partnered with Side. One of Side’s main goals is to help indies stay indie. So while Side has taken on the liability as broker-of-record, Deasy and Penner retain ownership of the DPP brand and maintain full control over how the business operates.
“We are doubling down on independence,” said Penner. “With Side, we are at the forefront of technology. And that is paramount for our business and the success of our agents.”
Side’s proprietary technology was a key draw, but what sweetened the deal was the long list of other services Side offers that would remove free up time in Deasy and Penner’s schedules. In addition to the tech suite, DPP now receives business management coaching, growth marketing strategies, legal coverage, a dedicated recruiting team, and more from Side.
“Side provides the horsepower, the backend engine for us to break off and focus on what we excel at,” said George. “And that’s maintaining this community.”
The business management service is key to the Side offering. Founders like Deasy and Penner work 1:1 with a dedicated business manager who helps them develop a plan to meet their business’ unique goals.
“It wasn’t just the technology that attracted us to Side,” Deasy reiterated. “They have the mechanisms and metrics available to help us take a deep look at our business and plan for growth more efficiently. As owners of a smaller firm, being so involved with our agents and community, we didn’t always have the time for that kind of long-range planning.”
“Side dug in from the ground floor and picked apart every single piece of our business, from our marketing, to how we transact, to training, to business strategy,” said George. “And they didn’t just provide insights and recommendations — they also took some of the components of the business we already had in place and helped us evolve them to make them even better.”
A bright future awaits
With this partnership, DPP is able to maintain its independence, protect its culture, offer its agents top-tier technology, and evolve its strategy — and agents are thrilled.
“It’s a win-win for everybody,” said Juan Longfellow, partner at DPP. “It’s still the same company; it’s still just Mike and George. But now we have the added benefit of having a company like Side to bring out the best in what we’re already doing.”
Sherry, who is thrilled to be back with DPP, agrees. “With this partnership, DPP is ahead of the curve. With the technology Side is providing, I’m going to have more time to spend on what I do best: helping my clients.”
DPP is the largest firm to partner with Side to date; up until this point, Side has partnered exclusively with top-producing solo agents, teams and smaller independent brokerages to transform them into boutique brands. But Penner suspects more large-scale partnerships are on the horizon.
“As owners of an independent brokerage, we want our hands in everything — but there’s only so much time in a day,” he said. “But if we also have the resources, the spine that can really translate those strategies into action and momentum, that helps us propel so much further. That’s what Side brings to the table. I truly think any firm our size would benefit from a strategic partnership like this. We’re personally really excited to see how we take this partnership to the moon in the next few years.”
For more information on partnering with Side, visit sideinc.com.