The company helps owners of single-family properties sell their assets without a broker. The firm plans to introduce an apartment-finding model by year end.

REC is aware of the existing competition from Buy-Owner, cHome.com, Homeadvisor.com, Owners.com, HomeStore.com and several other established online FSBO services. But Michael J. Gerrity, REC's founder and chairman, welcomes the challenge.

"We have created very unfair and sustainable competitive advantages over others and will continue to form additional barriers to entry with exclusive strategic partnerships and distribution channels," Gerrity tells GlobeSt.com.

Additionally, he notes, "most real estate websites are trying to convert an old brokerage-based legacy business model into a new Internet and consumer-empowered business space."

REC's business model, however, "was specifically written for the digital convergence and upcoming broadband space," Gerrity says.

The listing fee on the REC system for an owner ranges from $350 to $750 for six months. The fee includes yard signs, local school and community content around the property and the IPIX virtual tours inside the home.

The firm is initially seeking $2.7 million in the first round of equity financing. Within the first two years of operation, Gerrity and his associates will be looking for an additional $30 million to continue the firm's national rollout plans of penetrating at least 25 additional dominant market areas.

The company's exit strategy will be an initial public offering within 36 months to fund the final phase of national expansion into a total 70 markets. The exit strategy will also allow REC "to fully deploy our proprietary digital and bi-directional broadband television channel for terrestrial cable and wireless platforms," Gerrity says.

The 37-year-old entrepreneur, who has headed his own full-service commercial real estate brokerage house in Orlando for the past 11 years, is confident REC's growth strategy will work.

"Our IPO will be well-timed for Wall Street's peaking interest in digital convergence infrastructure and content plays within this timeframe," Gerrity tells GlobeSt.com.

He projects revenue in the first year to approach $1.5 million, scaling to over $500 million by the end of the fifth year of operation. At that time, the business should be generating an after-tax profit of 17.5%.

Besides himself, the company's directors are Robert Long, a 12-year board member of Sun Microsystems and Tom Huber, president of Fiserv CBS Worldwide.

Among REC'scurrent strategic media partners and distribution channels are Time Warner Communications/Road Runner, Tribune Interactive/Orlando Sentinel.com, PaxTV, MPInet, Barnie;s Coffee & Tea Co. and Clear Channel Communications of Florida.

Instant Insights /

New Dot.Com Firm Takes on the Competition in the Servicing For-Sale-By-Owners Arena

Related Stories

Recommended For You