Composable Brokerage

The shape of the product is the product.

People ask what we sell, and the easy answer — that we sell homes — is not quite right. Plenty of companies sell homes. What we sell is the service of buying or selling one. And the shape of that service — the way it is structured, priced, and assembled for a customer — is, in our view, the most consequential thing we are building. This letter is about that service. About what, exactly, you are paying for when you choose to work with us. About a category we have come to call composable brokerage service.

The observation came first from our co-founder Monica, who has worked as a licensed agent for years. She put it on the table simply: real estate, as an industry, has been doing the same thing in the same way for a hundred years — and the thing it has been doing is not the thing it should have been doing.

Imagine you walk into a restaurant. They serve a set menu — one fixed sequence of dishes, no substitutions. You sit down, the food arrives, and one of the dishes is something you happen to be allergic to. So you get up and try the restaurant across the street. The cuisine at the second place is, you discover, genuinely excellent. But its set menu includes a dish you cannot stand. You sit there picking around the plate, wondering why nobody in the entire history of restaurants has thought to let you choose what gets brought to the table.

For a long time, people have framed this experience as a feature of real estate itself — as if the set menu were inherent to the cuisine, inseparable from the thing being served. We do not think this is true. The cuisine is fine. It is the restaurant that has been wrong.

For a century, real estate brokerage has been that restaurant.

You hire a broker, and what you get is everything-or-nothing. The listing. The search. The showings. The pricing call. The negotiation. The paperwork. The closing. The handholding through inspection. The phone call when the mortgage hits a snag at 4pm on a Friday. All of it, bundled, paid for via a single number — a percentage of the transaction. Six percent. Five. Two. The numbers have drifted around over the decades, but the architecture has not. It is one product, sold one way, priced one way.

Notice that other industries did not stay this way. Telecom unbundled. Banking unbundled. Travel unbundled. Software unbundled twice — once to SaaS, then again to per-API-call. Airlines, who took the longest, eventually unbundled the experience down to the seat, the bag, the meal, and the priority boarding. The set menu got replaced, in industry after industry, by a menu of services, each priced separately, each chosen by the customer based on what they actually wanted.

Real estate, alone among large consumer industries, stayed on the set menu. The percentage got renegotiated. The features around the edges got a polish. The brokerages rebranded. But the structure remained.

The arbitrary constraint

Why? The question is worth a paragraph or two, because the answer is interesting, and it tells you what we believe is now changing.

Real estate brokerage is, viewed honestly, an optimization problem. The customer wants the best home for the best price, with the least friction, at the lowest total cost in fees and time. The broker wants to deliver that outcome efficiently and earn a fair margin for the work. Somewhere in the space of possible service designs, there is a global optimum — an arrangement that produces the best result for both sides at the best total cost.

For the entire history of the industry, the search for that optimum has been conducted under a constraint: service must be bundled, and priced as a percentage of the transaction. That constraint has been treated as a law of nature. It is, in fact, a choice. It was a reasonable choice in 1925, or in 1965 — when every step in a real estate transaction required a human being, when human time was expensive, when bundling was the only practical way to deliver complex multi-step service at scale, and when a percentage commission was the only pricing model that didn’t bankrupt the broker on a slow month. Like every arbitrary constraint in an optimization problem, however, it kept the industry stuck on a local optimum — the best answer reachable under that one limitation, not the best answer reachable in the wider space.

Remove the constraint, and the solution space opens up.

The constraint is removable now. It was not removable in 1965 — in fact, it was not removable in any year B.C. (Before ChatGPT) — because the constraint was always really about cost: the cost of running a custom, unbundled service for every customer. When the only available labor is human, you cannot run a thousand bespoke service combinations simultaneously; you have to bundle, and you have to price the bundle as a fraction of the deal, because that is the only arithmetic that closes. AI changes the arithmetic. A system that can serve a thousand customers simultaneously, each with a different combination of services, does not need to bundle. It does not need to charge a percentage. It can offer an actual menu, with actual line items, at actual prices, and execute every combination cleanly.

This is what composable brokerage service means. You choose the services you actually want. You pay for the services you actually use. The repeat investor who needs only legal-and-paperwork backstop pays one price. The first-time buyer who wants full guidance from search through closing pays another. The seller who wants a quiet, fast off-market transaction pays a third. The buyer who wants AI for research and comps but a human broker at the negotiating table pays a fourth. Each row on the menu is a real product, priced honestly for what it is. The percentage is gone. The set menu is gone. The constraint is gone.

We think, for the first time in the hundred-year history of this industry, the global optimum is reachable. Not because we are smarter than the people who came before us. They were, by and large, excellent practitioners. They were simply working under a constraint we are now in a position to remove.

That, in the end, is what we sell. A real estate transaction, à la carte. Pay for what you use. Get what you need. The shape of the product is the product.

— The Rockhood team