‘Playmakers’: Opendoor ‘crushing it’ on key metrics, CEO says 

Editor's note: The Playmakers podcast explores the biggest shifts in real estate with those who are shaping the industry's future. Check out our top takeaways and watch the latest episode from host Andrew Flachner, co-founder of RealScout.

The views, thoughts and opinions expressed in the Playmakers podcast belong solely to the podcast creators and guests.

On this episode of the Playmakers podcast, Kaz Nejatian explains what he thinks Opendoor was getting wrong before he joined as CEO last fall — and what he's doing now to right the ship.

The company's first mistake, according to Nejatian, was becoming so risk averse that it had to look for profit margins elsewhere. The second, he said, was waiting out a persistently slow housing market while retaining its faulty strategy — and "warehousing" purchased homes in the meantime.

"We took every wrong lesson we could," he said.

And now? "We're not perfect; we have flaws like everyone else," said the former Shopify exec, who earlier this month declared that going "faster" is Opendoor's "moral imperative."

"Our revenue is up, our tax rates are up, our margins have gone up every single month since September. Under actual metrics that matter, the company is doing well."

Going all in on 'founder mode': Many startups shift from "founder mode" — which emphasizes rapid growth and experimentation — to a more operationally focused "manager mode" once they become established. But Nejatian embraces the "founder" philosophy. "I am accountable for outcomes, not processes," he said, adding that he doesn't "care at all about org charts" or "about feelings," but does "care about truth."

Under his leadership, Opendoor "has become a place that not everyone would want to work at," he acknowledged. "But there's some subset of people who think this mission is a worthwhile mission, who are willing to have their careers define them. I think those people are finding Opendoor to be an incredibly rewarding place to work."

Fewer people — and more AI: Prior to Nejatian's tenure, Opendoor was a company with "quite a bit of specialization" among its employees — a culture that he said "handcuffed" the iBuyer. Now, Opendoor has transitioned from having 11 people working on a transaction to just one, a staffing shift hinted at last fall by Co-founder Keith Rabois.

At this stage, "most of the work inside Opendoor now is being done by AI," said Nejatian, who was first introduced at Opendoor as "the right leader for the AI era." But Nejatian doesn't view the rise of new tech with a doom-and-gloom perspective.

"I'm actually an AI maximalist," he said. "I think AI will increase employment. I think we'll have more jobs because of AI — and far fewer people working jobs that they truly hate — because toil is the enemy."

Introducing 'Cash Now, More Later': On May 19, Opendoor announced a new partnership with RealScout, the client collaboration platform co-founded by Playmakers host Andrew Flachner. Through the partnership, the iBuyer's Cash Now, More Later product can appear in an agent's existing workflow — and those who bring a seller to Opendoor will earn a bonus commission of 1% or 2%.

"We believe with this tool at their hands, agents will get a significantly higher number of listings," Nejatian said.

Opendoor was previously "bad at understanding the workflows that agents use for their day-to-day job," he noted. Moving forward, "we want to embed our products" in those workflows, he added.

Ignoring stock price fluctuations: Opendoor's stock price drew considerable attention last year, first dropping below $1 for long enough to receive a delisting warning from Nasdaq, then veering into "meme stock" territory in July, which ended the delisting threat. Around the same time, activist investors demanded the ouster of ex-CEO Carrie Wheeler, who resigned soon after.

"Our stock has been up 5% one day or 5% down the other day. We don't get smarter by 5% that day, and we don't get dumber 5% the next day," Nejatian said.

Instead of focusing on those shifts, he prioritizes long-term value. "I have the luxury of caring about the actual numbers that will matter a year from now, rather than the numbers that appear like they matter because I'm trying to raise money. And on those metrics the company is crushing it."

Operating 'on a weekly cadence': The quarterly financial reporting schedule — which may be changing soon, if a new SEC proposal is enacted — is also problematic in Nejatian's view because "a quarter is not long enough to understand change, and it's too long for anything to get done."

"Opendoor's heart beats on a weekly cadence. We ship every week, we review every week, we decide every week, we measure ourselves on a weekly basis, and every week we'll feel fresh."