As a real estate agent, you may consider working with List With Clever to get free buyer and seller leads.
You only have to pay when you close a property sale, which sounds great at first glance.
However, you must be ready to say goodbye to the traditional commission model.
From the consumer side, it isn’t all 100% positive either. Well, nothing is perfect.
To assess List With Clever with a focus on its use for real estate agents, I wrote today’s article, covering:
- An introduction to Clever Real Estate (its owners, workings, and business model)
- The benefits and what it offers
- List With Clever alternatives
- The pros and cons from agents’ and consumers’ perspectives
- Final thoughts on whether you should use it
Intrigued? Then please keep reading…
Introduction to Clever Real Estate: Owners, Operations, and Business Model
Before delving into the details of List With Clever’s various benefits and features, let’s start with a brief introduction to the basics.
What is Clever Real Estate and Who Owns It?
Clever Real Estate is a discount real estate broker providing referral leads for agents.
I have already analyzed various providers of this kind in this article, by the way.
Do you hear the term “discount real estate broker” for the first time?
It refers to a real estate broker focusing on the internet to connect sellers with agents open to accepting lower commission rates, promising the agents a higher volume of leads in return.
The added value for the real estate agent is that they do not have to focus on lead generation.
As a result, they can offer a discounted commission rate by returning the savings on marketing and lead generation costs (I will crunch these numbers later).
On the buyer and seller side, the US-based online real estate platform helps reduce transaction costs, such as real estate commissions.
List With Clever was founded in 2017 and is headquartered in St. Louis, Missouri (source).
So from a business standpoint, the company could still be considered a startup.
Since List With Clever isn’t a bootstrapped firm by the owners, it doesn’t have a single or a small handful of owners.
Instead, several investors, venture capital firms, and angel investors own it. The lead investor is Cultivation Capital (source).
The founder and CEO, Ben Mizes, has experience in the real estate industry running a real estate brokerage.
Since its inception, List With Clever has raised several million dollars.
How Does Clever Real Estate Work and Make Money? (Its Business Model)
Regarding its business model, we can analyze List With Clever based on the business model canvas that I already used in my article about ExP’s business model here.
You can quickly learn that List With Clever is a typical two-sided platform, like dating platforms.
You need at least two types of users that, when using the platform, provide value to each other.
The challenge of these platforms is a bit like the chicken and egg problem.
Without one group of users, you don’t attract the other and vice versa.
Below, I have included an overview graphic showing its business model.
Not all areas can be filled out for obvious reasons since only a real insider would know about them.
In the graphic above, the information is split into two.
In some areas, I could add information publicly available or deduced by logic, and in others, my best guesses.
Regarding how List With Clever makes money, they get referral fees from their agents when a property closes.
It works like this for buyers:
When a buyer finds the List With Clever website, they can hover over the menu item “Buying a Home” in the top navigation bar and click “Get Started.”
They then need to go through a multi-step questionnaire and, as a last step, a contact form to become pre-qualified buyer leads.
After that, the relevant agent for their needs, requirements, and location will be matched.
The process is similar for potential real estate seller leads.
They hover over the top menu item “Home Selling,” click on “Get Started,” and go through the same multi-step process to convert into pre-qualified seller leads.
At first, I was a bit confused that it doesn’t matter if you click “Get Started” from the seller or buyer menu.
You will always be asked if you want to sell or buy.
However, it makes sense that some sellers or buyers may spontaneously do the opposite.
If this were not the case, the menu would lack consistency from a UX perspective.
Is Clever a Reputable Company? (Reviews from Past Users)
List With Clever or Clever Inc. is a reputable company that can be proven from various angles.
It has a top A+ rating on the Better Business Bureau website and also five out of five stars from customer reviews on the same website.
Although not that reliable regarding information quality (everyone can leave a review without being vetted), on Trustpilot, it also gets an excellent rating with 4.9 out of 5 stars (source).
List With Clever has also been indirectly featured on CNBC via its educational platform Real Estate Witch (source).
I consider the Better Business Bureau rating to have the most weight. Since it’s positive, you can assume List With Clever is a reputable company.
Assessing the Benefits of List With Clever: What Does it Offer?
From the above, we learned that List With Clever offers real estate leads paid at closing for real estate professionals and professional help to buy or sell properties at a discounted commission rate for buyers and sellers.
Do Sellers Really Save Money With That?
To answer this question, let’s dig deeper into the promised savings of List With Clever and discount real estate brokers.
According to List With Clever’s promise on their homepage, for a house up to $350,000, the total commission (1.5%) would be $5,250 in savings.
In contrast, the traditional commission amount would be $21,000 (6%).
Several articles have already discussed whether the savings of discount real estate brokers are valid.
In this article from IsSoldMyHouse.com, it reads as follows:
“…some discount models rely on the volume of houses they sell to make money, resulting in services that may not be quite as robust or beneficial as what you might get if you pay an agent the full commission rate.
You also might not get as much hand-holding either, and that’s important if you don’t know what to expect when selling a house.”
Or in this one from Homelight, it cites top-performing agent Robert Dombrowsky as follows:
“Homeowners that go with a traditional brokerage model tend to make more money on their homes. You can save a percent and lose five percent because you didn’t negotiate well and you didn’t get as many bids as you could have gotten on your property.”
The article continues with:
“Some discount brokerages may charge hidden fees, or they sell their services à la carte, which can add up and chip away at your expected commission savings. Additionally, if you pay a flat fee or minimum commission, you may end up paying more.”
This Washington Post article mentions similar arguments about discount real estate brokers and that the seller’s savings may be 1 to 2 percent or $1,000 to $2,000 on a $100,000 house.
To summarize, the potential downsides of a discount real estate broker for sellers can be:
- The service you get from the real estate agent may not be the best, with less hand-holding.
- A full-commission broker can either be more motivated, experienced, or skilled in selling a house for more than a “discount agent.” Hence, it costs the seller more by getting less for the house (saving 1% in commission but losing 5% with the selling price).
- There might be hidden fees from the discount broker.
- A minimum or flat fee may cost the seller more than a traditional commission.
Now, let’s look at how List With Clever selects their agents and then see if that mitigates potential downsides.
As discussed in my article about real estate leads paid at closing, List With Clever, as one of such providers, doesn’t take on just any real estate agent.
When you go to the page to join List With Clever as an agent, the top menu asks “Are you a top realtor?”
On their homepage, the section where top agents are presented also states, “Clever only works with the best of the best.”
This implies that the company looks for quality and doesn’t work with everyone.
To apply as a real estate agent, you must enter your sales over the last 12 months and answer how much experience you have in years.
I suspect that internally, these performance indicators do the first level of vetting.
Because of this likely vetting process, I assume that sellers will get good real estate agents most of the time and be able to save money on commissions.
However, it isn’t clear whether the vetted agents sell at higher prices or have sold at higher prices.
So the application form may need an additional field.
Clever Real Estate Leads (Any Costs?)
As you may have learned above, List With Clever doesn’t sell real estate leads to real estate agents like other companies do.
The leads you get from the company are based on a referral basis.
You only pay when you close.
If you close a home for less than $350,000, it’s a flat listing fee of $3,000, and for more than $350,000, the referral fee is 1.5%.
In my article about real estate referral leads, I discussed that to start working with List With Clever, you will need the following:
- Above-average local market knowledge
- A high affinity for technology
- Great reviews from past sellers
- A track record of past sales
- Being an above-average negotiator and a full-time agent with more than five years of experience
List With Clever Alternatives
In my article about real estate referral lead companies, I discussed nine providers, including List With Clever.
So I will provide you below with the table I used in this article so you can see how it compares regarding referral fees for real estate agents considering using it.
|Provider||Referral Fee||Requirements to Join and/or Stay||Pros Based on Agent Reviews||Cons Based on Agent Reviews|
|Realtor||n/a||n/a, agreement is done on broker level||Users have successfully closed deals, beneficial for new agents, emphasizes quick appointment-making,quality of leads tends to improve with experience, efficient lead alerts||Concerns about the quality of leads, high referral fees, risk of becoming too dependent on the platform, app performance on the Google Play Store is subpar.|
|Zillow Flex||35%||30% answer rate over the last 3 months.|
60% appointment rate over the last 3 months, additional information here
|Useful for jumpstarting real estate careers, comprehensive dashboard for sales, reviews, and leads, the app caters to agents on the go||Poor lead quality, financial concerns with Zillow's model, caution against over-relying on Zillow, competition for the same non-exclusive leads, deceptive sales approaches, difficulties with cancelation and billing problems, functionality problems in the app|
|Homelight||12.5%||Transaction volume by year, the average number of days on the market, price point, property type, and geographic expertise, success rate with HomeLight referrals, the relation between the average sales price and the average listing price, reviews from past clients, response time to HomeLight referrals||Several users have had successful outcomes, the 25% referral fee is considered valuable by some||Concerns regarding transparency, dissatisfaction with the 25% referral fee, some users experienced unsolicited phone calls and text messages, mediocre lead quality|
|Agent Harvest||15 - 25%||Proof of expertise (awards or rankings), pledge of customer-focused service (testimonials from 5 recent clients), additional information here||n/a||n/a|
|Clever||1% of transaction value or $3,000 flat||Great reviews from past sellers, above-average local market knowledge, being over five years full-time agent, having a high technological affinity, being an above-average negotiator||n/a||n/a|
|Upnest||30%||Real estate experience of a minimum of 3 years, real estate license in good standing, great communication skills and a fast response time, six transactions in the past 12 months, local market knowledge and expertise, knowledge about online marketing techniques and strategies, positive online reviews, being tech savvy||n/a||n/a|
|Agent Pronto||25 - 35%||n/a||n/a||n/a|
|Agent FixUp||25%||The number of transactions over the last 12 months and likely also experience, getting you the best price, great communication, the ability to close fast.||n/a||n/a|
|Rocket Homes Verified Partner Network||n/a||Working for an eligible brokerage, 24 months of full-time experience, eight closed transactions in the past 12 months, undergoing Verified Partner Agent training, a high client satisfaction rating||Successful closing experience, ability to offer the best rates and expedite clearances for early closures, the Rocket Pro Insight service||Many users described their experience as a nightmare, challenges and difficulties during the mortgage process, concerns about the capability to proficiently handle transactions|
|Effective Agents||n/a||Almost only by invitation when you are in the top 3% regarding transactions in your market.||Highly recommended by many users, good leads, operations are characterized as smooth, commended for its effectiveness in matching agents with potential buyers and sellers||Leads are often very cold. users have not been converting many of these leads|
Clever Real Estate Pros and Cons (Agents’ and Consumers’ Perspectives)
Below, I have added two pro and con tables.
While this article mostly focuses on using List With Clever for real estate agents, I also wanted to look at the pros and cons from a real estate agent’s and a seller/buyer’s perspectives.
You can also use the latter in conversations with buyers or sellers about this topic.
|Buyer and seller leads likely have a higher quality due to a multi-step lead capturing form with qualifying questions||You will need to reduce your commission|
|Free buyer and seller leads if you qualify and are matched.||Beginner agents, that would most benefit from the program don't meet the requirements to get accepted.|
|You save time, because the real estate lead generation is done for you||You may get dependend on one lead source.|
|Good option to bridge the time until you have an established real estate lead generation system up and running.|
|Provided you get the right agent you can truly save on transaction costs.||You may not get the same service from a real estate agent as from someone that works for a traditiional commission.|
|It's easy to find an agent.||You may make less money on your home than with a traditional brokerage model.|
|100% free matching service|
Is Clever Real Estate Any Good? Should You Use It? (Final Thoughts)
As with any real estate referral lead company, there are risks and benefits to using Clever Real Estate.
If List With Clever accepted beginner real estate agents, I would say go for it immediately.
Unfortunately, this is not the case, and it would make the company’s value proposition obsolete.
Since it is only for real estate agents with a track record (they look for “Top Realtors”), as a more established agent, I would test it for some time but still keep up with the lead generation I was doing before joining, so as not to become dependent on one lead source.
You got there for a reason as an established agent, so you already did something right with your real estate lead generation.
Therefore I consider List With Clever more as the cherry on top of what you were already doing.
From a seller’s perspective, I would also try it, but I would do my own vetting on top of Clever’s vetting to find out about the service you may get from the matched agent.
This article has been reviewed by our editorial team. It has been approved for publication in accordance with our editorial policy.
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