On March 13, 2020, Glenn Kelman, the main executive of the on the net genuine estate broker Redfin, was biking to get the job done when he acquired a get in touch with from Henry Ellenbogen, a longtime investor in Redfin who experienced started his possess fund.
At Harvard, Mr. Ellenbogen majored in the historical past of technological know-how. One major factor he acquired, he has claimed, was that know-how is produced well in progress of people’s means and willingness to use it.
“Tell me some thing,” Mr. Ellenbogen questioned Mr. Kelman, according to an account the main government posted on Redfin’s internet site. “When people today begin touring residences through an Apple iphone, will not a good deal of them make a decision, even following this complete pandemic ends, that this is just a improved way to see homes? And if this entire system of buying and offering homes mainly goes virtual, how will other brokerages contend with you?”
Mr. Kelman, a very little preoccupied by how Seattle’s generally bustling streets ended up eerily vacant, stated he didn’t know.
“I do,” Mr. Ellenbogen said. “The world is modifying in your favor.”
This was not a normal check out then, and it definitely was not what Mr. Kelman was encountering. The initial verified coronavirus demise in the United States was a nursing dwelling resident in a Seattle suburb on Feb. 29. In just hours, household sellers resolved that possibly they did not want strangers breathing in their living area and bedrooms. Prospective buyers started to pull out as nicely.
For Redfin, that was the beginning of a disaster. Within just a couple of days, it shut down its 78 workplaces all around the place. Its inventory plunged, dropping two-thirds of its worth.
“The magnitude of the drop was rising every single day,” Mr. Kelman mentioned. He agreed to sell Mr. Ellenbogen extra stock for $110 million, thinking Redfin might have to have funds to make it by means of a extended drought. In early April, Mr. Kelman furloughed 41 percent of the company’s brokers, who ended up salaried employees. A lot more than 1,000 people were being afflicted.