Leading proptech consultant James Dearsley (pictured, below) says he doubts the Guild of Property Professionals merger with online agent easyProperty will deliver the result that the two organisations are hoping for.
The key plank of his criticism is that EastProperty has yet to gain the market traction needed to prove that it can work, and that therefore the merger deal is an “enormous risk” for the Guild.
Last week it was announced that GPEA, the parent company of the Guild and Fine & Country, was to merge with easyProperty backed by £15 million from venture capital firm Toscafund Asset Management LLP.
It was said that the deal would provide independent agents with the option to access easyProperty’s fixed-price sales and lettings packages through a monthly brand and technology licence.
The deal creates a new structure for the soon-to-be merged businesses which will all be under an umbrella PLC called e-Prop Services, headed up by former GPEA CEO and industry veteran Jon Cooke.
The key focus of the new entity, it says, is to offer sales and lettings services to consumers across the entire market including high end via Fine & Country to mass-market budget vendors via easyProperty.
In a highly critical blog James says the deal is unlikely to deliver the digital transformation that the guild hopes for or help EasyProperty improve its balance sheet.
He also calls the deal “one of the worst knee-jerk reaction response by a traditional firm to the threat of digital transformation”.
After canvassing industry sentiment, James says he found it varied from “super excited” to “very disappointed” and that some Guild members may be confused by the deal, given articles on the Guild website recently extolling the virtues of traditional agents over online ones, and easyProperty’s ‘funeral for estate agents’ advertising (see right).
But the proptech blogger, who recently criticised Rightmove for its strategy as well, also says the Guild should be applauded for “trying something innovative” and that digital transformation is “about evolving a business model, and the Guild seem to be doing this”.
James also says that if the deal does succeed, it will be down the steady hand of Guild board director Jon Cooke, who recently stepped down as Group CEO of the Guild/Fine & Country in April after just seven months in the role.