Purplebricks co-founder Michael Bruce has revealed both why Purplebricks went for such an early stock market launch and how much the pair personally invested in the company’s two-year incubation prior to launch.
Michael is the public face of Purplebricks more so than his brother Kenny and was a property lawyer before buying estate agency Burchell Edwards Group with his sibling during the late noughties for £5 million. The pair then sold up in 2011 and used the £1.5 million profit from the deal to finance the start-up of Purplebricks, he says.
Asked why they started up Purplebricks, Bruce says that: “Millions and millions [of pounds] have been spent around the world helping and supporting buyers understand what’s on the market and what’s in the market.
“But actually, little or nothing has been spent helping and supporting sellers, the people who actually create the industry, to make their whole life a lot more convenient, a lot more transparent, and a lot more cost effective.
“We looked whether we could do it alongside a traditional model and came to the conclusion that our ability to do that and remain credible would be very difficult.
“Sending someone to a street armed with an £800 fee and a £3,000 fee knowing that the £800 fee was going to deliver a better experience wasn’t going to be a recipe for future success.”
During the interview with a Northern Ireland legal podcast site, Bruce also revealed why Purplebricks went for a stock market listing on AIM just 20 months after the business had launched in the UK.
“We did that deliberately to – in some ways – make the ability of funds available to competitors to be harder to get,” he says.
“Therefore, I suppose in our case, a first mover advantage has worked. There will be other markets that we will enter where we won’t be first mover, but we’ll certainly be first mover in terms of technology and the power of what it will do for the customer.
“We’ll be first mover in terms of building and growing a brand and we’ll be first mover in terms of capital.”