SoftBank backed Compass goes public, Reffkin set to become America’s youngest Black Billionaire

Real estate brokerage company Compass in a statement said it slashed the number of shares to be sold and dropped its price target range to its lowest range of $18 - $19. The company sold 25 million shares at $18 a share, after previously marketing 36 million shares at a price range of $23 - $26.

The SoftBank Group Corp’s Vision Fund-backed company raised $450 million at the low end in its initial public offering, according to Bloomberg reports. Its offering is being led by Goldman Sachs, Morgan Stanley, and Barclays Plc. Shares will begin trading Thursday on the New York Stock Exchange under the ticker COMP.

The company’s valuation is about $7 billion based on the outstanding shares it listed in the filing, as reported by Fintechnology. Compass’s market value will likely hit $9 billion if fully diluted to include employee stock options and restricted stock units.

Despite Compass’s low-end IPO, its chief executive officer and co-founder Robert Reffkin is set to become America’s youngest Black billionaire. The company wrote on its website that Reffkin is on a mission to help people find their place in the world. He earned his B.A. and M.B.A from Columbia University.

“According to an analysis by Insider, the IPO could put Robert Reffkin, the 41-year-old co-founder of Compass, on the path to earning more than $1 billion. That total comes from adding together stock awards he has been granted by the company, other stock promised to him if the shares meet ambitious prearranged pricing targets, and awards that will vest over time,” Fintechnology reported.

The report also said that Reffkin could become the eighth Black billionaires in America – and the youngest, if he can collect all of the shares

Reffkin’s high-profile career and business with the White House, Goldman Sachs Group Inc., and McKinsey & Co. may have contributed to his popular status, but Bloomberg said his real estate startup is responsible for his ultrarich status. However, Bloomberg states that Reffkin’s investment in technology talent must justify the company’s valuation, which is yet to be turned into a profit.

Compass had recently raised more than $1.5 billion from Vision Fund and other investors after it presented them with its strategic business idea of using software to schedule home tours, communicate with clients, and design marketing materials, to save time. The company has invested heavily in AI technology to build artificial intelligence for agents’ tools. He argues that technology can help agents save time and provide better services, as well as make more money.

According to its IPO filing, Compass said last year, it was involved in residential real estate transactions totaling $152 billion, or 4% of the U.S. market. Its revenue increased to 56% to $3.7 billion, from a year ago. The company said more than 19,000 agents use its platform.

In a LinkedIn post, Reffkin expressed his excitement about the IPO and explained why he started the company in the first place. He said his inspiration was his mother, who is now one of the company’s 19,000+ agents.

“I started Compass because of my mom, Ruth, a single mom who embodies the entrepreneurial spirit and is now one of Compass’s 19,000+ amazing agents. It was a great honor to have her join me this morning at the NYSE!” he said.