CoStar Enacts Board Changes as It Takes Control of OnTheMarket

The U.S. real estate giant CoStar has wasted no time enacting boardroom changes at British portal OnTheMarket and has parachuted four of its executives into director positions at the company.

CoStar's £100m deal to take over the formerly agent-back OnTheMarket officially went through yesterday (12th of December) with OnTheMarket issuing a notice confirming that Christopher Bell, Ian Francis and Rupert Sebag-Montefiore have tendered their resignations as directors of the Company.

CEO Jason Tebb, CMO Helen Whiteley and CFO Tom Carter have also resigned from the board of directors but will keep their management jobs at the portal.

Replacing them on OnTheMarket's board of directors are CoStar CFO Scott Wheeler, VP and Corporate Controller Catherine Bland, MD of CoStar Europe Matthew Green and the Managing Director of CoStar's hospitality data intelligence business in Europe (STR), Robin Rossman.

Following the completion of the CoStar takeover, OnTheMarket's CEO took to Linkedin to publish a punchy essay entitled "Now is our time".

The former agent paid tribute to the portal's founding aim of "creating a market-leading, national portal which would deliver services to its members at sustainably fair prices" and said that since it began in 2013, OnTheMarket has achieved a lot despite not attaining the goal of market leadership.

As OnTheMarket and CoStar's PR teams are sure to continue to do, Tebb made sure to assuage any lingering agent doubts about the intentions of CoStar's entry into the market.

"We are truly grateful for the tireless support of our agents over the years. I have spent hundreds of hours listening to and engaging with thousands of our customers via my Town Hall meetings and individually. The feedback from these is almost unanimous; agents are pleased with our progress and are hugely supportive of our transformation and growth. But they want us to go even faster. With the support of our customers and the innovations and developments we have made to all aspects of the business, we have never been in a better position to do just that.

We were founded by agents as a competitive response to the negative effects of a duopolistic market and ten years on from OnTheMarket’s inception, agents continue to be passionate about the need for real competition."

Apart from the significant premium paid, the attraction of CoStar's takeover offer for OnTheMarket's agent shareholders was the American company's resolution to spend big to try to break the so-called duopoly of Zoopla and Rightmove. CoStar has pledged to spend £46.5 million on sales and marketing in the first full year, with Tebb saying that the money now gives OnTheMarket "the potential to be much more than 'competition'".

CoStar is employing a similar tactic domestically with Homes.com in an attempt to take on Zillow and the Washington-based giant's track record in building up portals to challenge market leaders was attractive to OnTheMarket's management in negotiations.

"During our discussions it became very clear that a combination of OnTheMarket’s agent friendly platform with CoStar’s proven track record of transforming similar platforms across the world, was a powerful and industry leading collaboration. I was reminded of the original intentions of those brave group of agents who founded Agents Mutual. “To create a market-leading, national portal which would deliver services to its Members at sustainably fair prices.”

In my opinion, and as an ex-estate agent of 20 years, the collaboration between OnTheMarket and CoStar will enable us to deliver on this original aim."

Tebb's post finished by pledging to go "head to head" with the market leaders and make a "positive impact on the industry as a whole".