Experts analyze growth strategies of eXp and Compass

With eXp Realty and Compass Real Estate sitting atop RealTrends Verified’s 2025 Brokerage Rankings in terms of increases in volume and transaction side growth, fast-growing new models are knocking at the door.

“There are a lot of new models out there,” said Steve Murray, a senior advisor to HousingWire and founder of the RealTrends Verified Brokerage Rankings. “But at the core, the fundamentals haven’t changed as much as people want to believe.”

Craig McClelland, president of Atlanta-based LOCAL Realty, agrees and said the current moment is less about reinvention and more about refinement. He noted that the game may be changing, but only for those who can keep up with it.

“The playing field may look wide now,” McClelland said, “but it’s narrowing quickly.”

When evaluating five-year movers (2021-2025), eXp Realty leads in volume growth, adding $80.46 billion for a total of $152.66 billion. Compass followed closely with an increase of $79.04 billion, totaling $231.04 billion.

Over the past five years, in terms of transaction sides, eXp Realty saw the most significant increase, adding 111,138 sides to reach a total of 350,119. Compass followed with an increase of 84,001 sides, totaling 228,785. 

Gaining an edge are new low-cost players.

“The top 10 movers by volume over the last five years split into two camps,” Murray explained. “Half are flat-fee or low-cost, organic growth players like eXp, United, Fathom, Samson, and LoKation. The other half — Compass, Hanna Holdings, and Sotheby’s — have mainly grown through acquisitions. Then there are the outliers like Jason Mitchell Group and Mark Spain, who rely on volume-heavy, lead generation tactics. They’re lead gen monsters. It’s smart, and they’re very good at it.”

Two roads diverge and meet again

At the surface level, the rise of eXp Realty and Compass represents a fork in the road for brokerage models.

eXp has grown rapidly through a decentralized, low-overhead model powered by virtual offices and agent-led recruiting. Compass has leaned heavily on a centralized strategy of mergers and acquisitions, acquiring brokerages, and signing top agents to lucrative contracts.

“eXp is very similar to the Keller Williams model,” McClelland said. “They created the downline to create a profit share, and eXp refined that. It’s a different model of profit share, but they share revenue, and they’ve got virtual offices, so they’ve crushed (operating expense) costs.”

Murray also cited parallels between eXp and Keller Williams.

“They mimicked Keller Williams with the cap but added revenue sharing and stock incentives,” he said. “They had no offices, which kept their overhead low. The big inflection point came when they hired five or six former top regional Keller execs — people who really knew how to build recruiting systems.”

That strategy worked — fast.

“(eXp) just took off,” Murray said. “Even though the last few years their U.S. growth has slowed, it was enough to put them among the top movers by volume.”

Compass, meanwhile, took a more aggressive approach to recruitment, targeting top producers with upfront incentives and multi-year agreements.

“They took the M&A model used in the industry for many years and refined it for agent acquisition,” McClelland said. “It’s a trade-off; I’ll give you a revenue load upfront, you stick with me.”

Notable acquisitions for Compass over the past year include Christie’s International Real Estate and @properties, luxury real estate firm Washington Fine Properties, and Gulf Coast-based brokerage Latter & Blum.

Compass has also been the subject of rumors regarding its possible acquisition of Berkshire Hathaway HomeServices, but has not offered clarification on the matter.

In Q4, Compass reported a 26% year-over-year revenue increase, reaching $1.4 billion, along with a 24% increase in transactions. For the full year 2024, Compass achieved $5.6 billion in revenue and generated $122 million in operating cash flow.

eXp Realty reported $4.6 billion in revenue for all of 2024, a 7% increase from the previous year, with $1.1 billion generated in Q4. The company closed $185.2 billion in transaction volume for the year, marking a 9% annual rise.

Despite any business model differences, both Compass and eXp are executing on a similar premise, paying agents out of top-line revenue to fuel rapid expansion, McClelland said.

“eXp is paying a piece of top-line revenue to bring in another agent. Compass is paying a piece of top-line revenue to bring in your production,” he said. “They’re quite alike.”

Shifting ground

McClelland acknowledged that the industry landscape is shifting fast — especially in the wake of the National Association of Realtors’ commission lawsuit settlement.

He sees big implications for business models that rely on large numbers of lower-producing agents.

“A lot of new and hobbyist agents don’t have the negotiation skills to articulate the value of their commissions,” McClelland said. “They’re stepping away from the business. When that happens, companies based on volume [may] have problems.”

The commission ruling could shake the very foundation of the buy-side-heavy “cap” model, he added.

“The big shift isn’t just that buyer brokerage agreements are being signed,” said McClelland. “It’s that listing agents no longer have a reason to pre-secure the buyer brokerage commission for the buyer’s agent. That’s a seismic change.”

Murray agreed that the industry is facing a moment of reckoning.

He points to historical parallels, such as Century 21’s explosive rise in the 1980s, followed by a decline after a series of corporate ownership changes.

“They dominated through franchising, which was a new model at the time,” Murray said. “But when they sold to a conglomerate, then to MetLife, it all started to slip.”

He sees similar risks for today’s companies that are utilizing some version of the eXp model — like United or Fathom.

“They’re offering flat fees, revenue share. It’s competitive now,” Murray said. “The edge eXp had is gone.”

Back to the basics

In a market full of complexity, Murray and McClelland agreed on a simple approach; relationships, reputation, and a real understanding of what agents need.

“Glenn (Sanford, CEO of eXp) was brilliant,” McClelland said. “He built a better Keller Williams. And Compass, they’ve done some brilliant things too. Both models have validity.”

But long-term survival, they argue, will depend less on disruption and more on discipline.

“More of the noise will fall away,” McClelland said. “We’ll get back to what works. Real support. Real relationships. Real production.”

Murray summed it up matter-of-factly; “The names might change, the tech might change. But in the end, it’s still about the people.”