27 June 2014 - The following post was written by OKAY.com CEO Joshua Han Miller, who recently made an appearance on CNBC Asia's Squawk Box.
I had a great time yesterday as a guest on CNBC's Squawk Box with the esteemed Susan Li. We discussed some of the dynamics of the current property market and touched on what OKAY.com does differently in its business model.
In the interview, Susan focused first on OKAY.com's business model, and how our agent incentive structure for enables us to aggregate more information then share it with consumers.
Ultimately, we share approximately 50-60 cents of every dollar with the agent(s) involved, or about double what other agencies' business model allows. This not only gives us an information advantage as mentioned, but also enables us to attract the best people in the industry - including those interested in building teams and teaching others how to be great professionals.
We also discussed the current state of the Hong Kong property market, and why I feel that many analysts' predictions made last year for 20-40% declines were overblown. There is an enormous amount of pent-up demand in the market to purchase, as people have held off for years (following the government's cooling policies.) We're already seeing this at OKAY.com where the interest from purchasers has increased in recent months, after just a very small easing in market prices. I don't profess to be a full time market analyst, but these were my views 2 years ago, and the recent "unexpected" optimism in the market has supported them.
I do expect prices will fall further (modestly) and that we'll see a significant increase in demand as a result. Ultimately this is healthy and necessary for the market to regain stability before resuming long term growth.
Fortunately our business model isn't dependent on market swings, but on the growth in our databases, client base and agent population. Having grown revenues 120% in 2013 despite a 40% market drop in sales volumes, we're on track to double again this year, and I expect our growth to accelerate.
Unfortunately the clip online doesn't include Susan's introduction of the company, and how our name "O-Kay" means "Home" in Cantonese. If we get the full video, we'll share that and the rest of the interview.
While I would have enjoyed sharing a little more about how we address a real consumer need, bring information transparency to a large, opaque industry, and our plans to expand in China, I was happy to be there. Susan was great to speak with - genuine, informed, and clearly knew what people were interested in. I look forward to being back on the show in the future!
