Creative CEO: Compass Co-Founder Robert Reffkin on What Fuels Success
Robert Reffkin, 41, was raised by a single mother in Berkeley, California. After completing his bachelor’s degree at Columbia University, he became an analyst at McKinsey. He went on to earn his MBA from the same institution then worked as an M&A associate at Lazard; moved on to the White House as a Fellow in the Department of the Treasury; had a six-year stint at Goldman Sachs, where he was chief of staff to the firm’s president and COO; and founded a nonprofit that matches first-generation college students with mentors.
In 2012, he co-founded and became CEO of Compass, whose 20,000-plus real estate agents booked $3.72 billion in revenue in 2020, and which just went public with a valuation of more than $8 billion. But Reffkin isn’t solely focused on making the firm sustainable.
“Valuation isn’t my obsession. It really isn’t,” he told Forbes. “My obsession is agents and building one of the world’s great companies.” As CEO of one the largest independent brokerage firms in America, he gets incredible joy from having a positive impact on as many people as possible.
I caught up with him recently to talk about his newly released book, “No One Succeeds Alone,” a tribute to the power of mentorship, and hear his perspective on creativity, positivity, and the need to risk failure.
Remember that your disadvantages can often be your greatest advantages as they can give you the motivation to do extraordinary things.
– Robert Reffkin
Q. What advice do you have for entrepreneurs starting out today?
I believe entrepreneurship is the greatest force for progress the world has ever known. For someone with entrepreneurial ambitions who just graduated college and is working their first job, here are three pieces of advice:
Don’t let anyone get in the way of your dream. Not society, not your colleagues, not even yourself. Whenever anyone tells you to slow down, speed up.
Spend the next 10 years learning as much as you can from the smartest people you can. Feedback is a gift, so find mentors in your job and outside who will give you the honest feedback that others won’t.
Learn how to turn negativity into positive energy that fuels you. There will always be skeptics, doubters, and haters telling you that you can’t do something or that you don’t belong. Remember that your disadvantages can often be your greatest advantages as they can give you the motivation to do extraordinary things.
Q. What creative CEO would you love to have drinks with and why?
Although he might not technically be a CEO, Lin-Manuel Miranda is a real genius who embodies the entrepreneurial spirit. He’s fighting for authenticity, inclusivity, positivity, and dreaming big. I can’t wait to see his new movie, “In the Heights.” When I first watched the trailer with my wife, it brought tears to our eyes.
Q. Is scaling a business necessary for success? And what’s the hardest part of scaling?
My underlying motivation is to have a positive impact on as many people’s lives as possible—to help people realize their potential.
When I started the nonprofit New York Needs You in my late 20s, I loved the feeling of being able to support many dozens of students who were the first in their families to go to college, living below the poverty line each year. They are, without doubt, some of the most inspiring people in the world. Over the past decade, New York Needs You has expanded to four states, become America Needs You, and now serves several hundred students each year.
But the way nonprofits are funded and structured makes it very difficult to increase your impact more rapidly than that. Startups, on the other hand, are designed to scale extremely quickly, as Compass has—starting with just a handful of people in 2012 to now serving over 20,000 real estate agents, giving them the tools and support to realize their entrepreneurial potential.
As someone who likes to dream big and move fast, I appreciate the urgency to improve the lives of as many people as you can, as quickly as you can.
Q. What traits do you look for in selecting partners, collaborators, or team members?
As an entrepreneur, energy is everything. So, I seek out people who give me energy and avoid anyone or anything who saps it. I tend to select collaborators who share my mindset of abundance and possibility—the type of people who don’t sit around thinking about how something might fail but get to work making sure that it succeeds.
Q. What was your first job and what lessons did you take from it?
My first job after college was working at McKinsey, and it was really challenging. During one of my early performance reviews, my manager said, “Look, Robert, you’re never going to be a great analyst,” in a tone that many people would have taken very hard. But I took that comment as a gift. It felt both clarifying and freeing. And when my manager followed up with, “But you’ve got some real spikes,” (a business term for strengths), “and you should focus on maximizing those,” I started to see the path toward accepting myself for who I am and what I’m good at.
He was right that I was never going to “spike” at poring over statistics and building financial models like some other analysts. That work would never make me come alive. But I loved building relationships with clients and partners, assembling high-performing teams, and bringing in deals.
I didn’t figure out how to truly act on my manager’s advice until I started Compass more than a decade later. Here, I’ve built my role to allow me to spend as much time as possible doing what I’m best at and selected my team to be strong where I am not.
Q. What was your biggest failure and what did you take away from it?
It’s hard to pick just one. My approach to business, and to life, is to try many things in order to find the one that works. If you come up with a single idea that changes the lives of your customers, that’s all that matters. There are no points deducted for coming up with a lot of ideas that fail along the way. In fact, trying a lot of things that go nowhere is the best way to get somewhere amazing.
So, that’s led to a lot of “failures.” I applied to hundreds of college scholarships and got rejected from almost all of them, but I got more than I would have received if I didn’t apply to any. I applied to countless firms after college and got rejected from every single one—except the one that hired me.
A lot of what people call failures are really just necessary steps to get to where you are going. The more quickly you take those steps (whether they are successful or not), the faster you will get to where you want to go.
Q. Where do you get your inspiration?
When I look back at the hardest things I’ve ever done in my life, I realize I have been able to do them for the same reason: because I loved the people I was running for. When I ran 50 marathons—one in each U.S. state—to raise a million dollars for nonprofits, I didn’t do it because I loved running or because I loved raising money. I did it because I loved the students I was running for, who were the first in their families to go to college and who went beyond what their parents believed was even possible. Whenever I felt tired or my feet hurt, they inspired me to run harder.
I have been running so hard at Compass for the same reason: because I love the entrepreneurs that I’m running for. The agents who come to Compass to build a business, realize their potential, and elevate the industry and the buyers and sellers they serve. And the employees who joined Compass to pursue a once-in-a-generation opportunity bring harmony and simplicity to the real estate process.
Q. What stifles your creativity?
Negativity. You of course need a variety of opinions and healthy debate in order to find the right path, but I find that it drains my own energy when I’m collaborating directly with people who don’t treat challenges as opportunities. I believe that seeing the world as abundant greatly improves your ability to lead a meaningful life.
Q. How has the current pandemic affected your business and the way you work?
COVID created a permanent shift in the demand curve. Everyone now wants more space—more indoor space, more outdoor space, more private office space, more second-home space—and it’s not going to go away because people now have the flexibility to work from home. They’re not going to have a mandate to work from home forever, but if they have the flexibility, they’re going to take advantage of that. And so having a private office is more important.
The effect on everyone’s individual life and work during this time has been much more mixed. Personally, I used to travel at least two days a week, and this work-from-home period has eliminated that almost entirely. I miss connecting in person with agents and employees across the country, but I’m so grateful for all this extra time with my family and all the extra evenings I’ve gotten to tuck my three kids into bed that I wouldn’t have if I’d been on the road.
Q. Talk about the importance of mentorship.
I believe that no one succeeds alone in this world. I’ve had more mentors than anyone else I know. Perhaps because I didn’t have a father, I sought out more meaningful relationships with mentors than others did and stayed close to the ones who really seemed to care about me.
My mom was my first mentor—and the most significant. But I wouldn’t have made it through elementary school without the encouragement of people like my fifth grade teacher who looked past my skin color and saw my potential. I wouldn’t have gotten into one of the best private high schools in San Francisco without the support of a half-dozen nonprofits that taught me about college, entrepreneurship, and how to obsess about every possible opportunity.
I wouldn’t have gotten into Columbia and built a professional network without minority internship nonprofits like Sponsors for Educational Opportunity and the mentors who challenged me not just to dream, but to dream bigger. I wouldn’t have figured out the worlds of consulting, investment banking, politics, or finance without the help of literally dozens of mentors who helped me get in the door and figure out how each firm worked.
I believe deeply in giving back through mentorship, which is why I founded America Needs You and why I wrote “No One Succeeds Alone,” to distill all the advice I’ve been given and make it accessible to everyone. It’s also why I’m donating all of my proceeds from this book to nonprofits that help young people realize their dreams.
Q. As the only Black founder of a public real estate technology company, what challenges did you face?
Being Black and Jewish, I’ve felt out of place my entire life. In most classes in high school and college, I was the only Black person. In almost every meeting early in my career, I was the only Black person. When I was raising capital for Compass, I almost never saw someone Black on the other side of the table.
But I’ve been very fortunate. I’ve been lucky to get terrific advice along the way from so many Black mentors, from the late Vernon Jordan; to Ken Chenault, the former CEO of American Express; to Bayo Ogunlesi, who is lead director for Goldman Sachs. There’s a really strong community of people who’ve all supported each other.
It’s also given me extra fuel. I don’t think I’m just working for myself, I never have. Think about it: If I had been born 40 or 50 years earlier, it’d be literally impossible for me to be here. But over the years, people worked hard, made sacrifices, and paved the way so that people like me could have more opportunity than they had. So, I feel that I have a responsibility to work hard and create opportunity for the next generation.