eXp World Holdings’ acquisition of NextHome is not just a bet on a new brand, according to eXp Realty CEO Leo Pareja and NextHome co-founder James Dwiggins.
In an interview with Inman ahead of the announcement, the two executives framed the deal as eXp’s first major move into inorganic growth, a way to add a franchise model to its cloud-based brokerage business and a philosophical alliance between two leaders who have been outspoken about transparency, private listings and the future structure of the residential real estate industry.
The deal also formalizes a relationship that both executives said had developed through years of industry events, public debates and shared views on where the residential brokerage business is headed. Pareja said the two first connected organically, but that the relationship deepened as they repeatedly found themselves “on the same side of many arguments.”
“We aligned philosophically. We found ourselves on the same side of many arguments, which gave way to friendship,” Pareja said.
The deal, announced Thursday, brings NextHome’s more than 500 franchisees into the eXp ecosystem and coincides with eXp World Holdings’ move to begin trading under the ticker symbol “AGNT” on Friday.
eXp gets the franchise model it never had
Pareja said the acquisition gives eXp a way to reach a segment of the industry the company’s cloud brokerage model was never built to serve directly: franchisees and broker-owners who want to remain entrepreneurs while operating under a brand structure.
He described the fit between the two companies as unusually complementary, saying eXp recruited very few agents away from NextHome last year.
“We recruited a whopping total of 28 agents away from NextHome. So, I mean, like less than 1 percent of 1 percent in our total funnel,” Pareja said.
Pareja also said that eXp has historically had a strong value proposition for individual agents and team leaders, but not for broker-owners who wanted to keep a franchise structure, local identity or physical office.
“We’ve done a very good job of making the agent the center of our value proposition, and we’ve been the home of the solo producer and the team leader,” Pareja said. “But we’ve never had a solution for franchisees.”
That gap became clearer after conversations with independent broker-owners and franchise operators who liked eXp’s broader ecosystem but were not a fit for the company’s core brokerage model.
“There are countless folks who were independent and/or owned a franchise and came to their franchise renewal, and they say, ‘I want to be in your ecosystem. I want to be in your world. I’m philosophically aligned with you. I like your total offering, but I have a physical office and 300 agents,’ and we just were not a product-market fit,’” Pareja said. “So that is exactly what James can do.”
Consolidation has started — and it likely won’t stop
The deal comes amid a wave of brokerage M&A, including Real Brokerage’s planned acquisition of REMAX Holdings and Compass’ acquisition of Anywhere Real Estate. Pareja said he has been warning publicly that the industry’s long-fragmented structure is entering a new phase.
“When you look at American history, industries can stay fragmented for decades, if not hundreds of years, until they don’t,” Pareja said. “And once consolidation starts, it doesn’t tend to stop.”
Pareja said he still does not believe residential brokerage is becoming a winner-take-all market, but said the industry is moving toward a smaller group of scaled players. However, the U.S. real estate industry will remain more fragmented than other markets because of the country’s entrepreneurial culture, Pareja added.
“In three to five years, there’ll probably be three to five companies of scale, and now we’re starting to see them,” Pareja said.
Pareja also sought to distinguish the NextHome acquisition from other recent deals involving legacy brands. He described this move as eXp’s first major inorganic growth moment, but added that NextHome, in his view, is not a shrinking legacy company being absorbed by a faster-growing platform.
“Bigger is not better. Better is better,” Pareja said. “I do think we’re going to get larger as the industry consolidates organically and inorganically. So this is a very big moment for us, because this is our first inorganic growth moment.”
But, he added, the deal still pairs two companies with growth stories.
“I think one of the interesting things is, this is not a fast-growing company buying a legacy company. This is a fast disruptor buying another fast disruptor, which we haven’t seen yet. That’s a combination that hasn’t happened yet,” Pareja said.
Dwiggins made a similar point, arguing that NextHome’s culture, virtual infrastructure and growth profile made the company a natural fit for eXp’s broader platform strategy.
Why scale mattered to NextHome
For Dwiggins, the decision was also a recognition that brokerage is becoming a business where scale increasingly matters. He described NextHome as a company he and his team built from the ground up, but said the changing industry environment made a larger platform more compelling.
“NextHome is a beautiful company,” Dwiggins said. “We built it from the ground up. It’s a bootstrapped business. And in this place that we’re going, we recognize that the size of a company is going to matter.”
Dwiggins said the deal came together because the two companies were aligned culturally and philosophically, particularly on consumer transparency and the future of the industry.
“Leo and I have been on stages all across the U.S. talking about what this industry will look like if we lose transparency, and in our opinions, how harmful that is to consumers,” Dwiggins said. “And at the same time, I said this publicly, I have a fiduciary responsibility to my shareholders.”
He said the decision to join eXp World Holdings was not difficult.
“You can’t have a better opportunity than to be backed by a billion-dollar company with significant assets and two teams that are fighting for the same thing,” Dwiggins said. “I believe we’re fighting for the soul of the industry as well. This was not a complicated decision for us. This was a very easy decision for us. And we are very excited to get moving.”
Dwiggins also made clear he does not see the transaction as an exit.
“I’m here,” Dwiggins said. “I told Leo, ‘I’m 45. My wife would kill me if I spent more time at home.’ So this is game on — take on the industry.”
Backend tech, broker-owner economics and margin pressure
Pareja said the practical integration opportunity is less about forcing NextHome agents onto eXp’s agent-facing tools and more about giving franchise owners access to backend infrastructure, compliance systems and operating efficiencies that eXp has built at scale.
“One of the things that comes with our size and scale is size and scale,” Pareja said. “It’s buying power for technology.”
Pareja said eXp’s internal systems are not always visible to the broader industry, but could become a major part of the value proposition for NextHome franchisees.
“I don’t think we do as good a job of actually storytelling the backend technology that powers what we do,” Pareja said. “In any given month, I close roughly 30,000 transactions. That’s not normal. That’s somewhat rare to see that level of size and scale.”
He said the most useful technology may not be the agent-facing tools brokerages often focus on.
“The tech that we do to fulfill transactions on the broker side — as well as the compliance tools we’ve built that are AI-powered — we absolutely think will give lift to the franchisee, which is actually James’ customer. My customer is the agent. James’ customer is a franchisee,” Pareja said, adding that eXp has close to 200 engineers who can build new tools around that model.
Dwiggins said he sees immediate opportunities for his franchisees.
“When we were looking at a lot of the stuff that eXp has built — and candidly, nobody knows about — I’m sitting here going, we can allow brokerages to margin their business differently, to be either more competitive in the space with splits or to actually create profitability back inside their companies,” Dwiggins said.
Dwiggins also said NextHome already has meaningful overlap with eXp’s distributed operating model. While NextHome is a franchise company, he said many of its offices do not operate like traditional brick-and-mortar franchise locations.
“We are by far a very unique model,” Dwiggins said. “Forty percent of our offices operate virtually. We don’t force offices to have brick and mortar. They can operate virtually. They can operate out of a shared space. They can have brick and mortar as well.”
The ‘transparency coalition’
Both Pareja and Dwiggins have been outspoken critics of private listing strategies and have frequently framed transparency as central to the future of the industry. But when asked by Inman whether the deal amounted to a kind of “anti-Compass coalition,” Pareja pushed back on the framing.
“Fundamentally, that’s giving too much credit,” Pareja said. “It’s the transparency coalition. It’s being the consumer first, and not as a sales track. It’s actually doing that.”
Pareja tied that philosophy to broader syndication, nonexclusive listing agreements and making listings available to the widest possible audience, saying the approach includes “open sourcing my forms,” “doing nonexclusive deals,” “syndicating to anybody who asks me for it” and “giving it to Google so as many humans as possible can see it.”
The comments also come after court documents in the Compass-Zillow litigation showed Zillow had sought to line up major brokerages and franchises, including eXp and NextHome, behind its listing access strategy earlier this year.
Pareja said he will continue speaking out on transparency, drawing in part on eXp’s experience operating in international markets where listing data and comparable sales information are less centralized or less accessible than in the U.S.
Dwiggins framed the issue in similarly high-stakes terms.
“We have a pretty big microphone, which everybody seems to follow,” Dwiggins said. “So we’ll continue to say what’s right for the industry and consumers.”
Asked whether eXp and NextHome would become more active in policy and legislative fights, Pareja said the companies have strong opinions but have not yet translated those views into formal lobbying operations. He also suggested that national industry groups should be more active in that role.
“I think we’ve always had, both of us, strong opinions,” Pareja said. “I don’t know that you can couch it as it’s translated to actual lobbying practices. And again, for NAR listening, I believe that’s the role they should be playing.”
Pareja said eXp has already shown it is willing to act on its views when it believes existing systems are not serving agents or consumers.
“As you know, our continued support of organized real estate, it’s like, are you doing what we need you to do?” Pareja said. “And if the answer is no, then we will. We’ve demonstrated very tactically that we will change the rules and write our own forms and go after the tools necessary for agents to be able to serve consumers the way we see it should be.”