eXp World Holdings’ acquisition of NextHome is more than 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, both executives described the deal as eXp’s first major move toward 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 on transparency, private listings, and the future structure of the residential real estate industry.
The agreement also formalizes a relationship that both executives have built over years of industry events, public discussions and shared views on the direction of the housing brokerage business, the company said. Pareja said the two bonded organically at first, but their relationship deepened as they repeatedly “were on the same side of many arguments.”
“We were philosophically aligned. We found ourselves on the same side of many arguments, and that 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 franchise model like never before
Pareja said the acquisition gives eXp a way to reach a segment of the industry that its cloud brokerage model was not built to directly serve: franchisees and brokerage owners who want to remain entrepreneurs while operating under a branded structure.
He said the relationship between the two companies was unusually complementary, noting that eXp hired very few agents from NextHome last year.
“We hired a total of 28 agents from NextHome, which means less than 1% of 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 want to maintain a franchise structure, regional identity or physical office.
“We’ve done a really good job of putting agents at the center of our value proposition, and we’ve been home to solo producers and team leaders,” Pareja said. “But until now, there hasn’t been a solution for franchisees.”
This gap became clearer after conversations with independent broker owners and franchise operators who like eXp’s broad ecosystem but don’t fit into the company’s core brokerage model.
“There are countless people who are independent or who own a franchise, and they come to renew their franchise, 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 overall product, but I have a physical office and 300 agents, and we didn’t fit the product market,'” Pareja said. “So that’s exactly what James can do.”
Consolidation has begun – and it probably won’t stop
The deal comes amid a flurry of brokerage M&A, including Real Brokerage’s planned acquisition of REMAX Holdings and Compass’ acquisition of Anywhere Real Estate. Pareja said he has publicly warned that the industry’s long-fragmented structure is entering a new phase.
“If you look at American history, industries can remain fragmented for decades, if not centuries, before becoming unfragmented,” Pareja says. “And once the integration starts, it doesn’t stop.”
Pareja said he still doesn’t believe housing brokerage is becoming a winner-take-all market, but the industry is moving toward a smaller group of players. However, Pareja added that the U.S. real estate industry will remain more fragmented than other markets because of the country’s entrepreneurial culture.
“In three to five years, there will probably be three to five size companies, and now those companies are starting to emerge,” Pareja said.
Pareja also sought to distinguish the NextHome acquisition from other recent deals involving legacy brands. He described the move as eXp’s first major inorganic growth moment, but added that in his view, NextHome is not a shrinking legacy company being absorbed into a rapidly growing platform.
“Bigger isn’t necessarily better. Better is better,” Pareja said. “We think we’re going to get even bigger as the industry consolidates organically and inorganically. So this is a huge moment for us because this is our first inorganic growth moment.”
But the deal still brings together two companies with growth stories, he added.
“I think one of the interesting things is that this is not a fast-growth company acquiring a legacy company. This is a fast-disruptor acquiring another fast-disruptor, which we haven’t seen yet. This is 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 it a natural fit for eXp’s broader platform strategy.
Why scale matters to NextHome
For Dwiggins, the decision also recognized that brokerage is becoming an increasingly scale-based business. He described NextHome as a company he and his team built from the ground up, but said changes in the industry environment have made a larger platform more attractive.
“NextHome is a beautiful company,” Dwiggins said. “We built this from the ground up. This is a bootstrapped business. And we recognize that where we’re going, scale is going to be important.”
Dwiggins said the partnership was made possible because the two companies were culturally and philosophically aligned, particularly around consumer transparency and the future of the industry.
“Leo and I have been on stages across the country talking about what happens to our industry when we lose transparency, and how, in our opinion, it’s harmful to consumers,” Dwiggins said. “At the same time, I have said publicly that I have a fiduciary responsibility to my shareholders.”
He said the decision to join eXp World Holdings was not difficult.
“What better opportunity than to have the backing of a billion-dollar company with a lot of assets and two teams fighting for the same cause,” Dwiggins said. “We believe we are also fighting for the soul of our industry. 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 it clear that he does not see the deal as an exit.
“I’m here,” Dwiggins said. “I said to Leo, ‘I’m 45 years old. If I spend more time at home, my wife will kill me.’ So this is a game, take on the industry.”
Back-end technology, broker owner economics and margin pressures
Pareja said the practical integration opportunity lies not in forcing eXp’s agent-enabled tools on NextHome agents, but in providing franchise owners with access to the backend infrastructure, compliance systems and operational 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 purchasing power over technology.”
Pareja said eXp’s internal systems are not always open to the industry at large, but could become a key part of the value proposition for NextHome franchisees.
“I don’t think we’ve done a very good job of actually doing the storytelling around the back-end technology that drives what we do,” Pareja said. “We close about 30,000 deals every month. That’s not normal. It’s somewhat unusual to see this size and scale.”
He said the most useful technology may not be the agent tools that brokerages often focus on.
“We absolutely think that the technology that we’re doing to fulfill transactions on the broker side, and the AI-powered compliance tools that we’ve built, will actually impact franchisees, who are James’ customers. My customers are agents. James’ customers are franchisees,” Pareja said, adding that eXp has nearly 200 engineers who can build new tools based on that model.
Dwiggins said he sees immediate opportunities for franchisees.
“As we were looking at a lot of the things that eXp has built, and frankly no one knows, but I keep sitting here, we can allow brokerage firms to set different margins on their business in order to be more competitive in areas that involve breakups or to actually create profitability internally,” Dwiggins said.
Dwiggins also said NextHome already has significant overlap with eXp’s decentralized operating model. Although NextHome is a franchise company, many of its offices are not operated like traditional brick-and-mortar franchise locations, he said.
“We are by far a very unique model,” Dwiggins said. “40% of our offices operate virtually. We don’t force our offices to have a physical presence. You can operate virtually. You can operate from a shared space. You can also have a physical presence.”
“Transparency Coalition”
Mr. Pareja and Mr. Dwiggins have both been outspoken critics of private listing strategies and have frequently advocated transparency as central to the industry’s future. But when Inman asked if the deal constituted a kind of “anti-Compass coalition,” Pareja insisted on this framework.
“Basically, that’s an overestimation,” Pareja said. “This is the Transparency Coalition. We’re putting the consumer first, not selling. We’re doing it.”
Pareja tied that philosophy to broader syndication, non-exclusive listing agreements, and making listings available to the widest possible audience, saying his approach includes “open sourcing the form,” “doing non-exclusive deals,” “syndicating to anyone who asks me to,” and “giving it to Google so it can be seen by as many people as possible.”
The comments also come after court documents in the Compass-Zillow case showed that Zillow sought to put major brokerages and franchises such as eXp and NextHome behind its public access strategy earlier this year.
Pareja said he will continue to speak out about transparency, drawing in part on eXp’s experience operating in international markets where listing data and comparable sales information is less centralized or less accessible than in the United States.
Dwiggins similarly framed the issue from a high-stakes perspective.
“We have a pretty big microphone, so everyone seems to follow it,” Dwiggins said. “So we will continue to say what is right for our industry and for consumers.”
Asked whether eXp and NextHome would be more active in policy and legislative battles, Pareja said the companies have strong opinions but have not yet translated those opinions into formal lobbying. He also suggested that domestic industry associations should play a more active role.
“I think we both always had strong opinions,” Pareja said. “I don’t know if you can convince me of that because it’s reflected in actual lobbying practices. And again, for NAR listening, I believe that’s the role NAR should play.”
Pareja said eXp has already indicated it is willing to act on its views if it believes existing systems are not serving agents or consumers.
“You know, our continued support of organized real estate is like, you’re doing what we’re asking of you,” Ms. Pareja said. “And if the answer is no, we will. We have demonstrated very tactically that we will change the rules, create our own forms, and pursue the tools we need to enable agents to serve consumers the way we think they should.”
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