What does Upstream have to show for itself?

The National Association of Realtors (NAR) is pouring $15 million into Upstream, an online platform designed to give real estate brokers more control over their data, including property listings. NAR has twice now allocated large chunks of Realtor dues to the project ($6 million in May 2015 and another $9 million in May 2017).

But more than two years after the initiative was announced, nothing has launched and the largest real estate trade organization in the country has little to actually show for its investment other than a series of missed deadlines and yet-unrealized promises. Based on its original goals, Upstream is 17 months behind schedule and counting.

The dream Upstream sold to the industry was a private database for all types of broker data — not just property listings, but also records relating to consumers, vendors, agents and employees; images; videos; and accounting information. Both brokers and agents (with broker permission) were supposed be able to use it, and control who received the data.

Upstream was conceived as the starting point for the data, acting as the middleman between brokers and data recipients, including the 700 or so multiple listing services that they use to keep track of properties for sale. To do so, it would incorporate each MLS’s business rules so that they would receive compliant data from Upstream at the outset.

Upstream was originally supposed to debut as the “single point of entry” for broker data in five pilot markets around the country (MLSListings, RMLS, NorthstarMLS, NTREIS, and West Penn MLS). Upstream has since scaled back that pilot to two markets (MLSListings and RMLS), though the company says it still plans to eventually implement its original proposal nationwide.

Yet as of the time of this article’s publication, no MLS has integrated with Upstream. Without that integration, there has been no alpha or beta testing so far, either, though those were supposed to begin in May 2016 and conclude at the end of 2016. No agent or broker has ever submitted a listing to their MLS using Upstream.

NAR continues to publicly support Upstream’s promise to put real estate data in the control of the trade group’s 1.3 million Realtor members, rather than companies the association has long viewed as well-funded outsiders threatening to displace or undercut brokers, particularly Zillow Group.

Upstream has told Inman that by the end of this year, some brokerages will finally be able to use the platform in some form. But the holy grail of efficiency the company promised may still be a long time coming for most brokers and agents—if it ever arrives.

Interviews with several people linked to the project yielded numerous different explanations for Upstream’s delays, including a single decision Upstream’s CEO made that has delayed alpha testing for months.

But one overall theme emerged: there seems to have been a severe underestimation among Upstream’s creators of the difficulty in building a single system to both do everything brokers desire and fit into the real estate industry’s existing infrastructure, which includes NAR, RPR, brokerages, MLSs, MLS system vendors, and the Real Estate Standards Organization (RESO), among others.

The missing alphas and betas

In May 2015, NAR’s board of directors, made up of about 800 members,  approved $12 million for NAR subsidiary Realtors Property Resource (RPR) to build Upstream and a related, but separate project called Advanced Multilist Platform (AMP). Upstream is set to exhaust its $6 million share of the funds — which don’t have to be repaid — by the end of 2017.

In November 2015, NAR announced that RPR had signed a formal agreement with UpstreamRE LLC, the independent company formed expressly to launch the Upstream project. As part of the announcement, RPR was responsible for “development, implementation, operations, training and support,” of the Upstream platform, while all three entities—NAR, RPR, and Upstream—were to provide marketing for the project.

At that time, the companies said beta testing in pilot markets would start in second-quarter 2016. In February 2016, Upstream board member Cary Sylvester of Keller Williams International specified that alpha and beta testing would start in May 2016 and beta testing would be complete at the end of 2016. (See an expanded Upstream timeline here.)

RPR defined “alpha” testing as when one office in a pilot brokerage, along with its designated data recipients and MLSs, integrated with the Upstream platform and made Upstream the sole add and edit point for data.

“Beta” testing referred to expanding Upstream to all the offices of the pilot brokerages in a market, thereby making it available to more agents and brokers.

But Upstream and RPR never launched these phases. Upstream CEO Alex Lange told Inman via email in October 2017 that the timeline for alpha and beta testing was set before he was involved with Upstream and he found “it hard to believe anyone would have thought that an endeavor this large could be developed so quickly.”

‘This is members’ money’

Nonetheless, this past May, NAR’s board  approved an additional $9 million in loans to the project. (NAR’s annual dues have remained unchanged at $120 per member for the last six years and will not increase for 2018.)

It’s unclear how much NAR’s board members knew about Upstream’s progress when they allocated it more funds.

Cindy Hamann, a NAR director and chairman of the Houston Association of Realtors, told Inman she did not know that Upstream had yet to integrate with an MLS or start alpha testing.

“People are getting paid for this,” said Hamann, a real estate broker with Berkshire Hathaway HomeServices Anderson Properties and 23-year Realtor. “That makes me mad. That makes me angry. This is members’ money. I’m a hardworking member who is very proud that I was able to send my kids to college without college debt because of real estate. And they haven’t started yet? That makes me angry because that means [Upstream’s] going to come back asking for more money.”

Upstream has started in terms of development. RPR has built the platform’s sleek user interface (where agents will enter their listings), which will incorporate hundreds of MLS business rules from the two pilot MLSs that will be the first to integrate: RMLS in Portland, Oregon, and MLSListings in Silicon Valley. The platform has also integrated with over 40 non-MLS vendors — including VoicePad and Corefact —  to which brokers may also send their data.

And sometime after the first week of November, Upstream will start broker direct feeds (listing feeds from the MLS to Upstream) in three pilot markets and any brokerage in those markets may participate, according to Lange. Upstream will subsequently launch broker direct feeds in seven additional pilot markets “at a brisk pace,” he said.

“With the framework in place, we can bring on many MLSs every month and we already have commitments from MLSs that have over 250,000 agents and are finalizing [letters of intent] for 100,000 more,” Lange said. “We don’t need to beta test by MLS. We will immediately start onboarding brokerages. We are far from ‘haven’t started.'”

With broker direct feeds to Upstream, “[b]rokers can immediately enhance their listings with additional data not in the MLS and add unlimited high-resolution photos and video [and] then subsequently have complete control over distributing their data,” Lange added.

Upstream competitors Bridge Interactive and Paragon for Brokers provide similar features, but neither offers listing syndication without the MLS.

Lange noted that the brokerage community also has “skin in the game”: capital contributions from brokerages in the form of repayable notes.

“In the past two years, contributions representing more than a thousand brokerages across the country have surpassed $1 million to help fund Upstream with verbal commitments of an additional $250,000,” Lange said. “That’s not NAR dues, that’s not money from agents, that’s brokers digging into their pockets to try to solve data challenges that are costing agents and brokers wasted time and money.”

Joseph Rand, an Upstream board member and managing partner and general counsel for Better Homes and Gardens Real Estate Rand Realty, personally contributed $25,000 to the project.

“People think that it’s only their NAR dues that are funding this, but Upstream has gotten a lot of funding through no-interest loans from individual brokers like me,” Rand told Inman via email, adding, “If Upstream fails, we don’t get paid back … I didn’t make that loan to generate a profit, I made it to support a better industry. That’s why we all did it.”

‘No cause for panic’

Upstream’s leaders recognize that the project is behind schedule, but continue to assert it will come to fruition soon.

“Industry participants with any experience will tell you that any transition from one MLS vendor to the next, any launch of a new company website or Intranet, any implementation of a new software platform is likely to miss deadlines,” Upstream board member Craig Cheatham told Inman via email. “It is not welcomed, but expected.”

Cheatham went on to say that while “everyone associated with Upstream wishes original deadlines had been met,” it was getting “closer to having functionality in use in real time,” and that there was “no cause for panic.” He said NAR leadership and staff were being kept updated on the project.

For its part, NAR said it continues to believe in Upstream’s promise. The trade group also said it will no longer fund Upstream after 2018.

“NAR has made a significant investment in RPR and we wouldn’t have made it if we didn’t believe in its promise to allow brokers through Upstream to more easily control where and how their listing information is displayed,” said NAR spokeswoman Sara Wiskerchen via email.

“Per the NAR/RPR agreement with Upstream, by January 2019 all costs are to be with brokers, and they will determine Upstream’s future funding and direction.”

When asked why development and implementation had been slower than anticipated, NAR’s Wiskerchen said, “The [NAR] board understands the challenges of this pioneering effort, and is so far satisfied with the benchmarks that have been reached.”

After being asked which challenges and benchmarks it was referring to, NAR declined to comment.

NAR board member Hamann said the trade group had not asked for her opinion on whether she was satisfied with RPR’s progress on Upstream. She assumed the trade group took the board allocating more funding to Upstream in May as evidence of its approval, which she said was an example of NAR being “out of touch” with members.

So, why the delays?

When asked precisely why Upstream is behind schedule, Lange said, “[I]t’s an inherently complex initiative,” and cited the “unprecedented” granularity, flexibility and control it would offer brokers over their data.

Asked whether or not building the platform turned out to be more complex than Upstream or RPR thought, Lange said that was not the case, at least not on a technical level. “We are introducing concepts and processes, which we must carefully think through,” Lange said. “Understanding potential long-term consequences is where the complexities lie.”

As for how satisfied Lange is with RPR’s progress on Upstream: “I’m not someone ever satisfied, so that’s a tough question,” he told Inman. “RPR has been a great partner.”

Upstream, not RPR, developed the project’s original timeline, according to Lange.

“Upstream’s timeline is a product of three factors: the willingness of either an MLS or their vendor to integrate despite broker demand, Upstream’s need to alter its strategy to adapt which added new requirements, and any technology partner’s ability to quickly adapt to our changes,” he said.

‘We needed to show traction’

According to the CEOs of the two MLSs that will deploy Upstream’s original plan — RMLS and MLSListings — RPR did not publish data mapping tables they needed in order to integrate with Upstream until a month ago, on September 25, 2017.

About a year ago, MLSListings proposed a different approach to integrating with Upstream than the one RPR had planned.

“We couldn’t really work with it the way that they were proposing,” Jim Harrison, president and CEO of MLSListings, told Inman.

Upstream’s APIs — application programming interfaces, code that would allow Upstream and MLSListings to exchange data — are not compatible with data standards from the Real Estate Standards Organization (RESO), according to Harrison. Because MLSListings shares data with so many other MLSs, creating a new type of data collector not compliant with RESO standards would have been counterproductive, so MLSListings asked RPR to make changes.

When MLSListings made its request, RPR got to work. But that request went “on the back burner” when Lange decided to re-direct the RPR team to prepare a demo for NAR’s midyear conference in May, MLSListings CTO David Wetzel told Inman.

The demo was of Upstream’s user interface (UI) and how it would integrate with RMLS. So MLSListings’ request was delivered four months after NAR’s midyear expo.

Lange defended prioritizing the UI demo over making the MLS-requested changes. “Every CEO must prioritize resources to optimize and balance stakeholder needs and the business plan. In this specific case, we needed to show traction on the overall project.”

Did Upstream’s desire for more funding from NAR play a role? Lange said Upstream uses NAR events to set development milestones and “it’s the perfect forum to show progress to NAR Leadership who has contributed funding. It’s correlation, not causation.”

Lange disagreed with Harrison’s assertion that the changes MLSListings requested would be useful to other MLSs that wished to integrate with Upstream.

“It was a ‘one-off’ solution that made the implementation easier for the MLSListings team, but wasn’t something we’d reuse nationally,” he said.

At least one other MLS is using that “one-off” solution, however: RMLS. Kurt von Wasmuth, RMLS’s president and CEO, told Inman his MLS had also been waiting for those data mapping tables from RPR to start integration.

Upstream is still waiting on this tech update

Regardless, Lange concedes MLSListings’ request “was a catalyst” in Upstream’s September decision to conform to RESO standards.

“It became clear that standardizing on the RESO Web API, knowing every MLS will have to certify, was the best approach,” Lange said.

The version of the RESO Web API Lange is referring to is one that incorporates  “Update”– a standard for adding and editing listings. That standard is what Upstream is betting on to migrate MLSs from broker direct feeds to “direct input” (the Upstream-to-MLS route originally conceived).

When MLSs adopt that standard, Upstream will “be able to simply ‘plug in’ and update, insert and read listings if that MLS allows,” Lange said. Once RESO finalizes the standard and its board of directors ratifies it, all Realtor-affiliated MLSs have one year to adopt the standard, per NAR MLS policy.

The problem is RESO has not yet finalized the Update API standard. The RESO workgroup developing the standard is hoping to have a draft by the end of year, according to RESO CEO Jeremy Crawford.

“We have added in new resources into the Workgroup in order to speed up development. I would suspect it would be the latter part of Q1 before going to the RESO Board of Directors for ratification, and MLSs would have a year to adopt the standard once the Board ratifies the standard,” Crawford told Inman via email.

Earlier this year, he noted that it will be up to individual companies and MLSs to implement the standard and incorporate MLS business rules for editing listings — a process he described as “nontrivial” —  so he’s not sure how long widespread industry adoption will take.

The elephant in the room

At NAR Midyear in May, Upstream’s Lange and then-NAR CEO Dale Stinton put the blame for Upstream’s delay squarely on the shoulders of uncooperative MLSs and MLS system vendors.

“It’s going slower. It’s pretty disappointing to explain why. Politics, and that’s my polite word,” Stinton told NAR’s board at the time. Stinton left his position as CEO on August 1, and was succeeded by Bob Goldberg.

“There were those that were pretty unhappy with the Upstream concept and the broker, the agent, the member … having complete control of their listing,” Stinton went on. “There are a lot of competitors, frankly, there are a lot of vendors and some MLSs who don’t like that.”

When asked which MLSs and MLS system vendors Stinton was referring to and examples of them being uncooperative, NAR spokesperson Wiskerchen said, “[Current NAR CEO] Bob Goldberg is not going to comment on the past; he stands by what he has stated publicly … about the valuable partnership between MLSs and NAR, who are both serving our members and industry.”

Wiskerchen then said NAR would decline all further comment for this article.

Lange also declined to name recalcitrant MLSs or MLS system vendors, saying “it’s simply bad form to point fingers,” and citing “many interests.” However, he did clarify that the 12 pilot MLSs were “supportive,” but noted that they have vendors who may not be.

“Most MLSs and MLS vendors have expressed a desire work with Upstream,” Lange added. “And we are working with those with concerns or resource issues to resolve them.”

Yet there are “instances where an MLS simply blocks our progress,” Lange said, condemning those who fail to put pressure on their system vendors who aren’t working to integrate with Upstream.

RPR: ‘It’s not a technology problem’

RPR President Marty Frame told Inman that while Upstream “has certainly gone longer than anybody originally planned for,” he thought everyone knew why. “It’s not a technology problem …The problem is that the technology has to be integrated,” he said.

Had MLSs or their system vendors cooperated more, Upstream would be in multiple markets right now, according to Frame.

Asked why MLSs or vendors wouldn’t want to play ball, Frame was vague: “Everybody’s got their own reasons. It’s not a competency problem.”

Still, Frame commended RMLS, likely to be the first MLS to launch Upstream integration sometime around the end of the year, saying its partnership with RPR was “outstanding.”

But RMLS has its own in-house MLS system and does not rely on outside vendors. So why isn’t it in alpha yet?

“It went as fast as we expected because it was the first time,” Frame said. “When it’s the first time it takes longer. The first time you deploy a complex system you have a lot to learn.” He added that it went as fast as expected and subsequent integrations would be different.

Frame also said that he thought RPR had lived up to one of its key promises for Upstream: being able to do the work faster and more affordably than other vendors, in part because RPR already maintains its own property database.

But RPR had to develop its own data input method from scratch, and is helping RESO develop a standard for aggregating the hundreds of business rules of each MLS, “which is what a lot of people said couldn’t be done,” Frame said. “And now [that standard] belongs to everybody.”

‘No one knows what the hell Upstream’s doing’

MLSListings CEO Harrison noted that neither MLSs nor their system vendors had received those data tables they needed to even prep for alpha testing until last month, so Stinton and Lange’s comments about MLS and vendor cooperation were putting “the cart before the horse.”

“You can’t say people aren’t cooperative when they don’t have enough information to be cooperative or not,” Harrison said.

John Mosey, president and CEO of pilot market NorthstarMLS, agreed.

“The problems are entirely between Upstream and RPR. I don’t think they are between the vendor community. The MLSs that have signed up for the pilots, every one of us have done everything possible to make this work,” he said.

Mosey said he and fellow members of COVE, a group of the 20 largest MLSs in the country, are puzzled as to why they are being kept in the dark about Upstream’s progress. A year ago this past summer, RPR came to NorthstarMLS to go through its business rules and other “technicalities” for Upstream, but “there’s been infrequent dialogue since then,” he said.

“No one knows what the hell Upstream’s doing and there’s questions as to whether they do,” Mosey added, saying that, as far as he could tell, the broker direct feed was a return to status quo.

Communication problems have plagued Upstream since its inception. Mosey said he had no idea his MLS was slated to soon launch a broker direct feed or that it involved his MLS sending a listing data feed directly to Upstream rather than to brokers themselves.

And he learned that his MLS was supposed to be part of the original pilot along with everyone else at an industry event in January 2016.

‘It’s a lie from the get-go’

Still, Mosey believes Upstream will accomplish what it says — one MLS at a time, at least.

“My belief is that they will someday find a way to be able to load and update their listings in Upstream into our system. And great, good luck to you. Have at it,” he said.

“And it should not be at all hard for them to come up with a way to do that one at a time. For them to do it with all 700 MLSs has got to be and has proven to be a real challenge.”

Toward the end of Inman’s interview with Mosey, he declared he wished he hadn’t taken the call.

“Because when you announce that [nothing’s happened] — which is absolutely true — there will be a segment of the broker community that uses this as an excuse to say the MLSs are uncooperative and it’s a lie. It’s a lie from the get-go.”

It’s a discussion he would have face-to-face with anyone, Mosey said.

Harrison, whose Silicon Valley-based MLS employs 20 software engineers, urged patience.

“It’s interesting how so many people think that because the project is not done, that the project is failing,” Harrison said. “They don’t understand … it’s a massive task.”

Upstream has agreed to pay for a software engineer to integrate MLSListings and Upstream so that alpha testing can begin. It’ll be about six weeks worth of work, Harrison said.

“We think we should have it working by the end of the year,” he said.

Email Andrea V. Brambila.

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