# How Kaz Nejatian Is Rebuilding Opendoor Business Breakdowns · 2026-05-08 · 26 min · https://www.youtube.com/watch?v=m53ysyhjDJs ## Transcript Matt Reustle This is Matt Reustle, and today I have Kaz Nejatian, CEO of Opendoor, fresh off the first-quarter 2026 earnings release. We get into what is driving the strong execution quarter to quarter here. We've seen the product rollouts, the sales velocity, and the margin improvements that have Opendoor EBITDA-positive as of April 1, 2026, and on track to be adjusted net-income-positive by the end of the year. Kaz is a fascinating CEO to watch, follow, and listen to, and he does not disappoint. I actually want to start with the bigger picture here. If you go back to February 2025, you're still at Shopify. You're ready to sell all of your possessions, lever up, and buy Opendoor and take it private. You end up becoming the CEO in a much more traditional way, I would say. But if you look back on your thesis then, compared to where you are now, having run the business for some period of time, how much has changed since you've taken over and been inside the operation? Kaz Nejatian Well, two things. First, it was my wife who wanted to sell all of our possessions to take Opendoor—or at least, she was the one who encouraged me to think about it. But there are two things that have actually held in my mind. I like to try to be thoughtful about this. The first is that the company is actually structurally in much better shape than I thought it would be. The underlying models of the company, the underlying databases, and the underlying processes are just in much better shape than I expected them to be. I think the company had kind of started this doom loop of going down and down and down, but it does feel a lot like Raiders of the Lost Ark, when there's a guy guarding the cup. There were a bunch of people here who were still guarding the cup, and that had kept it in really decent shape. But actually, the underlying model is just honestly in very good shape. We've invested a lot in it, but I'm actually very impressed. Second, I significantly underestimated the attach opportunity. I've basically done this whole attach-services thing my whole career, and I did not expect our first crack at this to go so well. Those are two upsides. Generally, I've just been very impressed. The main downside, honestly, just to be very self-reflective, is that I was shocked by how the company was basically being run by outside consultants for so long. It feels like the people who were making decisions for the company basically had almost no stake in the outcome of those decisions. So the OpEx was just honestly stupid—not just stupid, but spent on the wrong things. And I think that was actually offensive. Matt Reustle Based on the OpEx metrics today versus when you stepped in, you've done something about that. I think it's been reflected in your actions. I want to go back a little bit to your point on the attachment and even just, at a higher level, when I first came across Opendoor, I had a very simple view that it was essentially a real estate asset manager based around tech. That is oversimplified, but you clearly distinguish it as a software platform. How do you think about the capital intensity and the underwriting skill set required to run the business when you're clearly aiding all of that with technology? How do you think about that aspect of it, which I think many traditional investors—the East Coast types, let's say—can get hung up on? Kaz Nejatian I think the underlying assumptions about the business are just fundamentally wrong. And, by the way, when I say the underlying assumptions are fundamentally wrong, those assumptions were held by some people inside the building for a while. So it's not like people in New York were wrong; people in San Francisco were also wrong. Saying Opendoor is an asset manager that happens to have software is like saying Amazon in its early days was a warehouser of books that just happened to have software. Did Amazon warehouse books? Sure, but was it a warehouser of books? No. That's not where the leverage comes from. The very real difference between being a prop desk and a market maker—to use New York language—is that if you're a prop desk and you hold assets for profit, you do one set of things. If you're a market maker and your fundamental job is not to hold assets for profit, you do a different set of things. Opendoor is a market maker, not a prop desk, at the core asset level. So, do we have to be very good at underwriting? Damn right we do. We have the best underwriting engine in the business. There's nothing close to it. And I say this as an honest-to-goodness nerd. Matt Reustle I'm coming to appreciate that many people got caught up with “trust the process.” I think you're really saying, “Trust the outcome and trust the endpoint.” You're putting that into vogue, which I can appreciate. On that point, I think it's a really great way to distinguish a market maker from a prop desk. It gets into this concept around spread versus velocity. What does it mean in practice to really focus on velocity? I'll tee it up. Is it really focusing on markets where there's higher turnover of homes? Is it really just focusing on capturing less spread so we can sell faster? If you were to stack-rank the really important drivers of that focus on velocity, what would those be? Kaz Nejatian If you think about it, Opendoor has an embedded advantage compared to every other buyer and seller of real estate in our cost of capital. We're just bigger. We're just relatively big. We've got a great capital-markets team, but that has not been adequately used by the company. Do you mind if I just go on a rant for a second? Because I think this actually— Matt Reustle Do. Kaz Nejatian The best reason why you want to always be in a flow market is that, at the end of the day, card counters at a blackjack table play every hand. The reason they play every hand is to get more information. The information is the point, right? When we buy lots of homes and sell them very quickly, we get very live feedback about actual market conditions—not just about the clearance price, but also about the renovation process and the demand that impacts every other demand. We actually pick up data in a way that no one else does. And, by the way, we're ahead of the market. So even if you were scraping all the data you could from MLSs, you're 90 to 120 days behind us. We're picking it up live. We have access to data in a way that very few people do. When you're a market maker at a stock exchange, everyone sees the ups and downs. We have a 90- to 120-day advantage on the market. It's a very real thing, but you can't use that advantage if you decide you want to have a very high margin on every single trade. Let's say you want to have high spreads in buying an asset. So I come to you. You think your home is worth $400,000. I agree it's worth $400,000. If I offer you $300,000 for it, you will tell me to take a hike. The only scenario under which you will not tell me to take a hike is if you know things I do not know. I am paying for a negative feedback loop. I'm not actually getting $100,000 of spread. There isn't that much arb in real estate. But if I'm actually able to have very tight spreads such that you can say, “Look, if I list my home, I have to pay Realtor fees, taxes, and holding costs. I have to account for the odds of the home falling through. I have to account for 90- to 120-day hold periods; that has a cost to me.” If I can add those up and come to you saying, “Look, I will do it for you faster, cheaper, more certain,” you will say yes to me as a rational human being. And I still have significant room for margin. If I can compress that so I can buy from you at a better deal, with more certainty, when selling to market, and sell to the next person at a better deal, with more certainty, when buying from the market, I'm just increasing my information advantage. And, by the way, as we've shown, we also have significant attach opportunities. We own a title and escrow business, which is growing very quickly. We have a mortgage product, which is just excellent. And the things you need to do to underwrite a home, acquire it, underwrite the home for a mortgage, and underwrite a home for insurance are all identical to each other. In a traditional market-maker world, like in the stock market, the attach opportunities aren't as significant. Whereas in this world, the attach opportunities are significant. So as long as I can move fast, the business works. Matt Reustle If I were ever to want to sell my house, why would I pick Opendoor? Because I could do it faster. I could get the offer quickly. The likelihood of closing—I know there's still not every contract you go into closes—but that's focused on speed and almost removing the inconveniences associated with real estate sales, of which there are many. What would you say? Is that an accurate depiction, or am I shrinking the customer base too widely when you think about who the ideal partners are? Kaz Nejatian No, you're shrinking the customer base too widely. I think what you're saying was true of the company some time ago, when the people who sold to Opendoor were people who wanted to move fast, at high risk and at high cost, right? Death, divorce, delinquencies—people who were under stress, like, “Yes, but I need to move fast. I understand there's a cost.” Our customer base is really quickly changing. If you look at the family that we talked about in earnings, the Watsons, they weren't in that much of a rush. They wanted to move from California to Colorado. They could have moved at any time. But Opendoor bought a home from them because it was a great deal. They took a mortgage from Opendoor because it was a great deal. And they sold a home to Opendoor because it was objectively a great deal. It wasn't that they valued certainty, obviously. They could have tested the market, and they would have been worse off. My job is to go to a family and say, “The product genuinely is better for you.” That's what we want to do, right? I would say, overwhelmingly, that is true. Now, we are going to get better and better at this. Our spreads are going to get tighter and tighter over time. But my job is to make sure that when you want to take your next move and you want to buy a home or sell a home, you think of Opendoor the way you think about Uber, the way you think about Amazon, the way you think about your market maker. Matt Reustle To your point on attachment possibilities, you've started to roll out some of these various options. I'm curious: When you think about the long term, that spread being tight and seeing more velocity going through, what do those represent in terms of the profit pool and the pie for the business? What are the things that naturally attach to real estate, and what is the embedded margin, or at least the embedded gross cost opportunity? Kaz Nejatian Right. There's a transaction cost of 6% to 7%; everyone understands it. There's the title and escrow cost of 1% to 2%. There's mortgage, where the average margin is 300, 350, 400 basis points. There's insurance, where the average margin is 100 to 200 basis points. There is home care, there are satellite dishes, there's solar—all these things add up, right? Some of these are friction; some of these are premium products. Some of these you have to have. You can't—mortgage isn't an option for most people. You have to have a mortgage provider. Now, if I can take a series of services in a highly fragmented market, all of which have very low NPS scores, and jam them all together and say, “Great. All the profit made by all these players in the stack, and all the inefficiencies created by all these players in the stack, because they all have to pay for CAC and I don't. They all have to pay for gathering information; I don't.” That's the opportunity. Look, it is the single largest market in the world. It is significantly bigger than the stock market. I think you can believe whatever you want about the underlying business of Opendoor. You can have a variety of opinions about Opendoor and me. What I think is very hard to say is that the largest real estate company on the public market in the United States could not be very large. There isn't a $100 billion market cap real estate company in the public markets in the U.S. That's just—that does feel like a flaw in the matrix. I think most people would say, based on their experience, that it is one that is ripe for disruption, or that there's an opportunity to improve the experience. The stack as it exists sucks. It's just terrible. And it's set up in a way that allows people to take advantage of information asymmetry in a way that you don't see anywhere else. This doesn't exist elsewhere. It's very odd. Matt Reustle On the attachment opportunities, you often mention that you don't like to announce or tease products before they are formally launched. But if you just think about prioritization, which is a big thing for you, in rollouts, do you have an order of operations or an order of focus when it comes to mortgage, title and escrow, attachment rate, and, generally speaking, anything along those lines? Kaz Nejatian What you want to create in order to simplify a system is a thin waist, right? You want to be able to actually have a thin waist that you can use to simplify the rest of it. For e-commerce, that's checkout. Checkout is what actually runs the business logic on either side of the transaction. That doesn't exist in real estate. For us, the priority is creating checkout for real estate in the United States. That, by necessity, means we care a lot about title and escrow. Title and escrow is something we care a lot about. Once we solve that, lots of other things in the system just become simpler. It's public that we have a mortgage product live in Colorado, and we'll have a bunch of other states soon. That's obviously second. I think home warranty is very high on the priority stack, then insurance, and then a bunch of other services. I think, for what it's worth, it's not that hard to imagine why Opendoor is almost an ideal provider of solar services. Matt Reustle Give me that vision. Just how would you lay it out? Is it post-close? Kaz Nejatian We buy homes. Lots of homes we buy lease their solar panels from someone else. It's very easy to imagine how we can buy those solar panels and then lease them to Next Solar. That's just the easiest version of it. There are a couple of versions that get slightly more complicated. But more importantly, just go down the stack of financing. You're an ex-banker; you're good at this. So imagine what it takes to underwrite the risk of any given asset class. How correlated is the risk of leasing someone a solar panel to the underlying home? How correlated is that risk to the mortgage? How correlated are all these risks to insurance? I think that you'll get to a point where—you know, cars have a very interesting history. You used to buy your engine separately from the carriage. It was actually a real thing. There were people who made the body of the car, there were people who made the engine, and they would just go buy them. But we decided that was exceptionally dumb, yet we still buy homes the same way. The way we buy cars is we usually get financing from the person who sells us the car, and the car usually comes the way we want it. The way we buy a home is we deal with a couple of dozen different parties in the system, and they all hate each other. It's a very, very weird hack on the system that has been maintained. Matt Reustle When you think about introducing those various things that you could attach to the purchase or sale of a home, each one does potentially involve friction. The mortgage doesn't go through, or the insurance doesn't go through—any one of these things. How do you solve for that when, yes, it would naturally be a great thing, but could they add friction or slow things down in terms of velocity? Tell me where that thesis is wrong, or how you solve for that. Kaz Nejatian I think you're just straight-up wrong. Actually, maybe you're not wrong. Matt Reustle Yeah, you don't have to mince words. Kaz Nejatian I think there's a lot of FUD that comes from people who provide point solutions and say, “My point solution is so complex that you could possibly never mix it with another one.” Let me give you an example: The 2 products at Shopify, Shopify Payments and Shopify Tax, both had extremely high penetration rates and were used by basically everyone. If you happen to own a restaurant in New York and you went to your payment provider and said, “Hey, I'm considering getting this tax. Can you do tax for me?” they'd say, “Oh, no, you should stay with us because it's so complicated.” Look, is there complexity in the system? Of course there is. But for 80% of people, 100% of these services are relatively vanilla. Eighty percent of people are the margin opportunity that pays for 20% of the complexity. That just seems terrible for those 80%. Do I think someone who wants to buy a $14 million mansion, has no U.S. residency, has trusts all over the world, and has multiple cars should be able to use an Opendoor home loan, Opendoor insurance, and all the other services? No. I don't think they should use us. But I don't think the average American living in South Dakota should pay for that subsidy. Our job is to make life easier for the average person—the schoolteacher, the plumber, the electrician. They should not have to pay more because complexity exists in the system. And, by the way, I say this as a guy who has complexity in his life. There's no reason why the average person should subsidize my life. That sounds insane. Well, that's what we have. That's the world we live in, right? My job is this at Opendoor. I want the teacher in Kansas City to have a one-click mortgage, title, escrow, home-buying, and home-selling experience. That's what we're going to work on. We're going to solve this for a teacher in Kansas City. All the dudes living where you live with their Maseratis can go to someone else. No Maseratis parked in the garage. I'm not saying you have one, to be clear. Matt Reustle In terms of going forward, you brought up multiple times that you have this path to profitability, but also that you're not afraid to invest in the business. I just want to think about that philosophically: How do you approach that? Sometimes you want to heavily invest when there's an opportunity to go after something. You've made it clear that you have that path to profitability, with EBITDA-positive and adjusted-net-income-positive targets by year-end. How are you balancing that with whatever need there is to reinvest in the business, or how are you going to balance investment back into the business with that? Kaz Nejatian My wife wanted me to work out because I'd become really unhealthy, so she bought me some weights and a bench. Then I totally ignored them and didn't work out, so she put the bench at our bedroom door and the weights on it. I couldn't get out of the bedroom without actually seeing those things. I think Opendoor requires some of that energy. I think Opendoor has had too little discipline when it comes to being a for-profit business because it has been able to reach for capital markets over and over again. I think that has actually been bad for Opendoor. So I think it's incredibly important for us to be incredibly disciplined, and this will be painful as hell. It'll just be painful. This will hopefully be the last job I ever have, and I care about my job and the company I'm running a decade from now. The best thing I can do for that company is ensure this company is the most disciplined and most aggressive tech company in the market. That's the real answer. Am I forgoing an area of growth that I would not forgo if I had lots of profits? Yes, I am. For sure I am. But I think there's a very real thing, man, where I think this is healthy discipline. I think it's healthy, and I think it's important that Opendoor be funded by its cash flow. Actually, I think it would surprise people to learn how few engineers work at Opendoor. Opendoor has fewer than 70 engineers. I think that would surprise most people. We're getting a crap ton done with those 70 engineers, but I promise you, I know what every single one of them is working on because we don't have the luxury of waste. Matt Reustle I heard you mention in another interview that you've had some people make some pretty powerful changes within the business, along the lines of engineering changes, but they did it with an AI system. It's actually a nice segue into that question. How much of your ability to operate with 70 engineers comes from the power of those engineers, and how much is it that those without an engineering background are able to do a lot more in that regard? Kaz Nejatian Our engineers are just excellent. Just genuinely excellent. Our head of data is an ex-signals-intelligence officer who used to run a very complicated system for one of the world's largest militaries. We have multiple YC founders in the building who have joined in the last few months. Two from my batch at YC alone. So we have excellent engineers. But there's a division of labor between systems that create leverage for other people and those front ends, right? Our engineers spend their time creating systems that allow other people who are not engineers to create leverage for themselves. When I got here, we had an entire service whose job it was to calculate RSU allocations for employees, and it was maintained by an engineer. I can't tell you how nutty a waste of time that is for an engineer. Basically, all companies have this. I'm like, "Why is an engineer working on this?" Look, if you cannot, using Claude or ChatGPT or Codex or Grok, write a SQL query, you should not be working at a tech company. This is a tech company. I can see our head of internal comms right there. Our PR consultants all quit when I joined. They actually all rage-quit. I can tell you our head of internal comms, who now actually sits at her desk, does this work for us and spends most of her time on Claude. So does everyone else in the company. I think that is different from most other companies. Matt Reustle Thank you very much for taking the time after that conference call you just had. I appreciate it, and I will say the words that are always important after earnings: Congrats on a great quarter. Have a great day, dude. Kaz Nejatian Likewise.