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'Selling Sunset' Broker Jason Oppenheim Calls Compass Business Model 'Unfixable' Oppenheim also called the rival real estate firm's commission model "unsustainable."

By Madeline Garfinkle

entrepreneur daily

Opinions expressed by Entrepreneur contributors are their own.

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Reality television star and real estate broker Jason Oppenheim has some thoughts on real estate giant Compass' business model, which he deems "unsustainable."

Oppenheim, who runs real estate firm The Oppenheim Group and stars in Netflix's Selling Sunset, told Inman that "there's no fixing Compass. It's unfixable."

The "unfixable" model he's most notably concerned with is the real estate firm's generous "splits" — which refers to the ratio of commission from sales kept by agents versus what portion goes back to the brokerage firm. Oppenheim called Compass' splits "unsustainable," as several of the firm's agents keep about 90% of the commission — meaning only 10% goes back to the firm, which Oppenheim believes is too little for the brokerage to be profitable.

Related: This 31-Year-Old Investor Nearly Quadrupled His Multifamily Housing Empire From California to Texas in Just 3 Years

"If you are making televisions for $100 a piece, and you're selling them for $99 a piece, it doesn't matter that you're making more televisions, it doesn't fix your business model," Oppenheim told Inman.

Oppenheim then shared with Insider what he believes to be a more successful split model: Superstar agents get 80% of the commission, newer agents 60% and the majority of agents 70%. However, he declined to inform the outlet of the split ratio at his own firm, The Oppenheim Group.

Oppenheim is speaking out about Compass' model because of the impact it's had on the rest of the industry. Other brokerages have had to adopt higher split ratios just to compete with the rival firm.

Meanwhile, Compass reported $154 million in losses in the third quarter of 2022.

Despite his criticism, Oppenheim made it clear to Insider that he's not rooting for the demise of the competing firm. "I hope they succeed, but time will tell," he told the outlet.

Related: 'I'll Spend The Rest of My Life Wondering How I Could've Avoided These Layoffs': Real Estate Firms Attempt Damage Control

Madeline Garfinkle

News Writer

Madeline Garfinkle is a News Writer at Entrepreneur.com. She is a graduate from Syracuse University, and received an MFA from Columbia University. 

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