Rethinking Freemium: How Real Estate Tech Companies Can Build Sustainable Revenue

Written by:

Rudi Davis

Date:

29 Sep 2025

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The traditional freemium model is failing in real estate technology, according to RealReports COO/Co-Founder Zach Gorman, who argues that building long-term value and trust is more important than quick conversions to paid subscriptions.

“Agents are notorious for being really resistant to two things: changing their behavior and paying for anything,” Gorman says, highlighting the unique challenges of selling technology in the real estate space.

The Freemium Fallacy

Many tech companies approach the real estate market with a traditional freemium strategy: offer a basic version for free, then aggressively push users toward paid upgrades. According to Gorman, this approach often backfires.

“So much of what these agents are used to is, like an MLS would be like, ‘we have a new member benefit for you,'” Gorman explains. “Here’s how you use it, and then it’s just some freemium upsell thing, and they get really pissed off.”

A New Approach to Value

RealReports has developed a three-part strategy to differentiate itself in the crowded proptech market. The first priority is delivering real value at the free tier. Rather than offering a superficial product simply to capture leads, the company ensures its free tools are genuinely useful. “I want them to be using that 80% of the time because there’s real value there. It’s not just some throwaway to put an ad in front of them,” explains Gorman.

The second pillar is creating natural integration points so the platform becomes part of a user’s everyday workflow. RealReports is built to connect seamlessly with existing MLS software and to send automated emails when new listings appear. Users can access the product through multiple touchpoints during their daily tasks, while educational resources and dedicated support help them get the most out of each feature.

Finally, the company focuses on building trust before upselling. By allowing customers to rely on the free product and see its impact over time, RealReports strengthens relationships before presenting paid options. “If I can get somebody on the hook using our product for free all the time, then if I present them with a real use case for upgrading, they will acquiesce,” Gorman says. “They’ve built up this goodwill. They trust us.”

The Implementation Challenge

Making this strategy work requires significant investment in integration and support. RealReports’ approach includes:

• Technical integrations across multiple platforms
• Automated touchpoints tied to agent activities
• Comprehensive educational resources
• Ongoing partner support and training

“You have to do this all,” Gorman emphasizes. “You have to be in front of somebody 10 different ways before they even know the name of your product.”

The Solution: Long-term Value Creation

RealReports’ experience indicates that successful technology adoption in real estate hinges on several key factors. First, solutions must focus on genuine value creation, offering tools and features that users find truly useful in their daily workflows. Second, building trust through consistent delivery is essential, ensuring that clients can rely on the product before any upsell is proposed. Third, creating natural upgrade paths allows users to seamlessly transition from free to paid tiers as their needs evolve. Finally, supporting partners in implementation helps integrate the technology effectively, maximizing its impact and encouraging long-term adoption.

“While it may be a shortcut to just have a terrible freemium model, you’re going to have churn and those people are never going to come back,” Gorman concludes. “It’s a complex, arduous journey to get people using products… but across the board, the people who allow us to insert ourselves in all of those different ways… they’re seeing 2-3-4x the average adoption that they see across their other products.”