From Disrupting Real Estate to Taking on the Venture Capital Experience

Delivered December 13 @ 5:00pm ET

Happy Friday everyone! My name is Gerry Hays, and I’m the Founder of Doriot.

I’m actively in the venture game as a Founder/CEO, investor, researcher, inventor, author, game designer, and professor. I’ve built companies and developed a global venture portfolio entirely from the great state of Indiana, all while teaching over 6,000 undergraduates and MBAs at Indiana University, as well as in Croatia, Hong Kong, Slovenia, and Singapore.

Through Doriot, I’m devoting the remainder of my professional career to democratizing the venture transaction and create a new pathway to build wealth for non-millionaires who want to become millionaires.

If you’re enjoying this newsletter and think others in your network would too, I’d be grateful if you forwarded it along and encourage them to subscribe. And, with 10 referred subscribers, I’ll autograph a copy of my first book, the First-time Founder’s Equity Bible and ship it to you!

From Disrupting Real Estate to Taking on the Venture Capital Experience

In my first startup, HomeYeah, I set out to disrupt the Residential Real Estate industry - specifically, the real estate commission. I believed the Internet would do to Realtors what it did to stockbrokers (think Ameritrade, E*Trade, etc.).

I raised $165,000 from family and friends and launched the company. Fast forward 18 months: by transactions, HomeYeah became the 11th largest real estate company in Indiana. We took millions of dollars in commissions out of the Indianapolis market and surpassed $1 million in annual revenue. At our peak, we had more than 450 active home listings in Indianapolis. You couldn't drive into a single hot neighborhood without seeing our signs.

It was working - not because we replicated the Realtor model with technology, but because we completely reimagined the experience. We cut 80% of the costs while still delivering a professional experience. More importantly, we got results.

Albert Einstein said it best: “We can’t solve problems by using the same kind of thinking we used when we created them.” We didn’t think like Realtors. In the traditional model, the middleman is the Realtor. In our model, the middleman was technology, supported by human touch points at the most critical parts of the process for both buyers and sellers. We made both sides feel safe and protected. 

And, critcally, there was an incentive for both buyers and sellers to participate. For sellers, the incentive was simple: they kept an extra $5,000–$25,000 in their pocket. For buyers, sellers could accept lower prices, which meant better deals. We even took a page from AOL and created our own CD-ROM that mailed out to potential customers. It worked, it scaled, and, unfortunately, it was ahead of its time.

As you might expect, Realtors hated us. They stole lawn signs and blackballed HomeYeah-listed homes. It was madness. I even received a surprise visit from the US Justice Department investigating monopolistic tactics the Realtors were using to try and prevent our growth.  And, despite all of this, every Indianapolis VC passed on investing “after” we proved out the model and were looking to expand into other markets. One even dismissed us outright because his mom was a Realtor. 

That experience trying to raise capital planted the seed for Doriot. I thought, if someone of my caliber- building something significant, achieving product/market fit, and growing from zero to $1MM in revenue in 18 months on $165K - can’t raise venture capital in his own backyard, then there’s clearly room for a new type of investor (and investing model).

Fast Forward to Venture Capital

Which is why I’ve spent the last 6 years studying what exists and imagining a new experience altogether. Just like in Real Estate, there’s a founder, an investor, and a middleman. Currently, VCs are the middlemen between founders and institutional investors. Like real estate, it’s a low-volume, high-touch, high-margin business. And, like real estate, I believe the solution lies in technology paired with human touch points at the right moments for both sides of the table.

The only key question is the incentive. What are the financial incentives for retail investors come into the protocol en masse and for founders to choose Doriot over existing options? For HomeYeah, the financial incentive for sellers and buyers was immediate and clear. For Doriot, it’s rewarding participation with ownership in Doriot. To learn more about our imagined scenario click here.

The Steel-man:

Of course, whenever I talk to anyone in the VC world about Doriot, I expect to be steel-manned. The arguments sound eerily similar to what I heard when I was building HomeYeah:

Yes, if you are opining about Doriot under the assumption that we are trying to bring the traditional venture capital experience down to the retail investor, it won’t work. That I absolutely know for certain.

Here, like Real Estate, you have to rethink the entire venture experience from the ground up. You need a system designed for small investors — one that’s easy, engaging, and most importantly, trusting, and allows them to get into the market of venture capital without a ton of effort or time. On the other side, founders need high-touch support during their most critical moments, ensuring they’re fully backed throughout their journey. 

That said, we’re not here to disrupt Venture Capital. If we could have raised the $3.5MM to expand, could HomeYeah have eliminated agents altogether or disrupted commercial real estate? No. Similarly, venture capital will always play an essential role in helping companies grow and scale. Venture Capital isn’t our competition any more than the Realtors were our competition.

But I believe that non-millionaires who want to become millionaires (about 50 million Gen Zs and Millennials) and who are prepared to exercise their Capital, Imagination, and Agency deserve a platform tailored specifically to them - one that gets them in on the ground floor of the next wave of venture over the coming two decades: the application of AI to reimagine existing industries and create entirely new ones. This is where the greatest risk/reward opportunities lie. I also believe we can win at originating deal flow under terms and conditions that benefit both investors and founders, while delivering a completely new and transformative experience.

I’ve said this before, if traditional venture capital is tennis, then Doriot is pickleball. Same court, different rules. Less work, more fun.

New Released Next Week:

BitterBrains on Republic: This will be our last deal for 2025!

Have a great weekend, everyone!

Sincerely, -gerry ([email protected])