Editor’s note: This story has been corrected to note that the $51.75 million proposed maximum offering price submitted by Zillow in its S-1 registration statement is an estimate used solely to calculate a registration fee. Zillow could raise considerably more than that amount. 

Real estate listings and valuation site Zillow.com has racked up $78.7 million in losses since 2004, but the ads it sells to real estate agents and mortgage lenders have helped the company narrow its losses and nearly triple its revenue from 2008 and 2010, the company said in a regulatory filing in preparation for an initial public offering.

It remains to be seen how much Zillow can raise in an IPO — the $51.75 million maximum the company cited was an estimate used solely for calculating a registration fee. But Zillow said it’s already signed a lease on a new 66,000-square-foot headquarters in Seattle that the company plans to move into in August. The company, which employs 252, leases additional office space in San Francisco, Chicago and New York. 

Zillow’s management "will have considerable discretion" in deciding how to spend the money the company raises in an IPO, the company said in an S-1 registration statement that reveals numerous details about the company’s past, along with its plans for the future.

The company said it will continued to boost sales and marketing activities, and "If appropriate opportunities arise, we may use a portion of these proceeds to acquire or invest in technologies, solutions or businesses that complement our business."

Zillow.com — which attracted 1 million visitors within two days of its February 2006 launch — reported double-digit revenue growth for the past three years: from $10.6 million in 2008 to $17.5 million in 2009, rising to $30.5 million last year.

Expenses have also grown, reaching $37.3 million last year, though the company has narrowed its net loss from $21.2 million in 2008 to $6.8 million last year.

Zillow claimed traffic to the company’s website and mobile applications grew from 5.5 million in the fourth quarter of 2008 to 7.6 million during the same period of 2009 and 12.7 million in the final three months of 2010.

Zillow users have submitted more than 30,000 reviews of local real estate agents, more than 8,600 reviews of mortgage professionals, and more than 370,000 questions and answers in the company’s discussion forum, Zillow Advice (formerly Home Q&A).

Three times a week, Zillow said it creates more than 500,000 unique valuation models, built atop 3.2 terabytes of data, to generate current Zestimates on more than 70 million U.S. homes.

Last year, Zillow posted $140,000 in earnings before interest, taxes, depreciation and amortization (EBITDA) — the first time the company was in the black using that yardstick.

One of the keys to revenue growth has been Zillow’s Premier Agent program, which allows local real estate agents to purchase ads that appear alongside home profiles and home listings within the agent’s ZIP code. Pricing varies by ZIP code, and contracts range from six to 12 months.

The Premier Agent Program had 8,102 paying subscribers at the end of December, up 193 percent from 2009.

Zillow said Premier Agent ads, which launched in October 2008, provide "a significant source of more predictable subscription-based revenue" than display advertising.

While display-ad revenue grew by 27 percent from 2009-10, "marketplace revenues" — which include the Premier Agent program and revenue collected from mortgage lenders that participate in the Zillow Mortgage Marketplace — were up 238 percent, Zillow said.

Consumers using the Zillow Mortgage Marketplace to request personalized loan quotes submitted nearly 1 million mortgage loan requests during the quarter ended March 31, 2011, the company said.

While display ads accounted for 99 percent of revenue in 2008, they brought in 57 percent of revenue in 2010, or $17.2 million.

Marketplace revenues, including Premier Agent, totaled $13.2 million in  2010, or 43 percent of the company’s total revenue, up from 22 percent in 2009.

But the company acknowledges that its revenue growth will slow, while costs will continue to increase as Zillow develops and expands its business. Zillow expects to continue to expend "substantial financial resources" on product development, sales and marketing, technology infrastructure, and commercial relationships and acquisitions.

The S-1 filing reveals that Zillow’s annual expenditures on technology and development peaked in 2008 at $15 million, declining to $10.6 million last year — the lowest level since 2006. The company has more than tripled spending on sales and marketing since 2006, to $15 million in 2010.

Zillow entered into an alliance with Yahoo Real Estate in February, in which Zillow provides real estate listings to the site and has exclusive rights to sell subscription advertising and certain display ads throughout Yahoo Real Estate.

Zillow provided a copy of its listings and sales agreement with Yahoo as part of its S-1 filing, with some confidential material omitted. The agreement stipulates that Yahoo will present listings in the same order as Zillow, giving priority to paid "featured listings." During the first 12 months of the agreement, Yahoo must also maintain a monthly minimum unique user count, although that number has been redacted from the public filing.

Zillow boosted spending on sales and marketing 55 percent from 2009 to 2010, primarily for a sales team to promote the Premier Agent program, plus trade shows, conferences and related travel expenses.

"We expect our sales and marketing expenses will increase in future years as we continue to invest more resources in growing our sales team and potentially invest in advertising," the company said.

Zillow said it employs an inside sales team based in Seattle to sell Premier Agent subscriptions to real estate agents and Zillow Mortgage Marketplace advertising to mortgage lenders, using a combination of outbound calling and inbound customer requests generated from the company’s website and event marketing activities.

Zillow also maintains a field sales team based in New York, with additional offices in Chicago and San Francisco, to specifically target larger advertising customers in the real estate and related content categories, including real estate brokerages, home builders, lenders and home-service providers.

Through 2007, Zillow said it had raised approximately $81 million through various offerings of convertible preferred stock and approximately $5.9 million from the sale of common stock.

The company said it holds one U.S. patent that expires in 2026, and another 11 patent applications pending. Zillow said it’s a defendant in separate lawsuits filed by Smarter Agent LLC, CoreLogic, and LendingTree.

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