RealScout, a startup that provides brokers and agents with branded home search technology aimed at helping them compete with portal giants like Zillow, Trulia and realtor.com, has raised $6 million in a Series A funding round.
The Mountain View, California-based firm raised $1.1 million in a seed round when it first launched its product to agents last year. The company will use the additional funds to help it expand from the San Francisco Bay Area and Washington state markets where it sells its product to brokerages and agents now, RealScout CEO Andrew Flachner told Inman.
Last year’s real estate recovery set the stage for some serious investment in real estate tech in 2014. And the industry and investors have played the part so far this year. RealScout’s funding round shows the trend continues to blaze.
Money pouring into real estate tech in 2014
|Trulia||Zillow||$3.5 billion**||July 2014 (announced)|
|Move Inc.||News Corp.||$950 million||September 2014 (announced)|
|ZipRealty||Realogy||$166 million||July 2014|
|DocuSign||Undisclosed||$85 million||March 2014|
|Urban Compass||Advance Publications Inc. and Marc Benioff*||$40 million||July 2014|
|BoomTown||Adams Street Partners and Susquehanna Growth Equity*||$21 million||September 2014|
|Updater||National Association of Realtors||$8 million||April 2014|
|Zumper||Kleiner Perkins Caufield & Byers*||$6.5 million||March 2014|
|Placester||Romulus Capital*||$5.5 million||April 2014|
|Contactually||Gil Penchina’s AngelList syndicate*||$2 million||November 2014|
|One Cavo||Howard Hanna Real Estate Services||Undisclosed||November 2014|
|Walk Score||Redfin||Undisclosed||October 2014|
* Leaders or prominent members of the funding round. ** Value of the all-stock deal on July 28, when it was announced.
Based on broker and agent demand, RealScout may look to expand next to Southern California, Florida and Arizona, Flachner said.
Existing investor DCM led the round, with additional participation from another existing investor, Formation 8.
“RealScout is unique in that they’re focused on building technology that empowers real estate agents instead of trying to minimize their role,” said DCM partner Osuke Honda, who joined RealScout’s board of directors with this financing, in a statement. “We’ve seen enthusiastic early response from agents and brokers using the platform, and believe that RealScout’s vision of helping agents be more successful represents a massive opportunity for the real estate industry.
In October, RealScout launched a broker-focused version of its product and announced its entrance into Washington state.
RealScout is looking to differentiate itself by building a search platform centered around matching homebuyers to homes with location-specific search filters. It’s also working to elaborately tag listings to help homebuyers dig up those homes for sale that match their particular desires, like homes with cul-de-sacs, with high ceilings or professional kitchens, for example.
As a tech vendor, RealScout handles Internet data exchange (IDX) feeds from the eight multiple listing services it now has licenses with. IDX refers to the pool of listings brokerages in a certain market make available to each other for online search.
RealScout is not available to every consumer right off the bat. Typically, agents with a RealScout account invite consumers to use the platform, Flachner said. Consumers can also access the platform from a RealScout partner agent or broker’s website.
Investors, and tech companies themselves, have been pouring money into residential real estate tech recently.
Tech-focused brokerages Urban Compass and Redfin raised $40 million and $50 million, respectively, in the last 12 months.
Global Media giant News Corp. completed its $950 million acquisition of realtor.com operator Move Inc. last week. Zillow has a pending deal to acquire Trulia that was worth $3.5 billion in stock when it was announced in July.
Brokerage and franchise giant Realogy bought ZipRealty in July for $166 million. Large brokerage Howard Hanna Real Estate Services bought lead management firm One Cavo earlier this month. The list goes on.