Gordon Stephenson is a Zillow Premier agent. Through his association with Zillow he has accumulated approximately $10 million in wealth.
According to his profile on Zillow, he had 23 home sales in the last 12 months. He is a small Seattle broker with 60 agents and a property management division. Hmm, what are you missing here?
Stephenson joined the Zillow board of directors and made an angel investment when it launched 10 years ago.
He met Rich Barton through a Stanford classmate, Christian Acker, who was Barton’s first hire at Zillow. Barton was looking for insight about real estate and turned to Stephenson who got into the real estate brokerage business as his first job out of college.
“When Rich asked me to help out, I thought, ‘This sounded interesting,’” he said. As it turned out, “For a little real estate guy from Seattle, this was a big deal. Being a Zillow insider gave me real insight into how non-real estate people think about our industry. Invaluable.”
Two lessons: “I learned to be open to all new business models and to be more nimble.”
As a board member and an early angel investor, Stephenson earned enough shares to cash out almost $4 million and still holds approximately 50,000 shares that add up to about $6 million at the current share price. I asked Stephenson to confirm the numbers that I was reading from the SEC reports.
“I don’t really know exactly, Brad, but I do know that the learning from this experience adds up to even more value,” he said.
Zillow’s largest shareholder, Caledonia Investments, once predicted that the online giant would be worth $50 billion some day. If that happens and Stephenson holds on, then his net worth would rise to $50 million.
Regardless, Stephenson’s $10 million is impressive. So, who is this guy?
While he is a broker-owner today, he still represents old clients. His website is a little dated and his bio reads like so many brokers across the country, personal and sincere:
Our goal is to provide the highest quality real estate services. We have over 60 licensed professionals, specializing in residential and commercial brokerage, mortgage lending, and a division devoted to property management for the small and medium sized investor. We have closed over $1,500,000,000 in sales since 1991, and are the largest property manager of houses and condos in Seattle. My home is in Lake Forest Park, not far from from North Seattle’s Shorecrest High School where I graduated in 1984. I earned a degree in Economics from Stanford University in 1988. In addition to my work at RPA, I am on the board of directors for Zillow.com, and have served on the boards for Seattle’s Union Gospel Mission and Earl Palmer Ministries. You can often find me in the dugout or at courtside, coaching my three kids’ teams.
The story here is not about Stephenson getting rich. Instead, this tale shows the contrast of two distinctly different worlds that often collide and partner with one another: the everyday brokerage vs. the backdrop of crazy tech riches. One is a rational path taken by small business everywhere; the other is an eye-poppingly crazy growth trajectory that rains prosperity on anyone who is lucky enough to be under it. Though uneasy at times, today these two worlds depend on each other.
Stephenson’s day-to-day business is like the DNA of the everyday broker everywhere.
They are local; they love real estate; they are often small businesses, even family businesses; they are earnest; they are teachers (of agents); they are compassionate (taking care of agents who do not get it); they are often set in their ways in a world that is changing fast around them; they are challenged to keep up with everything; their businesses are organized around a simple model but one in which margins are often eroding as their cost of goods goes up and contingent liabilities rise.
They were often agents who came up through the ranks and they were the most ambitious among their peers. They took a risk starting their own shop, recruiting other agents and launching their own brokerage.
Like so many small businesses, the pride of ownership is rewarding and the returns in a good market make it worthwhile. But day in and day out, the rigors of running a local brokerage are daunting and tiring.
But in the end, Mr. Stephenson, you are a lucky guy, not because you made $10 million from your role at Zillow. But because you slog it out every day running a brokerage, working your leads as a Premier Agent, representing old clients, and coaching your agents and your kids. It’s not easy, but it is more than meaningful.