In the first of our series of interviews with Real Estate 2.0 market leaders, I spoke with Eric Heller, Director of Marketing for Redfin.com
Redfin started as a pure tech play but has morphed itself of late into an online brokerage, competing with the more traditional agents and brokers. It started in Seattle, but flush with $8 million in VC funding, they’ve recently rolled out into the San Francisco Bay Area as well.
Those savvy Redfin guys have even trademarked the term ‘Real Estate 2.0’ – but they’ve promised me I can still use it… (Right, Eric?)
Anyways, on with the questions:
1. What’s your elevator pitch? How would you describe your company in 50 words or less?
Redfin is the world’s first online real estate brokerage. Customers can see listings, previously sold properties and neighborhood statistics on a map, and buy or sell homes online. Local Redfin agents handle the negotiations and paperwork, refunding two thirds of their commission to the consumer. Unlike other brokerages, we pay our agents only on customer satisfaction.
2. What inspired you to create your site? What need did you identify that your technology could meet?
Redfin was the first company to put real estate data on a map. We were inspired to create the site by the need customers had to see the location of each listing, and to gather objective data about what other homes had sold for in each neighborhood.
3. What has been the biggest challenge getting your site off the ground?
Getting direct access to real estate data has been the most significant challenge, requiring Redfin to operate a brokerage in each of the states for which its site is available.
4. Real estate is generally seen as a conservative industry, what has the general reaction been to your site?
The industry itself has been initially hostile, but agents we work with directly have been receptive, and consumers have been extremely enthusiastic. We are fanatic about customer satisfaction, which has been at 100% since our launch.
5. Who is your typical user?
Our typical user is 25 – 35, Internet-savvy, buying his or her first or second home.
6. Any technological achievement requires significant R&D, how do you plan on recouping the investment and remaining profitable? (Which is a very long winded way of saying, what’s your business model?)
Our business model is to act as a brokerage, making money from buying and selling homes on behalf of consumers. By exceeding the expectations of those customers, we keep them and their friends coming back to use our service.
7. Who have you identified as your biggest competitors? Why?
Our most significant competitors are traditional brokerages, who are investing significantly in upgrades to their own Web sites.
8. What have you found to be the most effective ways to market (i.e., build the brand awareness/mindshare of) your site?
The most effective way to market the site has been through viral techniques; without any significant marketing spending Redfin has become the #1 brokerage site in Seattle.
9. Web 2.0 is often defined as a web-based service that lets people collaborate and share information online. How does your site either a) incorporate these ideas or b) plan on incorporating these ideas in the future?
Redfin is a Web 2.0 site because it uses Flash and AJAX technologies to create an interactive experience via the Web similar to that of a Windows client. We also monitor user activity on the site to identify hot properties. We are developing community features that allow direct communication between buyer and seller.
10. Why do you care about real estate?
We care about real estate because it is a market in which consumers have not traditionally been empowered; they’ve lacked access to the information they need to make informed decisions, and they haven’t been able to transact directly with one another, significantly increasing the cost and hassle involved with every transaction. Since almost everyone at Redfin has bought a home, our personal experience has motivated many of our business decisions.
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Thanks Eric. Stay tuned tomorrow for an interview with Amy Bohutinsky, Director of Communications from Zillow.com