Zillow鈥檚 Spencer Rascoff on the future of his $10B company 鈥淩eal estate is the ultimate untethered activity,鈥?says CEO of listings giant

Spencer Rascoff (Credit: Max Pixel)

UPDATED, 3:22 p.m., April 9: Spencer Rascoff doesn鈥檛 often share his secret sauce. But in a new, wide-ranging interview, the CEO of Zillow provided the most detailed look yet at the strategy that鈥檚 made the company a $10 billion listings giant.

The big insight, Rascoff said to Forbes, was betting it all on mobile in 2007, after watching Apple CEO Steve Jobs鈥?announcement that the company would allow third-party apps on the iPhone.

鈥淟iterally within the week we had pivoted towards mobile,鈥?Rascoff said. 鈥淸We] basically stopped all desktop development and redeployed all resources toward mobile web and mobile app development.鈥?/p>

Real estate, Rascoff added, 鈥渋s the ultimate untethered activity. When you want access to real estate information is precisely when you鈥檙e driving around a neigh阿爱上海同城

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borhood and looking at houses, not when you鈥檙上海千花网

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e tethered to your computer.鈥?/p>

The strategy paid off 鈥?today, mobile makes up about 80 percent of Zillow鈥檚 usage, and the company, which has a market cap of $10 billion, took in around $1 billion in revenue last year. About 80 percent of that revenue comes through Premier Agent, the online agent-advertising program that has generated its share of controversy.

Rascoff expects Zillow Group, which has acquired the likes of Trulia, StreetEasy, and DotLoop over the years, to generate around $1.3 billion in revenue this year. He acknowledged the company 鈥淸doesn鈥檛] entirely know how exposed we are to cyclicality,鈥?but believes that in the event of a downturn, advertisers will pull away from 鈥渦nmeasureable channels鈥?like print and direct mailing, allowing online advertising to take a bigger bite of market share.

Speaking on Zillow鈥檚 other divisive feature 鈥?the Zestimate 鈥?Rascoff said the company has used machine learning and artificial intelligence to make the property estimate tool much more accurate than in the past. Zestimate uses public data and algorithms to estimate the price of homes, whether or not those properties are on the market. Critics say it distorts consumer expectations, and it has been the subject of lawsuits in the past.

鈥淲hen we started 12 years ago, we had about a 14 percent error rate,鈥?Rascoff said. 鈥淭oday we have about a 4 percent error rate.鈥?/p>

Looking forward, Zillow has plans to expand its presence in the rental m上海龙凤论坛

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arket, which 鈥渉as fo爱上海

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r decades belonged to Craigslist,鈥?Rascoff said, with tools including 鈥渁utomated showings, automated applications, digital leasing and digital payments.鈥?It also wants to streamline the dealmaking process. The company is currently piloting its 鈥淚nstant Offer鈥?program, in which 鈥測ou press a button and we get you offers from that home from上海贵族宝贝

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investor buyers,鈥?he said.

Rascoff said people have grown accustomed to their smartphone being 鈥渢he remote control of your life,鈥?and that the company wants to 鈥渢ap into that consumer expectation of magic.鈥?/p>

鈥淲e haven鈥檛 really done that yet, to be honest,鈥?he said. 鈥淭he first 10 years have been great, and were successful, but shopping for a home today isn鈥檛 all that much different than it was five or 10 years ago.鈥?/p>

Correction: A previous version of this story incorrectly stated Rascoff s revenue projections. Rascoff expects the company will earn $1.3 billion in 2018.聽

Tags: streeteasy, tech, Zillow
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