Zillow – This Real Estate Startup Is Exploiting Zillow And Airbnb’s Blind Spot
(Photo courtesy of Revestor)
The evident dominance of Airbnb and Zillow has transformed the way residential real estate is discovered, managed, and rented. More specifically, the swift rise of these digital platforms marks a paradigm shift, asserting that the top real estate enterprises of the future will be disruptive tech companies.
Airbnb currently lists over 2.3 million homes, averaging more than 500,000 nightly stays across 65,000 cities. In 2016, the home-sharing giant snatched headlines after raising over $555 million from Google Capital and Technology Crossover Ventures, in pursuit of a reported $850 million round, raising the company’s valuation to $30 billion. This valuation positioned Airbnb as the second most profitable tech startup after Uber. To date, Airbnb has successfully raised a staggering $3 billion.
Zillow, the prominent hub for reviewing and sharing real estate information, boasts a market cap of $6.14 billion, generating a total of $96.6 million in funding.
Yet, despite the ability of these power players to successfully scale and master niche segments of the market, questions pertaining to the investment value of property and projected return on investment go unanswered on both platforms. Understanding the evident need and profitable opportunity in solving for this blind spot, one real estate entrepreneur launched a startup to advance the industry and rival the competition.
Founded in 2011 by Bill Lyons, Revestor is a digital real estate search engine that uses proprietary data and live listings to help sync realtors and potential investors with desired residential properties. While other services allow users to search real estate based on specific property details, Revestor lets users search based on investment criteria. This approach works to ensure the most profitable use of available funds, helping homebuyers track the projected resale value of their property over time. Thus, real estate investors can use various tools to determine whether a property matches their firm investing goals.
Revestor’s competitive advantage is found in the platform’s emphasis on customization, providing in-depth analysis tools to assist beginning and experienced real estate investors find potential investments nationwide and accurately measure their likely return. Backed by two of Lyon’s ventures, Lyons Real Estate and Griffin Funding, the progressive startup is looking to redefine the short-term residential rental market.
I spoke with CEO Bill Lyons about the vision behind his company, disruptive the real estate industry, and plans for taking over a rapidly evolving tech industry.
What was the specific void or opportunity that inspired the idea behind Revestor?
Bill Lyons: Technology has changed the way people look for houses. Look at Zillow and Redfin, for example. However, when it comes to residential real estate investing, technology had not transcended a tradition of books and seminars. I knew we needed to solve for this, and that’s ultimately what we did.
Most people may not think of a real estate company as a tech company — In what ways do you see Revestor redefining how people view the space in a digital age?
Bill Lyons: Additionally, over 90% used the internet to research the home they were buying. Revestor seeks to redefine how people search, analyze and acquire investment properties. Zillow is a marketplace, not a real estate company, and they have done a great job being a tech company. Redfin, however, is an actual real estate company, and they have done a great job at being a tech company as well. Big name real estate franchises like Keller Williams, Remax, Sotheby’s, and Coldwell Banker are all deciding on how they will become tech companies. Will they hire large in-house teams of developers to build proprietary products, or will they outsource it to professionals who can keep them under budget? Bottom-line, the space is getting disrupted. If you adapt to change, the opportunities are endless. If you resist, you won’t survive.
What do you see as the keys to establishing a competitive advantage in the changing real estate market?
Bill Lyons: The riches are in the niches. We make money by connecting realtors with investors. I have my eye on all the trends right now. I own three companies inside the real estate space, and I’m on the advisory board of a startup. Griffin Funding, a mortgage lender that operates in multiple states; Lyons Realty, a San Diego based boutique real estate firm; and Revestor, a digital platform that provides data to help find and evaluate investment properties. As an advisor, I’m working with a startup called Approved, which is a digital mortgage platform. I just acquired a new technology that we will use for all the companies in the portfolio. It is a total game-changer when it comes to providing hot leads to Realtors. It is the same technology that politicians used recently to win in their districts. We will soon be offering it up to all our realtor partners. They will be able to simply upload their list of physical addresses inside their ‘farm area ‘ and we will match it to the IP addresses in their farm. We then help them run ads on all the computers in their farm. The new product is called ‘Sniper Farming’ and we are super excited to begin offering it to our customers.
Your company uses smart data and live listings to help match realtors and investors to the right property — How does the process work and what key data points are factored into to make determinations?
Bill Lyons: We are what we eat. If I eat a steady diet of fast food, my performance is going to be poor. The same applies to Revestor. If we don’t feed the platform quality data, we can’t deliver quality results to our clients. The problem we face in the real estate industry are the hundreds of data sources from the countless multiple listing services across the country. We’re currently improving our database and will be making this transition as we plan to be around for a long time. The industry is currently plagued with multiple companies resorting to ‘web scraping’. There are companies now that scrape data from local real estate websites and Airbnb. Is it legal? That depends on who you ask. It is helping some startups avoid huge API and data costs while creating duplicate content for others — thus confusing Google.
How have your experiences as both a realtor and investor specifically shaped how you’ve built the company and what takeaways have you carried over?
Bill Lyons: From the Realtor side, I bring my passion for service. While we are a tech company, we’re very customer focused, and I try to reply personally to as many inquiries as possible. I want to hear what our customers are saying so that we can continue to build the features they want. As an investor, I love the ability to run different investment scenarios on the fly. From long-term and vacation rentals, to fix and flip. Beginners will no longer buy based on hyperbole or salesmanship.
As the on-demand economy continues expanding — Where does a company like Revestor fit into the fold and how does your company add value in the changing marketplace?
Bill Lyons: Crowd funding for real estate is on the rise with companies like Patch of Land and RealtyMogul. I can see Revestor playing a key role in analyzing investments for private groups of individuals. Airbnb is growing like crazy, and more and more investors are looking to own vacation homes to host on their site. The returns can be astronomical compared to renting out homes to long term tenants.
What separates Revestor from other major search services like Zillow?
Bill Lyons: Our property detail pages have sliders, which allow the user to change the numbers of key indicators as it relates to their investing goals. We also have the ability, through free account creation, for users to set their own investment criteria and to be notified by email when like properties become available.
How do you see Revestor evolving over the next 3-5 years and how do you see your company shaping the real estate market?
Bill Lyons: We’ll evolve through innovation and through the direction of our customers. If we can do those two things better than others, then we’ll be the ones shaping the future of the real estate investing market.
Zillow – This Real Estate Startup Is Exploiting Zillow And Airbnb’s Blind Spot