Zillow.com,
the real estate Web site that has attracted a massive audience
of home price voyeurs, has also attracted a solid following among hedge
funds, most recently landing Legg Mason Capital Management
as lead investor in a
$30 million third
round of venture capital. The deal follows a July 2006 round in which hedgie Par Capital Management joined initial venture
backers Technology Crossover Ventures and Benchmark Capital by leading
a pre-emptive
$25 million second round just months after the site launched.
Investor
enthusiasm has emboldened Zillow management to hew tightly to a
consumer model for the site, which in true dot-com spirit started up with
an ambitious plan to attract eyeballs with an array of data,
mapping and photo features, but without a detailed revenue model. Today,
Zillow chief financial officer Spencer Rascoff confidently asserts that the company is and
always will be entirely advertising supported, with no need for
transaction support as part of its future.
Despite, or perhaps
because of, a cooling of the real estate market, Zillow has
attracted a devoted following of viewers drawn to its snappy
presentation of continually updated "Zestimates" of home values,
accompanied by bird's-eye views of properties from all sides. The
company's heavy investment to keep up with public filings on home sales
and technology to create sophisticated models for matching comparable valuations has paid off in extracting similarly diligent work from its audience, who has responded by generating user content to draw ever more valuable eyeballs, now measuring some 4.4 million unique visitors a month with median household income of $90,000.
- Clifford CarlsenSee story from TheDeal.comSee July story from TheDeal.comSee more on latest Zillow funding from
Insider Chatter,
MakeYouGogHmmm and
GigaOm
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