Zillow Thoughts, First of Many

A lot of my friends from around the U.S. have asked me what I think about Zillow.com. You've probably heard or read about them in the press. Zillow is the Seattle-based real estate start up that provides consumers with a free valuation on homes. The founders have managed to raise a significant amount of capital, $57 million, in 2 rounds which means there's an expectation that an exciting pipeline of new features and tools are on the horizon.

I personally like Zillow's site. It's got a fun, campy feel to it and the value proposition is pretty compelling. It's going to tell me the value of my home (or my neighbor's or my boss's or Bill Gates' home if you have his address). No strings attached.

I'd say that's a pretty big hook for the consumer. A few thoughts here...

The user/consumer needs to buy into this number. Do I believe it? Does the market believe it and use it? I.E. buyers, sellers, realtors. Zillow will need to fine tune and continue to invest in the Zestimate so that folks start to respect and treat it as a leading market indicator of value. Otherwise, the allure of the Zestimate could fade quickly and it becomes another hokey online tool.

Also for the ad business model to work, there's the issue of getting the consumer to stay on site. A one trick pony a business model don't make.

Right now, once I've looked up my target home, say my buddy Mark's in San Diego, I get my jollies sated and leave. I need something else compelling to click, read, etc.

While the company has done a great job of getting folks to the site (ave. 3-4 million unique visitors/month), what are they going to do to keep them there in the long run?

New content, services. Certainly. More recently, they've aded a financing tab and heat maps of cities around the U.S. to help with this.

I do wonder, though, about the ultimate opiate that will keep folks on-site .... listings?!?

You heard it here first. If Zillow were to somehow infiltrate the world of the Multiple Listing Service (MLS), I'd be first in line to put my meager savings down for a round three of financing.