I have been writing about the startup Opendoor.com for over 2 years now. And I continue to believe that they are the most promising disruptor in the residential real estate space. 

Here is the first post that I wrote back in July 2014 after they raised their first round of funding. Here is the second post that I wrote after they launched in Phoenix. And here is another post that I wrote 6 months ago where I argued, once again, that they are doing something worth paying attention to. (This last post explains how the platform works.)

Well, about a week ago it was announced that they have raised another round of funding: a $210 million Series D. In all likelihood, the company’s valuation is now over $1 billion. Here’s the Techcrunch announcement where the message was: huge ass number; risky business model.

In response to this, Ben Thompson wrote a terrific and widely shared blog post called, Opendoor: A Startup Worth Emulating. I love his post because he says what I have firmly believed and argued for many years: Zillow and Redfin are not disruptive real estate startups.

This is what he says about Zillow:

“And yet, the most successful real estate startup, Zillow (which acquired its largest competitor Trulia a couple of years ago), is little more than a glorified marketing tool: the company makes most of its revenue by getting real estate agents — the ones collecting 6% of fees, split between the buying and selling agents — to pay to advertise their houses on the site. Certainly a free tool that makes it easier to find houses in a more intuitive way is valuable — Zillow has acquired the sort of userbase that allow it to build an advertising business for a reason — but at the end of the day the company is a tax on a system that hasn’t really changed in decades.”

And though very risky, he argues that Opendoor is far better positioned to shake up the status quo. 

Here are two of his key points:

“Sellers are uniquely disadvantaged under the current system, which is another way of saying they are an underserved market with unmet needs.” [Sellers are the side of the market that Opendoor is specifically targeting.]

“Opendoor has a new business model: taking advantage of a theoretical arbitrage opportunity (earning fees on houses sold at a slight mark-up) by leveraging technology in pursuit of previously impossible scale that should, in theory, ameliorate risk.”

And here’s what that could ultimately mean for the industry:

“Opendoor has many more reasons why it might fail than Zillow or Redfin, but its potential upside is far greater as a result. First is the immediate opportunity: sellers who can’t wait. However, as Opendoor grows its seller base, especially geographically, its risk will start to decrease thanks to diversification and sheer size; that will allow it to lower its “market risk” charge which will lead to more sellers. More sellers means both less risk and an increasingly compelling product for buyers to access, first with a real estate agent and eventually directly. More buyers will mean lower marketing costs and faster sell-through, which will lower risk further and thus lower prices, pushing the cycle forward. It’s even possible to envision a future where Opendoor actually does uproot the anachronistic real estate agent system that is a relic of the pre-Internet era, and they will have done so with realtors not only not fighting them but, on the buying side, helping them.”

I’m with Ben on this.

I just discovered an interesting Dallas-based startup this morning called TOOR. They were on Shark Tank and haven’t yet launched their product, but it’s essentially a connected lockbox. Lockboxes are a mainstay of the residential real estate industry (they hold the keys so that co-operating agents can show a property) and they are becoming even more common nowadays because of Airbnb rentals.

What caught my attention about TOOR is the app that goes along with the lockbox that also allows people to search for homes. Once you’ve found a home you can even find an agent for an escorted tour. I’m not clear on the exact workflow, but I am thinking that if you buy this connected lockbox you then have the opportunity to put your home up for sale on their platform.

This is interesting because the app will also verify user identities and scan people’s IDs, so it helps to solve the security problem that agents today now solve. I could imagine the app storing my credit card so that if I go into a home unescorted and I do something mischievous, it then charges me. It also makes it really easy to just drive around and pop into homes by instantly scheduling appointments.

In any event, I may have the exact user flows a bit wrong, but it’s fascinating to think about how something as simple as a connected lockbox could start to chip away at the status quo.

Work Market is an “on-demand talent marketplace.” They connect companies who need work done with skilled freelancers who are looking to do work. Conceptually, we’ve seen this before.

But this morning, as I was reading this interview with the CEO, the following lines got me thinking:

“By 2040, I’m pretty confident that every skilled worker will have their own signpost. You will be your own enterprise, in a much more meaningful way than the lip service of today.”

We are already seeing this phenomenon play out. Social media, for instance, has made all of us our own media brands. So it’s not outlandish to believe that we will also see more, not less, of this in the labor market.

But what I started thinking about is how this changing relationship between business and labor will ultimately manifest itself in our cities. 

If we are indeed shifting toward a fluid and dynamic labor market where not only do people switch jobs more frequently, but they have their own signposts, then I have got to believe that urban density will only become more important. We’ll all need to be “plugged in” to the market – both online and offline.

But what are your thoughts? I think this could make for an interesting discussion in the comments.