Tag: tech

• Opendoor.com raises $9.95M to make selling your home as easy as a few clicks

  

  If you’re a regular reader of ATC, you’ll know that I’ve been following the startup Opendoor.com for a few months now. I first wrote about it when it was codenamed Homerun and I just recently wrote about them as preface to a real estate survey I was conducting.

  Well, about an hour go it was announced that they’ve just raised $9.95M in venture funding from everyone and their grandmother. Here’s the list of investors (via TechCrunch):

  Paypal co-founder Max Levchin, Former YouTube and Facebook CFO Gideon Yu, Eventbrite co-founder Kevin Hartz, Y Combinator’s Sam Altman, Quora CEO Adam D’Angelo, Yammer co-founder David Sacks, Angelist’s Naval Ravikant, Yelp CEO Jeremy Stoppelman, Box CEO Aaron Levie, Initialized Capital’s Harjeet Taggar, Garry Tan and Alexis Ohanian, Former Twitter vice president Elad Gil, Blippy co-founder David King, Flixster co-founder Joe Greenstein, Angel investor Mike Greenfield, Quora co-founder Charlie Cheever, Path’s Dave Morin, Facebook vice president Dan Rose, Trevor Traina, Resolute Ventures’ Mike Hirshland, Caffeinated Capital’s Ray Tonsing, Felicis’ Aydin Senkut, True Ventures’ Om Malik, Thrive Capital’s Josh Kushner, Crunchfund’s Michael Arrington (who disclaimer: founded TechCrunch) and SV Angel.

  Not surprisingly, there are quite a few people who see an opportunity in the $20 trillion US residential real estate market – which I think is a good thing. This is a space that–despite its size–hasn’t seen an awful lot of innovation.

  There still isn’t a lot of information about the product, but there’s a clear focus on creating liquidity in the marketplace. Despite being located in San Francisco, the company will be launching in 3 markets outside of California – where liquidity isn’t as great for homeowners.

  The goal is to transform the typical 90 day selling process into a few clicks online. Homeowners submit their home to the platform and then Opendoor makes an instant offer to buy. Done.

  What I wonder then is if it’s going to be an arbitrage play. They buy the homes below market (because they’re offering total liquidity) and then they turn around and sell them at market.

  Do you have any guesses as to their business model?

  2014.07.07

• Your thoughts on the real estate marketplace, please

  If you know me at all, then you’ll know that I’m a big proponent of introducing more technology into the real estate space. I think the industry is one that has been incredibly slow to embrace technology, but that it’s only a matter of time before it does.

  Two months ago I wrote a post talking about how entrepreneur and venture capitalist Keith Rabois is working on a home buying startup codenamed Homerun — now called Opendoor. Here’s how he recently described the state of affairs:

  “My friend [PayPal and Palantir cofounder] Peter Thiel suggested that I come up with an idea to innovate in residential real estate,” Rabois told VentureBeat in April. “It’s the largest part of the economy unaffected by the Internet. And that was definitely true then, and even with things like Trulia and Zillow, it’s fundamentally true today. But the process of [selling a home] hasn’t been transformed by technology.”

  What Opendoor is trying to do is really interesting, but I have a different idea. It’s called Unlyst. And today I’d like to ask the ATC community for a small favor. I’ve created a short home buying and selling survey (embedded below) that will take you at most 2 minutes to complete.

  If you could please take the time to do that, I would greatly appreciate it. I’ve made the results public as well, so you’ll be able to see how buyers and sellers currently feel about the real estate marketplace. If you can’t see the survey below, please click here. Thanks for your help!

  [googleapps domain=”docs” dir=”forms/d/1bKvHYdSUfYH3AGX7LcLIK0_-i7nt7WIdTmHeaJ8P7pY/viewform” query=”embedded=true” width=”760″ height=”500″ /]

  2014.06.30

• Without trust, you have nothing

  I was reading Fred Wilson’s AVC.com blog this morning (as I do every morning), and I thought his post on trust was a really important one. He was talking about it in the context of building successful web applications, but I don’t think it’s only applicable to internet businesses.

  As marketer Seth Godin wrote on his blog earlier this year, the most important questions are not:

  Is my price low enough?

  Is it reliable enough?

  Do I offer enough features?

  Am I on the right social media channels?

  Is the website cool enough?

  Am I promising enough?

  No, the most important question in marketing something to someone who hasn’t purchased it before is,

  “Do they trust me enough to believe my promises?”

  Without that, you have nothing.

  I thought this was such an awesome, yet simple, post that I actually circulated it to a bunch of people in the office after I read it. Because whether you’re marketing widgets, marketing private cloud storage, marketing to investors, or marketing new condominiums, that question of trust is paramount.

  And it’s for that reason that I think social media and mediums such as blogging have become so important. Customers want to feel like they trust you before they buy your product. The best brands know this and forge “relationships” with their customers. And with the tools at our disposal today, it’s become a lot easier for companies to do that.

  2014.06.27

• Tech and the City

  

  I’m reading a great book right now called Tech and the City. I’m only 31% of the way through it (according to my Kindle app), but already it’s been an interesting read. It’s about the making and rise of New York City as a technology and startup hub – which, is fairly recent phenomenon. There aren’t too many cases where New York plays second or third city, but tech is one of those instances. Silicon Valley dominates.

  The book talks about the deliberate efforts that were made, by the Bloomberg administration as well by many others, to diversify New York’s economy away from financial services and towards technology, startups, and entrepreneurship. It gives you all the backstory about the rise of Silicon Alley in the 90s, its subsequent crash in the dot com era, and all the players involved. And yes the reference to Sex and the City is both on purpose and explicit throughout the book.

  But at a time where cities all around the world are trying to replicate the success of Silicon Valley, the takeaways from this book are perhaps universally applicable. It certainly got me wondering if, here in Toronto, we’re doing enough to prepare our city to dominate in the 21st century.

  Image: Stephen Wilkes

  2014.06.26

• How mobile apps are going to help us build better cities

  

  Some of you might know that I’ve recently started using a mobile app called Strava. It’s a platform that allows you to track your runs and bike rides, as well as those of your friends. It tells you your speed, elevation changes, and it also maps your trips–among many other things. Here’s what my 50 km ‘Ride for Heart’ looks like from last Sunday.

  But what’s even more interesting is how cities are starting to use the data this app collects:

  For $20,000 a year, transportation planners and others can access Strava Metro, which provides an unprecedented look at where and how people are biking. It can tell them where they speed up and slow down, for example, or where they might stay in the street or ride on a crosswalk. That information can reveal where bike lanes or traffic calming measures would be useful, and if those already installed are effective.

  It’s a perfect example of how “tech” is infiltrating so many other sectors. Mobile technology and networks are generating huge amounts of data and it’s happening at an increasing rate. We’re gaining insights into the way people live that simply wasn’t possible before. Some of this information will inevitably be misused, but a lot of it will be used to improve the way we live our lives.

  I know that the City of Toronto also has its own proprietary cycling app and is hoping to collect similar sorts of data from it. But intuitively, I don’t think they’ll be able to compete with the scale of a platform like Strava. Though I certainly applaud the initiative.

  The information age is an exciting time.

  Image: Strava via Wired

  2014.06.04

• Home remodeling site Houzz valued at $2.3 billion

  Earlier this week it was announced that home remodeling site Houzz raised a $150 million Series D round, which would value the company at around $2.3 billion, post-money. Meaning, that’s the value of the company including the money it just raised.

  If you’ve never used Houzz before, it’s a platform that offers design inspiration for remodeling projects, products for sale, and a directory of home professionals. The company makes money by selling products through its online storefront and through premium accounts for the pros.

  The perceived value of Houzz likely stems from the fact that it provides a platform to address the estimated $300 billion home improvement market. But what I see as really exciting is the potential for Houzz to bring even greater transparency to the whole renovation and construction marketplace.

  Already Houzz has started to aggregate data on average renovation costs throughout the US. But there’s a lot more they could do. Professional reviews and design inspirations are great, but I can imagine them “moving up the stack” to start acting as a king of virtual general contractor that manages more of the actual renovation process.

  And that would be pretty powerful.

  2014.06.03

• Could a decentralized sales model work?

  

  Since I started blogging last year, I’ve been getting regular emails from both people I know and from readers I don’t know (but hope to one day meet) asking for advice on buying real estate. Usually somebody sends me the link to a place they’re thinking about buying, and they want to know what I think about the property and the neighborhood.

  I’m more than happy to help when I can and I try to be brutally honest in terms of what I think. What’s interesting about this dynamic though, is that I don’t have a vested interest in any of the outcomes. Whether I tell that person I love the place or that it’s shit, I don’t stand to gain anything. And that means I can be brutally honest. It’s for this same reason that customer reviews on websites can work so well. 

  Because on the flip side, if I make money when you buy, then guess what, I’m going to want you to buy. That’s how it works for any industry–from financial services to real estate to retail. That’s why some stores will promote the fact that their sales people are not on commission. Although you could argue that those sales people are then less motivated to help you.

  In any event, all of this got me wondering if there isn’t some way to take customer reviews to the next level. Could a decentralized sales model work?

  Last year I had a conference call with one of the chief officers of one of the top 3 real estate websites in the US and I was told that they had actually tested a “social buying model.” It ultimately failed, but it strikes me as an interesting concept. Reviews are starting to feel a bit dated now on the social web, but I think the idea of crowdsourced input is here to stay.

  Image: Flickr

  2014.05.25

• New startup wants to solve urban congestion through data and lotteries

  

  If you’re a regular reader of Architect This City, you’ll know that I’m a supporter of congestion and road pricing. Any valuable good or service, such as a road, that’s offered for all intents and purposes as free, will never be able to keep up with demand. You need to price it.

  However, the political risk associated with implementing something like this has made it such that few cities around the world have done it. London and Singapore are the two most common examples.

  The more populist solution is to simply build more roads and highways, even though study after study shows that this doesn’t work. If it did, we would have already solved the problem of traffic congestion. And we most certainly haven’t.

  Which is why I’m excited about a new startup that recently launched called Urban Engines. Their solution is twofold. It’s based on incentives and on treating people and cars in cities as sensors that feed back data into their network. Here’s a brief video. If you can’t see it below, click here.

  [youtube https://www.youtube.com/watch?v=oaCp5Tl-uAc]

  The data piece is almost a no-brainer (provided they can get the data). The more data we can collect about the way people and cars move in a city, the more they’ll be able to optimize and manage the flows. The possibilities are endless.

  But what I found really interesting is their incentives based approach. Typical road pricing methods are, one could argue, a punitive approach. As traffic increases so does the price of the road. (I like to look at it as efficient pricing.)

  With Urban Engines, their approach is the opposite: it’s to reward people–through money and lotteries–for driving during off peak times. It’s smart because selling a reward program to cities will be a lot easier than selling a new charge.

  Overall, this a great example of how startups are stepping up to solve some of our most important societal problems. For more information on Urban Engines, check out their website and this writeup on CityLab.

  2014.05.19

• Location-based social network Foursquare is unbundling

  I’ve been a Foursquare user for a number of years now. I like seeing which friends are nearby and where I’ve been. I love the data aspect of it. It’s a kind of urban “spidey sense.”

  Sometimes when you “check-in”, the app will tell you the last time you were there (if it’s been awhile), how many consecutive weeks you’ve been there (which I like seeing when I check-in at the gym), and also give you any tips that others may have left about the place you’re at–such as, try the sea urchin ceviche.

  But Foursquare has been struggling. Check-ins proved to be a bit of a fad and Yelp solved the what-do-you-want-to-do-tonight problem better. However I’ve always felt that, on a fundamental level, Foursquare had the potential to be so much more powerful than Yelp. 

  Well, today the big news in the tech world is that Foursquare is unbundling its app. There will be Foursquare and there will be Swarm. Foursquare will be a recommendation engine that helps people find places to eat, drink, shop and so on (just like Yelp), and Swarm will be all about social–seeing where your friends are and which ones are nearby. And along with this unbundling, there will be no more check-ins:

  But how can Foursquare personalize its users’ results if they are no longer collecting check-ins, the foundation of Foursquare’s recommendation engine? Crowley smiles and says something a bit shocking. He no longer needs check-ins, the meat and potatoes of Foursquare’s entire business and data collection engine for the last five years.

  Not only has Foursquare collected 6 billion check-ins, he says, but it has collected five billion signals to help it map out over 60 million places around the world. Each place is a shape that looks like a hot zone of check-ins — of times when people have said “I’m here.” Foursquare’s “Pilgrim” location-guessing engine factors in everything from your GPS signal, to cell tower triangulation, to the number of bars you have, to the Wi-Fi networks, in order to create these virtual shapes.

  Now that it has this data, Foursquare can make a very accurate guess at where you are when you stop moving, even without a check-in, it’s a technology it hopes will allow it to keep its database of places fresh and accurate. Foursquare calls these implicit check-ins “p-check-ins,” or Neighborhood Sharing. Take your phone into four or five different Japanese restaurants over the course of six months and without a single check-in Foursquare will learn that you like Japanese food and start making recommendations for you based on that data.

  There will obviously be a number of people who have anxiety about an app that’s passively tracking everywhere they go and then trying to feed them recommendations (come eat here!), but I do think they’re on to something.

  The opportunity with Foursquare (and its data) is that the recommendations can be tailored. If I’m looking for a place to eat, Foursquare will already know that I love Mexican and that I just worked out (meaning I’m probably extra hungry). Personally, I’m okay with that.

  But then I start to wonder how this might impact cities. If the process of discovery becomes this automated and this tailored, how might it change the way we organize and design our cities?

  2014.05.02

• What will selling your home look like in 5 years?

  Earlier today it was announced that Keith Rabois–a venture capitalist with Khosla Ventures and the former COO of Square–is working on a startup that hopes to make selling your home as easy as a few clicks. The codename for the project is Homerun.

  “For most people, homes are their biggest asset and it’s completely illiquid,” Rabois said. “This is a really expensive transaction for many people. What we’re going to provide is instant certainty, liquidity and convenience for normal people to sell their homes.”

  Rabois hasn’t shared many details, other than a pretty basic flow:

  “I’m not going to describe the exact flow, but the general point is you’ll tell us what your address is and confirm your identity, then we’ll allow you to sell your home,” he said. “Obviously there’s a variety of ways you could verify your identity that we didn’t have in 2003, when I originally thought of this idea. Like Facebook Connect.”

  This, of course, isn’t a new idea. Many companies have tried to improve the process of buying and selling homes by going online. But it’s a space that hasn’t seen a lot of innovation. I’m particularly interested because I work in real estate and it’s always struck me as a lumbering archaic industry.

  So when a name like Keith Rabois announces that they’re working on solving a problem in this space, I get excited about what might come about.

  2014.04.03