Urban Compass, a New York-based startup that last year raised an $8 million seed round while still in stealth mode, is coming out of the shadows and debuting its first services in public beta: a hyperlocal social network, called the Urban Compass Network, and a housing rentals platform that brings online the whole process of finding, securing and subsequently paying for a place to live. The two services, which debut first in New York, were formally unveiled today at a press conference led by the Mayor of New York City, Michael Bloomberg.
Ori Allon, the co-founder and executive chairman — and also a search PhD who sold his last two (search-focused) startups respectively first to Google and then Twitter, where he became head of engineering based in New York until he left to start Urban Compass — is trying something new with his latest venture: a “data-driven company” as he describes it, but also one that, fundamentally, will be relying on a lot of human input for the wheels to turn.
In January, alongside an engineering recruitment effort, the company began to hire a cadre of “neighborhood specialists” to act as experts on specific locales in the city, with the request that they also have some kind of experience in customer services. The neighborhood specialists, it turns out, are serving a two-fold purpose. They are data collectors, reporting on the best that a neighborhood has to offer, which will be fed into Neighborhood Guides; these will in turn become the building blocks of Urban Compass Network. And, putting on another, more businesslike hat, those neighborhood specialists are agents, bringing prospective residents to look at potential homes. (And Urban Compass has equipped them with training and licenses for that purpose.) The aim is for 200 people to work for Urban Compass by the end of this year.
The rentals part of the service is already being used in private beta: a large corporate based in the city signed on and started to refer to Urban Compass all of its employees relocating to New York. Those users in turn were able to refer others to the site. With UC taking a percentage of every lease completed through the site, the rentals business has already started to bring in some impressive revenues — Allon says numbers will be made public soon, but he notes that those sales are strong enough that he and the other three co-founders — CEO Robert Reffkin, an ex-banker and non-profit fundraiser extraordinaire; head of product Mike Weiss; and lead engineer Ugo Di Girolamo — will not need to be raising more funding any time in the near future.
(Backers in the seed round included Founders Fund, Goldman Sachs, Thrive Capital, the CEO of American Express Kenneth Chenault, and ZocDoc’s CEO Cyrus Massoumi, among others.)
The rentals part of the site is a fairly disruptive operation in itself: not only does it cut out brokers who have acted as the costly middle man for each rental in the city; but by going directly to those leasing out properties, it’s offering one more way for them to bypass sites like Craiglist.org, creating a simple, one-stop shop for the lifetime of a rental deal. It’s also a direct link to one of Urban Compass’s first big hires, Gordon Golub, a long-standing real estate executive in the city.
Still, combining a hyperlocal social network and an e-commerce focused rentals site may sound like an incongruous pairing: a social network seems to work best when it feels as organic and uncommercial as possible, while a housing rentals site seems like the most overtly of commercial enterprises. But at Urban Compass, not only do the two have the same people working for them, but the they are built on the same platform.
“I like big challenges,” Allon says of decision to introduce the two services together. He maintains that both get equal weight in the company’s current system, and they will do in the future as Urban Compass adds more features.
Allon describes the social network as “an essential part of both our system and future growth plans,” while the rentals service, which will soon also include homes to buy, addresses a fundamental need, one that goes hand-in-hand with selecting a neighborhood to live in: “We want to help people find a place to live, both as a neighborhood and a home.” The idea, he says, is for rentals to complement other neighborhood-focused services going forward. “It’s true that we’re starting with rentals, but this is the just the first step. We’ve designed the system with large scale in mind.”
In the beta phase of the service, only those who sign up for rentals services will have access to the Urban Compass Network. The plan is for that to open up as Urban Compass’s own services grow to cover other areas.