When consumers are home shopping these days, they tend to be drawn to consumer-friendly portals like Zillow, Trulia, Redfin and others, which offer simple, user-friendly tools to take on what’s otherwise a complex and confusing process. But these services can also sideline real estate agents, who are often still stuck using dated technology while their customers are being lured away by other agents on these popular sites. A company called RealScout has been addressing that problem, by giving agents powerful tools of their own, and now has closed on $6 million in Series A funding to continue to grow its business.
The round was led by DCM with participation from Formation 8. Additional investors included Ken DeLeon, the top realtor in the U.S. in 2012 according to The Wall Street Journal and REAL Trends; and Matthew Moore, formerly VP of sales and marketing at Realtor.com and an investor in Retsly, which sold to Zillow.
With RealScout, the idea is about providing a consumer-friendly service which real estate agents themselves can offer their clients through an agent-branded mobile app for iOS and the web. Using the service, potential home buyers can perform narrow, personalized searches on RealScout, allowing them to look for things like homes with “big back yards,” or “gourmet kitchens,” for example. Those natural-language queries can then be responded to via automated email alerts that help customers find home that match their niche criteria, and can help agents better retain, and ultimately convert, their high-value customers.
RealScout charges agents $79/month for access to its service, which is tied into local MLS’s in the markets its serves (currently 15 systems.) Bulk pricing is also available.
As a consumer who coincidentally is currently shopping for a home myself, I can understand the niche RealScout is trying to fill. There’s definitely a disconnect between the data on sites like Zillow and what’s really happening in the world of real estate. While I’m surfing Zillow and favoriting homes, my agent already knows that some homes are under contract or off the market, and are probably available to buy. Zillow doesn’t know that a rental property’s owner might take a reasonable offer, but an agent could get me this information.
Zillow’s data, basically, is stale. But its app sure is nice!
Initially, RealScout was servicing agents in the San Francisco Bay Area, then used its seed round funding to expand to other markets. Today, the company is working with agents in both California and Washington state. Over the past year, RealScout went live in Seattle and made deals with a number of brokerages, including Sotheby’s International Realty in Burlingame, Zephyr Real Estate in San Francisco, Realty One Group in the East Bay, Carmel Realty in Carmel, and Century 21 Bundesen in Petaluma.
According to CEO Andrew Flachner, the service today includes roughly 50,000 active listings, not including pending and sold lists.
“These are the most innovative and competitive real estate markets in the U.S.,” he explains. “We’re demonstrating our value here first, and we’re currently planning our expansion into other markets.”
While the company won’t disclose metrics like customer count or revenue, Flachner would say that since its founding two years ago, it has grown from a team of 2 to now 22. Recent hires have included Duke Fan, a VP of Product at Realtor.com, and Arthur Kaneko, former VP of Investments at DCM.
With the additional funding in tow, Flachner says RealScout will continue to grow its team in marketing and engineering.
“We’re investing heavily in understanding homes and home buyer preferences even more,” he says. “Buying a home is a complex, emotional and important decision, and we’re rapidly gaining what we think is a unique perspective into how technology can enhance this decision. We think agents are a critical piece of the puzzle that previous ‘disruptive’ tech plays dismissed – but a stakeholder we’re laser focused on,” Flachner adds.
The company is also actively developing tools that will better leverage the data its system collects about listings to help its agent customers convert more leads.