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Seattle Tech Trends — What’s Happening in Real Estate?
Every day on my way to work, I walk past a condo building where two-thirds of the units are listed on Airbnb. Many of the owners own multiple units, and while most HOAs prohibit short term rentals, the president of this building’s HOA owns three units and lists all of them on Airbnb. (An Airbnb calculator estimates a 1 bedroom unit in this building makes ~$50K in annual revenue)
Clearly there is a lot of interest in real estate in Seattle, and over the last decade, Seattle has become a major center of real estate innovation and investment, both in physical real estate and in real estate tech companies like Redfin and Zillow. Here are some of the trends we are seeing from local real estate tech startups:
Better Rental Management 💼
- Vacasa, StayAlfred, and Domicile are property managers who enter long-term leases and re-market properties on short-term rental sites
- OYO isn’t a Seattle company, but they just expanded here and have a crazy story. Short version: six year old company, started by a 19 year old CEO, now the third largest hotel chain in the world
New Financing and Ownership Models 💵
- Loftium offers customers discounted rent in exchange for managing an on-site Airbnb
- Crowdstreet operates a marketplace for individuals to invest in commercial real estate projects
Next-Generation Transaction Services 🤝
- JetClosing digitizes the home closing process through a mobile-first title and escrow service
- FlyHomes is a fully-integrated digital brokerage that offers things like cash offers and sale guarantees
SaaS Platforms for Managers and Brokers 💻
- Knock is a customer relationship management platform for multifamily property managers
- Moxi Works is a set of software tools for residential brokerages that spun out of Windermere’s tech department
What are some of the common themes? The first generation of real estate companies like Zillow, Redfin, and Trulia made data accessible. The next generation of companies is using data, analytics, and workflow automation to make it easier to manage properties, close transactions, and find new customers.
And what’s next? Here are a couple of things I’d be excited to see:
Social products. Today, browsing Redfin is a solitary experience, but could it be more engaging if it had some of the social dynamics of a service like Houzz or Pinterest?
Better ways to use space. There are 8 parking spots for every car in the US. Is there a better way to use these temporary spaces? And for permanent spaces, is there a WeWork for chefs, for dentists, or for tutors?
Microsoft on 🔥🔥🔥
After Microsoft’s Q4 earnings call last week, the WSJ wrote, “Microsoft’s comeback is no longer tech’s best-kept secret.” The company made over $125B in revenue and $10.6B in profit last year, beating analysts’ forecasts on both numbers. (by the way, in case you were wondering, $125B a year translates to $240K every minute 💸)
Charlie Bilello also posted a cool chart on Twitter illustrating this comeback. In 2000, Microsoft was the largest company in the world, but their stock suffered a 70% drawdown over the next 9 years, hitting a low in March 2009. Now, 10 years later, they are back at the top with a trillion dollar market cap. Pretty cool.
Also, remember that time Slack bought a full page ad in the New York Times to write an open letter to Microsoft welcoming them into the messaging market? Well, last week Microsoft announced that Teams has overtaken Slack in daily active users (13M vs. 10M). Seems like there are a lot of things to be excited about over in Redmond!
Other stuff I’ve been talking about
- 📺 or 👨🚀? — Kids in the US and UK want to become YouTubers when they grow up, while kids in China want to become astronauts. As a millennial, I’m thinking, “Why not both?” 🤷♂️
- 📞”Can you send me some money?” — Criminals are now using audio “deepfakes” to impersonate CEOs and ask for money transfers
- 😃 Emojis — There is a 12 person committee that decides what becomes an emoji, and you can look at all the applications they get. Here’s the one for the sloth emoji (yep, they reference Kristen Bell)
- 🎧 Bill Gurley podcast — This is a conversation between one of the best interviewers and one of the best VC investors ever. Learn all about network effects, marketplaces, and IPOs. Highly recommend
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About me: I work as an investor at Madrona Venture Group, a Seattle-based venture capital firm that has been early partners with companies like Amazon, Smartsheet, Apptio, and Redfin.
I’m writing this to connect with other people who are interested in what’s going on in PNW tech, so if you have thoughts, questions, or comments, hit reply — I’d love to hear from you! 👋
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