Entrepreneur’s Perspective, part two: : Frank Richards, serial entrepreneur and former CEO of SmartZIP: The Building of a Company

As an avid fan and investor in real estate I identified a significant gap in the residential investment market around 2004.  I noted that 15-20% of all homes sold in the US are for investment. But I also discovered that there were no national platforms or proprietary algorithms that could help people identify the best investment markets and the best properties. Essentially there was no Charles Schwab for the residential investment market.  I realized there was a great opportunity for a private banking platform to help people research, plan, acquire and manage residential real estate investments nationwide.

After developing a successful proof of concept, my business partner Dan Worley and I asked John Steuart to fund us and lead a successful Series A financing to provide the company with growth capital. Additionally our team included Sam Coates, a partner in Cooley who has an exceptional track record with early stage companies. Sam, John, and a team of advisers including some of the brightest minds in real estate, mortgage financing and academia were invaluable players to our team and our success. At the same time we launched an attractive and aggressive ISO plan to reward key executives and contributors that were so very dedicated to building an extraordinary company. Eventually NorthPoint served thousands of clients and directed the investment of more than $1Billion in residential real estate nationwide while developing the most advance algorithms for the residential real estate market.

Years later while having the opportunity to get some real rest and relaxation on a couple of golf courses in Scotland, I realized that continuing to build a national service business was going to be excessively expensive and challenging. One day looking out our balcony over the 17th hole (the Road Hole) at St Andrews I came to the realization that the power of our model was in the intellectual property–the proprietary algorithms that allowed the home owners and investors to obtain the data and intelligence to make the best decision when buying real estate. It was a revelation and SmartZip Analytics was born.

It was the world first ever rating engine for real estate. Many have compared it to Morningstar for real estate.  SmartZip’s first objective was to build a robust database and analytic engine to rate 80 million homes in America for the risk and investment potential. In 2007 and 2008, NorthPoint invested millions of dollars to build out the platform…The team (a tremendous team of PHD’s and engineers that worked 24/7 with great pride and passion to make a difference), built the nation’s most robust homeowner database utilizing over 1000 data points to engineer an analytical engine to rate residential real estate. Again our early success was a combination of a great team with special kudos to Avi Gupta and Ashutossh Malyviya (this product would not have seen the light of day without these two key inpiduals) and a great team of outside advisors and industry experts. Again John Steuart of Claremont Creek Ventures was the compass helping us with the development of our product and ultimately our monetization strategy.

In 2008, we decided it was time to hit Sand Hill road to properly capitalize the company. We went to market in an effort to capitalize the on-line business SmartZip and off-line business NorthPoint into a seamless integrated consumer offering. I thought I was turned down for dates in college a lot but it was nothing in comparison to our experience on Sand Hill Road. The message was loud and clear, separate the on-line business from the service company. Upon doing so we had a term sheet in a week.

I am forever grateful to Noah Doyle and Jed Katz of Javelin Partners for having the faith in our vision and team to first step up to the plate. Once again John Steuart and his supportive partners at Claremont Creek Ventures participate as the lead investor to round out our Series A financing. John and Jed have both been exceptional partners and board members. John’s innovation, coaching and critical thinking has led to some of our most innovating products.

We closed the Series A financing on January 16th, 2009 still very much in the heat of the real estate meltdown. In May of 2009, we were very fortunate to hire a great technology executive Tom Glassanos to take the helm of SmartZip. Tom’s has an exceptional track record in building great companies and maximizing shareholder value. He is a world class strategist that also knows how to get the most out of his great team He is also a fiscal conservative therefore a great shepherd of precious investment capital. With Tom on board and with the help of John Steuart and Jed Katz. SmartZip successfully closed a follow on financing with Intel Capital. Intel Capital has been an innovative partner providing substantial value day one. Christine Herron is a next generation thinker providing a new level of insight to an already strong board. Christine has visionary ideas with an understanding how to apply them to today’s internet marketplace.

With the capital, products and team in place, it was now time to go make money. Tom and team realized early on that there were three immediate ways to monetize SmartZip analytics:

1. License their proprietary analytics to third parties such as Realtor.com, Homes.com, RealtyTrac, investment firms, and hedge funds.
2. Utilize the analytic engine to sell customized property reports to realtors under a subscription model helping the realtors win more listings and attract more buyers.
3. Build SmartTargeting, a predictive listing engine and marketing system allowing realtors to target market the homes in a particular region that are most likely to be sold in the next 6-12 months. SmartTargeting allows a realtor to focus their efforts and marketing dollars on homeowners that are 4-6 times more likely to sell then other homeowners in the same region.

 Revenues have grown more than 300% in the past year and SmartZip continues to innovate in exciting ways. Through the efforts of the Board (John Steuart and Jed Katz) and great effort from management, engineering and the analytics team, SmartZip has determined their proprietary homeowner database and analytics are portable to the broader market of home services. Recently SmartZip launched a comprehensive solution to provide predictive marketing services for the mortgage and solar industries. These two new channels have been well received creating the ability to accelerate revenue growth and validate how SmartZip’s analytics are well positioned to serve the broader market of home services.

SmartZip has evolved into a predictive marketing company offering a smarter way to sell products and services to the home. Using industry-leading home intelligence, predictive analytics and integrated offline/online media campaigns, SmartZips’ predictive marketing platform proactively finds and nurture homeowners who are most likely to buy. Over 300 real estate professionals, lenders and solar energy companies rely on SmartZip to reach top prospects early and accelerate sales.

I love building great teams and visionary companies. It’s been a great journey, and I am very confident that SmartZip is going to be a huge player in the home services market.

by Claremont Creek Alertson December 19th, 2011

Guest Post by Frank Richards

The Building of a Company

Who is Joseph Kony?

Joseph Kony is the world’s worst war criminal. In 1987 he took over leadership of an existing rebel group and renamed it the Lord’s Resistance Army (LRA).

The LRA has earned a reputation for its cruel and brutal tactics. When Joseph Kony found himself running out of fighters, he started abducting children to be soldiers in his army or “wives” for his officers. The LRA is encouraged to rape, mutilate, and kill civilians–often with blunt weapons.

The LRA is no longer active in northern Uganda (where it originated) but it continues its campaign of violence in Democratic Republic of Congo, Central African Republic, and South Sudan. In its 26-year history, the LRA has abducted more than 30,000 children and displaced at least 2.1 million people.

What is the goal of KONY 2012?

Invisible Children has been working for 9 years to end Africa’s longest-running armed conflict. U.S. military advisers are currently deployed in Central Africa on a “time-limited” mission to stop Kony and disarm the LRA. If Kony isn’t captured this year, the window will be gone.

We are taking action to ensure these two things:

1) That Joseph Kony is known as the World’s Worst War Criminal.

2) That the U.S. military advisers support the Ugandan Army until Kony has been captured and the LRA has been completely disarmed. They need to follow through all the way and finish what they have started.

Why are we making Joseph Kony “famous”?

Invisible Children’s KONY 2012 campaign aims to make Joseph Kony famous, not to celebrate him, but to raise support for his arrest and set a precedent for international justice. In this case, notoriety translates to public support. If people know about the crimes that Kony has been committing for 26 years, they will unite to stop him.

Secondly, we want Kony to be famous so that when he is stopped, he will be a visible, concrete example of international justice. Then other war criminals will know that their mass atrocities will not go unnoticed or unpunished.

Contact

General questions:

info@invisiblechildren.com// 619.562.2799

Media inquiries:

pr@invisiblechildren.com

For more information about Invisible Children, visit our main website:

www.invisiblechildren.com

So you hear the stories of the broke realtors. I have heard many state they can’t sell or rent the homes.  I know the economy stinks, there is a surplus of foreclosures.  However, there are still some people buying and renting homes, townhomes, apartments, condos and office space.

The question is are realtors really doing all they can to help sell the homes? I think overall the answer is no.  Read on to learn why.

A couple months ago we were considering a potential in State move of both our office and home. There are numerous changing happening in our business due to growth and expansion.  Our time is limited and we were hoping we could leverage the internet to find a good realtor and home. When I started looking at options for both our residential home and office I was literally shocked at what I found (and didn’t find).

Note, I was not searching in a po-dunk community. We are searching in a nice neighborhood in Orlando, Fl. An area where most residents are quite affluent. I would bet most people who are buying in our target neighborhood have a computer, a smartphone and probably at minimum leverage Google and other realtor sites such as Realtor.com, Trulia etc. to research the community, schools and of course the homes.

What I found during my search left much to be desired.

• Many of the realtor profile photos look like they were taken in the 70′s.
• Only two sites were leveraging video.
• 90% of the listings had no more than one photo.
• Many of the photos were blurry.
• Photos did not highlight the positive benefits of the house. They looked like they were taken by a 2nd grader riding a skateboard in the dark.
• Basic descriptions didn’t exist on many listings.
• Very few included any selling features such as if the home has a sunroom, den or pool.
• No real call to action on most realtor and leasing sites.
• Many sites had broken links.
• No content of real value for me, their audience and prospective buyer.
• Only one site included links to content about the community.
• None were leveraging social media or even invited me in a way that was noticeable to join their social platforms.

Overall Grade: D- to F

Come on folks this is 2011! You can take a decent photo or even video with your iPhone or flip camera! Take the time to help your client (the home owner) sell their home. Provide basic descriptions, good photos and something that inspires me to call you, look at the house or take some kind of action.

How did our story end?

Well based on how difficult we found it to research the communities, find a home and even find a qualified realtor to help us, we chose not to move at this time. We’re staying put right here in Tampa. A social savvy realtor could have made a difference in our decision to purchase a home and move to a different city.

So what would I do if I were a realtor? Here goes…

1. I would become the MOST social savvy realtor within my sales area. When someone thought of a realtor in my community my goal would be they would think of ME!

2. I would brand myself in a big way. I would come up with a theme and rock it out! Maybe the most honest realtor on the planet. The one who shows you the huge spider web in the garage or the hole in the back of the closet. Or how about the fastest realtor in the state. I would focus on getting your house listed with all social media bells and whistles within a short number of days.

3.  I would be the social realtor video queen. I would take a flip video camera everywhere I went. Bottom line, when you thought of a realtor with a video camera in hand you would think of me.

4. I would become the travelling realtor reporter. I would take the flip video camera every where I went. I would give kudos to the local businesses. I would give them the opportunity to shine. I would post their videos on my YouTube channel and feed them to my blog. I would invite them to my Twitter page, Facebook page and blog. I would help them build an online presence by starting with a guest post on my blog. I would build a community by helping others achieve their goals.

5. I would help others get social savvy. By doing all of the above plus partnering with a local social media consultant, trainer or agency I would teach free or low cost social media classes. I would ensure their first step was joining my social network communities. I would scratch their back and show them social love above selling my own stuff. The word of mouth from genuinely helping others would far out reach my own word of mouth talking about myself.

6. I would create a rockin’ blog. The blog would include tons of photos and vidoes of the local community and business leaders. It would include guest posts with food, entertainment and business reviews. Eventually it would grow into a community site or portal and become the one stop shop for community information. All of the videos would feed from YouTube and photos would be loaded via Flickr into my blog.

7. I would teach my clients how to get online and get social. I would offer a one pager to show them where to start and how to best leverage the social platforms where their house is being marketed. I would teach them via recorded webinar or cheat sheets how to get on Facebook if they don’t know. Basically I would “help them help me” sell their home.

8.  I would build a video testimonial database. I would film happy clients closing on their house, selling their house and moving into their house. I would come back in a couple months and let them show off their savvy design or painting skills. If the home owner owns a business I would let them talk about what they do and how how they can help others.

9. I would partner with other local social savvy business and realty leaders. I would partner with designers, moving companies, mortgage companies, title companies, welcome wagon folks and more. I would engage them on my blog, YouTube, Twitter and more. I would partner with them to give away a free package once a quarter that included a small set of services from each one. It might include a free interior design consultation, free meal at a local restaurant, discount on a haircut and who knows what else. Most partners would donate the giveaway for free given the value of my community, network and social platforms!

10. I wouldn’t accept status quo. Just because everyone else is accepting status quo to build their realty business I would not! I would shoot for the stars and never look back. I would take others on the ride with me. I would never get too focused on myself. I would always ensure it was clear I brought more to the table than just me. My goal would be to bring highlight to a rockin’ community and team members. That in itself would set me above the status quo of most realtors in a tie and suit and boring website!

So how can you get there?

1.  Develop a plan. Accept that you are not going to be able to become the social savvy realtor maven over night. It will take learning, time and effort. Spend some time learning the ecosystem, your audience and what others are doing. Then develop a plan for success. Integration is key and avoid random acts of marketing. Set clear objectives and goals to measure your success.

2. Take a Social Savvy Profile Photo. I know you may like the photo from the 70′s with your Leaf Garrett or Farrah Fawcett hair as you did look 30 years younger. However, taking an up to date photo will do you justice and help you better connect with your potential buyers, promise!

3. Know your audience. Who are they? How do they search for information on the homes you sell? What information are they searching for? What information is going to help them make a decision and why?

4. SELL the house! Don’t be afraid to sell. Tell me WHY I should come look at the home you have for sale. Why should I do the double click to learn more?

5. Sell YOURSELF! Tell me why I should hire you as my realtor. I didn’t notice any site that encouraged me to take a next step at engaging with the realtor, the broker team or other.

6. Take GOOD photos. Seriously folks, this is 2011. Buy yourself a $100 flip camera or Kodak and take some photos. Don’t just stick up a photo of the smallest bathtub in the house for a 3500 square foot house. Take photos that will help sell your house, not turn me away.

7.  Brand yourself. Spend some time on developing your own brand. If you don’t know how to do this hire a consultant or small agency who can help. Developing a consistent brand and message you can use across multiple social networks and web properties will bring exponential return on your investment.

8. Focus on standing out from the crowd. I don’t think this is going to be as hard as you may think given how few realtors are doing this. Do a quick study of your competition and determine ways you can be unique. How can you better communicate with your readers and website visitors? How can you more easily provide information they are seeking?

9. Setup at minimum a Facebook, LinkedIn, Twitter and YouTube profiles. Set these up, add your social savvy profile photo, include a consistent brand and look and leverage them to connect and communicate with your audience. If you don’t know how to do this hire a consultant or agency. If you don’t know the first thing about social media, then take some some media training courses online or in your local community to get your skills up to speed.

10. Consider a blog. Blogs are a great way to provide valuable content that will help your audience. You can include content on local communities you focus your sales efforts on, tips on moving, design ideas and more. Leverage your network and invite guest bloggers to provide content. You’ll be amazed at how many people will contribute content to your blog if you simply ask!

demandforce:

The proportion of small businesses planning to increase their capital spending in the next 12 months is at its highest rate in four years, according to a new Gallup poll.

moneyisnotimportant:

Interesting breakdown of what makes up the cost of gasoline.