The Real Deal New York

StreetEasy’s revenues leap 73% in 2015

Revenue more than doubled since acquisition by Zillow in 2013
By E.B. Solomont | February 12, 2016 11:05AM

Zillow CEO Spencer Rascoff, StreetEasy's "building experts" program, and StreetEasy GM Susan Daimler

Zillow CEO Spencer Rascoff, StreetEasy’s “building experts” program, and StreetEasy GM Susan Daimler

Despite broker backlash over its agent advertiser programs, StreetEasy revenue grew a whopping 73 percent in 2015, parent company Zillow Group said Thursday.

In a fourth quarter earnings call, Zillow CEO Spencer Rascoff said the New York City-based listings portal “seems to be on a tear” with revenue that more than doubled since Zillow acquired the company for $50 million in Aug. 2013.

While Zillow doesn’t break out financials for its individual brands, a back-of-the-napkin calculation would give StreetEasy revenue of more than $11.2 million in 2015 – conservatively – based on an earlier disclosure that StreetEasy had $5.6 million in revenue in 2012, the last full year that revenue was disclosed.

For the first six months of 2013, StreetEasy, led by Susan Daimler, generated revenue of $3.4 million, according to Zillow regulatory filings.

Earlier this month, the Seattle-based real estate giant announced it would amp up StreetEasy’s rental foothold by acquiring New York-based rental listings site Naked Apartments for $13 million. The deal, Rascoff said during the earnings call Thursday, “will help accelerate our growth in the New York City rental market, which represents two-thirds of the residential living units in the city.”

He estimated there is $500 million worth of rental commissions in the market, compared with $1.2 billion worth of sales commissions.

Last year, StreetEasy — which generates revenue via agent advertising, featured listings and other advertising opportunities — introduced two new advertising programs for brokers, a Building Experts and Neighborhood Experts program, which led to a flurry of negative responses from brokers. In particular, the Neighborhood Expert ad program is open to agents who have brokered just two deals in one New York neighborhood over a 36-month period.

Companywide, Zillow had nearly 92,400 agent advertisers as of Dec. 31, 2015, who spend an average of $438 a month to promote their business, Zillow said. At the end of the year, Zillow’s consumer brands – including Zillow, Trulia, StreetEasy and HotPads – saw nearly 124 million average monthly unique visits, up 61 percent year over year.

In 2015, Zillow’s revenue increased 18 percent to $679.9 million. The company’s net loss in 2015 was $91.1 million, compared with $83.3 million in 2014, due to litigation with News Corp., which sued Zillow in 2014 after executives from its real estate website Move joined Zillow.