Why this VC-backed StreetEasy rival is cutting back on listings inventory

The startup is restricting open listings on its platform

Apr.April 24, 2019 12:00 PM
The Zumper listings section with CEO Anthemos Georgiades (Credit: Zumper and Facebook)

The Zumper listings section with CEO Anthemos Georgiades (Credit: Zumper and Facebook)

In 2017, rental listings portal Zumper embarked on a brave new strategy — compete directly with the agents using their platform, and forge exclusive relationships with landlords across the city. As the venture-capital backed firm has introduced new restrictions on outside agents, the number of listings on the platform has been cut in half over the last year.

Zumper said the reduction in listings is by design — it has been culling open listing inventory in order to improve overall listing quality, a spokesperson told The Real Deal. The San Francisco-based company — with nearly $78 million in seed funding from players like Blackstone Group, Andreessen Horowitz and Kleiner Perkins — still allows exclusive listings on its platform for free, but has restricted agents who have listings without an exclusive relationship with the landlord.

Last May, when Zumper still allowed agents to post non-exclusives, there were 38,000 rental listings on the website. Zumper now has about 19,000 rental listings in New York, still above 5,000 more than market leader StreetEasy.

One agent who previously used the platform for open listings, for example, received notice of a canceled and refunded subscription and could no longer post listings.

Data quality concerns are hardly unique to Zumper — and have long been a complaint among agents. Zillow Group’s StreetEasy, when it rolled out a fee for rental listings, argued that it helped weed out inaccurate listings. The Real Estate Board of New York has also been criticized for data issues with its syndicated RLS, though agents recently told TRD that the cleanliness of the data is improving.

Zumper differs from its listings portal competitors in one significant way — it hires its own agents. “Zumper Select” is a feature that takes apartment hunters through the entire rental process from search to lease signing. Instead of involving agents from one of the traditional firms, it uses own agents to facilitate deals and collect commissions.

A year ago, the firm was staffing up in New York. Last May, Zumper had 26 licensed agents in New York, according to New York Department of State data. Nineteen of those agents were hired in the first five months of 2018. That number has since grown to 37 agents licensed in New York.

Zumper declined to say how much business its in-house team has done in New York, or how many exclusive rental listings it has. (Its search function indicated it had just over 2,100 exclusives in the five boroughs.)

When it launched in New York, several brokerages — including Citi Habitats and Bold New York — pushed back against Zumper. Citi Habitats president Gary Malin, for example, discouraged agents from sending listings to the platform.

Zumper, which acquired PadMapper in 2016, closed on a $46 million Series C round last September. The round was led by Axel Springer and Stereo Capital, with participation from Blackstone and existing investors Dawn Capital, Kleiner Perkins, Breyer Capital, Scott Cook, Goodwater Capital and xfund.

Related Articles

Eric Gordon

Eric Gordon on the evolution of the residential data game — and how to stay competitive in the new world

Big Tech locations in NYC

MAP: Here’s a look at all the Big Tech locations in NYC

What will proptech look like in 2019 and beyond?

What will proptech look like in 2019 and beyond?

TRD Talks Live

Watch tonight: Turning to tech on TRD Talks Live

(Credit: iStock)

Strong quarter for Manhattan home sales belies current struggle

Manhattan resi listings continue nosedive: report

Manhattan resi listings continue nosedive: report

252 East 57th Street and 196 Orchard Street with Samantha Sheeber and Tal Alexander

Closing in the time of Covid-19: “We’re pulling out all the stops”

Kuwait’s consul general in New York, Hamad Al-Hazeem and 50 United Nations Plaza (Credit: Google Maps)

Kuwait’s consul general buys 50 UN Plaza pad for $16M