Zillow Buys RentJuice for $40M, Reports Record Revenue
Zillow is paying $40 million in cash for the smaller company, which is the second acquisition Zillow has made since going public last July.
In a statement, Zillow CEO Spencer Rascoff said the RentJuice deal “propels Zillow’s rental marketplace ahead by years.” Zillow says it currently sees more than 5 million renters visit its sites each month, and has hundreds of thousands of rental listings.
Seattle-based Zillow also is reporting first-quarter results that show continued growth. The company made profit of $1.7 million on sales of $22.8 million, more than double the revenue from 2011’s first quarter. Zillow’s “marketplace” revenue—which encompasses its digital services for real estate agents—made up the bulk of this quarter’s revenue, at $16.6 million.
Those numbers illustrate the bigger-picture story for Zillow. The company, founded by Expedia alums Rich Barton and Lloyd Frink, was originally an online database of home values that sought to disrupt the traditional real estate market. As it gained visitors, the company made money through advertising—a standard Web 1.0 business.
But over the years, Zillow morphed from a scrappy challenger of the real estate market into an online platform that wants to serve real estate professionals, a change highlighted by the company’s recent acquisitions. Last year, Zillow bought Diverse Solutions, which provides online real estate marketing tools, and Postlets, an online real-estate listing syndicator.
“These companies deliver valuable marketing and business services to local professionals, supporting Zillow’s strategic expansion beyond a traditional media model to become a central hub for a broad range of ‘freemium’ services that help local professionals manage their businesses,” the company said in a statement.