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While Real Estate is suffering through its Sub-Prime Meltdown and Move.com and Realogy are still trying to get away from their Home Store and Cendant scandal pasts, Zillow was busy getting its third round of Venture Capital (VC) funding.

Legg Mason Capital Management, PAR Capital Management, Benchmark Capital and Technology Crossover Ventures voted with their dollars to give Zillow a kick in the wallet, funding Zillow's third round for $30 Million, giving "The Little Real Estate Search Engine That Could" a grand total of $87 Million in VC gold.

Zillow, only 19 months old, went from a second-round market valuation of $250 Million to an estimated $350 Million third round valuation. Interestingly, Richard Barton, whose company gives other people's home valuations, declined to comment on Zillow's most recent valuation.

This third round funding brings Zillow another step closer to becoming "The Expedia of Real Estate", on their way to becoming "The Google of Real Estate".

In his comments to the WSJ, Richard Barton didn't say he was going to add more Sales Agents and take more online Real Estate Courses with the Top Ten Tips for everything Real Estate. To the relief of all Brokers, for some reason, Mr Barton is sticking to online ad sales, and focusing on a localized advertising program at that. Maybe Zillow can succeed where the big boys (Google, Yahoo and MSN not RE/MAX, Century 21 and Coldwell Banker) have failed (so far).

With Zillow, Google Base (they have the greater majority of the top 100 US RE Brokers submitting their listing data) and Yahoo Real Estate (aggregating Zillow, Reply.com and Eppraisal value estimates) offering their services for free (paid for by ad revenue), can Realtor.com with their expensive subscription service model be long for this world? You can still get an AVM home value estimate from Domania.com for $29.95 (No Agent will call, and "free" with "An Experienced Agent Will Call You").

In further comments, Richard Barton said he's not only going after your CMA's (Zillow does them in about 6 seconds) and your ad budget (you can now buy ads on Zillow by Zip Code, just like Realtor.com), but also after your Concierge Service, offering a localized ad program to businesses such as plumbers, architects and renegade real-estate agents, delivering targeted ads to people searching for home information within specific Zip Codes. And just when you paid for a seminar telling you to set up a concierge service and tap your affiliates' ad budgets to help pay for your ads.

Maybe the real money in Real Estate isn't in selling houses anymore?

Adapt Or Die! Happy Searching.

WebHomeUSAblog; The Blog of Real Estate Search Marketing

FaceBook, that recent challenger to News Corps's MySpace, is having growing pains. On its way to a $10 Billion Market Cap FaceBook ran into a little problem with Search Advertising.

Few companies (even those founded before 2004 by former Harvard students) have the will, strength and finances to turn down billion-dollar purchase offers, from the likes of Yahoo and Viacom Inc. (FaceBook turned down a $900,000 purchase offer from Microsoft in 2006.) Most successful new Internet start-ups go the way of MySpace and YouTube with multi-million to billion plus dollar buy-outs by Google, Yahoo, MSN etc.

The Google PlayBook may not be as clear, as concrete or as easy to follow as many entrepreneurs, Angels and VC's (Venture Capitalists) once thought. Funny things can happen on the way to becoming "The Next Google", "The Google of Social Networking" or "The Google of Real Estate".

Internet Geeks may no longer be able to just beg, borrow and steal content; mix in, mark-down or mash-up some UGC (User Generated Content); add a new format, drive a little traffic, slap-on some Google Ads and sell themselves to Google for a Billion or a Gillion Bucks, or even a Zillion Bucks (in Zillow's case)? (A Gillion dollars is either a Billion Google Bucks or a Billion Gates Bucks.)

Won't your visitors click on your ads at the same rate Google's visitors click on their ads? Isn't your content just as good as Google's? Don't your ads look just like your content, the way Google's do?

All of a sudden it's not so easy being "The Next Google of Anything".

There are some significant differences between Google-Like Results, Google-Like Content and Google-Like CTR's (Click-Through-Rates) and the same content and user responses and behaviors than on most other Websites: Search, Portal or otherwise.

Google's Results/Content provides what marketers call "demand fulfillment". Google gives us what we're looking for, with ads relevant to the keywords we typed in the Search Box.

FaceBook is a different animal. FaceBook provides "demand generation" with their social network platform. FaceBook must generate (vs provide) the demand for visitors coming to their Website for other reasons. Are visitors to FaceBook, or any other social networking site, (who are going to the site to communicate,) click on ads? How does Facebook deliver relevant ads to their content?

FaceBook's traffic in 7/07 was over 36 million. So far ads on the social networking sites get response rates as low as 1/200, click through/page view, far below Google's rate.

Real Estate Websites offering useful data, info, mapping and search services offer content closer to what Google offers, demand fulfillment. Zillow's traffic is between 4 and 5 million per month.

Will Real Estate Websites with Google's business model (Zillow, Trulia, etc) drive traffic like the social networking and user-generated content sites of FaceBook, MySpace and YouTube? Can Real Estate Websites produce ads and click-through-rates as good as Google's?

Does your Real Estate Website have ads? Yet?

Adapt Or Die! Happy Searching.

WebHomeUSAblog; The Blog of Real Estate Search Marketing