Nov 18, 2009
(first reported in TechCrunch November 12, 2009)
Seattle based online real estate brokerage Redfin has raised another $10 million in venture capital in a round led by Greylock Partners. Existing investors Madrona Venture Group, Draper Fisher Jurvetson, Vulcan Capital and The Hillman Company all participated in the round. The round was considered a ‘Safety Round’ as Redfin announced profitability over the summer and has now exceeded a $20 million in revenue run rate.
Redfin has approximately quadrupled in size since 2008 – even in the United States’ down real estate market. According to Michael Arrington writer for TechCrunch the Redfin process works as follows:
“As a buyer you spend a lot of time on the Redfin site, looking at available houses and a rich set of data on previous sales, comps in the neighborhood, other homes listed in the same price range, etc. (or you can use their iPhone app, which the company says is the highest rated real estate app).
If you want to view a home you schedule online. They set it up for you and meet you at the house.
In all, it isn’t much different than the standard buying a house procedure. Except at the end they refund 50% of their commission to you. On a $500,000 house, you get a check for $7,500 at closing.
Sellers who use Redfin pay a flat a $5,000 – $7,000 fee, depending on services ordered. And if you’re also using Redfin to buy a home while you are selling, that fee drops by $1,000.”
According to Arrington real estate professionals are not thrilled about Redfin and nor do they love Redfin CEO Glenn Kelman. In an interview with 60 Minutes Kelman said “Real Estate is by far the most screwed up industry in America.”