In mid-March, as awareness of the COVID-19 pandemic spread across the country, Zillow Group CEO Rich Barton faced a tough business decision: Turn off the company’s prized new revenue engine, Zillow Offers, or keep it humming?
Barton said it was “really foggy” and hard to make clear decisions, but he opted to “pump the brakes,” and on March 23 the Seattle company shut down the buying and selling of homes via Zillow Offers.
Just two months later, things have changed, radically.
Zillow Offers is back in business, and Barton is once again charging ahead with a new zeal, not to mention a burnished and optimistic philosophy for this unprecedented time.
“This crisis is causing a great reshuffling,” said Barton, speaking Thursday during a GeekWire virtual event titled How to Build an Enduring Culture in the Era of COVID-19.
“It’s going to cause people to move to different places and work in different ways, and move in bad instances and good instances, and get vacation homes, because most people wish they were at their vacation homes right now,” said Barton.
Over the past two months, Barton said the data was clear when it came to residential real estate.
“We let the game on the field dictate our plans and our strategy,” said Barton. “We were not afraid to see good news. And when we saw good news, we leaned into it.”
Last month, Zillow beat analyst expectations for its first quarter earnings report with revenue of $1.1 billion, up 148% year-over-year.
Wall Street seems to like the message, and the recent results. Zillow Group stock, now trading at about $57 per share, is up more than 25% since Jan. 1. Zillow’s “Homes” segment brought in $770 million in revenue during the first quarter, up 27% percent from the fourth quarter, and took a net non-GAAP loss of $75 million. The company’s market value stands at nearly $13 billion.
Barton is one to talk in grand and broad entrepreneurial visions — popularizing and repeating phrases like how the internet brings “Power to the People.”
This new philosophy — “the great reshuffling” — was repeated by Barton on an appearance Friday morning on CNBC, along with comments about how food and shelter sit at the base level of Maslow’s Hierarchy of Needs. He believes Zillow is well positioned to take advantage of that situation with a research and development budget that Barton said dwarfs its rivals.
Barton said on CNBC, “Probably five years of adoption has been being compressed down into five months now.”
