Private venture capital firm Andreessen Horowitz says, “software is eating the world,” and sees data and access becoming a major disruptor in the real estate industry.
Andreessen Horowitz announced this month it is investing $17 million in startup FlyHomes, which works with homebuyers to make cash offers. Other investments include Facebook, Github, Point for homeowners, and Coinbase. The firm's general partner Alex Rampell recently spoke with MarketWatch on housing market disruption, saying that the market is "binary," where consumers are stuck either renting or owning. Additionally, Rampell says, "[housing] is one of the biggest sectors of the economy and it’s so remarkably inefficient ... The principle behind all the investments we’ve made is in the future you’re going to be buying and selling your house from a company."
"Zillow built an incredible tool. Zillow 1.0 was voyeurism about what my neighbor paid for his house, what that guy in high school who I didn’t like paid for his house. But the revenue model was not, “let’s go disrupt the industry.” It was, “let’s aggregate the demand.” Zillow did a very good job on SEO. Now, Zillow is realizing that 'we have all this demand, we should be more aggressive before this group of startups comes along and does it for us.' I give a lot of credit to Zillow as a public company that makes a lot of money selling leads to mortgage companies and agents, to try to disrupt their industry now."
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