Zillow Inc (Z) CEO Spencer Rascoff on StreetEasy Acquisition

Spencer: StreetEasy is already EBITDA positive and cash flow positive, so they have revenue, they have EBITDA, and we’ll start consolidating that once we close.

Brendan: Do you guys see this maybe as something you’d only look at in New York, since it’s such a large, important market, or would you potentially look at other large cities that have sites, maybe, such as StreetEasy and look at this to expand there, too.

Spencer: There’s no other StreetEasy and there’s also no other New York. So, certainly, if there were anothe dominant online real estate company in another important city, we’d absolutely look at acquiring it, but StreetEasy is a unique asset and New York is a unique market.

Brendan: Zillow Inc (NASDAQ:Z) has had a few acquisitions lately. Do you look at Zillow as a growth through acquisition company or an organic growth company?

Spencer: It’s an organic growth company. We’ve made seven acquisitions now, but they’ve all been relatively small. This StreetEasy acquisition, at $50 million, is our biggest deal. But all these companies have been relatively small. We’re a growth company; revenue growing 60% every year; traffic growing 60% year over year; leads to our real estate agents growing 80% year over year; our mortgage business growing 100% year over year. And the vast majority of that growth is organic, because most of these acquisitions have been small, B-to-B SAS companies, where we acquire their product then make it for free- we make it readily available for free to our advertisers.

Brendan: How about the rental aspect of StreetEasy? Was that an important part of this?

Spencer: It was. Rentals is a big focus of ours. We’re just starting to monetize rentals. We’re already one of the largest rentals websites out there, but we’ve never monetized rentals before, and so we’ve just started charging multi-family apartment owners to list on Zillow and HotPads, another company we acquired, and so the StreetEasy acquisition plays really nicely into our rentals monetization.

Brendan: Great! Well, thank you so much for your time. Spencer Rascoff, CEO of Zillow Inc (NASDAQ:Z).

Spencer: Thank you.

The article Zillow CEO Spencer Rascoff on StreetEasy Acquisition originally appeared on Fool.com and is written by Brendan Byrnes.

Brendan Byrnes has no position in any stocks mentioned. The Motley Fool recommends Zillow. The Motley Fool owns shares of Zillow.

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