Would You Use a Start-Up to Sell Your Home? This Philly Company is Betting You Will
It’s a phrase that countless start-ups use when they feel as if they have gained enough traction: “We’re the Uber of (fill in an industry here).”
There are companies like Instacart and AmazonFresh, considered disruptors of the grocery industry. There’s Roadie, the delivery service that connects people who have stuff to send with drivers already heading that way. Even household chores, such as furniture assembly or dog-walking, have been made easier, as a result of companies like TaskRabbit and Wag!
While each start-up has had varying degrees of success, all believe they are viable because they are so-called disruptors of entrenched, slow-to-change industries. By using technology to connect consumers directly with services, these start-ups believe they can make customers’ lives more efficient and easier.
Still, some industries have been insulated from change. One reason? The more crucial the industry is, some experts say, the more time a disruptor needs to build consumers’ confidence.
Take, for example, health care — a complex, deeply personal, and high-stakes industry. In a 2017 interview, Arun Sundararajan, a New York University business professor and expert on the sharing economy, said that what’s holding health care back at this point is that platforms “haven’t built up sufficient trust.”
The real estate industry is, in some ways, similar. Buying a home is the largest purchase many people make and something that is generally too complex to be handled without help. As a result, though the industry has experienced a few disruptor success stories — the real estate databases Zillow and Trulia are less than 15 years old, for example — it also has been littered with start-up failures. Consumers looking to buy or sell a home have consistently had to return to the status quo: hiring a real estate agent to help them.
The decades-long domination of the real estate agent has caught the attention of federal regulators. A few years ago, the U.S. Department of Justice’s Antitrust Division published on its website a page titled “Competition and Real Estate,” noting the necessity of more competitors in the industry. In one post, the Justice Department wrote that “the real estate brokerage industry has been slower to change,” leaving consumers to pay “higher commissions and fees than they would under a more competitive system.”
Recently, start-ups have emerged again — believing they could force the real estate industry to change. And as these companies forge ahead, it’s likely they could ruffle a few feathers along the way.
There is perhaps no better example in Philadelphia than Houwzer, cofounded by Mike Maher, who previously launched the Philadelphia co-working company Benjamin’s Desk. His latest start-up, founded in 2015, has branded itself as a “full-service,” “modern,” and “pressure-free” way to buy and sell homes, as a result of its low-cost model.
Read the full story here.
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