That's similar to saying, like, does the internet replace a lawyer? Right, it's like no. Right, does it elevate what a good lawyer is? And do sometimes customers walk in with like bad legal advice on the internet, and a lawyer has to show their value by saying, what you read is wrong, and here's how you should think about that. Yeah, but it elevates the profession. And I think that's what the internet and the mobile phone and now generative AI are doing to the real estate industry.
You talk about it privately, we talk about it publicly. This is the Real Estate Insiders Unfiltered podcast. Welcome again to the Real Estate Insiders Unfiltered podcast. I'm your host Diggy Dwiggins, along with Mr. Keith Robinson. So, some that won't be funny, but it is, but it still is, Mr. Keith Robinson. We were doing a live podcast and the Pacific Gas and Electric Company here in the state of California decided to cut my power, so we got right to the end. So everybody knows these are live podcasts that we record and sometimes happens. So I will be there till about 90% of it and then Keith takes over. Just fin, I get the rest of the pod by myself. But we had Mr. Jeremy Waxman, the new CEO of Zillow Group, on our pod to talk about a lot of stuff. Like give us a quick background on it. Yeah, he talked about the Zillow super app, what it is and why it's important. He talked about his vision for home buying in the future, what it might look like, the tension between trying to serve the industry and trying to serve the buyer at the same time for Zillow, and a whole bunch of other stuff. He's someone who's dedicated to policy. Yep, and he's got cut off. Yeah, that's right. And he's someone who doesn't do a ton of interviews, so it was really good to get to hear from him and have him share his insights in belief modality about technology, the industry, the consumer, and how it all fits together. It's a great conversation. You're going to dig it. Put in your kids. Jeremy, welcome to the podcast. We are very excited to have you on the show. So much. Well, actually, there's really nothing going on in residential real estate again. Nope, nothing to talk about. No, no, no specific topics that are lingering on the headlines. And we certainly want to talk about some of those today. But you're new in your role there, the new role there. So I thought you'd be better for you just to kind of talk about your background, because if I have my stats correctly, you've been at Zillow for 16 years and the technology sector since 1999, if I've got that right. This is what your LinkedIn profile said. So give us your background just real quick for viewers and listeners. You started in tech, kind of some of the roles you did, then Zillow, and then how you ended up as the new CEO of the company.
Yeah, well first, thanks for having me, excited to be here. And yeah, quick background on me. 14 years at Zillow. 14, okay, yeah. Started my career as an engineer, got my computer engineering degree, thought I wanted to be a software engineer, and quickly realized I wasn't going to be good at it and also just wasn't as passionate about it, and found my way into product and marketing early. Marketing is what got me out to Seattle. I worked for Microsoft for a few years, and that's how I met Rich Barton, our co-founder, and the team back in 2009, coming out of the global financial crisis and the worst housing crash we ever thought it'd be a really good idea to go work for a not yet profitable real estate startup. But honestly, I mean, I tell that in jest because for me it was about the team. And this team had obsessed and focused on consumer and customer problems and solving problems with technology, which really spoke to me. It's kind of how I built my career, was trying to figure out how to solve and delight consumers. And that got me here in 2009, and that's really kept me here ever since. Obviously at Zillow, I've worn a bunch of hats. I came to really work on marketing and product. That quickly turned into helping pivot the company to mobile. I think six months after I got here, the App Store launched on the iPhone, and we realized that wow, that was going to be the way real estate and categories like ours went. So I got to work on that. I got to build the brand as Chief Marketing Officer, and then for the last five or six years I've been working across our business lines, and then most recently as Chief Operating Officer. And so, you know, I woke up one day and I've been here 14 years. But it's really been a different job all the time, but I think the common through line, not just for me but for us as a company, is just trying to work backwards from what does that buyer and seller want and how can we actually delight them in this category the way that our phones are delighting us in all the other categories we use it for.
Yeah, you know, I've always wanted to ask this. So I'm going to preface this real quick before we dive into some rapid fires. I have always admired Rich Barton. I mean, every time I've seen him speak or I've had a cocktail with him and talked, I'm just, he just sees the world through a lens that very few people do. What's it like to work with him, just somebody who's like so visionary, you know, obviously from Microsoft and then Expedia, Microsoft, Expedia, did I get that right, and then Zillow? Yeah, like I mean, just what's that like to work with somebody who just is on that Elon Musk sort of level?
Rich and Lloyd Frank, our co-founder, and honestly a lot of the founding team that I still get to work with today, David Bell our CTO, and a bunch of other folks. When you spend that much time together, I think you have two things. One, you have a lot of trust in each other, which you need through the ups and downs of business challenges. It's what gets you to lean forward and take big risks. If you've listened to Rich, he talks a lot about taking big swings, and you can't innovate without failing, so you have to try things that aren't going to work. So you need trust in a team to get that. And I think Rich and Lloyd really built a culture here that created an environment where people are comfortable and confident in taking swings, all in service of the second piece, which is the long-term success of the consumer, the customer we ultimately serve. The thinking in the future and taking a long-term view on how do we actually get to the right end state versus being stuck in what's today's problem or tomorrow's problem. I think those are the two. I think creating a culture of trust and safety to take these big swings and keeping our eyes down field, I would say are the two things that Rich really embodies. But I think Lloyd and the rest of the team does too. I think it comes from them all having worked together for so long. It's really cool to have a team that just sees things in that view and then has the ability to take those risks too.
You know, there's, as you know, there's millions of great ideas, but it takes a really strong team to execute because ideas are dime a dozen, and execution is the key in all of that. So we'll do a couple rapid fires. This is just to get everybody to know you personally real quick. I'll start with the first. We have a link on our website for our pod that's all the book recommendations or podcast recommendations that everybody's listening to. So what is your favorite book now ever, podcast now ever, one of the two that you would love to share with people to go check out?
I mean right now I think my answer would be Stratechery, the podcast, which is Ben Thompson. He does a daily email and then a bunch of it's in podcast form, and the long form stuff is in podcast form, which I listen to on my walks. And it's just such a great strategy snack. Ben covers all industries across tech, and he brings a strategic framework to think about how to analyze what someone or some company's doing. So it's a great lift up and learn about something else not in my day-to-day. I find myself reading it every day, and I find myself listening to a bunch of his.
That's awesome. His email newsletter is worth signing up for regardless of what you do. It is. I don't get to read it as much as I like, but that's a really good call out, like that's solid. Matter of fact, I mean, he's not paying us, but we can link to his sign up in case people want. Appreciate it. Yeah, yeah, then maybe he'll bring us out later. Okay, this follow-up rapid fire question is: if you could have lunch with one person, current or historical, who would it be and why?
I mean, my head immediately went to Neil Armstrong. That's a solid one. The reason why is, I mean, a combo of, you know, I was a kid during the Challenger tragedy, and so the space race was history lesson, but then space exploration was like clear and present. And then I went to Purdue, the Cradle of Astronauts, and just the history of all the astronauts that went through Purdue just made me fascinated with space exploration and progress there. So it'd be fascinating to sit down with him and get to hear what that was like.
Yeah, bet. Yeah, that's a good one. We haven't had anybody say that before. We've actually had some really good ones recently that people have thrown out. And not to mention the timing with Elon Musk and all of his craziness. I mean, watching that video was wild. You thought it was a movie, you're like, that's just Hollywood, and you're going, no, that actually happened. He caught the damn rocket booster like what the. You know, I saw someone say Elon Musk is out here catching rockets with chopsticks, and I can't get my phone to sync to my car. And I mean, even landing a used rocket on a platform just a few years ago was, again, the same, oh my gosh, I can't believe they did that. And now it's just expected. That's now we can just have our usable rockets. Yeah, all right, we're going to dive into questions real quick. Bottom on your left hand side, over your shoulder, what is that? For the viewers, I'm looking on your shelf there, tell me the story.
Yeah, that F1 car. Yeah, it's like half in frame I guess. Yeah, that is the Mercedes F1 Lego car, which was a co... co got us into doing Lego kits here and there as a family. And I'm a huge F1 fan, so when they had that one come out, it was like the perfect marriage of let me work on that with the kids and then have to display it.
So that's our headline: CEO of Zillow does Lego. That's our, when Hamilton was winning by the way, just for added context. All right, let's dive in. We got, we only have so much time with you and a lot of subjects to talk about. First of all, I know for just going back with the headlines with Rich while he was CEO, he kept talking a lot about the Zillow super app. So give us a little context on that and sort of where you guys are, because I know I'm going to have some follow-ups on some acquisitions and things you guys are doing. So kind of give us sort of lay of the land on where you are in that process, what it is, and your goals with it.
Yeah, the housing super app, something we talk about a lot at Zillow. That's the Zillow app for a buyer and a seller. And we use the term super app to mean bringing a lot of disparate services together in one app. That's really what a super app is in other parts of the world, because that, as you all know and your listeners know, is what the real estate transaction is. It is a complex set of disparate services. But what does the buyer want or the seller want? They want a one-stop shop. They want to be able to open the app and kind of do everything from start to finish inside that app, have it notify them, have it stay really transparent, be in control, do things digitally. That's the vision. So we use the super app construct to really encapsulate all that vision. And that's what we're building. It's here today and it's getting better all the time. We started with things like digitizing touring, being able to take a virtual tour, being able to book a real-time tour, being able to get financing digitally and keep up with your affordability. Now starting to be able to message your premier agent or a loan officer all inside the app. And eventually it'll get all the way to closing and being able to go from start to finish all in the app. So that's what the super app is. That's what our strategy is. It's digitizing the transaction, building this integrated experience so that a buyer or a seller can buy or sell easier. The reason for the why is, as you all know and as your listeners know, this category is really hard and really complex. And most people get very stressed out. Many people abandon the transaction. We don't get as many moves as we could because of how hard it is. So that's what we're after. We're after trying to make moving easier.
You have this, so the idea is obviously all the different services creating a much more seamless experience. Do you have any thoughts about where that goes long term? There's a lot of companies that are trying to hit this. Like Keith and I kind of frame it as the life cycle of home ownership. You know, I bought the house, now I have this property that I'm going to own for 8 to 13 years. Is the evolution potentially going down that road where the buyer now is obviously an owner, is managing that asset, and then everything related to that? Is that part of the overall strategy with the super app too? Maybe eventually, but I think right now it's really about trying to build a better real estate transaction.
Got it. The transaction itself, there's enough work there. Yeah, the transaction itself. You know, I think we survey consumers, we talk to consumers all the time, and we do a big broad-based quant study of trends and sentiment. And I'm always struck by there's a stat in there that about half of buyers cry at some point during the process. Yeah, which is just such a great encapsulation of everything your listeners know about how hard this is, and by the way, how hard it is for agents to get those customers across the finish line.
Yeah, I was going to say about half of agents cry in a transaction every time too. So yeah, but you're right. I mean, that shows how much there is to do in the transaction itself to unlock getting it done for more people. And so that's why that's such our focus right now. It's such a big hairy problem. We'll never say never to more fun things down the road, but that's our focus for right now. And it is the consumer's been, yeah, the human being who buys and sells houses, who've been asking for this for decades. I mean, decades. I remember 25 years ago hearing about one-stop shop and everything under one roof. And it feels like you're trying to digitize that, right? So instead of being under one roof like we used to 25 years ago, it's more about the roof is your phone. And how much of it can we digitally manifest and create this sort of single place where we can clear everything?
Yes, I think the roof is your phone. And what outsiders to our industry don't understand in that construct is the buyer will stay inside and like Zillow, but they will work with their agent who is an entrepreneur who works for their own business. And then they and their agent will coordinate at arm's length with other professionals on the other side of the transaction and in the transaction itself. And so this complex project management of a bunch of parties all need to come together to enable that one-stop shop. And that's the software that we're after. And that's why we're so focused on not just software for the buyer and the seller, and not just tech for that person to work with their, we call them premier agents, agents that work with Zillow customers, but software for all agents and all teams to bring that transaction online and make it more digital.
Mm-hmm. So you've had an approach of obviously building some of it, acquiring some of it. So has some historical. I think what, do Loop was one of the first that you guys acquired? ShowingTime, Follow Up Boss, so components for the agents to manage this process better. And then recently, VSAI. Tell us a little bit about that acquisition and then the strategy for that.
Yeah, VSAI is short for Virtual Staging AI, and that's really what it is. It's a great young company that has innovated a way to do virtual staging. And that's, as you outlined, another example of us enabling the real estate industry to become more digital, more integrated, more productive. If I think about, we've been working on something we call Listing Showcase for a while now. That's now out there and getting broader and broader adoption. And what that really is, for those who are listening who don't know, it's really a next generation listing. Right, if listings for a long time were photos and a text description. Well, what does a seller want to market their home? And more so, what does a buyer want to be able to get a sense of a home? They want to be able to really virtually tour from their phone or from their laptop. And that requires generative AI, that requires a floor plan, that requires the ability to do a walkthrough, which sounds fantastic. But you have to be able to enable that experience with the tools that a real estate photographer does today. Right, with efficient, kind of moderate hardware, 360 cameras or your iPhone. Can you generate an experience like that? And so we've been working hard on software to create that. Now a photographer can go out and shoot a home the way they'd shoot a listing, and we can generate a Listing Showcase listing off of that. And so virtual staging is another example of that. Well, in that listing, shouldn't you be able to do some virtual staging of the room if you can capture the media to do that? So that to us is just another example of, how do we get the tech in the hands of not just even the real estate agents but their photographers, so that we can meet the needs of what the buyer and the seller are going to want? Because as soon as you see a showcase listing or an interactive floor plan where the photos are actually oriented on the floor plan, you look at that and you're like, well, I don't want to go back to the 25 photos in a lightbox. That's what.
Right, right. Yeah, you know, Keith and I do a lot of keynotes together on this subject, and it drives us nuts when we talk to people about, it's something like, and you would know the stat better than we would, Jeremy, but something like less than 30% of listings have a floor plan on them, and it's like the second or third most requested thing by buyers. You know, Keith, I look at property all the time, and we're always looking to buy a house if we wanted to, or another house, I should say. And we're like, and you get these photos and you're like, I don't know where any of this is. It's stupid. It's like I've got all these great photos but I have no context. Is this the first, second, third floor? Where am I looking? And it drives me completely nuts. I have a question that's related to this. If you think about that experience, you've got this ability to, which I'm assuming is part of your vision, for somebody to be able to see the house. The seller loves their shag rug from the 70s, but it's a shag rug from the 70s. Virtually staging it allows you to see what the house could potentially look like, so a better idea on selling it. Do you think there's a world where you guys have the ability, through machine learning and everything else, to be able to look at it and go, this is the house currently today, this is the type of marble in the kitchen or it's linoleum, here's the approximate cost you could spend to remodel this place, and then the upside value of this home? I mean, are we going to get to a spot where we're looking at this not only visually but like from an economic perspective? I'm forecasting here, but I don't know, I'm throwing it out maybe.
I mean, back to your question on how do we think about home ownership versus the transaction. I think there's a lot of interesting use cases for virtual staging. And we at Zillow have played around in the past with ways to improve our Zestimate, our AVM, and can we give it content that helps make it more accurate? So you could imagine cost and ROI of innovations. There's a use case for the homeowner as you outlined. There's also a use case for the appraiser or the buyer and seller to try and figure out the market rate for the home itself. So I think I hear your question, and I think yes, tech can get into some of those things eventually. But to me, that's all about getting more rich content, and getting that content and that data can help all make us more accurate and can provide more transparency, because at the end of the day, this marketplace is really opaque, and price discovery is really opaque in this marketplace. Yeah, even with all the work that agents do to try and get to good price discovery. So can data help that? I would hope so. Yeah, I think, just to nerd out on that for two seconds, yes, the answer in my opinion, not you, you didn't ask me, but I'm going to answer it, is definitely yes. In fact, there's a company called InspectToy. Jeremy, if you go buy it, I'd love a commission. There's a company called InspectToy that is ingesting thousands and thousands of home inspection reports, and then also thousands and thousands of bids correlated with those home inspection reports. And then they can forecast, just because they have so much massive data, that they can actually forecast what a potential repair in a given geography might be, because it's different in Kansas City, Kansas than it might be in San Francisco, California. So I think we're not far from that specific use case that you talked about. And another one we've worked on, the latest version of our Zestimate, it's actually by neural networks, and it can, in air quotes, it's not just comps. We actually feed it images to help it start to get a little bit more accurate, especially when a property comes on market, and we actually have a bunch of great rich media. So I think you think into the future and what generative AI can potentially do, and you think about the data that will help make everyone make a better decision, and we really are just at the early.
Yeah, I have another sort of, I don't know, vision casting far out kind of question, if that's okay. I really think when I see and experience what you all are doing, you're trying to get as far into the home as humanly possible at a distance, right? So that a buyer can have as deeply a contextual experience digitally as they can with a home, right? Like walking it without walking it. How far does that go? Like someday, is it just going to be people are going to look at two houses instead of 15 because they've gotten so good at thin slicing the information and the data down? Or like, where do you see that expand? And when you think about that, what do you think?
Yeah, people I think often ask, well, will this just make the consumer more efficient? And the answer is yes, but maybe not how you asked it. It's not they're going to take less tours. I actually think what happens is they take more tours. They spend more time. Like we find anytime you give consumers more tools, they become more empowered and become more efficient. But that efficiency doesn't mean they spend less time dreaming and shopping. They actually spend more time. They just spend it at a higher fidelity. They're more productive. So what that means is today, when someone books a real-time tour on Zillow, they're a higher intent lead for the agent. They've maybe done a little more window shopping. They're more empowered. So when they meet the agent, they're a little more ready to go, DIYing themselves down the funnel. Right, they're exactly DIYing themselves down the funnel, and they're not spending less time. I mean, that's the thing about this category. I think we all know people love to dream and shop. This is the biggest purchase that everyone makes. And as James said, it's eight to 13 years. So you are going to obsess over it. And if we can make you more efficient in how you spend your shopping time, it doesn't mean you're going to spend less time. You're actually probably going to spend the same amount of time or even more. You're just also everybody's nosy. So like everybody wants to see houses when it comes on, my neighbor's houses for sale. Like it's just, yeah, my mom is almost 75 and she has no intention of moving ever, but man, she loves your website, boy, and she spends a lot of time on it. And so there is that.
