Fortune writer trashes Zillow, "Why I'm not buying Zillow"
Fortune contributing editor Duff McDonald just trashed Zillow in what I think is the silliest financial analysis of a firm I've ever read. The background, Zillow has just filed the necessary paperwork for a proposed initial public offering of stock. McDonald says, "I'm not buying Zillow".
Now you have to understand that I think Zillow is really no more than an entertaining site and I've written about the good and the bad over the years. They just changed their strategy to focus more on getting real estate agents to advertise by featuring their listings (which are not proprietary to Zillow) and their mortgage network where they do the same thing with mortgage lenders. They also have minimized their original claim to fame, the infamous "zestimate", an automated home valuation tool which is not exactly the same thing as an appraisal, in other words, you shouldn't equate a zestimate with Moses coming down from the mountain with the Ten Commandments.
Here are a few excerpts from the Fortune article:
In an industry as opaque as real estate -- one that's replete with all sorts of screw-the-customer complexity, including title searches -- Zillow has offered a clarity and transparency that real estate agents, for all their "I'm-on-your-side" fakery, never have and never will. (Oh yeah, he doesn’t much like agents and other “insiders” in the real estate industry either)
Despite noble ambition, Zillow is nothing more than real estate porn, and by planning to raise $51.8 million in an IPO, it is merely looking to cash out its beleaguered venture investors, who have to date sunk $87 million into the business. (emphasis added)
Second, it appears to me that Zillow has sold out. The original idea, as I recall, was that the site would bring a degree of transparency to an industry that had long resisted it.
And there's more. But, it's just my opinion but while I have your attention, what happened to CNN and Fortune over the years anyway. They seemed to have gone from trusted news organizations to ???