Glenn Kelman announced that Redfin has acquired Walkscore. Here is his blog post that announces the acquisition.
While Glenn did a really good job of explaining his reasoning for the deal in his blog post, I wanted to point out three reasons why I think it will indeed be a great move for Redfin.
- It DIRECTLY accomplishes goals that they jointly share. Redfin as a company is highly focused on getting information in the hands of the consumer. Walkscore has information and traffic from all over the place and makes it ideal for them in this regard. Put bluntly, the folks at Redfin KNOW what to do with this data. And with the Rental piece of the deal. They will put it to good use.
- It DIRECTLY connects Redfin with agents who use the Walkscore service on their websites. And those agents / brokerages would likely share the same or similar values with Redfin.
- It DIRECTLY picks up authority from the Walkscore domain that can help them generate significant traffic via SEO.
So the industry has no earthly idea what Redfin paid for walkscore. I am sure we will know someday, but not today. Here is why it is immaterial:
- Glenn is not worried about getting notoriety out of a valuation. In fact, if this deal is a smooth quiet transition it is actually better for him. Many agents will not care that their sites are linking to a competitor now. And the less said about that from Redfin’s point of view the better. Currently it looks like over 25,000 separate sites link to Walkscore as their source for Walkability information on their websites. Much of that is from individual agent websites.
- This puts them on a stronger footing to compete with national sites like Zillow and Trulia
- From watching Glenn over the years, he is a prudent manager. Even though this is Redfin’s first acquisition, my guess is that the due diligence was well…ummm…diligent.
So congrats to Redfin on a nice pick up. It does open the door to some others who would want to pick up the “I don’t want to subsidize my competitor.” crowd and provide them with a good service.