For nearly a decade, the online housing rentals race has been Craigslist and everyone else. But in the last two years, ApartmentList has come out of nowhere to establish itself as a legitimate challenger. The company now has the largest inventory among all competitors in 60 of the largest 100 markets in the US, according to its co-founder CEO John Kobs. Craigslist, by comparison has the lead in just 30 of these top markets. In August, ApartmentList also crossed 1.5 million monthly users milestone for the first time in its history.
A key factor driving this growth has been ApartmentList’s focus on mobile, an area that Craigslist has largely ignored. Not only does 43 percent of all of ApartmentList’s traffic come from mobile devices, but those users have been far more loyal and 500 percent more engaged, according to Kobs. With the average apartment search lasting just 28 days, it’s crucial to interact with users frequently over this finite time period. The company reports seeing an average of six user sessions per download of its mobile app, with an average of 18 properties viewed per session.
Today, ApartmentList is releasing a fully redesigned version of its iOS app which Kobs describes as, “completely reinvented with an increased focus on discovery, organizational tools, and scheduling.” The goal, according to the CEO, is to make the ApartmentList app an integral piece of the housing search process. “We think of ourselves as the Evernote of your apartment search.”
For example, while users have always been able to save favorite listings, now they can add additional info such as status (“emailed”, “tour scheduled”, etc.) and add personal photos and videos from an in-person tour. In other words, death to paper, spreadsheets, and loosely scattered photographs, be they digital or printed. The app also rates each listing with a Walk Score and Transit Score, measured on a scale of 0 to 100 and conveying the proximity to local businesses and transit stops.
A comparable update to the company’s Android app is expected by December. Approximately one month ago, the company released a companion app called Roommates (iOS and Android) which acts like a matchmaking service for potential roommates.
Rather than relying entirely on landlords and property owners to create their own listings on the site, ApartmentList has instead pursued partnerships with the largest rental sites on the Web (Rent.com, ForRent.com, etc.), aggregating listings from these third party marketplaces. The goal with this strategy is to be the most comprehensive search option available – think “the Kayak.com of apartment rentals.” The company also curates the content available for each listing across the Web, displaying only the best photos – the average listing has 12 photos – detailed floor plans, and property descriptions.
ApartmentList is free to use for consumers and does not charge property owners to include their listings. The company’s monetization is built entirely around “promoted listings,” with listers able to pay for increased visibility.
At its current rate, the company expects to generate $17.5 million in 2013 revenue, up from $10 million in 2012. In conjunction with this growth, Kobs has nearly doubled ApartmentList’s headcount, swelling from 30 to 55 employees over the last 12 months.
The company was named the No. 108 fastest growing company in America on this year’s “Inc 500” list – it’s the sixth-fastest growing real estate company and the No. 18 company in California. Notably the Inc list considers only the company’s 2009 to 2012 revenue and employee growth.
ApartmentList has yet to raise an institutional round of financing, but has been profitable for the bulk of its two years in business (the company launched in September 2011). Its advisors and angel investors include former eBay Motors founder and current Greylock investment partner Simon Rothman, Karma founder Lee Linden, Rent.com founder Scott Ingraham, and prominant investor Ariel Poler.
While the current picture looks rosey for ApartmentList, the company will need to continue innovating and adding value to maintain its position and trajectory. The company faces increasing competition from home listings giants Trulia and Zillow, as well as to ever-looming potential that Craigslist will change its anti-innovation stance and better leverage its massive scale.
ApartmentList is also limited in its options to monetize its platform. Kobs readily admits that he doesn’t foresee ever charging consumers in any form, meaning that it’s only property owners that will be cutting the company checks. While Craigslist and others have charged listing fees (in select markets), this strategy is counter to ApartmentList’s objective of maintaining the most comprehensive listing platform around. Hence, ApartmentList is confined to charging for promoted listings – not that the company’s nearly $20 million in revenue is something to be scoffed at.
With the American real estate market rebounding and increasing competition for rentals in the many of country’s most popular cities, there’s no shortage of demand for powerful apartment search solutions. Today, ApartmentList has delivered one of the most compelling on the market.
[Image via MyFancyHouse]