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Zillow Hopes IPO in 2011

January 13, 2010 –  Kent Hu on Zillow “We’re not a 2010 IPO candidate, but hopefully we’re a 2011 IPO candidate,” Zillow Inc. Chief Operating Officer Spencer Rascoff , 34, said in an interview.

Zillow Inc., the second-largest U.S. real-estate listing site by users, having 5.2 million monthly visitors, compared with 6.4 million for #1 Move Inc.’s Realtor.com, according to research firm ComScore Inc. of Reston, Virginia.  Zillow boosted sales 65 percent last year, beating its revenue and earnings targets amid industrywide declines in advertising and housing, Rascoff said. The company gets its revenue from advertising, including banner ads and cost-per- click ads included in mortgage-rate tables.  The company’s growth is outpacing the U.S. online real- estate advertising market, said Kip Cassino, research director at consulting firm Borrell Associates Inc. in Williamsburg, Virginia. The market fell $100 million to $7.5 billion last year, according to Borrell. That’s almost one-third of real- estate and mortgage-ad spending in all media.

Zillow will boost sales by adding new kinds of ads and doubling its sales force this year. It will begin selling new lead-generation campaigns to mortgage lenders next month, letting consumers who have already viewed interest-rate quotes ask to be contacted by a specific lender, with Zillow getting paid for making the connection.  In tests, as many as 10 percent of consumers who make those requests close a loan, Rascoff said. Zillow hasn’t set prices for what it calls “customer-initiated-contact” ads, he said. The company’s target is to get half of its sales from mortgage ads by next year, up from 10 percent now, Rascoff said.

The company hasn’t begun interviewing investment bankers, Rascoff said. The exact timing of Zillow’s IPO plan depends on how well it does this year, spokeswoman Amy Bohutinsky said.

Watch here for a quick YouTube video on Zillow iPhone App –

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