New apartment Startup list

There are some companies so deeply entrenched in the American psyche that, even though they’re not perfect, we just can’t quit them. Perhaps the best example is Craigslist, that black hole of listings that inevitably turns apartment-hunting into a tedious chore. It’s a user-experience nightmare of scammers, phony listings, and duplicate (or in some cases, quadruplicate) posts. Sending out 10 emails to brokers gets maybe one response. Then there’s the hectic process of scheduling a walkthrough—that is, if the apartment ever really existed in the first place.

Which is why it should come as no surprise that investors are pouring millions of dollars into Urban Compass, a New York City-based startup that offers an antidote to Craigslist chaos. On Monday, the company announced it had raised million at a 0 million valuation to expand its service beyond New York. This follows another million round the company raised last September.

But all this money is not simply another example of the frothy venture capital environment. With Urban Compass, founder Ori Allon, a serial entrepreneur who previously sold startups to Google and Twitter, may actually have a viable and lucrative Craigslist competitor on his hands.

The Apple Approach

Urban Compass is equal parts listing aggregator and brokerage firm. Customers looking to buy or rent a home can go to Urban Compass and search for listings by neighborhood, price, and size, just as they would on Craigslist. Then Urban Compass’s sleekly designed site turns up a map of listings, along with a neighborhood guide for each listing and other helpful information such as, for instance, the length of the commute to Times Square and which subway lines are closest. Users can then schedule a time online to meet with one of Urban Compass’s own brokers for an in-person walkthrough. If all goes well, they can fill out the application paperwork right on the site. Urban Compass owns the entire experience, from the initial search to the lease signing, an approach that Allon compares to Apple’s.

Strange as it may seem in a disjointed market like real estate, it’s rare to see a company take on both the listing and the brokerage side of the business, says Susan Wachter, a professor of real estate at the University of Pennsylvania’s Wharton School. Instead, there are sites like Zillow and Padmapper that pull listings from a variety of other websites but don’t employ their own agents. They make their money on advertising. Then there are agencies that only manage a small selection of properties and make their money on commission. The fact that Urban Compass is marrying the two, Wachter says, is a very big deal.

“Unlike many of these information providers, this gives people an instant connect, which is terrific. It’s like a one-stop-shop, potentially, ” Wachter says. Plus, she adds, the broker business is where the money is.