Michele Serro had a terrible time buying her first home in 2006. Her agent didn’t seem to “get” her or her needs. “My confidence went down,” she says. “There were multiple moments where I wanted to throw in the towel, and I thought maybe I shouldn't buy.” She went online for help to guide her through the process, but the buying process seemed to vary significantly depending on the city, state and property type, and the information could be confusing. “I wanted something that looked at it in context, as a journey,” Serro says.
When she couldn’t find it, she created it. In 2012, Serro founded Doorsteps — initially designed as a shared online workspace for agents to attract, educate and guide clients. Agents could join for $25 per month then invite their clients (who could use it for free through their account). To Serro’s surprise, potential homebuyers who didn’t yet have an agent kept trying to join on their own too. So she revamped the site so that buyers (or pre-buyers) could join on their own for free. And Doorsteps became “an interactive guide to buying a home for early-stage homebuyers.”
In its first year, the site brought in more than $1 million in revenue, thanks to a lucrative partnership with a bank, and was used by more than 6,000 agents and 7,500 homebuyers. After the first year, the partnership ended, but five months into its second year, Doorsteps was acquired by real estate search engine Move.com, which operates Realtor.com. Last quarter, it grew its agent and lender paying customers by 40 percent. Today, more than 10,000 agents and 40,000 consumers use the platform. We talked to Serro, who remains CEO, about how she grew her company so quickly and how she’s maintained her vision since the acquisition.
You have a non-technical background as an opera singer, then design consultant with IDEO. How did you get Doorsteps off the ground?
I firmly believe that as a non-technical founder, you need to partner with a technical co-founder. But at the time, I didn't feel like anyone would take me seriously unless I had some knowledge of what I wanted to build. I needed to do some work first. So, I raised a very small amount of money, less than $200,000, did a friends and family round, hired a company called Pivotal Lab and got an education in how to build software.
The person working on my project at Pivotal ended up leaving Pivotal and launched the company with me. I was also staying in touch with some of the contacts I’d made through IDEO, including the CEO of mortgages at a major bank. They told me, “I'd love to license some accounts with you to give to our agent partners.” So I ended up signing a fee-for-services agreement for a year, which was the amount of money I would need to support a five-person team: close to $1 million. That was how I funded the first year.
With a partner that has so much money on the table, it can be tough to push back on changes they want to make. How did you hold onto your own vision for Doorsteps?
I wanted something to make the homebuying process a human one, and that vision never changed. I was very clear about that. How we got there varied, so I tried to always come back to the original mission but be open to the different ways we might get there. It's okay to say no more than you say yes.
A very specific example is in one section of the site, we explain the different types of lenders: mortgage brokers, mortgage bankers and correspondent lenders. They all can provide you a mortgage and a loan, but they work very differently, and for different types of people one is better than the others. Because our partner at the time was a mortgage banker, they wanted us to remove the definitions and presence of the mortgage broker. So I said if you put yourself as the only option, people will not trust you. They will not trust us. I was very adamant about that. I had to communicate to them that when you provide more choices to people, you’re trying to help them make the best decision and you truly have the best offering, you will win.
Partnering with a big bank was about three things: learning, credibility and distribution (to early-stage homebuyers who were acquiring loans) when the time was right. Throughout our conversations with this partner, we made sure we both were super clear on the mission, which was to make the homebuying process more humanized and transparent. They had to believe in that too for us to work with them. We weren't going to change our values to satisfy any short-term needs they had. At the end of the day it comes down to trust, though, between key people, and we had that in spades with this partnership.
How does your design background play a role in Doorsteps?
Design is a value, and everything we put into the world is well-designed. Well-designed is not necessarily about how [something] looks; it's how it behaves [and] how it feels. Design can be extended to taking complex information and making it simple and understandable.
That extends to how the code is written and how we think about error messages on the site. An error message that is unfriendly is not going to help with making you feel confident about us or the process. We want to make sure those error messages feel good, and the pages where you are giving really personal information, that they give you a message back that you completed [the form]. That's very tactical.
We’ve tried to infuse that into everything we do, from the code and the technology to the actual visual design and community management. It’s about getting back to people in a really timely way, responding to them like a human being, not like a robot, and using human language that people understand.
What made you decide to consider an acquisition?
After our first year, I was at a crossroads: Do I raise a series A? Do I re-up with this bank that engaged with us for a year? Or do I entertain acquisition conversations? After meeting with lots of investors, I decided the right opportunity for us was to go with an acquisition. We were acquired by Move.com, which is the owner and operator of Realtor.com, one of the big players in the industry. Partnering with them enables us to have better impact, sooner, with more people. And the team at Move shared our vision.
The acquisition can either be the moment where you give up and potentially go elsewhere, or you take that opportunity a large company is providing you and add a lot of gas and octane to what you are doing. That's what we've been doing. They’ve allowed us to really beef up our team. We have a huge amount of resources to do some really great things. The last couple of months have been really exciting.
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