I interviewed Sami Inkinen last week about Trulia and how their company is currently doing. Trulia is a US based residential real estate search engine, which Sami Inkinen, a Finn, co-founded together with Pete Flint. I wanted to talk to him how Trulia is doing in the turmoil of the US economy, where the housing market was hit the hardest definitely affecting their business. I thought of writing a story from Inkinen’s answers, but since he manages to best explain their business and his thoughts in his answers, I decided to publish the interview in full.
ArcticStartup (AS): The classified market is highly competitive, especially in the current economic recovery mode – what sets Trulia apart from the competition?
Sami Inkinen (SI): Considering that we have consistently grown our audience between 50% and 100% each year during our five years of operations and are now a leading online real estate site in the U.S., we must have done something right. I think the most important thing that sets us up apart from the competition is our team, our people: very talented and smart folks working very hard, solving problems and creating new innovations towards our common goal of becoming the category leader in online real estate in the U.S.
Our goal is to revolutionize the consumer real estate experience by providing truly personalized guidance for all consumers looking for real estate. For this to happen it is critical to keep innovating every day ahead of the curve and that is only possible if the team and company culture are top notch. I like Amazon CEO Jeff Bezos’ quote: It’s always day one. That’s how we think.
Of course, our current scale, brand, active online community, and many unique content assets and market place type of relationships that we’ve built, are very very hard to replicate and help us stay ahead of the many small and large competitors. But it’s still just day one for us.
AS: TechCrunch mentioned that you were “scratching profitability”, can you elaborate a little on that?
SI: “Scratching” is certainly not part of the official GAAP accounting terminology!
We’ve built our business patiently over the last 5-6 years and have now grown into 9 Million monthly unique users and about 160+ team members, or Trulians as we call ourselves. On the financials side, yes, we are a profitable company whether you look at it on a cash or EBITDA basis. I guess where the scratching comes into play is that we are aggressively focused on investing into our future growth, so our near term plan is not to maximize profit margins – rather, it is top line growth in all metrics.
Profitability in itself means that our business model works, we can continue to invest into our future growth and of course it is a huge psychological milestone too for the hard working team. We’ve matured from a “cute mashup” – as some called us in 2005 – to a real sustainable business that is helping millions of consumers and real estate professionals in their daily lives.
AS: How are you taking advantage of the current market situation in the US?
SI: We think any market conditions are good for our real estate service that has something for everyone from a buyer to a renter to a homeowner. The fundamentals for our business opportunity have not changed in the last 6 years: more and more consumers are using online tools to research and make their real estate decisions and real estate professionals are looking for better and more efficient ways to promote their business and connect with consumers.
Buying a home (sometimes even renting a home) is the largest financial decision for most people during their lifetime and that is not going to change anytime soon. There are unlimited opportunities for us to improve that experience, regardless of interest rates and other external factors.
But sure, I’d like more people to have jobs, home prices to stabilize and for sale inventories to start going down.
AS: What does Trulia’s future look like and where do you plan to take the company in the next 12 to 24 months?
SI: It’s still Day One for us! We have an ambitious product road map that includes very cool innovations for both consumers and real estate professionals. One example is mobile. At peak times, up to 15% of our traffic is from mobile. That will just continue to increase. All these investments should keep us on a rapid growth track in all metrics from audience to revenues to brand recognition.
AS: Any last comments to Nordic and Baltic entrepreneurs looking towards the Valley?
SI: Well, you can succeed anywhere. Sweden, Finland, Norway, you name it! It always takes enormous amounts of hard work, luck and “Sisu”.
But the Silicon Valley is a unique place with the best talent, very large home market, experienced investors with plenty of capital to invest, the best advisors who’ve built companies themselves, and a support ecosystem from lawyers to bankers and accountants that can significantly increase your chances of success.
Think of it this way: there were some (not so many..) successful and determined Finnish long distance runners who trained all winter in their garage on a cheap treadmill staring at the garage door. But, many of them came to Colorado for several months each year. Colorado has fantastic year round training, high altitude, great road and trail network and U.S. Olympic training centers with all the testing facilities. These runners wanted to maximize their chances of success. That’s how I think of Silicon Valley vs. many other places in the world for a (tech-) entrepreneur.
If you are building your business in the Valley, you should know that nationality or ethnic background doesn’t really matter at all. For example, close to half of Trulians were born outside of U.S. and we recently did a survey and found out that we have about 75 different native tongues spoken among us.
But establishing your business and yourself here does take time and commitment though. A one week trip to Palo Alto won’t get you local investors or make you a Silicon Valley company. An office and permanent senior management (e.g. founder in most cases) presence is a must if you truly want to tap into the Silicon Valley magic!