I’m talking to you.

Yes, you.

The person who thinks you will start an Australian real estate portal that will shoot right past domain, dethrone realestate.com.au and become the new number one.

Or, maybe you’re an agent who for some reason (perhaps because you have to send them a check every month?) doesn’t like realestate.com.au and wishes the industry would start a portal as a realestate.com.au killer.

I have a message for you: you’re dreaming.

I tell you this because of a very interesting discussion that developed in the comments of Ryan’s excellent post on FarmBuy.com.au. I thought I’d pull out the topic and expand on it.

Face it. realestate.com.au is the dominant market leader in online real estate listings in Australia. It would be very hard to beat them at their own game. What’s more, you cannot expect to copy realestate.com.au and win without their help, in the form of massive, ongoing self-destructive behaviour. They are not likely to give you that help.

All those hopeful entrepreneurs trying to create a new website to knock realestate.com.au out of its top spot and take it for themselves are on a fool’s quest. That goes for everyone from domain.com.au and on down. Domain can aspire to a profitable second place. Smaller, later comers can aspire to make a living, maybe, but certainly not to kill the giant.

The plain truth is realestate.com.au is the leader and will be the leader in online real estate listings in Australia as long as there are online real estate listings in Australia. There have been instances in business history when a player with a dominance similar to realestate.com.au’s was displaced by a competitor, but not many.

I say this as someone who has worked at realestate.com.au and with other real estate related web businesses on three continents, and as an entrepreneur.But, if you think I am missing something here, please enlighten me in the comments.

How to Make Money

Tell them they're dreaming!

Instead of leadership, go for a niche and establish a strong brand as the first and best in that niche. Here are some niches that are already in play, with varying degrees of success:

• Farms: FarmBuy
• Rentals: Rent.com.au
• Regional: AllHomes
• Premium property: Million Plus
• Free listings: The Home Page
• Chinese buyers: Juwai.com (a client of mine)

If you can be content with a niche, you could possibly be profitable, or at least one day sell out at a profit. It will be hard, because the Australian market is so small, but it seems possible. A niche could also be an add-on to another real estate-related business, giving that other business strategic advantages — like domain.com.au does for Fairfax’s newspapers.

Still Dreaming?

If a niche is not enough for you, and you want to beat realestate.com.au, there is only one credible strategy. You must dominate a new niche. This new niche by definition cannot be dominated by realestate.com.au and must be able to grow big enough to one day eclipse realestate.com.au. The flaw in this strategy is that you have to be riding a wave of history for it to work for you. Those waves don’t come along often.

For an example, look at realestate.com.au’s own history. The major media businesses had print real estate classifieds locked up prior to the realestate.com.au’s rise. They were unassailable. Classifieds were so reliable and profitable that analysts called them “rivers of gold”.

Then, three friends in Melbourne registered the domain name realestate.com.au and began persuading skeptical real estate agents to put their listings online. They chose a real estate classifieds niche the big players had overlooked: online. And they made themselves the leader in that niche.

(It is true that News International has a stake in realestate.com.au today, but that only goes back to 1992, when Simon Baker in his wisdom convinced News to buy it. realestate.com.au was a pure, independent startup in the classic mold. I reckon if you did the numbers, you would find realestate.com.au has been a much more profitable investment for News Corp than myspace.)

Over time, little realestate.com.au grew and grew by riding the growth of the internet. realestate.com.au won online and rode the internet’s historic growth into the very backbone of our economy and culture. The big media companies still dominate print classifieds, but print is sliding into irrelevance.

As of today, realestate.com.au has reported record revenue for six consecutive half-years, while the newspapers are struggling.

The lesson to draw from this history is simple. real estate portals should not take on the established leader head-on. Find a new niche and become the leader in that niche. You can make a living, and you may even get lucky enough to ride a historic trend into great riches.

Property Ad Guru has also “gone on Hiatus” recently as well, and we we only have to guess that this has also been closed permanently as not many companies go on ‘hiatus’ if things are going well.

At the launch Simon Baker the CEO of Classified Ad Ventures, said:

Social Media is an important marketing tool for Australian real estate agents and all agents should have a strong presence on the main sites – Facebook, Twitter, and MySpace. We launched SOBOX to help Australian agents get the most from social media and to reduce their reliance on traditional and other online media when marketing themselves and their listings.

It seems SOBOX found the going a little tough and we received reports detailing how only a few agents had actually signed up for the service over the past 18 months. These customers have apparently since been notified of the closure and have received all of their data to export into a new service.

One of the problems with SOBOX is that agents could actually get most of the same or similar offerings for free or for a nominal monthly fee with little effort, which highlights another problem facing new companies feeding to social media websites. Most providers today actually do the same services as a part of their overall web design service as nearly all new real estate sites also have a blog and social media integrated.

Classified Ad Ventures Pty Ltd has seen a number of projects close over the past 12 months with many of the previous offerings no longer available or merged into a more streamlined service and it seems the company is now focussing on providing a smaller core suite of products to real estate agents, including search, web services, content delivery and also web development.

Another of their offerings List Globally (which I think is a great idea) may also be struggling to get the numbers needed – primarily because I think it is too expensive, I still cannot get my head around their pricing. For such a great idea, I would have thought if List Globally was a completely automated service they could drop the price dramatically and get the volume they needs to have the success it warrants.

No one doubts the talent and reach of the team and particularly Simon Baker, he has proven in the past he has the experience and connections to make things happen, however for every success in online technology we each experience a number of failures along the way and having success in one area doesn’t always guarantee success in another.

Property Portal Watch seems to be still growing strong with regular updates which I follow closely. It is a good website to follow if you are interested in all the happenings of real estate portals worldwide. They seem to have expended this service into directories as well.

Todays economic climate is not easy on new web service companies and hiring the right talent often is the biggest ongoing expense, you add servers, maintenance and traditional business costs you can find yourself needing revenues almost immediately.

In a followup article to the Front Page Project Rebellion article, Ben Hurley from the Australian Financial Review has published a new story on an ongoing investigation by the ACCC into the activities of RealEstate.com.au and to a lesser extent Domain.com.au.

Questions directed at some of Australia’s leading real estate groups have seemed to focus on excessive price rises (see 1,2, 3 and 4) of realestate.com.au and the effectiveness of competition in the real estate online classified space.

Simon Baker, the ex CEO and substantial shareholder in REA has made some interesting comments on this blog recently regarding realestate.com.au prices :

If the franchise groups were serious about competing with realestate.com.au or at least providing a competitive offering, wouldnt they first start internally and attempt to organise group buying of REA subscriptions for their franchisees?

Imagine if all Ray White or LJ Hooker offices got together and negotiated as one for their REA subscriptions (and additional products). I think they would get a better price.

and

the most likely innovation will be suburb based pricing where there is significant differentiation between suburbs in the price paid.

and the most suprising comment from Simon was his take on add on products

The more interesting question is why do people have to buy the premium products? Do they really add value?

Does anybody else find that a little strange?

With all state Real Estate Institutes and the REIA meeting in Perth during the week strategies were again discussed to create a national industry run portal.  David Airey commented on this blog prior to the meeting :

“Sadly the REIA ailed to gain national support from most state institutes to launch or run a national industry owned portal. That’s a sad indictment of the politics that used to exist and allowed the commercial sites to grow around our industry at our expense.”

and

“I’m on the record on many occasions criticising REI’s for this intransigence and for not listening to members.”

But the current momentum in the industry may have changed some minds as all indications are that this roadblock may finally be pulled down and our REI’s finally taking a role that many members thought they would never see and that is the operation of a national industry controlled portal.  But taking on the might of REA would not be easy and one of the strategies being discussed is using the REI’s to feed to the commercial portals with delay of say 3 or 7 days. This would allow REI portals at a state and national level to promote something like “Find it first on  xyz.com.au”.

As this plays out behind closed doors the campaign to withhold sold data from  realestate.com.au is gaining some serious momentum and reports from small and large national real estate groups and portal pushers continue to roll in.

One side effect of withholding sold data from the likes of REA is that data companies like RPData who has paid substantially for this information feed from REA. RPData and other similar companies provide essential data services back to agents but also provide market analysis and review consumed by the nations media. With a strong national portal in place it’s expected that RPData will move to establish arrangements direct with the institutes bypassing REA entirely.

Another thing Ben Hurley has reported on today is the presents and gifts that Realestate.com.au is showering on their biggest spending clients.  With the real estate market slowdown agents have looked to reduce discretionary spending. REA have used things like dinner at high end restaurants, State of Origin games, Business Class flights and even brand new iPads to secure the relationship.  I personally have heard of a sales team being flown interstate to watch the AFL when discussions of reducing their yearly spend was raised.

Realestate.com.au has over 10,000 real estate agents throughout Australia and whilst many agents  spend around $1,000 a month there are offices who spend 10, 20 and even 30  times that amount which is primarily funded by Vendor Paid Advertising (VPA).  Realestate.com.au’s campaign to increase the share of wallet has been right around the country but it has been particularly successful in Melbourne where they have less competition from Domain and high dollar auction campaigns are popular .  As an example the Premier Property option offered by realestate.com.au can cost an owner well over $2,000 per month.

Many in the industry showed increasing concern towards REA’s motives when a video surfaced showing their intention to market direct to buyers and sellers. Check out the video yourself, particularly from 9 min 30sec of this video.

In response Greg Ellis issued a written response which seemed  to contradict itself from paragraph to paragraph. Why his response was not circulated widely by email is unknown but it might have something to do with the fact its easier to watch the video by clicking on the link if it was sent by email. I doubt to many would have typed in that long url.

In the letter he claimed that it was incorrectly reported that he wanted to cut agents out of the loop but then went on to state:

The development of site functionality that allows prospective buyers and sellers to access or claim property information that can be accessed by agents so they can cost effectively identify a new pool of leads.

I am sure I am not the only one that reads this sans spin to be that they are going to escalate their use of agents sold data, listing data and valuer general data to provide additional products to buyers and sellers direct and then sell those leads to agents…. as “cost effectively ” as realestate.com.au can do of course!

In an interesting side note REA reps have now started to sit down with salespeople and sellers in their homes to pitch $2000 a month Premier Property and other options in the marketplace. This appears to be very similar to the Redfin Portal in the US who have a team of salespeople on the ground in capital cities. The primary difference is that Redfin salespeople also present property and take a cut in the commission, something REA have repeatedly claimed they will not do.

REA’s dealings with the ACCC lately has not been good and has seen the scrapping of the Private Listing Policy which finally allows private sellers easy access to list on realestate.com.au.

The drought of sold data would certainly have some sort of effect on future revenue streams and to a certain extent current products but a successful ACCC action and a industry controlled competitor together would provide bad news for Australia’s largest and most successful real estate portal.

It’s going to be a very interesting few months as this all plays out but if it was bad news for REA it’s terrible timing for newcomer Onthehouse. A strong industry portal is not going to be good news for them.  Their original investor document and  subsequent prospectus highlighted the monetisation of client agents data.

The underwriter (and partial owner) took it a step further in their report when they stated :

“Low integration risk, with ongoing data feeds. PortPlus and Console databases are ready to be “plugged in” into OTH’s database. In addition, both businesses do not sell their software – they license it to each customer on a rolling basis. As such, they retain ownership and control over the software and its intellectual property. With the appropriate terms and conditions in place with clients, each business is licensed to access and upload the content that is captured by the software”

Customers of Portplus and Console are already questioning when the terms and conditions are going to change and just where their data is going to end up. I expect their competition will start to raise the issue and use this against them when pitching for business.  Even though the float was over subscribed, in their first month of trading the shares dropped to as low as 60c which must be a huge concern for the original operators of Portplus and Console who are restricted in selling many of their shares for quite some time.

Certainly, the “Noise” is getting louder by the day!   Join in and tell us what you think about the latest developments.

The Video

ListGlobally.com Simon Baker from Peter Ricci on Vimeo.

Overview

There is a little more to this product that warrants more than just a first glance. The software allows any agency to list properties for sale on www.listglobally.com for a fee of $90 per listing for 90 days  Listglobally.com then feeds (pushes) those listings to many of the most popular real estate websites in the world automatically including Canada, Germany, Great Britain, Japan, Russia, South Africa, Spain, United Arab Emirates, with many more in the pipeline.

Here are some of the websites that www.listglobally.com pushes to:

• rightmove.co.uk (United Kingdom)
• immobilienscout24.de (German)
• enormo.com (World)
• realestate.co.jp (Japan)
• iproperty.com.my (Malaysia)
• iproperty.com.sg (Singapore)
• propertyfinder.ae (United Arab Emirates)
• canadahomeguide.tv (Canada)
• gohome.com.hk (Hong Kong)
• 99acres.com (India)

The software looks to be very clean and efficient, the website looks the same, only information needed is presented and I like this approach. if you wish to join you have two options for adding your listings, you can join for free and then add each listing manually or you can feed your listings (talk to your IT people) to listglobally.com and then login and select which listings you want to activate for a fee of $90 per listing for 90 days. Most of these sites are the most popular in their country and the global ones like Enormo.com (which is really the only international portal available) should give your listings some decent exposure.

Listglobally.com have a number of country specific sites that have actually added on an “International section” for your listings to appear on and I understand in some cases listglobally.com have actually built in some of these international sections for portals.

If there is an inherent weakness in the product, it is this – I have real doubts that anyone would go to a site like realestate.com.au to search for listings in Japan , UK, India etc. If  you were a serious buyer, you would seek out sites that had all the listings for that country. So just keep in mind that the figures quoted (around 40 million eyeballs) are actually not very accurate as far as the sections of the portals we are talking about with Enormo being the only true global website. Realestate.com.au may get 5 million visitors per month, however the International section may only get a few hundred thousand –  so just keep this in mind.

As for the cost, $90 per listing for 90 days does sound pretty cheap but if you are going to market your whole portfolio, this can get quite expensive (10 x = $900, 100 times = $9,000), I am never a fan of time-limited fees, I would hate to see a realestate.com.au or domain.com.au do this in Australia although it will only be a matter of time before agents are charged per listing as more and more agents become mobile and offices begin declining in numbers (and they will).

All in all Listglobally.com should be a decent offering, but it will take time a few years to mature. At the moment the offering is fairly limited and probably will only be used by agents to attract more vendors,as with anything, the longevity of products like this does come down to the value it provides real estate agents.

I suggest you give it a go with one or two listings, you can jump right in now and give it a run with a property or three!

Simon is a pretty astute fellow and his reputation alone will get him off to a decent start in the market, long term – if they stick at it – I expect Listglobally.com to be a winner!

As a note for disclosure I am a shareholder in www.zooproperty.com which in some small way competes with Listglobally.com, although on a different level.

Whilst I was there I decided to give my FlipHD video recorder a run and do a few little interviews with some vendors I found that had interesting software that could benefit the real estate industry. Some of these are USA specific, but some also offer services in Australia.

So here are the interviews (please forgive the shoddy camera work)

Go Paperless – Mehrdad Alaei

Go Paperless Solutions provides software for the mobile real estate professional. Real Estate Dashboard and eSignOnline will change the way you work. I caught up with Mehrdad Alaei to talk a little about his software.

Go Paperless – Mehrdad Alaei from Peter Ricci on Vimeo.

More Information: www.gopaperless.com

NabeWise – Ann Baldinucci

Nabewise allows you to search for neighborhoods based on preferences by offering real time rankings and a neighborhood scorecard in key categories such as quality of life, people, things to do, character and schools. I caught up with Ann Baldinucci for a quick chat.

NabeWise – Ann Baldinucci from Peter Ricci on Vimeo.

More information: www.nabewise.com

DIYThemes.com – Chris Pearson

The Thesis Theme for WordPress is a premium template system designed to serve as the rock-solid foundation beneath any kind of website. Simply put, Thesis is powerful. It has a remarkably efficient HTML + CSS + PHP framework and easy-to-use controls that you can use to fine-tune each and every page of your site with a tactical precision that has never been possible before. I caught up with Founder and co speaker Chris Pearson to chat a little about his software.

DIYThemes.com – Chris Pearson from Peter Ricci on Vimeo.

For more information: www.diythemes.com

Qonnect.mobi – Emil Sheth

Qonnect allows real estate agents to efficiently push their listings content to mobile. The software also works with QR Codes. I spoke with Emil Sheth about this software.

Qonnect.mobi – Emil Sheth from Peter Ricci on Vimeo.

More information: www.qonnect.mobi

WordPress – Jane Wells

Jane is the user experience lead for WordPress, and has worked in the web industry for 10 years. Though her apartment is in the East Village, she spends much of her time traveling to WordCamps and meeting WordPress users to incorporate their feedback into each new version. I spoke with Jane about WordPress and her role within the community.

WordPress – Jane Wells from Peter Ricci on Vimeo.

For more information: www.wordpress.org

Street Advisor – Justin Adler

StreetAdvisor.com is an online community where people talk, learn and discover what life is like in millions of streets and cities worldwide. Connecting Real Estate Professionals with local home buyers, renters and sellers. I spoke with Just Adler about the software.

Street Advisor – Justin Adler from Peter Ricci on Vimeo.

More information: www.streetadvisor.com

SmartZip.com – Avi Gupta

SmartZip analytics offers independent investment ratings and analysis on over 70 million homes nationwide,which helps home buyers and investors make better informed, more confident home purchase decisions. I spoke with Avi Gupta about the software and services.

SmartZip.com – Avi Gupta from Peter Ricci on Vimeo.

More information: www.smartzip.com

Well, that’s all from Real Estate Connect San Francisco today. Next week we will be posting an interview with Simon Baker about his new venture!

There are some interesting connections going on here. Firstly Nestoria is an aggregator of property listings. They receive listing data from a range of other companies. Ultimately they are just a listing service for other portals and real estate groups to display their property on. They compete for the eyeballs looking for real estate and then distribute them to other “destination”.

They specialise in creating a better and more simplified user experience. Nestoria also offers a range of widgets and an api for third party webmasters to utilise their data and embed functionality in their website ultimatley driving traffic back to Nestoria.

If this all sounds familiar it is and that’s because it is basically Google’s model to Real Estate although there are of course still some differences. Nestoria’s user interface is far better than Google’s minimalistic mapping approach but Google also brings synergies with its search integration that Nestoria can’t offer. Another difference is that Google’s income stream is through the display of ads on every page whereas I believe Nestoria is charging the data providers for generating traffic.

Now Domain has signed up as one of the foundation partners for Nestoria. That seems a little hypocritical when you consider that Domain has not partnered with Google over their real estate solution. Domain obviously does not have an issue with the aggregation model itself more the fact that Fairfax is a huge user of Google for its advertising products and thus they believe it should not be interfering in their “space”. Clearly they dont have those issues with Nestoria.

So what we have is the ex CEO and still a major shareholder of the Australian number one portal doing a joint venture (or white labelling) with the UK’s 4th largest portal to create a new Australian portal and partnering with Australia’s 2nd largest portal and others to generate them more traffic. Confused yet?

Something has obviously changed in Simon Bakers thinking. As the man behind REA’s stunning success he operated a strictly subscription based portal that now talks about increasing their “share of wallet” from real estate agents. At the end of Simons reign at REA it was a truly corporate beast complete with executive and middle management levels and a huge administration and sales force.

Nestoria on the other hand is a lean mean fighting machine that operates on minimal overheads and uses smart user friendly design and SEO to create substantial traffic.

Only days before Google launched the first stage of their Real Estate solution Simon was publicly stating on his propertyportalwatch.com blog that Google would not be effective and not enter the mix. In contrast we have him behind a remarkably similar portal whose current partnerships are actively working against his previous employer and his substantial investment in REA.

So can Simon Baker make Nestoria.com.au a real contender in the real estate space? Yes I think he can.

Nestoria certainly has a good pedigree and an established and proven site design, user interface combined with widgets and an api. Simon also brings a wealth of experience to the table and the combination should certainly provide some fireworks.

Richard Freudenstein:

The Board is delighted that Greg has agreed to lead the REA Group through the next, crucial, stage of its development. We are confident he will fully realise the strategic vision we have for the company.

The REA Group has transformed itself into the second largest online real estate advertising company in the world, largely on the strength of its Australian operations.

Greg has the online and international experience necessary to grow the business from where it is today to an even larger and more successful future. This is excellent news for the real estate agents whom we help succeed and to the consumers who rely on our websites.

Greg Ellis

There is an excellent team in place at the REA Group and they have achieved great things. I am looking forward to joining them so that we can accomplish even more together.

My Comments: Firstly I would like to welcome Greg. Coming into a role in a company that already has complete market share will be nothing new to Greg, however it will be the expectations under which he is employed by the board that we will follow with interest.

I will be interested to see what changes he brings to the CEO role and how REA are perceived by agents, this is one of REA”s weak points and they need to improve relationships with agents especially after the email fiasco, which basically drove home the point and about REA being results driven rather than core customer focussed.

I wish him well and I am sure we all will judge him on his long term vision and results.

On Thursday evening I had a phone hookup with Simon Baker, former Managing Director of Realestate.com.au. We spoke about a range of issues and I will place some excerpts from the interview here. Simon recently departed from Realestate.com.au in the typical pathetic fashion that large organisations feel necessary and from his blog My CEO Life Simon explained his departure.

“I was summonded to a hotel room in town, asked for my access pass and told not to go back to the office and that my desk would be packed up and couriered to me – 7.5 years over in a flash. I was not to say goodbye to the team.”

Since that date Simon has been inundated with offers and judging by the response was very popular amongst his team. Simon is still a large shareholder of realestate.com.au so I am sure he will want to see continued growth from this company. You have got to give credit where it is due, the company now has a market capitalisation of over 500 million and employs some 750 people.

Realestate.com.au has a number of challenges ahead of them, not only trying to keep growth running along nicely, but also making its international businesses profitable (nearly all the profit comes from Australia).

There was no malice in this interview towards REA and he answered all questions openly.

So here is the interview.

It has been a dramatic few weeks, can you share with us some of your thoughts over the past few weeks, what have you been up to?

“Well I have had over 20 opportunities present themselves over the since the announcement. Anything from board positions, investment opportunities and of course some serious offers which I am taking my time mulling over, it has to fit.” Simon is also involved in a number of early stage companies and has investments in a number of these, from real estate to arts. Simon is currently Chairman and CEO of Artshub, a Director of Redbubble and a Director of 3eep. Simon seems to have a passion for the arts and you can see this from his investments, ArtsBub looks like a little ripper.

Where do you see yourself working, do you think you will remain in the online space in real estate or just general technology?

“Well it will have to be on the Internet, I am not interested in anything non internet related, I couldn’t cope with it.” So I am weighing up some opportunities and will make a decision in due course, but I have had a plethora of interest both in and around the real estate space.”

Realestate.com.au saw incredible growth over the past few years. Is this going to continue, or do you think it will be tough to continue at around 40% growth? We all have been waiting for Google Classifieds (Google Real Estate) to come to Australia. Do you see this as a threat to current revenue models?

“No”. Simon recently had a chat with Abe Murray Product Manager at Google and pointed out that Google are not in the business of taking down markets, more so complimenting them.

“Only around 30% of traffic comes from Google, Realestate.com.au is now part of everyday life for consumers, the real challenge is for off-line print media, realestate.com.au drives leads for agents, this is what we do, currently in Australia around 15% of marketing is spent online compared with 85% in newspapers, yet newspapers struggle with around 20% of leads. Naturally agents will just get smarter where they spend there money.”

Will the Portals embrace Google?

“Portals will embrace Google, they will be crazy not to”. Simon also spoke of the challenge for Google if realestate.com.au, domain.com.au, realestateview.com.au, myhome.com.au all send the same properties and perhaps also agents sent feeds to Google as well. We did disagree on some aspects of this, as I did point out that Google will be smart enough to filter these or link to all sources. Simon does however feel that Google will not be a threat, he thinks they will compliment the portals.

Newspapers have been struggling with print property guides, seeing revenues fall over the past few years. Can you ever see them give up, like the LA Times has done recently?

“I don’t think they will give up, agents will use newspapers more for branding and perhaps only high quality properties will be featured in papers – maybe 1.5 million dollar properties.” I agreed with Simon on this. I mentioned that it may well start at around $600,000 but more and more consumers will not want advertising in newspapers and each year the benchmark will increase, lower priced properties, especially in times where many may be getting less than what they paid for properties and will not want to spend money in print.

Do you think print and online departments should merge?

“No”. Many have speculated that this is where Simon and the Board had the base of their disagreement. I think the ‘no’ was a great answer, short and sweet. It is also speculated that Fairfax Digital and Print are also having the same bunfight.

Where do you see real estate in 5 years? Do you think Mobile is the answer or do you think digital television is the next big area?

“I think it will be via the browser, whether it is video or not, the mobile market here in Australia is different to some countries where there are so many more options and everyday uses for mobile phones – maybe an integrated TV browser”.

If you had to name one thing you could be proud of in your time at REA what would it be?

“Created a household name”. Simon struggled to name just one. He also spoke of his time coming into a company on its knees and systematically building it up with a great passionate team and taking it international.

Simon was leaving on a flight overseas tomorrow, so I thanked him for his time and wished him luck. I think we will see him somewhere building a smallish company up, more than likely in the real estate space. He does have a passion outside of real estate, but real estate is where he has all of the connections and a great reputation, he understands the market internationally, so I think that will be where we see his more prominent roles.

If you get a chance take a look at his MyCEO Blog it has some great articles and insights into his life as a CEO and also some good commentary on his departure.

This comes as a little bit of a shock, I honestly thought Simon would be around until he was poached by another company. The Chairman of REA Group Richard Freudenstein said,

“Over the past seven years REA has grown from a single Australian website into a world-leading online property company, with operations in 10 countries and publishing 22 websites and 8 print publications. Now the Board feels it is time for new leadership to take the business to the next level. The Board would like to thank Simon for his contribution to this success and we wish him well in his future endeavours.”

This announcement comes on top of some pretty impressive results. REA’s results for the fiscal year ended in June are astonishingly good.

- Revenue of between $152 million and $156 million (up by 41% to 46%)
- EBITDA of between $35 million and $37 million (up by 49% to 57%)
- More than 22,400 paying agents as at 30 June 08 (up by 5,400 paying agents from 30 June 07)

The New Replacement
Well if you look at the above figures, it is a pretty big ask. My guess if the board want to continue with this growth, then the next CEO will last less than 12 months, as I cannot see that % of growth continuing.

Simon Baker
I have dealt with Simon Baker on a number of occasions over the years and whilst we disagreed on a range of issues, he has always been available for a chat. I wish him well in his future endeavours. He will have leave big shoes and even higher expectations for his successor.

The article written on the recently released Realestate.com.au web log titled ‘News from the CEO Desk’ is a pretty poor attempt at playing down the impending threats of new real estate mapping sites in Australia (and possibly from Google, Yahoo and Microsoft read MSN).

Mapping systems for real estate are relatively new and it will take at least a year for it to kick into gear. There are already a number of sites released with some kind of mapping, but on the whole they are terrible attempts. However this may change with the release of realmap.com.au, of which I have had a good look at.

As for the CEO Blog, it has some nice touches to it and some interesting articles scattered amongst the plethora of chest thumping which seems to ever increasingly come from this well oiled operation’s marketing machine.

Simon Baker takes a swipe and like all clever operators hedges his bet by talking up his “market leading” mapping technology.

I will make a bet. Within 2 years they will dump their decidedly average mapping system for a actual real mapping system developed by mapping experts.

It is not that there is anything wrong with it, it is just that it will be overtaken very quickly by other mapping technologies that are avaiable today!

Having loads of money to spend on technology and development does not necessarily mean you are guaranteed success, as many of Australia’s big business and government agencies can attest to.

So if you get a chance keep an eye on the CEO Blog as there are some worthwhile articles written on it. You can also subscribe to it if you have an Rss reader and even better Internet Explorer 7 Beta release.