This week, it was announced that Zillow is acquiring real estate transaction management platform, DotLoop for an undisclosed amount, and social media instantly lit up with some support, but mostly concern regarding the new partnership.
Many readers told us that they don’t trust their customers’ most sensitive data in the hands of Zillow, and we speculated that assumptions regarding Zillow’s desire to become a brokerage are probably unmerited, but the potentiality of their using private data is an actual cause for concern.
DotLoop CEO palliates the situation
On this news site, DotLoop CEO, Austin Allison expressed his point of view regarding the unrest in the industry about the marriage.
Regarding speculation of Zillow Group becoming a brokerage, he states, “This acquisition is about helping brokerages and agents by providing them with tools, not competing with them. DotLoop will still be dotloop, just with a new parent company.”
That makes sense to us. This is honestly what happens with many acquisitions across all industries.
Regarding Zillow having access to private data, Allison asserts, “As has always been the case, data will only be used for our services in ways that are permitted by the license in place with agents and brokerages. Nothing has changed.”
Unpeeling the CAR layer of the onion
For years, DotLoop has been in a nasty fight with the California Association of Realtors, which has rendered the tool unusable in one of the largest states. Some argue that DotLoop never had a chance when competitor ZipLogix’s Board has ties to CAR execs. Others side with CAR who publicly stated they would not partner with DotLoop because of questionable privacy policies and terms of service (screenshots below via CAR):
Zillow undermines Allison’s statement
Prior to Allison’s statement, in a private Facebook group, a public Zillow rep set out to assuage fears regarding CAR’s public statements regarding DotLoop’s terms of service, contending that “Terms of service are always updated when a company is acquired. That won’t happen until the transaction closes though.”
Although addressing the battle between DotLoop and CAR, the statement has some on edge, questioning which is true – DotLoop’s statement that “nothing has changed,” or Zillow’s comment that things will change?
Victor Lund, Founding Partner at WAV Group comments, “Guess Zillow Group is not planning to dump their technology solutions to pursue being a pure Media company. Like Move and Homes.com – it’s Media and Technology. Let’s face it, Z is hardly profitable by GAAP standards. The [sic] need tech sales to expand revenue and profit opps. Their advertising inventory is sold out.”
This mentality echoes what we’re hearing from many practitioners in a debate that is nearly as heated as the fight over immigration.
As we opined yesterday, we will repeat today: If you were a Zillow fan on Monday, this is a glorious tool that will help your business, but if you hated Zillow before this news broke, this probably has you digging your heels in even deeper.
Questions remain – what of DotLoop’s goal to expand beyond the real estate industry – is that where Zillow is going, or is this dream ended by a boatload of cash?
Lastly, this is not a settled matter just because some champagne has been popped. Realtors in non-disclosure states are asking what their state associations are doing to insure that Zillow doesn’t get a backdoor to sold data. Practitioners are petitioning their brokers to consider whether or not they should continue using DotLoop. Competitors are likely looking at their stable of potential acquisitions and rethinking their position.