The man behind the latest property portal says he is completely serious about his ambitions to take on Rightmove and Zoopla.
Gary Smith, who has founded LocalPropertyIndex and is currently using crowdfunding to raise money for the venture, says he will start small and local, and build up the business.
He says he will launch focusing on south Hampshire, and concentrate on having a fully functioning portal at local level before rolling it out.
Smith, whose previous business made millions when it went public, already has £150,000 in backing from a venture firm, and is planning to raise a total of £300,000 via Crowdcube. That sum would represent just over 27% of the business.
He hopes estate agents will be among the backers.
Smith said: “We really like the concept behind Agents Mutual which is attempting to break up the Rightmove/Zoopla duopoly by establishing loyalty through agent participation in the ownership of the business.
“We decided to take a different approach. Rather than just invite agency owners to become stakeholders, we want individuals to get involved.
“So, with LocalPropertyIndex, anyone – administrators, negotiators, managers, conveyancing solicitors, etc – can own shares. This has become possible because we are offering shares through Crowdcube. It’s really simple and anyone can invest from £10 upwards.
“Equally importantly, we need agents to help us shape LocalPropertyIndex to be the best property portal in the industry.
“The beta version of our new website is now released and we want agents in Hampshire to engage with us, tell us what’s good, tell us what’s not so good, so that we can deliver exactly what they want from an advertising partner.
“Everyone in the industry has witnessed the rise of the portals. Our idea is to let everyone have the chance to benefit as we grow.”
Smith, pictured, also said that all listings will be free and there will be no compulsion on agents to take out monthly subscriptions. Instead, agents will pay £3.95 for each lead for the first 50. After that, leads will be free.
“That means agents pay nothing to advertise all of their listings and pay nothing if they receive no inquiries.
“They only pay £3.95 for each inquiry, but once an agent has hit 50 inquiries in a month, the total monthly expenditure is capped to £197.50.
“In case agents are worried that we’ll increase their fees in the future, we will be offering four-year contracts guaranteeing no rises.”
Smith, who has lived abroad for 12 years before moving back to England, has run a previous property website before in Spain, which he says became the country’s number two portal: www.inspain.tv
He said: “When I left England, the property portal market was over-supplied. When I got back, I was shocked to find that there were effectively only two.”
He said that speaking to agents, he found a high level of resentment towards Rightmove and Zoopla.
He also said that backers of his new UK portal venture include former employees of FindaProperty.
Smith, whose previous business, Netstore, was valued at £145m when it floated on the stock exchange, said: “I am serious about this. I really would love to make a difference.”
http://www.localpropertyindex.com/crowdfunding.aspx
http://www.crowdcube.com/investment/localpropertyindex-15442
Comments (24)
Apologies for taking my EYE off this one. I was otherwise engaged when Mr Smith responded to my initial post but thanks, ampersat, for more than filling my shoes. That being said, I would like to respond and debate further with Mr Smith (and hopefully others) on this subject so here goes.
"Regarding our company name. Actually we've had the domain for some time…"
The 'original' property portal to which I refer has been in existence for about eight years, Mr Smith. YOUR portal name has simply the addition of 'Local' – which is hardly a differentiator and in my humble opinion the two portals will simply become confused for each other.
"…and really feel that it matches are approach very well."
Again, you refer here to the use of "Local" in the portal name. YET, you state that you are "serious about challenging the big two" – which are NATIONAL portals.
"The key to our growth is effective and efficient marketing at a local level."
Only if you want to STAY at a local level, in my opinion. Ask those radar people.
" Our pace of growth will be slower using this technique but it allows us to gradually, and profitably expand county by county."
Or… while you are "gradually and profitably expanding", some other bright and shiny toy will whip in and steal the cream from under your chin.
"…we need agents to help us shape… to be the best property portal in the industry."
Really? The big two pretty much sorted it themselves.
With respect, Agents want YOU to come to THEM with the answer – not with the problem. Yes – it's nice to let us think we've had some say – but to be frank (and more's to the point, honest…) we're not really the right people to ask.
You are effectively offering your portal as the new Hovis. But we all love Hovis. It pretty much hits the spot (except, of course, for its price!). Why should (or WOULD) we change to a new brand – when the first thing we are asked by the baker is which ingredients to use and in which proportions?
"We are looking into the best mechanism for agents to actively work with us… One idea is to host a LinkedIn Group specifically for agents to participate…"
Erm… in my opinion don't even go there. As ampersat so rightly states, you have here on EYE the opportunity to draw on potentially the best Agency brains in the land. BUT… you have to acknowledge that EYE isn't a charity. They aren't going to turn over their site for your use or anyone else.
What worries me is that this and other stories/advertorials for your product have received little by way of input of any description.
Maybe – just maybe – the great majority of Agents are getting sick of the whole shenanegans.
They simply want 'day 1 RoI' – straightforward, open-the-box and ready to roll.
Give them THAT – you'll do okay.
I look forward to continuing this discussion. I respectfully suggest you need to speak to EYE to find if there's a way forward in that respect here.
Hello Ampersat,
Thank you for your post.
Gary Smith
Hello Gary
Now the story has slipped into the archive responses to the questions raised by Peebee and I are unlikely to get read by very many people but if you have got time to read and answer them it shows a level of commitment greater than any of your competitors.
Paul sounds like an Agent who likes the AM model, I am not convinced (yet) I have a fear the market will be against them by the time they launch a site, but I would point out that at no point has Ian Springett shown any inclination to get into discussion with any of us lowly readership. A simple explanation of the thinking behind the one other portal rule would suffice.
I can understand why executives feel inclined not go belly to belly with anonomous internet posters, it is all too easing for carefully applied PR to slip under the sort of wit, wisdom, wickedness and experience of a very conservative profession but executive salaries demand executive experience and if obvious questions raised by customers (and competitors) are too much to cope with it is an indication that the product isn't quite as robust as it should be.
I have some sympathy with you Gary I can see you are getting questions fired at you from all over the place but I feel a reply to the questions raised will reach a wide and influential audience that is denied by individual email correspondance. Property Industry Eye is reaching a silent audience of decision makers so it is an efficient way to influence them with well considered replies.
Hi Everyone,
Sorry I had to pull out of the conversation. I had meetings in London all day yesterday. Back now. Let me know if you have any questions that I can answer.
In fact, I would love to hear from any of you directly. My email address is Gary.Smith@LocalPropertyIndex.com.
Best regards
Gary Smith
Morning Paul, the very fact that you and I are both navigating into Ros's fast moving archive suggests we have an interest in hearing something from Mr Smith. For me there is something about this one that has caught my attention.
The fact tht he has taken the initial trouble to reply on here and show his face thoughts and colours is a USP over Miles and Alex. As Peebee pointed out agents want someone like him to suceed.
Let's hope he come back with something, In respect of AM I and many others are still not convinced by the one portal restriction. The only way to control competition is by offering a better service, I can't think of a single case were strong and healthy competitors have been edged legally out of a market by restrictive practice.
It's a shame that Mr Smith pulled out of the conversation especially as he made the effort in the first place,perhaps we will hear from him again soon.
Re AM (and I suspect as Mr Smith will find out) for me the one other portal rule is possibly it's biggest selling point. We have seen so many other portals try and fail to successfully enter the market. This rule will cause the disruption needed. Not only that I'm not sure that agents would want to pay for 3 portals.
Mr Smith, I have just viewed your Crowdcube pitch, I am not sure the description of the competition is quite as frank as it might be. It is a bit off not to mention the Elephant that is already well funded and is planned to launch in January with the backing of NAEA and ARLA along with some seriously respected firms in the industry.
Mr Smith has a task on his hands alright Ampersat.
It would save some people some time and a few quid if before entering the UK portal market they do some research first as they would very quickly establishing that all the agents listing with Agents Mutual will only be on one other site which is likely to be be either RM or Z and certainly not a brand new site as needaproperty have found out hence why there now trying to offer people free listings .
All of a sudden busy, bored or out of your depth Gary?
It is simply rude to walk away from a discussion Mr Smith, you have been given an opportunity to expand details of your service outside the constraints of a few hundred words the article requires to be interesting. You have been given credit for having the fortitude to answer questions from your prospective customers but for some un explained reason you have left us all hanging.
If we are asking questions you can't or won't answer or are raising points you hadn't considered then perhaps your plans aren't so well considered.
Let's hope there is an acceptable reason for going silent mid conversation after all your success is based on your ability to engage with customers and that is what you were doing.
Mr Smith. As has been said, I respect your decision to stick your head above the parapet and face/dodge the arrows and boiling oil.
Here's my first question. Why, of all names, LPI? Take an already-known(ish) site and simply add a word which gives a 'local' feel – is THAT the plan?
Why not, then, call it NeighbourhoodRM? DoorstepZoop?
At least then you'd have been riding on a name people would associate with.
Now – you state above in a response to Ampersat
"Every month around five million people do not go straight to Rightmove or Zoopla. They use Google…"
Okay – but
a) HOW MANY of those alleged 5 million a month actually go on to BUY or RENT property?
b) HOW MANY of them then simply click on the link(s) to RM and/or Zoop and forego all others?
Like you say they don't go STRAIGHT there – but go there they probably do, one way or another.
May I also ask why you only want your 'local' agents to "engage" with you with regard to your website? I appreciate that you want to start in your back yard and spread out – but if the offering doesn't fit all tastes (or, to be brutally frank, those that give you the most income stream…), then you aren't going to spread very far at all. Do you think that you are going to be able to build a universal model based solely upon the wish-list of Agents in one county?
Believe it or not, Mr Smith, we Agents want you – or someone like you – to succeed. To provide a REAL ALTERNATIVE to the 'duopoly'.
But as I (and, I would suggest many others) see it at present, ALL the current 'alternatives' will simply be ANOTHER site to list our properties on. MORE expense – for WHAT?
Over to you.
Regarding our company name. Actually we've had the domain for some time and really feel that it matches are approach very well.
The key to our growth is effective and efficient marketing at a local level. Our market entry approach is to focus our marketing within a tight geographical area (Hampshire). This allows us to specifically target our activity which has two benefits; more precise targeting of potential visitors, greatly reduce expenditure. It’s like the difference between a sniper rifle and a shot gun. Our pace of growth will be slower using this technique but it allows us to gradually, and profitably expand county by county.
As I mentioned, we need agents to help us shape LocalPropertyIndex to be the best property portal in the industry. The Beta release of our new web site is now released and we want agents in Hampshire to engage with us, tell us what’s good, tells what’s not so good so that we can deliver exactly what they want from an advertising partner. But, this won't stop when we expand outside of Hampshire. We will continue to improve our services as agencies provide us with feedback throughout the UK.
I have a question for you. We are looking into the best mechanism for agents to actively work with us so that we can prioritise our software development and make the right enhancements to our service that really benefit both agents and home movers. One idea is to host a LinkedIn Group specifically for agents to participate and allow all parties to openly communicate.
Please let me have your thoughts.
Best Regards
Gary Smith
Good morning Gary, an early start for me and quickly checking PIE I noticed this reply to Peebee, He obviously hasn't seen it but I will Thank you on his behalf. It is a very positive and promising start to your project that you are willing and prepared to engage with us.
It would be my suggestion that if you are genuinely looking to work with Estate Agents and are prepared to listen, I really can't think of a better place than Property Industry Eye. I requested? suggested? finding a way to bump comment stream stories onto the front page so posts like your reply to Peebee don't get missed.
The networking opportunities and opportunity for dialogue is probably better on here than a Linked in group. The RICS linked in group is active but it is a tad dead and dull, that can't be said for the discussions on here when people like Peebee, Wardy and Jonnie get going. Who knows you might even get some of Trevor Kent's very experienced, worthwhile and respected input.
Hello Ampersat,
The Gap in the Market: Every month around five million people do not go straight to Rightmove or Zoopla. They use Google (in the UK) and search for their next property by typing their requirements into Google – e.g. “property for sale in Winchester”. We have built LocalPropertyIndex.com – a highly scalable property advertising portal capable of hosting millions of property descriptions and serving millions of users. Our strategy of targeting Google Organic Search Results to drive relevant traffic means that our portal must be able to rank well for popular property related search terms. However, unlike a normal web site which needs only to rank well for a handful of different search terms a property portal must perform for every permutation of property type and location name throughout the UK.
In fact, people searching for property on Google will often use specific keywords for known areas. An example might be a specific property development name or popular street name. The number of location name/property type permutations often used by searches runs into the millions of unique sets of keywords.
A Highly Scalable Ranking Engine: The success of a large scale property portal depends entirely on the foundation platform technology which sits behind the visible user-interface. This platform must be employ multi-level keyword drivers capable of automatically serving each and every property description as a distinct web page specifically optimized for the Google Search Engine Algorithm. This is non-trivial. Over the last eight years we have perfected our Ranking Engine Technology so that we can automatically accommodate every property type and location – not only throughout the UK but internationally. This technology can not be purchased off-the-shelf and is a cornerstone of our ability to sustain growth.
We are Google Experts: So, there is an opportunity. Our ranking competitors are Rightmove, Zoopla (including Primelocation). There are 10 slots on the first page of Google for any given search. For sure, Rightmove and Zoopla will take two or three slots because they employ search engine experts skilled at tuning their web site to appear at the top of the rankings. We also have search engine experts. In fact, this is our core competence. We have built-up over a period of eight years specific knowledge how to target popular niche property related search terms and generate high volumes of traffic. Our team includes the SEO professionals behind PrimeLocation and FindaProperty (previously two of the best ranked property portals in the UK). Therefore, we have an above average chance of ranking well. Our planning doesn't call for our portal to be the highest ranked web site for property – we just need to be one of the ranked sites.
Gary
Now you have me confused Gary, I understand the point re RM and Zoopla but aren't you then competing against your own prospective customers who will, by definition, be listing property with the local criteria that you say is giving you an edge.
Agents don't mind being lumped in with their competitors for remote searches but surely the 5,000,000 area specific searchers are the applicants their own site ought to be attracting and capturing.
With Agents mutual restricting to one other portal do you think your offering is strong enough to be the AM complimentary portal in favour of both RM and Zoopla?
Good morning Wilko,
This is Gary Smith from LocalPropertyIndex.com.
Any new publication whether online or offline must prove to its advertisers that the publication provides a good return on investment. We recognise that agents in the UK have little or no experience of LocalPropertyIndex. It is for this reason that agents can advertise all of their listings free of charge and only pay if we generate enquiries. Also, agents need to set marketing budgets and make sure that they do not spend more than they had planned. So, we have set a maximum monthly expenditure of £197.50 (equates to 50 enquiries). Any more enquiries in the month are free of charge.
In other words, zero risk, good value advertising.
I like your grocery analogy – maybe we are like Aldi, which has just announced its highest ever growth of 35.3%. You can start small and grow to challenge even the biggest, most entrenched of competitors.
Hello Gary, I am impressed you are prepared to face your audience.
How are you going to overcome Agent apathy towards your offering? I keep a watch on the portals and how they are used by Agents, applicants and vendors as their 3 customer bases, being realistic most agents and their staff have delegated their work to the portals and in a self fulfilling stereotype of Agents the general public rely on the portals to deliver/provide the information agents fail to.
Obviously this is your attempt to tempt agents but what have you got planned to get to the 22,000,000 (yeah right) individual enquirers each month to know that your little market stall even exists?
You are going to have devil’s job SEOing onto page 1 Google when you are up against RM, Zoopla all the other micro portals as well as the SEO efforts of your individual prospective customers so I am at a loss how you are going to grow however much you shine your plums.
Thanks for explaining Gary, really appreciate it.
It's just it is very hard to see how you would get agents to sign up, local or otherwise.
What would be "extra" or "different" about the product that would tempt us to come on board and spend 10's of £1000's of pounds p/a with you?
I don't think we need to be very different or indeed that special. We just need to offer agencies really good value for money. Wilko, an agency won't need to spend 10's of thousands with us – that's the beauty of it. If we can help an agency to make one extra sale or rental in a month then its worth it. So far, we've had a really good response from agencies that are interested in helping us tune the Beta release of our portal and start to generate enquiries. They see the benefit of not having to pay up front and the opportunity of getting involved with a new player at the beginning.
Let me know if you would like to discuss this in detail. Gary.Smith@LocalPropertyIndex.com
Gary
Thanks Gary, I will watch how you go and sincerely wish you all the best.
For all offices in my group to commit it would equate to 10's of £1000's a year (assuming we got 50 enquiries per branch) -but, as you say that would have to be the budget set.
At the moment, however, the main 2 portals are giving us enough viewings to sell our properties 3 x over so we don't actually need more leads to sell properties.
Why do £3.95 an enquiry up to 50?
Shows an absolute complete lack of knowledge of the industry….is any estate agency office likely to not get 50 internet enquiries from their portals each month…….unless, of course, they don't think they will generate 50 enquiries a month. Also, if you are getting the enquiries from the big portals then why pay £3.95 per enquiry for leads from this lot.
Also why say "I' m serious about challenging the big two" and then go on to say "I'm going to start small and grow the business" ?
It's like saying in the grocery industry "I'm serious about challenging Tesco, Morrisons, Sainsburys etc" and "I plan to start with a corner shop in Milton Keynes and expand from there"
Oh, and the best part is It will be with other peoples money!
Perhaps start small and grow the business is the way to go, Tesco started with a market stall!
Although Gary has responded – from a landlords perspective/part time agent – how is this not a fantastic offering?
All of you 'agents' complain year on year about the price rises sent through by Rightmove/Zoopla – if this is the case, then why are you always so against new competitors! Paying a fixed sum of £150 per month to advertise an unlimited number of property is far cheaper then Rightmove/Zoopla – and for smaller agents can result in a 0 bill if they don't receive any leads.
I like this idea and would be very happy to invest. This by far attracts me more then Agents Mutual
Agents Mutual has been started to compete with Zoopla and RM.
Indeed – as has Localpropertyindex