When HomeSwipe founder Michael Lisovetsky arranged a meeting with Silicon Valley investor Tim Draper, he knew he needed to come up with an idea; and fast.
After his previous startup fell apart, Lisovetsky started a frantic brainstorming session with his current cofounder, real estate broker Dean Soukeras. “It was the last day of the [Draper University] program, and I had a new idea that I pitched on the spot,” he said. The two partners figured out a way to introduce a new interface experience to the tedious process of apartment hunting, a problem which Lisovetsky himself had faced in New York.
“There is complete uncertainty in searching for apartments. There is no guarantee that the apartments posted on the other sites are real, and that the agents that respond to you aren't vetted. You have no idea who you’re working with.”
Despite the on-the-spot improvisation for a new venture, the meeting with Draper proved to be successful. Draper promised a large six-figure investment if Lisovetsky and Soukeras could prove Homeswipe to be a viable project. The next six weeks were all work and no sleep: Lisovetsky convinced his previous cofounders to come on board, hired a 17-year-old App developer, and started marketing the service to real estate brokers and apartment seekers.
Six weeks later, a “really ugly but functional” version of the app was developed, with over 400 users already subscribed. The app already had its characteristic user preferences such as location, size, number of bedrooms, pet suitability and other technicalities.
Draper was impressed. True to his word, he invested a large portion of the half million dollars that the startup eventually raised. Today, Homeswipe has over 1,700 real estate agents, 18,000 apartments and a cumulative 36,000 downloads.
During an online event that took place at Altcity earlier this month, Lisovetsky, pictured at left, shared his insights on how his idea worked for him.
1) Network, network, network
Lisovetsky’s idea might have been pretty cool, but it was through his cofounder Soukeras’ networks that the platform started getting traffic. “We relied a lot on mouth-to-mouth marketing through Soukeras’ connections” said Lisovetsky. “If it hadn’t been for his experience, we would have had a much harder time getting users.”
2) Over-delivering never gets old
Draper was impressed by the speed and efficiency with which Homeswipe met his challenges. The team not only managed to build a customized app with user preferences, but also attracted an acceptable traffic rate in what could be considered as record time. “The important things is that when you say you’re going to do something, stick to it,” says Lisovetsky. “A lot of people have great ideas but they don’t follow through.”
3) Don’t be afraid to flaunt your victories
If you’re an ambitious entrepreneur in Silicon Valley, getting noticed by well reputed investors, like Dave McClure or Keith Rabois, gives a considerable boost for your startup’s profile. “Having Tim Draper on our list of investors was like having a luxury brand on our resume; it gave us a good image for other investors, although that’s not necessarily how things work.” In the next few months, Homeswipe had garnered exactly $500,000 USD of investment from several other investors.
4) Investors like quick learners
Lisovetsky had two failed startups before Homeswipe. The first one, he says, was only image focused, while the second one lacked good marketing. “You have to really learn what to do and what not to do in your startup, because things are going so fast that you realize you don’t really have time.”
5) It’s all about the team
“When people learn that our CTO is a 17-year-old who dropped out of high school, and how quickly we got things going, they think it’s crazy,” says Lisovetsky. “But Draper is an optimist who invests in people; he saw we had potential and that we delivered; he took a calculated risk in us.” Lisovetsky met his CTO, Jason Marmon, through a hackers’ group on Facebook, and, after a couple of follow-up sessions, Marmon was on-board to develop the app ASAP. “I really can’t overestimate how important our team was.” Marmon is the company's third partner.