Building an Online Real Estate Business From Brazil: Brian Requarth, CEO of VivaReal (Part 3)

Sramana: What did you find to take feedback from him?

Brian Requarth: He was just Brazilian.

Sramana: That’s it? That’s the qualification, that he was Brazilian?

Brian Requarth: The other qualification was that his family had a simple construction company. It had nothing to do with home-building, but I thought he perhaps knows something about real estate market. He didn’t, but he started researching the market. Perhaps the excitement was contagious about our entrepreneurial venture where we were trying to build a business in Brazil without really knowing much about the country or the language. He worked for months just researching for us because now even he was interested in the topic. We launched a little blog and he would write articles about the real estate market. I had him do an analysis of the competition. After a couple of months, I said to Thomas, “Diego is pretty good and he’s like really excited about this. We should just make him a partner in the company. We should expand to Brazil. That’s going to be our entrance in Brazil.”

I advised Diego to come up to Colombia. He slept on Thomas’ couch for a month and we developed a plan at the end of the month. I have been documenting all this and there’s a picture of the whiteboard on which we made a list of 10 things that we need to do now in order to be successful and ranked them. Then, we crossed out everything except for the top three items and decided to focus on them, which was to get listings, sign up customers, and get traffic to the website.

I sent Diego back with a handshake and some money. We had no contracts, nothing. He was living at his parents’ house in Minas Gerais and he would commute to São Paulo every week. At that point, we are paying him about $20,000. In order to make it a success, we decided he should move to São Paulo. It was in May 2009 when he moved into a tiny, little studio apartment in São Paulo. His rent was $300 or $400, which in São Paulo is absurdly cheap. Every apartment in Brazil has maid’s quarters, which is a small 2m by 3m space. He turned that into his office for 15 or 16 months where he would just call the real estate companies.

During the first six months, we built the listings in Colombia. We made a target list of companies to contact and I would call the real estate companies because it’s a chicken and egg problem, right? You don’t have a marketplace unless you have the inventory but no one wants to give you the inventory because you have no one visiting the website. My Portuguese was bad, so Diego wrote a script for me. So, I would call the companies and read the script in Portuguese to say, “I’d like to speak with the owner of the real estate company.” The secretary would instantly hand me over to the owner of the company because she probably thought I was trying to buy real estate. I would talk to the owner in my broken Portuguese and set up an appointment for Diego. We did that over and over again and got lots of meetings with customers.

We gave free trials to get the properties. We didn’t charge them anything. We did that for seven months. In December 2009, we converted them into paying customers because we had more properties and more traffic now. Our first two customers paid us a couple of thousand dollars as pre-payment for the year. I remember Diego calling me and saying, “Hey. I think this business is going to work.” After that, we did the same thing, gave free trials, and grew the business.

Sramana: The business model that you were trying to do on the property side was you were charging for a listing?

Brian Requarth: Yes. It is actually the model used in most countries except for the US. You’re probably familiar with Trulia or Zillow, right?

Sramana: Yes. We did it free like this on Trulia when Trulia was much, much smaller.

Brian Requarth: Yes, so Pete is an advisor to me.

Sramana: However, the model in Latin America is that you are charging for listing?

Brian Requarth: Yes.

This segment is part 3 in the series : Building an Online Real Estate Business From Brazil: Brian Requarth, CEO of VivaReal
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