Redfin is the third-most-popular real-estate website in the country, but its brokerage business hasn’t upended the industry the way the company hoped — it sells just 0.6 percent of U.S. homes.
Redfin, the Seattle-based real-estate and technology company, launched the Puget Sound region’s first initial public offering of the year Friday and saw its stock rocket up. But its CEO worries about expanding in a city he says is becoming more like the Bay Area for housing costs.
Unlike Amazon, Expedia and other local tech companies that have upended traditional businesses, Redfin has struggled to carve out a big slice of the real-estate market. More than a decade after it started, it sells less than 1 percent of homes nationwide.
But the company’s strong showing on Wall Street is indicative of just how hot the local tech scene has become — helping fuel the rise in home prices locally. That’s good for Redfin’s business, which relies on selling homes, but bad for its recruitment and retention of employees struggling to afford living here.
Redfin fast facts
Homes sold:75,000 homes worth $40 billion through 2016
Revenues:$267.2 million for 2016, up 43 percent
Net loss:$25.5 million
Employees:2,200, up from 750 in 2013
Trading under the RDFN ticker on Nasdaq, Redfin stock soared 44.7 percent Friday. Redfin had priced its stock at $15 per share, but closed at $21.70 — raising its market cap to $1.7 billion.
Redfin has been expanding in recent years, moving into new markets and hiring more agents. Earlier this year, the company moved its 400 or so local employees into a new Denny Triangle office space that is twice the size of its old headquarters in Belltown.
“We’re recruiting on almost every front, but I think we’ve also been paying attention to how expensive Seattle is getting,” CEO Glenn Kelman said. “At first it seemed like such a great middle-class town where people…