SocialMLS Validates Market Fit, Tees up First Customer
Talk to any early stage investor about what they are looking for in a startup, and they’ll tell you market validation and a coachable entrepreneur. Both aspects of entrepreneurship get tested in Rev1’s Concept Academy, as Chris Sauerzopf, founder of SocialMLS can attest.
Sauerzopf had already taken a run at a launch when he enrolled in one of the first Concept Academy sessions.
As he began researching his market in depth—using multiple techniques from the Internet to online surveys of real estate agents—Sauerzopf validated that he was on the right pain point, but his planned feature set wasn’t aligned with the needs of customers he hoped to serve.
“He was addressing the right problem, but in the wrong way,” said, Rev1 venture analyst.
“With Concept Academy, I saved time and energy identifying what my audience was really looking for instead of developing concepts for me and not for my client,” said Sauerzopf .
“I’ve learned some lessons the hard way,” he said. “I learned that the easier softer way is to listen and use others’ experience. Also if you are going to fail, you want to fail fast.”
Building prototype that matches customer needs
Real estate agents intuitively know that their next home seller or buyer is likely to come through a referral.
SocialMLS provides a cloud-based platform that uses the social networking power of a home seller’s Facebook connections to help sell the house and to increase referrals for the real estate agent.
“There are dozens of ways for a real estate agent to promote listings through Facebook,” Sauerzopf said. “What SocialMLS does well is to connect their sellers and automate the listing details through sellers’ network of friends, family, and neighbors.”
With SocialMLS, sellers are able to craft messages that resonate within their sphere of relationships and drive the sellers’ network to the real estate agent’s listings online.
SocialMLS has changed from 10 “infomercial” Facebook posts to four tailorable messages that make engagement more compelling. Consistent with Concept Academy best practices, the messages are vetted in the marketplace.
And it’s working. In the tests, SocialMLS reports generating traffic numbers that exceed traffic on real estate agents regular listings by 5 to 10 times.
Sauerzopf learned that it was incredibly important to have the SocialMLS application seamlessly integrate with the Multiple Listing Service (MLS) applications that many brokers already use.
Through the consolidated tools of MLS, brokers share information about listed properties and work out cooperative marketing and compensation agreements. Sellers gain additional exposure for their properties. Buyers can gain more information on homes for sale.
“We’ve been able to get a prototype up fairly quickly based on our initial research,” Sauerzopf said. “We’ve taken it to the target market, tested, brought back results, revised our solution, market tested more, and revised again. The result? We have our first large potential client.”
Concept Academy is just the beginning of SocialMLS’ relationship with R1
“At the end of Concept Academy, we believed that Chris was on the right track, said Matt Veryser, Rev1 venture analyst “He had a lot of work to do before we could sign an engagement letter together.”
And that’s why Sauerzopf is such a good example.
“He kept working at it,” Veryser said. “He worked through the next steps we defined. We reached the point where we agreed he had a compelling product.”
Rev1 and SocialMLS signed an engagement letter. Together he and his Rev1 advisors nailed down the next set of features.
“Concept Academy was an important piece—necessary and important—but it’s only a piece of what I’ve received as an engaged client of Rev1 over the last four months,” Sauerzopf said.
We began this blog by saying that investors looks for market validation and coachable entrepreneurs. They also look for resilience and tenacity.
Now, several months later, Social MLS has interest from a large Ohio real estate firm as well as from other distribution partners.
“I don’t know about other entrepreneurs, but I know about myself,” Sauerzopf said. “It becomes easy to operate inside a vacuum. To have Concept Academy helped me create solutions for my potential target users—for them and not for me—was incredibly beneficial.”