Intuition has just as much of a part in the tech world as data. Launching a startup takes time, money, and gumption, which can make pivoting difficult, even when the cold hard data says the original idea may not have the best product-market fit.
Chicago real estate startup PadScouts, which originally set out to pair prospective home buyers and agents using data, faced this problem shortly after launching in January.
“We ran a campaign for four months detailing the consumer side,” said CEO Eric Tseng. “When we analyzed the data and feedback, we learned that real estate agents — especially the most successful ones — get most of their business through their spheres of influence.”
The power of personal referrals is still strong in the industry. According to a 2017 study by the National Association of Realtors, 42 percent of home buyers found their agent via a referral from a friend, neighbor or relative, with that figure rising to 64 percent for home sellers.
We’re encouraging our users to be data-driven, so we have to practice that ourselves and follow the data.”
Instead of retooling the consumer side of the platform, Tseng and his three co-founders decided to axe it altogether in favor of designing a tool to help agents better leverage their spheres of influence.
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