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Brier Dudley's blog

Brier Dudley offers a critical look at technology and business issues affecting the Northwest.

July 23, 2007 at 11:08 AM

SecondSpace launches with cash flow, A-list team

Actually it’s hard to call it a launch.

Second Space, the Bellevue startup, has been operating its first two Web sites for a year, generating more than $1 million, before it disclosed its game plan today.

SecondSpace has a team of 32 building a Web services platform targeting people who own, rent or hope to acquire “second spaces” such as vacation homes and timeshare properties.

Founder and Chief Executive Anil Pereira, an early manager at Verisign, said there are 45 million to 50 million people in the U.S. who own property in addition to their primary home.

The first two sites built on the platform are ResortScape.com, focused on “destination communities,” and LandWatch.com, a site geared toward “rural retreats” such as ranches.

Both sites include real estate listings, local community information for visitors and landowners and ads for service providers such as maintenance and landscaping companies.

These sites made sense to me because my first newspaper job was at the Sequim Gazette, a newspaper that served a similar function for people who planned to live there when they retired.

Those out-of-towners received the paper by mail to keep tabs on the community and connect with service providers through the paper’s ads. When they finally moved to Sequim, the paper informed them of local events and activities.

That’s exactly what SecondSpace plans to do with its sites, which will be supported by ads, listings and subscriptions. To start, Landwatch is charging $50 per month for listings and Resortwatch isn’t charging at all while it builds up the site.

When I asked who SecondSpace is competing with, Pereira said he sees no major competitors, only some niche Web sites that don’t get a lot of traffic. It seems to me that its first two sites, at least, will compete mostly with community newspapers.

That’s just the start for SecondSpace. It’s also planning to use the platform to build sites for people whose “second spaces” include boats, RVs and in-city homes, such as condominiums.

The condo market is also an entry point for SecondSpace’s expansion into international markets, since many buyers of condos in cities such as New York and Vancouver, B.C., are residents of Europe and Asia.

SecondSpace raised $6.6 million last July from Ignition Partners and an undisclosed partner that also formed a multiyear commercial relationship with the company.

I wonder if that investor is Plum Creek, the Seattle based timber and real estate company that’s one of the largest landowners in the country. Plum Creek is the sort of company that would use SecondSpace sites to market land it’s converting from timberlands to recreational and residential property. Plum Creek’s vice president of real estate, Russell Hagen, is on the SecondSpace board. Other board members are Ignition partner John Connors and Colleen Brown, Fisher Communications’ president and chief executive.

Pereira said it’s likely to seek another financing round this fall that would carry the company through to profitability. It plans to use the money to build the next set of sites, invest in its platform and expand beyond the U.S.

Among the key players at the company are developers who worked on HomeAdvisor, a Microsoft online real estate service that was going to be spunoff similar to Expedia but fizzled after the dot-com downturn.

Alok Sinha, co-founder and development manager of HomeAdvisor, is now co-founder and CTO of SecondSpace. Between HomeAdvisor and the startup, he was a product unit manager on Windows Driver Kits and MSN Mobile.

SecondSpace architect Delane Hewett also worked on HomeAdvisor.

Management also includes Amazon.com veterans Satbir Khanuja, the startup’s marketing VP, and Gary Cowan, product management director.

Comments | More in | Topics: Startups

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