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

March 3, 2014 at 6:00 AM

Porch.com remodels, eyes big expansion

Seattle’s Porch.com is facing all sorts of established competitors in the online home-improvement space, but the company’s founder isn’t too worried about its position.

Just five months after launching its service for exploring, sharing and referring home-improvement services, Porch.com is on a tear, hiring as fast as it can to fill a huge new office and build up its platform.

“Really over the last five months, we’ve gotten over that inflection point where the business is going to work,” said Matt Ehrlichman, the company’s 34-year-old founder and chief executive.

Erlichman confers with colleagues in the new offices of Porch.com. Photo by John Lok, Times staff photographer.

Ehrlichman confers with colleagues in the new offices of Porch.com. Photo by John Lok, Times staff photographer.

Now that the team believes the business will fly, “it’s really about execution, it’s about staying focused and every day trying to go faster and do it better than it’s been done before, in every part of the business,” he said.

A breakthrough was a deal with Lowe’s announced in January. It put Porch.com in stores and on the devices carried by Lowe’s employees, who direct customers to the site when they’re looking for professional help with home-improvement projects.

Ehrlichman wouldn’t share sales but said they’ve accelerated since the Lowe’s deals. Its services are now highlighted in 139 stores, mostly in the South, but will be extended nationally later this year.

Also boosting growth is new backing from investors, in addition to the $6.25 million Ehrlichman raised initially  from angel investors after starting the company in 2012.

“The company has raised more since. We’ve not announced details of that yet,” he said. “I would say that the company is exceptionally well capitalized at this point so right now we’re not raising more money at this point in time.”

He’ll probably need every penny for its battle with Palo Alto, Calif.-based Houzz, a similar home-improvement site that has raised about $50 million since 2010. Another well-financed competitor is Zillow, which launched a home-improvement channel called Digs last year.

“We are a newer kid on the block certainly in this space. There are companies that have been around 10 or 15 years and are at scale,” Ehrlichman said. “The reality of it, though, is that we’re [taking] an exceptionally different approach than all of those companies, starting with the data and through that information be able to provide insights that are unique to homeowners — not just help them get inspired and look at photos but to actually get their projects done.”

Similar to the way Zillow drew on public assessors to build its real-estate site, Porch combined mapping information and public records of building projects and contractor licenses to build a foundation of data on which it’s layering features and services.

Already the site includes information about 1.5 million home-improvement professionals. They get free listings on the site and can pay to upgrade their accounts. Homeowners use the site for free.

The plan is to connect with homeowners who have done projects and add their recommendations to its listings, so visitors to the site can find local referrals.

Ehrlichman believes he’s building what will be the next big software company in Seattle. He’s been down this path before with a company called Thriva, which he started while studying at Stanford. It was sold in 2007 for $60 million to The Active Network, an event-organization software company based in San Diego.

Porch.com was hatched when Ehrlichman tried to find referrals for pros to work on his own home project in Seattle.

He’s simultaneously been remodeling the office. The company, which initially started in Ehrlichman’s basement, last month moved into a 17,000-square-foot office on Seattle’s Eastlake Avenue, where employees chipped in to paint and decorate the space.

Porch grew from 25 to 111 employees over the past year, including the recent addition of six employees hired en masse from the Jawfish Games studio in Seattle, which folded in January.

Ehrlichman said he’s budgeted for 180 employees this year but “with the way things are going I wouldn’t be surprised if we surpass that.”

Which means that Porch’s remodeling project, like many others, may just keep going on and on. The company already has taken an option on 28,000 more square feet of adjacent, bare space formerly used by the Bill & Melinda Gates Foundation. No doubt it will share details of that project as well.

Swings in the new offices of Porch.com. Photo by John Lok, Times staff photographer.

Swings in the new offices of Porch.com. Photo by John Lok, Times staff photographer.

Comments | Topics: porch.com, seattle, Startups

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