Zumper launched in just three cities in 2012-2013: San Francisco, New York, and Chicago. The founders chose them based on landlord relationships, not data, and deliberately stayed small to build up rental listings before chasing renters. They waited until supply was strong enough before expanding.
Also, too, one of the things that a lot of marketplaces typically do is, you know, kind of constrained to a specific kind of market or geography. So is that something that you also did in the early days? Or— Yep.
If you came to Zumper, like back in 2012, '13, you could pick from 3 cities. Your first, it was super janky, we'd load a map, and then we throw 3 bubbles on top of the map. You could either pick San Francisco, New York, or Chicago. And in all honesty, they weren't meticulously studied. This wasn't data science driven. This was purely based on where we had like better connections to supply and where we had more traction with supply. And so actually for the first 2 years, we were only in 3 cities, which is kind of embarrassing when you look back on it. We're trying to build a rental marketplace where people could be like socially mobile and move across the US. but we constrained it to 3 geographies and heavily supply-focused too.
Yeah. So you mentioned as far as like the notice, you know, the importance of focusing on supply and that kind of supply liquidity. So how did you think about, you know, when the right time was, you know, when you had enough kind of liquidity with supply to kind of move into more of a, I would say, you know, on the demand side and kind of solving for demand?
Yeah. So we, so there's a couple of things that happened. First of all, as we built supply up in those 3 markets, As many founders find out, like through building supply and constrained geos, you often work with the enterprise or SMB kind of community on the supply side. So the, for us, the bigger landlords or the biggest PMCs where only 5% of the inventory they had was in these 3 markets, 95% was outside. So when we finally switched Zumper's map on for the full US, we had a baseline supply liquidity that had been built accidentally almost by focusing on these 3 markets. The key stat for us, there was like one number that just explains how Zumper got to this stage and, you know, now we need to hit our next stage, but it was 85%. The key number for us was when we got supply to about 85% of what we thought was the full rental supply in the market, whether that was measured against our biggest competitor in the market or by publicly available data for how many rentals were available in any given month. When Zumper got to 85% supply, we saw the flywheel kick in where our MAUs that have started to come in through SEO or through some early word of mouth would stick and they'd return. And so it wasn't just that we brought more MAUs in, it was that our sessions per MAU started growing, meaning people were finally finding value on the platform. And so I'd say for the— we're a 10-year-old company now. For the first 5 years, we reported every single week what our total supply number was in every single market, where the numerator was our supply and the denominator was what we estimated to be the total supply. And we targeted getting to 85% in every single market. And that's when the flywheel span.
