Coffee Break with Kirby Slunaker
► Psst... After you enjoy the full interview, be sure to watch Kirby answer even more questions in the Xpresso Round Video!
DMAR: Can you tell us a little bit about yourself and how you’ve gotten to this point in your career? We looked you up on LinkedIn and you have an amazing resume and career.
Kirby: I'm really a technology guy by trade. Yeah, there's a lot of things on LinkedIn, but that just means I'm old. It means I've got a lot of stuff to put on a resume. I've run technology for some of the biggest companies in the U.S., like Visa. I ran all their debit and ATM business worldwide in 195 countries for six years and really was in the industry for 14. The last 10 years - before I joined REcolorado in 2011 - I'd been going in and helping to turn around and sell usually VC-backed companies… a lot of venture capital and private equity companies.
I had done some work for REcolorado in the past and when I joined them they had a set of challenges I thought looked fun and was convinced I’d take this on as a turnaround. Not really to sell, but to turn it around and get them out on the acquisition trail, which is what we're doing now.
D: What did you study in school?
K: I came out of college with a degree in computer science and electrical engineering. I spent a decade writing software and at one point ended up being the VP of software development and then got a degree in business and finance. Nobody ever beats you up because you don't know anything about technology… they beat you up because you're trying to run technology for a big company and you don’t know what the average weight and cost of capital is. Then I got an MBA out of DU and I've taken lots of stuff from Stanford University as well. Most of it's all business and technology strategy related stuff. When I was working at Visa you could go down to Stanford and take anything you wanted and they'd pay for it.
D: Walk us through a day in your life.
K: I don't know if a day in the life is the right way to do that since every day is different for me. The bottom line is we're a $10 million a year company. We have 52 employees. We have a great executive staff of five people, some who have spent as much as 10 to 15 years working for other real estate companies or companies that apply technology in real estate. Mostly what I do is try to work on the culture and the interaction. The cultural changes are probably the biggest hurdle that we had in 2011. We've reinvented our culture and re-established a new vision and mission and things like that. If you get a great team of people together and they all know what the vision is, you really just get out of the way and let them do their thing.
[Tweet this] "If you get a great team of people together and they all know what the vision is, you really just get out of the way and let them do their thing."
D: So when you first became CEO, what was your top priority?
K: I inherited a $1.1 million negative cash flow. Eighty nine percent of our brokers and agents were either dissatisfied or extremely dissatisfied. We had an aging set of systems for technology and products that couldn't go mobile. There were also a lot of challenges in the industry like the rise of Zillow and Trulia, founded by people that I'd done business with so I knew what they were capable of. I knew what kind of capital they could bring because of the situation.
But we turned it around. We've rolled out all new systems and we've inverted the customer satisfaction number. Now, about 92 percent of our customers are either satisfied or extremely satisfied. We've doubled our cash reserve. We’re not only continuing to expand the use of our public-facing website, but we also have a deal coming where we're going to be providing MLS services to MLS's around the state.
D: Can you expand a little bit more on what challenges you had in the past with company culture and what type of culture you've established?
K: Our culture now is all about teamwork and collaboration, accountability, and responsibility. We always talk about how the vision of our company is to be all things real estate in the state of Colorado. Our mission is to provide world-class customer care and great products and services. Core values for the company are honesty, integrity, and respect, and that's really the culture that we've tried to build. I take pride in the fact that in the last five years, every major initiative that we've bid off, we've hit on time, on budget, and delivered with full content. We’ve been able to run a tight operation that works well.
D: How are you able to establish a collaborative environment, especially across disciplines?
K: I think the biggest challenge we had when we started was that REcolorado (Metrolist at the time) was really a classic B2B. I tried to convince our board of directors that we were really a B2B-2C company because brokers and agents are all about consumers and if we don't have a relationship with consumers, how do you expect us to help them and to go from there? Luckily, they bought into that.
If you're really going to be about teamwork and collaboration, the first step is just to recognize your own strengths and weaknesses and what you bring to the plate, and be willing to recognize what other people bring. If you're not going to let them participate, you're not going to get your best result. It's about valuing what other people bring, giving them the space to do that, and recognizing that everybody has different motivations. I've found that it's the intrinsic motivations that really motivate people the most. It's not the money, the title, the things like that. It's usually how they're allowed to contribute, what difference they can make in what you're trying to deliver, what happens day in and day out, and the relationships more than anything else.
[Tweet this] "...if we don't have a relationship with consumers, how do you expect us to help them?"
D: What would you say is the biggest business improvement that you made in the last year or so?
K: I've noticed in this industry that people confuse what we do. We’re not all about real estate and we're not like the REALTOR® associations, which are nonprofit membership organizations. We're really a search and data technology company, more about operations than anything else. We’ve got 15 other MLS's in the state, very few of them ever collaborate and they don't do any type of joint business together. In fact, they usually ignore each other.
When I joined Metrolist, we changed the name to REcolorado since we didn't own the rights to the name Metrolist, after being in business for 30 years. A company in Sacramento, California actually owns the rights to it. So we didn't have a choice, we had to change. After that, about five years ago, we re-launched REcolorado.com. We now get 21 percent of all eyeballs in the Denver market. Zillow gets 38 percent. We're in second place. Five years ago we got 8,000 visitors a month, now we get two and a half million a month. We've been able to make quite a change there.
[Tweet this] "Five years ago we got 8,000 visitors a month, now we get two and a half million a month. We've been able to make quite a change there."
Last year we opened up that public-facing website to all the MLS's around the state, six of which now put all their listings in. We opened that up to all the MLS's around the state to provide free leads to brokers and agents because their business is all about connecting with consumers who are going to buy houses or who need real estate services. That's really the purpose behind that. That was probably the biggest change that we made, by sharing that with the rest of the state.
D: Do you have something planned for this year?
K: No, we're not doing a thing. (Laughs.) One big plan is that we will be the MLS for REALTORS® of central Colorado. We're four times bigger than any other MLS in the state, but we'll be providing products, services, and everything else to REALTORS® of central Colorado (i.e. Poncha Springs, Salida, Alamosa). We expect to continue that model, much like we did with opening up our public-facing website, with other entities around the state. We know that there's probably about half a dozen who are interested in talking to us so our goal for the coming year is to start that - not really consolidation or acquisition, but that's kind of the phrase that's used in other industries. We don't want to say that a whole lot because it makes people nervous, but it’s a bigger, stronger organization providing services in a partnership model to other MLS's around the state.
That's what we're doing this year, as well as rolling out new mobile products and everything else. We rolled out a new mobile product called Homesnap last year that I think is the best mobile app I've seen in this industry. Not necessarily in all industries, but certainly in this one.
D: Speaking of other MLS's, what are your thoughts on Upstream?
K: I don't see Upstream as a big disruption point. I think RPR's AMP™ could be, but I don't see Upstream as that. People say, “Oh geez, it's going to disrupt the MLS model.” Not really. Big brokerages gave away their most valuable intellectual property, which is their listing data, to countries like Zillow, Truila, and even Realtor.com and others. They gave it away for nothing, then they let them turn around and sell it back to them. Upstream, to me, is simply a way to take back control of that. I don't see it as a national MLS.
[Tweet this] "Big brokerages gave away their most valuable intellectual property, which is their listing data, to countries like Zillow, Truila, and even Realtor.com and others. They gave it away for nothing, then they let them turn around and sell it back to them."
The new CEO of Upstream is a 15 year-old friend of mine who came out of Silicon Valley. I spent six years out there and so did he. He's run a fair number of VC-backed companies as well. I look at somebody like him and say, “Alex will do a good job for them.” I think they have a much better chance of success with Upstream with Alex Lange running it than anybody else. But I don't see it as a disruption.
D: Let's talk a little bit about leadership. What type of CEO are you?
K: Old and overweight, can I say that? (Laughs). I guess I spent 20 years of my career trying to micro-manage everybody, do everybody's job, and do it better than they were even though I'd hired them to do it. Now I would say that I like to hire really good people, give them the vision of where we're at, set the tone from a cultural standpoint, and then let them do their job.
[Tweet this] "I like to hire really good people, give them the vision of where we're at, set the tone from a cultural standpoint, and then let them do their job."
What you really do as a CEO is set expectations and also stand there when people get scared about a decision they're making or have self-doubt. Your job is to help them overcome that and grow as professionals. The real thing that you do for a living is take responsibility for mistakes that people make and make sure that there's more than enough credit for everybody. From my standpoint, day in and day out, you empower people to do their jobs and then stay out of their way.
D: Is there a particular quality that you look for in an individual when you hiring?
K: We used to say, “You try to hire the most skilled people you can,” and over the years I guess that's morphed into, frankly, I don't care what skills people have. You hire for attitude and train for skill. I look for people with drive and motivation and who understand balance in life. Nobody ever dies and says, “Gee, I wish I would have spent more time at work.” It doesn't happen that way. I look for two things: one, a drive and motivation to be something in life and two, the strength to balance personal life with professional life and understand that they're actually one and the same. I love the fact that people come to work and throw 120 percent into it and then quickly jump back out of that and find time to have a wonderful personal life because one without the other doesn't work.
[Tweet this] "I love the fact that people come to work and throw 120 percent into it and then quickly jump back out of that and find time to have a wonderful personal life because one without the other doesn't work."
It's those intrinsic values. People have to want to make something of themselves and want to accomplish things. There's no way you can motivate or teach somebody that. They either have it or they don't.
D: What is your relationship with risk? Would you say that you are more risk-prone or risk-averse?
K: I don't think you're either risk-prone or risk-averse - there's a lot of stuff in the middle. I don't know anybody who would run across I-25 at rush hour and put their life at risk, but you might if your kid was out in the street. It's a risk-reward thing. I'm willing to take huge risks if I think the reward is there. If there's no reward, I'm not willing to take a risk.
The best companies in the world can see the potential reward of taking a risk, and they're not afraid to fail. One thing I've learned in my career has been if you're going to fail, fail fast and don't spend a lot of money doing it. You can fail any day of the week but get it over quick and learn from it. Also, it's okay to have your employees try something that's really risky and that has a fairly low probability for success if the potential reward is huge. If they do fail, make sure they understand what they learned, and then do it again and go from there.
[Tweet this] "...if you're going to fail, fail fast and don't spend a lot of money doing it. You can fail any day of the week, get it over quick, but learn from it."
When I worked for Visa, we rolled out some fabulous products. But a couple of them, in my opinion, were complete failures. They hooked on and grew tremendously in other countries and now all of a sudden they're showing up in this country. We built a chip card product when I was with Visa for the 1996 Atlanta Olympics. It just came to the U.S. two years ago. The question is, where the hell has it been? Well, it's been in Denmark, Singapore, Hong Kong, China.... A lot of other countries rolled it out because telecom over there is not reliable or cheap, where in this country it is. It's the old Indy 500, Mario Andretti quote, “If you're not scared, you're not driving fast enough.” I love that quote because it works in business too.
D: What do you think is the most drastic way that technology is changing the real estate industry?
K: I think technology for real estate is behind about 10 years and I can't figure out why. I saw that five years ago and I thought, that's one of the things that we can change. It has to do with things like bringing out a lot of strong mobile apps, great lead-generation tools, CRM tools… things that already exist in other industries. Frankly, they've been there for 15 years, but they're new to this industry. I'm not quite sure why that is.
[Tweet this] "I think technology for real estate is behind about 10 years and I can't figure out why."
For example, what is Zillow really? To me it's an entertainment site. It's not a serious real estate website. In the Denver metro area, for example, they're missing 15 to 20 percent of all listings. When you go out there and look at any property, it's cool to look at it, but essentially it probably really isn't for sale and it probably hasn't been since last summer. I think the value Zillow has brought to the industry is not only the sizzle, but they've given that technology to brokerages that have been so busy selling real estate that they've never really leveraged technology to the max. There are other industries that have leveraged it tremendously and real estate is playing catch up.
I think things like Upstream, AMP™, Zillow, and some of the things we're doing are really cool things. Every year, Inman gives awards to the most innovative REALTOR® association or MLS in the country. They gave it to the San Francisco Association of REALTORS® who went through a merger and then the runners up were the California Association of REALTORS®, and us. We were the only MLS mentioned.
D: What are you most excited for in terms of new technology?
K: The kind of technologies that I really like are ones that help you with certain things in your personal life and do it in a way to flow over into your professional life. I like some of the great apps that integrate just a series of simple technologies. AllTrails and PeakFinder for hiking are both terrific. Little tools like Periscope for real-time streaming video are wonderful too.
D: What websites do you visit daily?
K: Well the number one is, of course, REcolorado.com. (Laughs). I have to say that. But I've got several that I like. For work-related stuff I love reading anything that comes out of SXSW. I also like all the stuff you can get out of Google News.
D: What's the most overrated real estate technology?
K: Zillow. I don't have to think about that at all. It's really just an entertainment site. I probably shouldn't say this, but it’s the ultimate yuppie porn. My brother-in-law and his wife told me, "We're going to stay home on a Friday night and surf Zillow and REcolorado." I said, "Caroline, you just bought a house, are you thinking of buying another one?" "No. We're just trying to get ideas for our bathroom remodel and we like looking at a couple other in the neighborhoods that we might want to move to when the girls are grown." And they’re six and eight years old.
It's an aspirational thing and it's fun, but it is not a serious website for people to generate business. The best thing about Zillow, from a broker's' standpoint, is that the data's inaccurate and incomplete, and it means if someone is serious they better talk to a REALTOR®.
D: Zillow has recognized its accuracy issues and are working on fixing those...
K: Can I argue with that? I don't believe they're working on it at all. I had a gentleman in industry relations for Zillow tell me, "Well, it's really hard getting accurate data because how do you know you have the right address? You're getting data from so many places." I said, "I simply don't believe that." I think they're inaccurate on purpose because it makes the phone ring and it gives them an opportunity to up-sell somebody and do the switch and bait and bait and switch to somebody that's paying to be a premier agent.
[Tweet this] "I think they're inaccurate on purpose because it makes the phone ring and it gives them an opportunity to up-sell somebody and do the switch and bait and bait and switch to somebody that's paying to be a premier agent."
Think of all the great software around consumer recognition and address verification. Why does the FedEx guy never get lost looking for a house in your neighborhood? They never pull over and are like, "Hey, I can't find this address, you've got to help me." That never happens because they have the technology to know where every address is. If they can do that, Zillow can too. It's not a limitation. They can fix their inaccurate data, they just don't want to. I really believe that. I've told Spencer Rascoff that. The people who are in technology get it. He just kind of grins and says, "Well ..." He's a tech guy too. This isn't a technology problem. This is a business model choice on their part.
[READ NEXT] Get the Most out of Your My REcolorado Profile Page ⇒
D: How does REcolorado educate the consumer that it is the best tool to use when searching for a home?
K: We have a consumer ad campaign that we use. We do a lot of digital but also a lot of print and traditional media as well. It's hard because you have to communicate the essence of what you are. We're trying to communicate to consumers that REcolorado is the most accurate website and has the most accurate for real estate and, at the same time, the idea that you can go where the pros go. There's a reason why we did a web properties consolidation project and moved our public-facing website to the same url where all our brokers and agents go - so that we could sell that to consumers. Go where the pros go and get the most accurate data. Don't waste your time looking at something that sold last summer and hasn't been on the market in a year.
D: What are your favorite activities outside of work?
K: My wife and kids are kind of everything. I like hiking and traveling. I always tell people I've traveled a ton... I've been to 42 countries.
D: Since this is the Coffee Break series, we have to ask about coffee. So, how would you describe your relationship with coffee?
K: Well I don't do the two quad latte thing anymore. I did that for about a decade but then I quit doing that. Now I drink one cup of coffee a day. I like little pour-overs and certain coffees. This place actually is owned by people who are all connected to the Central American coffee industry - San Salvador, Nicaragua, Guatemala, Costa Rica. I'm a big fan of that. I like coffee the way they drink it in Europe; they go in for coffee and get a shot of espresso in a little shot glass. They talk for 20 minutes then pick it up, slam it, and walk out the door. That's the right way to do it.