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Summary:

Zillow CEO Rich Barton — who is working on “four or five” startups, is a venture partner at Benchmark Capital, and is on the board of Netflix — is stepping down to allow his more focused lieutenant, COO Spencer Rascoff, the top spot.

New Zillow CEO Spencer Rascoff

Online real estate site Zillow today is announcing a change that was a long time coming. CEO Rich Barton — who is working on “four or five” startups (see previous coverage), is a venture partner at Benchmark Capital, and is on the board of Netflix — is stepping down to allow his more focused lieutenant, COO Spencer Rascoff, the top spot. Barton will remain executive chairman and keep his office next to Rascoff’s.

New Zillow CEO Spencer Rascoff

Though trying to make a positive news story out of a CEO stepping down is a round-peg-square-hole kind of problem, Barton maintains that Zillow’s prospects are great. In fact, the company is announcing it’s profitable for the first time today, and keeps hinting it wants to go public. Barton founded Expedia, and served as its president and CEO through its IPO and subsequent purchase, so he’s qualified to run Zillow — but he said he’s too distracted to do so.

“It’s not like I don’t like operations and running stuff,” Barton said in an interview today. “It’s that I like to do a lot of things, and the CEO of a company with 200 employees and the potential to be the biggest brand in real estate should be somebody that’s completely focused and driven.”

Rascoff has been at Zillow five years and was named COO two years ago. In addition to Zillow’s content business of providing home sales and rental information, the company’s mortgage marketplace is a fast-growing product, Rascoff said. (However, LendingTree sued Zillow and others last week for patent infringement of its system for pairing borrowers and lenders.) Zillow reported 12.5 million unique users in August (a year-over-year increase of 41 percent) and said it sees 15-to-20 percent of weekend traffic from its popular mobile apps. Both Rascoff and Barton said they expected Zillow to go public, but wouldn’t set a timeline.

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  1. “True that” on the difficulty of spinning a CEO change.

    My initial reaction was likewise an “Uh oh, what went wrong at Zillow?” knee-jerk.

    However, after hearing about all of the other high-profile positions that were no doubt making it really, really difficult to focus on Zillow (really…if I was on Netflix’s board & all of those other things at once, Zillow would be getting short-changed on my time too).

    So, ya, in this case, it seems like the only real sane thing to do. Both for his own well-being & for Zillow.

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  2. Zillow has raised a ton of dough and will not be a great financial success for employees or shareholders. They have been a business for more than 5 years, which means they are no longer a start-up.

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  3. Yeah, this company raised an insane amount of money which it will never see the potential of. Rich is moving to the next thing. Good for him. Zillow is a bit if a flop imho.

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  4. [...] this announcement, which comes on the heels of Zillow’s recent claim to profitability, also throws an interesting wrinkle into the unfolding online real estate [...]

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