Whoovia’s Zero-to-One Strategy
The exercise was inspired by seven questions laid out by Peter Thiel in his book, Zero to One.
My logic was this: Thiel is one of the best startup investors in a generation. If I can answer the majority of the difficult questions Peter would ask before betting on a company, I’ll know we are onto something.
Question 1: The Engineering Question: Can you create a breakthrough technology instead of incremental improvements?
No: The trouble with any software is that you are not building self-driving cars or commercial flights to the moon. Software is relatively easy to imitate. Instead, we are in the category of Airbnb and Uber: Companies that have to engineer their success in a hyper-competitive landscape.
Nevertheless, using the perspective of these other network effect companies, there is a path to answering this question with a “Yes.” These companies didn’t just make an incremental improvement. Their improvement was category-defining, crafting a path to an entirely new marketplace dynamic. Instead of winning because of a massive technical advantage, they won because they realized the nature of the market faster than their competition.
For Whoovia, the first question is whether we can engineer a defensible network. As you’ll see below, the right team, speed, funding, distribution, and integration into the agent’s existing business are all key aspects of this design.
To build this network, we first need to build a category-defining tool. If agents can’t get value from the tool we are building, they won’t stay for the network that grows around them.
Question 2: The Timing Question: Is now the right time to start this particular business?
Yes.
In 20 years, I’ve not seen a better time to launch a company like Whoovia. Why? Just about everything is changing. Just look at how new brokerages are being structured and the behavior of millennial buyers (now over 50% of the market). Consumers are both price-sensitive and value-conscious in a way I’ve never seen in my 20 years in the industry.
These changes have been accelerated by the Siter-Burnett verdict, designed to force a change in how buyer agency is compensated (at least technically). More fundamentally, for consumers, Sitzer made public the question of the value of agency.
In this new landscape, agents are looking for unique ways to separate themselves from the average licensee. Our early users are excited about their ability to demonstrate unheard-of value to the consumer in seconds. When we can give agents a tool that instantly separates them from the competition and data that shows their value in the market, they win. And so will we.
Question 3: The Monopoly Question: Are you starting with a big share of a small market?
Yes.
In fact, building hyper-local “atomic” networks is the only way to go when building a network effect company. Mastering the construction of atomic networks is table stakes to going big fast.
In 2025, we will need to stay disciplined and not chase too many markets at once. The first domino focuses on building marketplace dynamics at the neighborhood, zip code, and city levels. This will create a playbook, allowing us to enter any market quickly.
To build these networks, our partnership with the right agents is essential. Strong agents are the owners of hyper-local networks: They have the buyers and the homeowners. Agents are the subatomic particles that make up the local atomic network we are building.
Last month's big news is that we’ve built an architecture that allows agents to connect to their entire database. This CRM functionality adds rocket fuel to agents' interactions with those who already trust them.
Question 4: The People Question: Do you have the right team?
Yes.
A wise friend who has invested in many companies told me that while the idea behind a startup needs to be strong, 90% of his decision to invest is based on his assessment of the team that will execute day in and day out on the idea. Over the past year, we’ve made some tough decisions about the team we are building. The fruit of these decisions is the extreme clarity we have around the team we need on the field.
Here’s your starting lineup as we enter 2025: (these titles give an idea of what each of us does, but if you’ve ever launched a startup, you know that we all wear various hats!)
John (front-end developer)
Reagan (back-end developer)
Josh (back-end developer)
Vicky (client experience)
Jason (CTO)
Pat (CEO)
Question 5: The Distribution Question: Do you have a way to sell and market your idea?
Again, Yes.
Product as a sales channel: The easy thing to miss in our model is the partnership with agents. The trust an agent has with their network is something an AirBnB never had in their partnership with hosts, and Uber never had with drivers. When it comes to distribution, the agent’s connection to buyers and homeowners is more powerful than any marketing we could ever pay for. Therefore, building a product that makes adoption as frictionless as possible is foundational in 2025.
I’ll make this a bit more tangible with a simple way to think about a top agent who uses Whoovia:
Number of qualified, ready buyers in the agent’s pipeline: 10
Number of warm homeowner contacts in the agent’s database: 1000
Now, what does this look like with just 100 top agents in a suburb, township, or city?:
Demand side: 1000 buyers
Supply Side: 100,000 homeowners invited to the platform.
4% per year will sell: 4000 sellers
Traditional sales: Now that we have a live product, we are throttling up the invitations to best-in-class agents and teams. We’ve already learned a lot over the last quarter about our ideal agent partners:
Agents who understand their business’ essential KPI of having as many seller conversations as possible immediately grasp the unique leverage Whoovia offers.
Teams with implementors and/or data managers are structurally set up for the implementation of a new tool and can conceive of doubling their business with a tool like Whoovia.
These teams have built-in systematic outreach to their past clients, prospect pipelines, and general “sphere of influence.” Working with these teams gives Whoovia an additional marketing channel.
Question 6: The Durability Question: Will your market position be defensible 10 and 20 years into the future?
Yes.
Within the industry, the best analogy for defensibility might be Zillow’s. Zillow offered unique knowledge to homeowners in the form of an automatic estimate of the value of their property. This knowledge is even more compelling because it concerns a homeowner’s most valuable asset.
This is precisely the space where Whoovia will provide value: at scale, homeowners will have specific knowledge about the most qualified buyers looking for a home like theirs. In the marketplace of demand for homes, Zillow is trading with macro data; we are trading at the micro level.
The faster we can structure strong local buyer demand data, the faster we will make this a national and international network, and the more defensible it becomes in the short and long term.
Question 7: The Secret Question: Have you identified a unique opportunity that others don’t see?
Yes, we’ve got a few “secrets” that we’ve uncovered over the past year:
We are a data company, building a world-class tool for agents is the “API” we need to collect this data.
The data set of shadow inventory is far larger than the data set of active listed homes.
Technologists tend to see all agents as commodities and, therefore, as a necessary evil in their platform. This is an error and a failure to understand the evolution of efficient service marketplaces. Focusing on top non-commodity agents is essential to the buyer and seller experience and the platform's success.
This is more of a secret belief that informs how we are building specific to the agents we are partnering with: Superb fiduciaries in a free market dynamic don’t lead generate (in fact, for true fiduciaries, clients are never leads). Proof of this category of professional excellence drives demand for their service. Deeper fulfillment for these fiduciaries results. We are building tangible proof of great agent’s excellence so they can take market share by doing what they do best.
I’ll end with a final quote from Peter Thiel that resonates deeply with what we are building in Whoovia. It captures the dignity businesses owe their employees, customers, and society. If we keep this concept at the forefront, the opportunities to build a great company will abound.
“The most valuable businesses of coming decades will be built by entrepreneurs who seek to empower people rather than try to make them obsolete.”
Thank you for being co-conspirators in this adventure.
