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Houzz aims to simplify home renovation (illustration) Photo: Shutterstock
Houzz aims to simplify home renovation (illustration) Photo: Shutterstock
 
 

The phone that designs the home

Globally acclaimed application Houzz, launched just two years ago by Israeli couple, already dubbed 'Wikipedia of home design'

Asaf Gilad, Calcalist
Published: 11.27.12, 07:33 / Israel Business

PALO ALTO – Globally acclaimed home design application Houzz, launched just two years ago by Israeli couple Adi Tatarko and Alon Cohen, has already been dubbed the "Wikipedia of home design."

 

The two, who for the past 12 years have called Silicon Valley home, developed the application to cater to their own home remodeling needs, which apparently were shared by many others. Since its launch, the application has received over three million downloads from Apple's App Store and it is a regular on Apples' top five best-seller lifestyle applications list.

 

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The company, bearing the same name, is based in Palo Alto and run by the expat couple. Cohen used to be a senior development manager at eBay.

 

The breakneck speed in which the company grew, coupled with the ties the couple have with some of Silicon Valley's decision makers, led celebrated VC fund Sequoia Capital – which is invested in leading global ventures the likes of Google, YouTube and PayPal – to lead the company's $11.6 million financing round.

 

Houzz allows users to browse, online or via a mobile device, through a large gallery of home design pictures and save their favorite images. Furthermore, it connects homeowners to over 100,000 home improvement professionals such as designers, architects and contractors.

 

Both groups create a social network that shares ideas, tips and recommendations. Houzz also generates a large supply of jobs for its home design professionals.

 

'There was no good way to find professionals'

Houzz began like so many other startups before it – following a personal crisis in the life of its founders. After their second child was born, Tatarko and Cohen decided to remodel their 1955 home.

 

"We looked for professionals whose expertise was renovating old homes, we wasted a lot of time and came up with very few options," the couple recounts. "We were just throwing money down the drain and ended up back in square one.

 

"We felt there was really no good way to find professionals that are suitable for our project," they say. "The home renovation and construction area is relatively underdeveloped.

 

"When you use Trip Advisor or Expedia, you more or less know what you're getting and can customize your own trip. In the construction market, things are completely different."

 

Tatarko and Cohen explain that renovating a home is a complex and usually stressful process that may end with shabby results and disharmony between couples. Houzz aims to simplify matters and walk users through the process.

 

Tatarko quit her job at an investment house, and Cohen built the website. The couple talked to architects and designers from the Bay area and to the parents of their children's classmates, who were also seeking to remodel their home.

 

They found out they were far from being alone in their search for online information. Architects began posting portfolios to the website and the users loved the fact that they could view resolution images, save their favorite pictures and speak with designers. The word soon spread, and increasing numbers of users began joining the community.

 

Then came the investors, and without investing a cent in marketing, the company began gaining success outside the United States. With the new financing, the couple opened their office and were joined there by the other employees, who until then worked from home. One of Houzz's first employees was the editor-in-chief of prestigious style magazine Sunset, who left her job to join Houzz.

 

Not aiming to dictate style

Tatarko and Cohen wanted to throw in some style, so they launched an online home style magazine, which is considered one of the company's gems.

 

Tatarko explains that Houzz does not aim to dictate trends, but rather to report the popular current trends and showcase works of architects and enable homeowners and professionals to interact.

 

Houzz employs engineers from Stanford and Berkley universities, and computer professionals from Google, PayPal, eBay and Yahoo, in order to improve users' experience which is based on high resolution images.

 

The team also develops algorithms to analyze user preferences and monitor social networking activity, similarly to online trading sites.

 

According to Tatarko and Cohen, the current $11 million financing round was unplanned.

 

"We wanted to remain a family operation, in a team environment," the two say, revealing that they vowed to never chase funds with a presentation, an experience all too familiar to Silicon Valley entrepreneurs.

 

But the inevitable happened: Angel investor Oren Zeev, one of the company's first investors, contacted five investment funds. Sequoia's Mike Moritz scheduled an appointment for the next morning and by noon decided to invest in the small startup.

 

Despite the millions in costs Houzz saved its users, the couple had not yet earned a cent in proceeds. The big bucks started pouring in later, when Houzz began partnering with mega home design chains such as IKEA and Lowe's.

 

Currently Houzz has 50 employees in the US and another two mobile developers in Israel. The couple continues to run the company while raising their two children, aged 6.5 and 10.

 

"Raising children as a couple isn't as hard as remodeling a house," jokes Tatarko.

 

Insofar as Israeli design, the couple say they like Israeli designers and regularly read Israeli design magazines.

 

"We're happy to expose Israeli design to the world. We have over 200 architects from Tel Aviv listed on our site and many Israeli users."

 

This interview was originally published in Hebrew by Calcalist

 

 

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