{ "docId": "019dd923-622c-750b-8b99-74af5c9e9edb", "docSlug": "de028a1085e6", "documentTitle": "Zillow Group, Inc. (Z)", "authorId": "54_Spruce_Point_Capital", "authorName": "Spruce Point Capital Management", "documentKindSlug": "activist-deck", "documentKindLabel": "Activist deck", "sourceTypeSlug": "short_seller", "sourceTypeLabel": "Short seller", "presentationDate": "2024-03-05 00:00:00", "orientation": "landscape", "aspectRatio": 1.3333334, "pageNumber": 37, "pageCount": 103, "prevPage": 36, "nextPage": 38, "slideType": "expose_contradiction", "function": "expose_contradiction", "density": "overcrowded", "nDataPoints": 1, "notes": "Uses executive quotes to establish the business model's reliance on buyer-agent leads.", "elementsJson": [ "headline_text", "callout_box", "data_table", "footnote" ], "metadataConfidence": 0.95, "imagePath": null, "slideHref": "/slides/019dd923-622c-750b-8b99-74af5c9e9edb/37", "deckHref": "/decks/019dd923-622c-750b-8b99-74af5c9e9edb", "deckJsonHref": "/decks/019dd923-622c-750b-8b99-74af5c9e9edb.json", "deckAnchorHref": "/decks/019dd923-622c-750b-8b99-74af5c9e9edb#slide-37", "components": [ { "bbox": null, "kind": "callout", "text": "We believe the outcome of these lawsuits could ultimately result in a significant reduction in advertising spending by buyer-agents and/or commissions paid to Zillow via Flex.", "attrs": null, "subkind": null, "toolName": "Visual emphasis", "toolSlug": "visual-emphasis", "confidence": null, "componentId": "019dd953-3f42-76f3-adc9-0acfcc16559e", "frameworkName": null, "frameworkSlug": null }, { "bbox": { "h": 0.47, "w": 0.52, "x": 0.46, "y": 0.41 }, "kind": "paragraph", "text": "Premier Agent revenue is generated by the sale of advertising services... Premier Agent revenue accounted for 66% of total revenue for the year ended December 31, 2022.", "attrs": null, "subkind": "paragraph", "toolName": null, "toolSlug": null, "confidence": null, "componentId": "432e5aa7-df15-4796-92f0-649c980df679", "frameworkName": null, "frameworkSlug": null }, { "bbox": { "h": 0.18, "w": 0.96, "x": 0.02, "y": 0.16 }, "kind": "paragraph", "text": "Under Premier Agent's MBP model, real estate agents sign up for a monthly subscription which allows them to market their services on Zillow listings as well as earns them a share of buyer leads...", "attrs": null, "subkind": "paragraph", "toolName": null, "toolSlug": null, "confidence": null, "componentId": "aefdfc7d-d316-48a1-9913-d89cafdf0611", "frameworkName": null, "frameworkSlug": null }, { "bbox": { "h": 0.18, "w": 0.43, "x": 0.02, "y": 0.41 }, "kind": "quote", "text": "So Premier Agent revenue is our core media business where we monetize this 2 billion visits a month we get on our apps and sites...", "attrs": null, "subkind": "testimonial", "toolName": null, "toolSlug": null, "confidence": null, "componentId": "83c244fd-2375-4870-9e31-2a16d7345068", "frameworkName": null, "frameworkSlug": null }, { "bbox": { "h": 0.07, "w": 0.43, "x": 0.02, "y": 0.81 }, "kind": "quote", "text": "Historically, the Premier Agent product has -- been mostly about acquiring buyer leads.", "attrs": null, "subkind": "testimonial", "toolName": null, "toolSlug": null, "confidence": null, "componentId": "a3a1f393-cc50-4c96-a5f5-c79b2abf9b6e", "frameworkName": null, "frameworkSlug": null }, { "bbox": { "h": 0.12, "w": 0.43, "x": 0.02, "y": 0.66 }, "kind": "quote", "text": "So Premier Agent overall, which is our revenue workforce, has always been focused on the buyer side of the transaction...", "attrs": null, "subkind": "testimonial", "toolName": null, "toolSlug": null, "confidence": null, "componentId": "ec4d171e-dabc-4775-a972-bab137bb1125", "frameworkName": null, "frameworkSlug": null }, { "bbox": null, "kind": "quote", "text": "\"So Premier Agent revenue is our core media business where we monetize this 2 billion visits a month we get on our apps and sites. And it's mainly buyer monetization that we do, and we basically sell leads to estate agents. We have monetized that historically by collecting credit cards from agents upfront, getting them to buy on a subscription basis and then sending them leads.\" — CEO Rich Barton, 11/20/2019; \"So Premier Agent overall, which is our revenue workforce, has always been focused on the buyer side of the transaction, the buyer leads that we're sending to real estate agents.\" — Fmr. CFO Kathleen Phillips, 2/16/2017; \"Historically, the Premier Agent product has -- been mostly about acquiring buyer leads.\" — Fmr. CEO Spencer Rascoff, 11/01/2016", "attrs": null, "subkind": null, "toolName": "Authority citation", "toolSlug": "authority-citation", "confidence": null, "componentId": "019dd953-3f42-76f3-adc9-0cca6d8fdb61", "frameworkName": null, "frameworkSlug": null }, { "bbox": { "h": 0.02, "w": 0.35, "x": 0.02, "y": 0.97 }, "kind": "source-note", "text": "Source: Z earnings and conference calls, Z FY22 10-K", "attrs": { "numbered": true }, "subkind": null, "toolName": null, "toolSlug": null, "confidence": null, "componentId": "30d25cee-0bbd-4bb5-b775-73ee12627a8c", "frameworkName": null, "frameworkSlug": null }, { "bbox": { "h": 0.08, "w": 0.65, "x": 0.32, "y": 0.03 }, "kind": "title", "text": "Zillow Is Highly Dependent On Spend From Agents Representing Home-Buyers", "attrs": null, "subkind": "headline", "toolName": null, "toolSlug": null, "confidence": null, "componentId": "0a063a3d-3932-489a-9e3f-5dd68415d6f2", "frameworkName": null, "frameworkSlug": null }, { "bbox": { "h": 0.04, "w": 0.43, "x": 0.02, "y": 0.36 }, "kind": "title", "text": "Premier Agent Quotes", "attrs": null, "subkind": "subtitle", "toolName": null, "toolSlug": null, "confidence": null, "componentId": "4d03e9ce-0e84-4fd7-881b-c62374bf171b", "frameworkName": null, "frameworkSlug": null }, { "bbox": { "h": 0.04, "w": 0.52, "x": 0.46, "y": 0.36 }, "kind": "title", "text": "Premier Agent Disclosures", "attrs": null, "subkind": "subtitle", "toolName": null, "toolSlug": null, "confidence": null, "componentId": "e41918e1-834e-465a-a436-bede935a52d6", "frameworkName": null, "frameworkSlug": null } ], "metrics": [], "tools": [], "frameworks": [ { "name": "fraud-exposure", "slug": null, "matchId": "ccda3277-1f14-4a0b-abf9-9828fb5b347b", "evidence": "Connecting business model dependency to legal risks and executive statements.", "confidence": 0.8 } ], "arcBeats": [ { "to": 50, "from": 21, "beatId": "2825f36d-3055-4526-b439-677abc0e48a8", "arcName": "Overcoming the Monster", "arcSlug": "overcoming-monster", "beatName": "Evidence", "beatSlug": "evidence", "evidence": "The document presents evidence to support Spruce Point's claims, including data on Zillow's declining site traffic and revenue per visit.", "position": 2, "confidence": 0.8, "parentBeatName": null, "parentBeatSlug": null } ], "loops": [], "imagePathAlt": null, "thumbSrc": null, "thumbSrcAlt": null, "locked": true }