Exclusive interview: Spencer Rascoff talks SPAC mania, home buying and why he’s created a stealthy social media startup with his daughter

Former Zillow Group CEO Spencer Rascoff. (GeekWire Photo / Kevin Lisota)

When we reached out to entrepreneur and angel investor Spencer Rascoff on Tuesday with notes about appearing on the GeekWire podcast — an appearance that was scheduled several weeks ago — we mentioned possible discussion topics around SPACs, real estate trends and any other big tech news events of the week.

And then we made the age-old journalistic error, pointing out that it had been a “pretty slow news week so far, but I am sure something will pop in the next day or two that might make life interesting.”

Indeed it did. But we had no idea that this week’s big news would actually involve the former Zillow Group CEO.

On Thursday, Rascoff — operating through a special purpose acquisition company known as Supernova — announced the acquisition of Offerpad, a 6-year-old real estate company that, like Zillow, is moving fast to transform the way people buy and sell homes. The deal, which values Offerpad at $3 billion, is fascinating on so many levels with interesting subplots.

Obviously, we had a lot to talk about with Rascoff when he joined the GeekWire podcast recording Thursday afternoon, discussing the inner workings of the Offerpad deal, dissecting SPAC mania and learning why the longtime entrepreneur took issue with parts of our original story.

We also heard about Rascoff’s side hustle projects, including a stealthy new social network he’s building with his 15-year-old daughter and a fast-growing startup called Pacaso that’s bringing fractional ownership to vacation homes.

Known for an intense working pace, Rascoff also provides hacks on how to better manage your day-to-day work life — hint, he swears by 15-minute meetings and Slack. And he offers a few tips for home buyers in this red-hot real estate market. The Los Angeles resident even shares why he calls his venture capital groups 75 & Sunny — yes it harkens back to the many dark and rainy days he spent in Seattle.

Listen below, or subscribe to GeekWire in any podcast app, and continue reading for key takeaways.

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  • On competing with his former Zillow colleagues: “There’s no personal animus here. This is purely about me finding a company and my team finding a company that we think will make for a great public company and taking it public through a SPAC…. To me, it is all motivated by a desire to innovate and a desire to create and to build.”  (Minute 7:55)
  • On why he can’t seem to give up the real estate business: “It’s a little like Godfather Part III, when he’s like: ‘Every time I try to get out, they pull me back in.’ Yeah, I am a little tired of it, but I also I’m quite expert in it. I get a lot of deal flow in the space because of my expertise. And as an active angel investor, I’m very capable of assessing the company’s likelihood of success in the space. And so I do do a lot of prop tech things.” (9:20)
  • On SPACs going mainstream: “I can argue that there will be a time in the not-too-distant future where the best companies will choose to go public via SPAC, and that’s a huge shift from just a couple years ago when a SPAC was pretty much a dirty word. It was kind of in the shadows of the financial markets, but it has become front-and-center very quickly and I believe for good reason. SPACs have a lot of advantages from a traditional IPO. (14:20)
  • On a SPAC bubble: “There are too many SPACs. Now, there are not too many good SPACs.” (15:25)
  • On the 2-year “shot clock” on SPACs: “There’s a clock ticking, and generally the name of the game is you want to try to do your deal on the earlier side of those two years. Because the later you get with that shot clock, the more sort of desperate you get, the more mistakes you make, the less leverage you have over the private company in that negotiation, because they know that your time’s running out, and that you have to get a deal done.” (17:15)
  • On working efficiently and the power of 15-minute meetings: “It’s brilliant, it is really effective. Turns out, that’s all you need for a lot of those intro meetings. And it saved me a lot of time, and it saved them a lot of time.” (26:00)
  • On challenges for first time home buyers: “It’s hard. There’s so little inventory in all of these markets. Most markets have just a couple weeks of inventory. And, in a healthy market, you’d expect to see like four or five months worth of inventory. So the days on market is 10 days on average instead of 100. Unfortunately, I don’t see that changing very much in the near future. I mean, especially in Seattle, where there’s not a lot of places to build in the city because of where the lakes are and the regulatory environment doesn’t really allow for that much development in those areas.” (29:00)
  • On why recessions are great times to start companies: “We started Hotwire in 1999 and we grew through the 2001 travel recession. We started Zillow in 2006 and we grew through the 2008 housing recession. And now we’ve started Pacaso in 2020 and we’re growing through the COVID, real estate and travel recession. And you’re exactly right. The reason that startups do well when they’re started during that period of tumult is because everything changes. And when everything changes, then there’s an opportunity for a new entrant to gain a foothold.” (38:05)
  • On the problem with social media and why he’s starting a new social networking startup with his daughter: “It’s a very interesting time for social media. It’s become extremely toxic, and exhausting. And when I talk to my 15-year-old about Instagram and TikTok and Snapchat and other social platforms that she uses, it’s quite clear that these services have gotten very far away from where they once began. And they are now pretty unpleasant places to be. And so something will happen there. I think new social platforms will emerge. I am working on one, no surprise, which I will have more to talk about later this year.” (43:45)
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Editor’s note: GeekWire is an investor in dot.la, a media company covering the Los Angeles tech scene that’s backed by Spencer Rascoff. 

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