It’s rocky times in the tech world. Valuations are shrinking. Layoffs are spreading. And the primary lender to the startup world, Silicon Valley Bank, is a shell of its former self.
But amid the uncertainty, Seattle entrepreneur Rich Barton is relishing the choppy seas. And the Zillow Group co-founder sees opportunity ahead, with a few lessons to share based on his more than three decades in the tech business.
“I actually love a storm,” said Barton in an exclusive interview with GeekWire. “Warren Buffett likes to say: you don’t know who’s swimming naked until the tide goes out. A lot of people (are) swimming naked right now, getting exposed.”
Barton is essentially living by the old political maxim: Never let a serious crisis go to waste.
And he feels Zillow — which held $3.4 billion in cash and investments at the end of 2022 and attracts nearly 200 million monthly visitors to its real estate sites — is well prepared.
“A lot of cruft is getting washed out to sea,” said Barton. “And if you’re an organization or a company that is wearing a bathing suit and a wetsuit, you’re all good. And that’s kind of how I feel right now.”
Barton says he wants to make the most out of this tectonic shift, calling it Double Jeopardy time.
“Scores can really change now,” he said.
Looking back at a career that has included stints at Microsoft and then the founding of travel giant Expedia, the 56-year-old entrepreneur says he relishes times like these.
“The stuff that I really love the most is when I’m deep in the trenches in a crisis situation with a team of people I love and we’re doing something important,” said Barton.
Drawing comparisons to the so-called “swing” that the University of Washington men’s crew team achieved at the 1936 Olympics — portrayed in the best-selling book “The Boys in the Boat” — Barton says something similar can happen in business, especially during tough times.
“It just feels like magic and it feels effortless and you feel euphoric,” he said.
Zillow reported Q4 revenue of $435 million, beating estimates and coming in at the high end of its guidance range.
“I’m really feeling better than I’ve felt in a long time right now,” Barton said of the company.
Zillow’s stock took a beating in November 2021 when the company said it would exit its ambitious iBuying house-flipping business.
Now that decision is looking prudent given the recent housing market slump.
“We were ahead, luckily, of what’s happened in the housing market this year,” Barton said. “I feel pretty good about that decision.”
More broadly, Barton thinks the recent wave of layoffs in the tech industry and the current banking crisis might be a harbinger of tough times ahead.
“The real pain is probably coming,” he said. “And you know, all organizations should be prepared for that.”
Barton coaches other entrepreneurs and said in good times and bad he tries to “be a ballast weight.”
“You know, this too shall pass. We will get through this,” he tells them. “Do the right thing, communicate clearly, don’t hide anything, get it out there, get the right people around you, and you will make it through.”
Leaders shine during tough times, Barton said.
“I actually think in stormy weather, it’s when leaders are the happiest,” he said. “It’s when the value of what we do as leaders is high.”
Check back on GeekWire tomorrow for more from our conversation with Barton.