Six years after they moved to the United States from Israel, Adi Tatarko and her husband Alon Cohen were finally able to buy their own home in Silicon Valley. The problem, however, was that they could not tell the architects and designers they talked to what they wanted done to their four-bedroom property from the images that were in their head.
“We didn’t have the right terminology,” says Tatarko. “Most of us are not professionals from the industry. We are not designers or architects or contractors, so when people came to our house and asked us, ‘Would you like to have … coffered ceilings here?’, we looked at them and said, ‘What?’ We started digging in books and magazines and reading a lot and trying to educate ourselves but the whole process was really difficult.”
From that frustration has emerged Houzz, a website and app that acts as a hub for home improvement, featuring seemingly countless pictures of the insides and outside of homes and flats, which can be flicked through until something catches the eye. The rapid rise over the past five years of the Californian company has led it to an estimated value of more than $2bn (£1.3bn), with Tatarko and Cohen now listed among the tech sector’s power couples.
The galleries of living rooms, gardens and extensions are mostly put up by architects, builders and interior decorators. The site includes details of lamps, beds and tables used to create the effect – in effect, the portfolios of home improvement professionals. On the other side is the Houzz “community” of 25 million users, who use the galleries to find what they are looking for, or to link up with professionals.
The site is designed to bridge the gap between homeowners frustrated at being unable to explain what they want and professionals struggling to interpret clients’ ideas.
“The first users of Houzz were 20 parents from our kids’ school, who we talked to and we said it would be wonderful if we could talk to each other and share ideas, and see ideas and talk to professionals and have it all very visual and have the technology,” says Tatarko, who started Houzz in the San Francisco Bay area in 2009.
“Professionals were also frustrated. They said, ‘Well you’ – pointing to us as homeowners – ‘you think that you see a picture in a magazine and then you call us and you want to have something similar. Unfortunately what you see in the picture cost somebody hundreds of thousands of dollars but you say that you only have a $20,000 budget. Or what you see there is meant to work in a very big house but you have a very small house – that is not going to work.’ They said somebody needs to educate homeowners because their expectations are not realistic.
“We wanted to remove the barriers between homeowners and great design, and make the whole process way more fun and productive by applying technology.”
Tatarko and Cohen had no marketing budget and their business was running on only $2,000 a month, but the idea soon spread by word of mouth outside of California and across the US. The couple built a network of professionals and users before they decided in the autumn of 2010 to commit to the business fully themselves, hire staff and seek investment to expand.
By 2013, more than one-third of the users were from outside the US. A London office was opened last summer, and the UK network now numbers 15,000 tradespeople, designers and architects, and 1.5 million users.
Algorithms dictate what style of room and furnishings appear when users search galleries on the site, while there are tags to identify and buy pieces of furniture or pinpoint the type of paint used in a room. Typically, professionals such as builders or lighting specialists upload their own pictures, but householders who have had their own home renovated also put up galleries of the finished project. Users create “ideabooks” of their favourite posts and can ask questions about, for example, where a desk was sourced or what type of wood was used.
After the US, Houzz expanded to Australia, Germany and France as well as the UK – adapting to cultural differences along the way, such as swapping “elevator” for “lift”. Tatarko and Cohen now intend to move into Japan.
“I can see something that someone is doing in Australia and say, ‘This is exactly what I want to do here, and I don’t care that nobody did it in my neighbourhood before – as long it is doable, I am going to do it,’ ” says Tatarko. An unexpected side-effect of the international expansion, she adds, is that architects and other professionals are getting jobs outside of their own country.
From being run on a shoestring by the couple from their home, Houzz has attracted in excess of $200m in investment. Revenues come from advertising by home furnishing and improvement companies, professionals registering their services, and the commission from sales of items such as lamps and chairs.
Despite some of the elaborate houses on the site, Tatarko says that Houzz aims to cater for all types of home decorator, from those trying to renovate a mansion to someone who is fitting out a one-bedroom flat on a modest budget. The philosophy of the company dictates that it stays away from celebrity homes and focuses on realistic ideas about what people can do to their properties.
Houzz-eye view of Britain
Unsurprisingly, when British users went to the site, they tended to type in “small” as a reference term, reflecting the more limited space available compared with homes in the US.
Adi Tatarko says that the trend for building down into basements, which has caused neighbour disputes because of the disruption involved, is clear in some of the content appearing on Houzz from the UK. “Because there is not enough space, people are either going up or down and trying to add to basements, or going up the top. But sometimes they do have a little space in the backyard.”
Other trends in the UK, she says, include “glass box” extensions – sometimes featuring glass walls and ceilings.