It’s 9:30 a.m. on a Monday, and the Washington, D.C., offices of Redfin, a 10-year-old real estate listings Web site, are just coming to life. They’ve only been in the space for about a year, and the office feels more like the tech start-up Redfin wants to be than the old-line brokerage it’s cribbing from: Computer workstations line the walls and free-floating tables stand ready for spontaneous meetings.
One of Redfin’s newest recruits emerges from her office. Nela Richardson’s scarlet red dress matches the office’s color scheme, but otherwise, she’s the odd one out. Unlike Redfin’s more than 1,000 employees, Nela is neither techie nor agent, but a PhD economist, there to broadcast Redfin’s data to the world.
“They were looking for someone who could connect the dots,” Richardson says, explaining how the site’s executives lured her away from a well-paying gig at Bloomberg Government, after stints as a senior economist at Freddie Mac and the Commodity Futures Trading Commission. “Having a point of view in the market is important. Redfin wanted its own voice to cut through that noise.”
It’s already been quite a couple months. Flying back and forth between Redfin’s Seattle headquarters and its D.C. office, Richardson takes calls from local reporters trying to place their city’s housing markets in context. She talks to Redfin agents all over the country, and helps promote new data products, like one that calculates how likely a home is to sell within a certain period of time.
There’s a fundamental difference between Richardson’s previous jobs in government and regulation: She’s talking to real people, rather than finance pros and policymakers.
“A lot of economists go into banking, but I just find this part so much more exciting,” she says. “This is the first one where I was shaking hands with the customer. Before, I always felt like there was a buffer, like I was speaking through gauze.”
The market for consumer-facing economists is certainly getting crowded. Big Internet companies have had chief economists for years now; Google’s Hal Varian is an oft-quoted exponent of his employer’s capabilities and worldview. Microsoft recently hired Yahoo’s former chief economist to push a more “data-driven culture” at the tech dinosaur.
But they’re not just looking for super-wonks. More importantly for Richardson, rival real estate sites Zillow, Trulia, and CoreLogic have offered their chief economists as media-friendly talking heads, always available to explain national trends: Stan Humphries, Jed Kolko, and Mark Fleming have essentially become their companies’ most visible employees, speaking at conferences and testifying on Capitol Hill. That’s why Apartmentlist.com’s recent listing for a chief economist includes the following in its job description: “Act as the face of the company with key journalists for both print and tv interviews with leading publications,” “work closely with our PR and branding teams,” and have “excellent stage presence.”
In a data-chic world, a chief economist is the new marketing must-have.
It’s one thing to hire an economist for a role your competitors have already defined. It’s another to carve out space for one in an entirely new sector.
That’s what Marco Zappacosta wanted to do with Thumbtack, which he co-founded in San Francisco five years ago. The platform for consumers to find local independent professionals — like plumbers and guitar instructors — is working through $50 million in venture capital funding and has data to burn, between the surveys it gathers from clients and information on each transaction. His model was Zillow, which has integrated itself into government and media simply by supplying expertise where it helps.
“They positioned themselves in the consumer’s mind as a resource for the housing market, as well as in the political mind as a legitimate resource in this world,” Zappacosta says. “They’re speaking on behalf of the sector, and we would like to do the same thing.”
So several months ago, he went shopping for an economist, hitting up PhD programs to find someone who might want to make their name at a start-up. Instead, he found someone he already knew: Jon Lieber, who at that point was an economic policy staffer in the leadership office of Sen. Mitch McConnell (R-Ky.).
Lieber, who just has a masters degree in economics, was used to translating the Republican conference’s agenda to business groups. During his first project, a nationwide survey of small business friendliness, Lieber found that the needs and views of several hundred thousand small service companies didn’t exactly comport with conservative orthodoxy.
“If you work for a politician, you might say, ‘everybody should be free do what they want,’” Lieber says. “That’s not what our pros say. They might say ‘you need regulations, and that they be consistently enforced.’”
Another thing: Local licensing requirements for service professionals like barbers and personal trainers are a bigger headache than taxes, since most of them aren’t making much money anyway. Lieber is charged with making sure that information is disseminated in influential circles, with the idea that it could be used as ammunition for policy campaigns — making the site even more valuable to the micro-entrepreneurs who use it. Independent contractors are a fast-growing category in the new service economy, and there’s no lobbying group that represents them.
“We want to be your advocate and your partner as you go out and navigate the world,” Zappacosta says. “We represent a segment that’s not being heard.”
The reason why: It’s easy to ignore someone who’s not being counted. The toolbox of metrics that government agencies use to inspect the economy doesn’t include much in the way of the cost of services. For example, needs that aren’t solid goods but which are nonetheless essential — like carpentry and auto repair — don’t factor into the consumer price index. Lieber figures they probably have a large and diverse enough sample size of active members to create such an indicator, which then would carry Thumbtack’s name and brand into the stars.
That’s the dream of the new tech company chief economist: Become indispensable, by using your employer’s data to create something the market didn’t know it needed. The labor market analytics firm Burning Glass Technologies, for example, got on Washington’s radar screen by providing some of its insights on job vacancies to the Brookings Institution. CoreLogic has done it with the Urban Institute.
Redfin, for its part, is trying to do it with headline-friendly research on things like house-flipping and which billionaires could buy which cities, for which Richardson provides authoritative-sounding quotes. She’s even working on developing Redfin’s own real-time housing index, with the hope of being able to predict consumer behavior in the future, rather than figure out what the market was doing two months ago — a shortcoming of traditional indices, like Case-Shiller and Pending Home Sales.
Of course, every dataset has its own perspective. Any company only has data from its customers — Redfin’s only counts urbanites, for example — which introduces some possibility of bias. “Redfin has a history of being a truth teller,” Richardson says. “A lot of that is interpretation.”