TIP809: The Real Estate Data Empire Making a $5 Billion Bet: CoStar Group w/ Shawn O'Malley & Daniel Mahncke

“Think about every commercial building in America, every office tower, every strip mall, every apartment complex, every warehouse. Now imagine that for 40 years, there's one company that has had people physically visiting each one of those properties, recording what they see, photographing the buildings, and compiling the most comprehensive database to digitalize commercial real estate in the world.”

“It's so boring that most investors have probably never heard of CoStar Group. And yet, it's a company that just reported its 59th consecutive quarter of double-digit revenue growth through COVID and through the 2022 rate hike cycle that crushed commercial real estate in transaction volumes.”

“They've invested something like $5 billion into their own consumer facing real estate website called homes.com, to compete directly with Zillow and also realtor.com. And I had never heard of it until they started running this blitz of Super Bowl ads with Dan Levy.”

“And then just in the last year, you've seen something like a 50% sell off at the time of recording and CoStar. And so one of the most prominent activist investors in the world, Third Point, run by Dan Loeb, published an open letter in January 2026, essentially calling for a board overhaul and demanding the company pull back on residential spending.”

“But from what I can tell from a user perspective, it is hard to meaningfully articulate any differences between Zillow and homes.com. But on the back end, there are some very big differences in how their business models work. And CoStar is hoping that that will be what enables homes.com to win long term.”