Mrs. Brasky's kindergarten class in 1976 was the beginning of a beautiful friendship for Dave Gooden and Cameron Henkel.
The boys' upbringing in northern Minnesota gave them a competitive edge—as teammates in the heart of hockey country, they learned the definition of hard work firsthand.
In the mid-1990s, the duo jumped on the technology bandwagon early with a big opportunity: something called the Internet.
Turns out they had done their research. In 1997, Gooden and Henkel got their first big break selling refurbished computer equipment on a commercial website, generating $1 million in revenue over the course of a year.
Nearly two decades later, their entrepreneurial spirit — and their friendship — remain steadfast. Meanwhile, a real estate startup idea came to them and inspired a new venture in 2003 — LakePlace.com, a search site for waterfront real estate.
More recently, the founders just launched another domain in September (DaneArthur.com) with a minimalist twist on the property portal.
As business partners and friends, venture capitalists and investors, experimenters and entrepreneurs, Gooden and Henkel's efforts bring to light an evolving hybrid beast where technology meets the human experience in real estate.
Their integration into industry shows how an outside perspective can blend efficiency into systems without disrupting what works.
The Genesis of LakePlace.com
Perhaps it's no surprise that, as Minnesota natives, Gooden and Henkel dreamed of owning a cabin overlooking the water.
However, few who grace the “Land of 10,000 Lakes” take this dream and turn it into a business venture.
While scanning newspapers and looking for beachfront real estate listings on unrelated Realtor websites 14 years ago, the idea for LakePlace.com was born.
“We started LakePlace.com because of the difficult experiences we had when looking for our own vacation homes in 2002. It's such a cliché, but it's true. we thought there had to be a better way,” Gooden said.
“We started it from a customer's perspective, not an agent/broker's perspective.”
Screenshot: LakePlace.com homepage
Pulling from all MLSs in Minnesota and Wisconsin, LakePlace.com lists lake properties, cabin rentals and family resorts in the two respective states.
The founders' goal with the launch was to become the dominant brand for lakefront properties in these two states.
There are over 15,000 lakes in both Minnesota and Wisconsin. These serve largely as vacation spots, but some are located in upscale metro centers — so the big market made these locations a natural fit.
Lead producers became brokerage owners
In 2006, LakePlace.com, which started as an classifieds model, became a referral brokerage.
The founders hired a broker so they could refer clients exclusively to over 50 brokerages. Henkel became a Minnesota and Wisconsin broker in 2008.
Then, in 2010, tech entrepreneurs presented themselves with an interesting proposition.
“One of the agents from the brokerages, our referral agent, contacted us,” Gooden explained. “He said if we were interested in going on the market, he thought 12 agents would want to join us.”
They took the call and have been a full-service independent brokerage ever since.
Headquartered in Bloomington, Minnesota, LakePlace.com has 18 locations — 13 company-owned offices and five franchises.
A natural momentum has been created largely thanks to the leads that LakePlace.com has brought.
Combined with the founders' sister site offering land for sale in Minnesota and Wisconsin (LandBin.com), the company receives 10,000 customers annually with LakePlace.com alone attracting more than 3 million visitors annually.
“The company has doubled in size in the last year, and in all honesty, we haven't done a lot of hiring yet,” Gooden said. “Agents find us online or their clients ask them about appearing on one of our sites and that always opens a door.
“We have also recruited many agents through referrals from our current agents and brokers.
“Sales professionals are always interested in hearing how their peers are so busy, and this has worked in our favor,” he added.
The founders also brought in Randy Johnson, an experienced executive who had owned four Re/Max offices and a title company, to help run the brokerage.
That helped stabilize the company through growth spurts, as Gooden explains: “We didn't have a lot of experience. we were just lead producers.”
Creation of complementary corporate structure
Entrepreneurs have borrowed the distinct systems of different business models, from both real estate firms and Silicon Valley tech startups, to “build the company we'd want to work with if we were agents.”
They cite a commitment to ongoing sales training and company culture as two of the most important parts of their business.
Gooden and Henkel have an internal technology development team of three and created their own internal social network for corporate communication.
They describe it as a cross between Twitter and Facebook, a platform that includes chat, office calendars, customer distribution, a sales board, video tutorials, software downloads, marketing materials and more.
So far agent retention has been close to 100 percent for the 100 agents currently working there, Henkel said.
“One thing we don't do is charge referral fees to agents for leads,” he added. “We see all our dealers as our business partners. Our job is to generate as many leads and opportunities as possible. Our agents' job is to turn those opportunities into happy customers.”
The latest business dive: DaneArthur.com
Agent training at the company largely involves how to handle and convert Internet leads, as over 50 percent of sales started as Internet leads from the founders' websites.
And the business couple are counting on generating many more leads with the launch of another property website, DaneArthur.comwhich they hope will increase the fee as they expand into the major metro centers of the Twin Cities, Milwaukee and Madison.
DaneArthur.com (Henkel and Gooden's middle names combined) launched in September and has every listing from every MLS in Minnesota and Wisconsin — about 100,000 every day.
Screenshot: DaneArthur.com homepage
It's the largest real estate site in the Midwest, they say.
“A lot of people don't realize that a third of our business is residential real estate. Of course, we still sell mostly recreational properties, but a third of our business is off-lake housing,” he added.
Over time, they expect DaneArthur to “beat” LakePlace.com in terms of traffic and customers.
“We're not sure how long it will take, but the wheels are in motion,” Gooden said.
Entrepreneurs have set an ambitious sales volume target. With sales forecast for 2016 of $200 million, up from $110 million last year, “our eyes are on a billion,” they said.
They estimate it will take around 500 agents to achieve this – along with a combination of acquiring independent brokerages and adding more franchises (which they just started in October 2015).
Website Design 101
What makes DaneArthur.com stand out? The fact that it doesn't.
You won't find any bells and whistles, pops of color or fancy decorations in this area. And this is the desired user experience of the founders.
Screenshot from DaneArthur.com
Gooden and Henkel are candid about the site's rather basic design, which intentionally resembles Craigslist's layout style.
“The idea behind DaneArthur is that as technology advances, everyone is building prettier, shinier, more complex websites. In our view, the majority of these sites look good, but are slow, clunky and unwieldy,” said Henkel.
“We took a step back and asked ourselves who our favorite sites were and why our list was filled with utility-type sites that get us what we want quickly, not sites with huge photos or videos that play on the home screen.”
Screenshot of a DaneArthur.com listing
Henkel notes that “brutalism,” a design style derived from the French word for “raw,” is the “hottest new trend.”
Gooden added, “It's pretty obvious that Craigslist, with over 49 million monthly users, heavily influenced our design choices. Craigslist gives you what you want and gives it to you fast — we're just trying to do the same thing here.”
“Google is very ugly, Reddit is ugly, many of the ugly sites are the most popular — we hope to join that category.”
Speed, SEO and how to start
So users might not describe DaneArthur.com as “easy on the eyes,” but speed is the other side of the minimalist coin.
The founders say they split-tested DaneArthur.com with the big local, state and national websites.
And on average, users were able to navigate to the listings they were interested in in less than half the time it took on other sites. In some cases, it was less than a quarter of the time, according to the duo.
While DaneArthur doesn't seem like a slam dunk as a website name — and it looks potentially problematic for SEO, the founders (who consider themselves SEO experts) are confident in their decision because they've been successful in dominating the SERPS (search engine results pages search) with their current locations.
SEO is not a short-term plan. it's a long game and you have to stay on top of it every day for years, Gooden said. As for other real estate sites like Zillow or realtor.com — don't rely on them.
He added: “We push our listings to as many sites as we can, but the impact is barely measurable. We rely on our own technology.”
As the group expands its online footprint, is there a possibility of expansion beyond the borders of Minnesota and Wisconsin?
One day, maybe.
“Right now we're focused on Minnesota and Wisconsin, but you never know when an opportunity will present itself,” Gooden said. “Although we've been here since 2003, we operate like a startup and can turn on a dime when necessary.”
Email Gill South.
