Angie’s List: Giving Homeowner’s Peace of Mind

In this two income family world, it has become harder and harder to find reliable contractors to take care of home projects.  Before, you could talk to your neighbors and get a recommendation for the best person to take of the job.  The contractors knew that if they did not perform, then they would not be rehired in that area.  However, times change and that neighborhood network may not be as strong anymore.  Furthermore, with both spouses working, time is too valuable to waste on poor quality work.

Enter Angie’s List.  Bill Oesterle and Angie Hicks founded Angie’s List in 1995.  It started out simple enough as Hicks helped her boss Oesterle find a contractor for a home project.  They realized that there was a demand for this type of service and started a phone-based referral business.  This type of business was ready-made for the fast growing internet and their timing could not have been more perfect.

They quickly realized that the beauty of internet was its ability to disseminate information.  The phone and publication service was replaced by an online service where people could post reviews of plumbers, builders, electricians, cleaning services, etc.  The challenge was to ensure that this information is reliable.  Anyone who has ever checked a review on the web knows that a minor glitch by a contractor can become a melodrama.  Furthermore, there is an old saying that if someone has a good experience, they will tell one or two people; however, if they have a bad experience, they will tell twenty people.  The internet is no different.  Therefore, to avoid bias, Angieslist.com employees review postings to ensure fairness.

Creating a quality website and a quality company has paid off for both Angie’s List customers and its clients.  Despite being a relatively mature business, revenue increased over 60% last year and over 130% in the past two years.  The company will need to focus on profitability, but clearly has a business model that customers appreciate.

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