AH Belo Invests in Real Estate Pay-for-Performance Site

Newspaper companies are so far down we don’t pretend to offer comprehensive fixes anymore. That’d be science fiction. But we do track the incremental investments that leverage their strengths and often prove to be strong profit centers in themselves.

Last year, we noted AH Belo‘s $2 million investment in ResponseLogix — an auto dealer leads management program. Now we’re noting another Belo investment, this time in Sawbuck Realty, which takes advantage of its broker’s status to list 100 percent of local MLS listings, rather than the portion that typically ends up in a newspaper from a la carte MLS deals and broker listings.

The service collects leads and funnels them out to agents, like RealEstate.com does. The  similarity to RealEstate.com extends to its guaranteed discount referrals for mortgage brokers and escrow  agents.

What is unique about Sawbuck is its business model. It generally takes 30 percent of a Realtor’s commission, which is the same as a typical “referral fee.” The fee may ultimately come out higher than advertising would — but it protects the agent/broker because it is pay for performance. And home buyers are guaranteed savings. The Sawbuck service runs separately from other newspaper real estate advertising, which will remain available.

Belo is leading a $2 million round, with cofounders Guy Wolcott and Steve Barnes also participating. Some of that money will be used to extend Sawbuck Realty beyond the D.C. metro area into several new markets, including all three of Belo’s major markets — Riverside, California; Dallas; and Providence.

Just launched are services in Southern California, including San Diego, Los Angeles/Orange County and Riverside/Inland Empire, where Belo publishes The Press-Enterprise. Sawbuck launches in Dallas and North Texas launch in early August. It is also launching services that month in the San Francisco Bay Area and Chicago. In October, it launches in Providence.

Sawbuck’s pay-for-performance model is similar to Zetabid‘s model for selling and listing foreclosures, which has been a major effort for the LA Times.