In Seattle, the real estate technology scene is pretty crowded. There’s the big 3: Zillow, Redfin, HouseValues. And then, there’s the cool 3: ActiveRain, Estately, and RealTech. Well, there’s another company in town, which will soon be joining the party.

Bellevue based, SecondSpace, was founded by Classmates.com executive Anil Pereira and former Microsoftie Alok Sinha, SecondSpace landed $6.6 million in venture funding from Ignition Partners over a year ago. Alok (their CTO) & Delane Hewett (their Software Architect) both had stints in the MSN HomeAdvisor teams (back in the Web 1.0 days), so they know the internet real estate space better than most new comers.

Pat Kitano of Transparent RE, talked about them 6 months ago when they came out of stealth mode, and starting flying under the radar. The most interesting thing about the company’s business plan is that they are attacking what appears to be small vertical niche. However, one does not talk venture capitalists into writing big checks for thinking small. Their sites, ResortScape.com and LandWatch.com are currently targeting consumers looking for vacation homes and vacant land. In future, they’ll probably target time shares, vacation homes in foreign countries, non regional visitors, and other second home ownership opportunities with additional sites targeted for those niches.

Technologically speaking, they have some very compelling technology under development and a very talented technical staff. On their blog, They’ve talked about using SOLR & Lucene as the basis for their search engine, which should give them a near term advantage until somebody does the same thing or writes a check for Endeca. The neural network based learning they employ, should help visitors find interesting properties easier (think of a Google-like search experience tuned for real estate) and it allows them distribute more qualified traffic to their customers (brokers, developers, etc) than a traditional means would allow. They also have even more interesting features on the drawing board, that I’m probably not at liberty to discuss, but I can say their job posting on Craigslist drops some big hints.

However, given that they only have 70,000 listings at the moment; it’s difficult to fully appreciate the impressive technical infrastructure they are building until they have more data to test it with. It’s kind of like test driving a Corvette on a short pot-hole filled road. You just know it performs better than the conditions will allow for. The problem is until the test track improves, you don’t really know how much faster the car really is.

The real question is there a market for a second home or vacation home real estate web portal, when the first home real estate market is struggling? And is that opportunity worth the millions Ignition Partners is investing? For comparison sake, a typical NWMLS IDX web site has about 56,000 listings right now and popular real estate blogs currently have a larger reach than Landwatch.com (their largest site). Even with hockey stick growth of 10,000 new listings a month, it’ll be another 7 years before they hit the million mark (which I think is the magic number of listings you need to have to be taken seriously if you have big aspirations). I think the only people that read their blog are their employees, their VC’s and I. I think they need more a LOT more listings and a LOT more traffic before they are taken seriously by the general population. That hockey stick growth better turn exponential or they better have very patient investors.

Perhaps most disconcerting, they have no visible marketing push, and no real buzz in RE.net blog-o-sphere. Maybe, they are just flying under radar of the public eye until their technological terror is fully operational? Maybe it’s because their business model and the community they serve are so different than the ones the titans Web 2.0 real estate are currently serving, that they don’t need to play by the same rules? Maybe developers don’t feel the need to read or comment on blogs? Maybe their business development leaders needs to read Seth Godin or Dustin Luther?

All I know is that sooner or later, they’ll need to soar above the clouds with after burners at full throttle or crash back to earth. They can’t fly under the radar forever with the firepower they are packing… Anyway, I’m going to be watching this company very closely. The technology under development is too compelling and the business plan is too interesting to stay under the radar at cruising speed for much longer. Will 2008 be the year SecondSpace goes supersonic?