By Aaron Pressman and Adam Lashinsky
May 8, 2018

Experiments are fun and interesting. The real estate advertising company Zillow should know. It’s running a real-time experiment with its business that can be characterized as anything from courageous (its management’s position) to reckless (the reaction of its shareholders.)

Looking merely at the numbers, Zillow reported a fine quarter Monday. The Seattle company doesn’t make money. But it does grow quickly on top of a billion-dollar-plus annual-revenue clip. It is worth more than $10 billion and is the winner of its category, having absorbed competitor Trulia and outlasted others.

Yet Zillow isn’t satisfied. It is starting a new home-flipping business using its own balance sheet to buy, touch up, and sell homes. Wall Street hates the idea, wondering why a perfectly respectable online business would wade into the messy and highly variable world of investing real money in actual houses.

Zillow management is undeterred. “We are taking our biggest swings yet,” CEO Spencer Rascoff wrote in prepared remarks for Zillow’s earnings call with analysts. Zillow’s hoped-for profit from its “Instant Offers” business is shockingly small. Rascoff sees Zillow making $3,500 on a $250,000 home, a puny 1.4% profit. But it’s a huge market. He says 5% of the volume would be 275,000 transactions, or a “nearly $1 billion profit opportunity annually.”

RBC analyst Mark Mahaney calls the audacious plan the “father of all total addressable markets” but nevertheless cites high execution risk in downgrading Zillow’s stock.

Big bets are so much more interesting than playing it safe. Especially when someone else’s money is involved.

Adam Lashinsky
@adamlashinsky
adam_lashinsky@fortune.com

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