Proptech company HouseME has successfully closed another round of multimillion-rand funding.
HouseME is a digital long-term letting platform that makes renting easy and accessible for both landlords and tenants. The startup won first prize at the 2018 Cape Town Seedstars Summit, one of the legs of the world’s biggest startup competition in emerging markets.
The latest round of investment comes via a large private fund which undertook an extensive external consultancy project on the company, market and product before investing. Their analysis estimates HouseME’s market size to be valued at over R120-billion per year in South Africa alone.
Previous investors include a financial services provider and a property development company, bringing total investment to several million dollars since the founders first embarked on building the rental company in 2015.
Ben Shaw, CEO of HouseME, says that the past few years have seen funding spend becoming more targeted to data insights, financial products and growth. “Earlier this year, we launched our hugely disruptive DepositFREE product and we have another ground-breaking liquidity product in the pipeline for launch in early 2020.
“This funding now helps position the company for Series-A investment, with a focus on data architecture, analytics and scalable growth strategies. Our collaboration with Gumtree at the end of last year raised our profile considerably, and the platform and team have grown substantially since that was announced,” says Shaw.
HouseME currently boasts a user base of 100 000 and a collection rate of 99% – higher than the national average.
HouseME’s DepositFREE – which enables tenants to lease a residential property without paying an upfront deposit – has successfully seen HouseME take tenant default risk on behalf of the landlord, and is thriving.
The product eases the liquidity burden for tenants, particularly in the current economic climate, while providing landlords with the peace of mind that a deposit brings.
The proptech company is able to provide full coverage against the value of the deposit because of the rigorous smart technology-driven tenant vetting process it has implemented since inception.
HouseME’s rental guarantee, which since inception has ensured that landlords are paid on time every month, is still available through the platform, and HouseME’s transparent, digital PlaceME tool ensures that landlords get the best price and tenants don’t face any discrimination.
HouseME is a South African first, and costs landlords as little as 2,5%. Using smart technology, HouseME digitally co-ordinates the complete viewing, vetting, administration and payment process.
Since it was first founded in Cape Town in 2016 by two young South African entrepreneurs, HouseME has achieved a nationwide footprint and grown 12-fold.
Fast facts about HouseME
* Almost all (99.0%) of HouseME’s rentals are paid in full by tenants. This is higher than the national average of 82% of tenants who end up paying.
* HouseME’s fee from 2.5% of rental is less than one third of the industry average of 8,3%.
* HouseME’s property portfolio is growing by almost 8% per month, and its userbase of tenants and landlords is growing by more than 6 000 a month.