Real property tech startup Sunroom Rentals, which leases items on behalf of property managers and condominium homeowners, has raised $11 million in a Series A spherical of funding led by Gigafund.
Ben Doherty and Zachary Maurais, former founders of the delivery app Favor, launched Sunroom in May 2018 with the mission of “boosting the profitability” of mid-size property managers and condominium homeowners by giving them a approach to outsource their leasing operations.
The pair bought Favor to Texas grocer H-E-B in 2018 and shortly after shifted their give attention to constructing out Sunroom. The Austin-based firm has developed an app that it says offers renters a approach to tour, apply for and lease a unit “entirely online.” COVID-19 has led to extra renters wanting digital methods to discover and safe rental items. Mobile-first, Maurais famous, is especially interesting to millennials and Gen Zers.
“Personally, we love to create products that fulfill consumer’s most basic needs,” mentioned Maurais, the corporate’s president. “With food under our belt, we decided to focus on housing.”
While one may surprise what the parallels between food delivery and housing may be past fulfilling shoppers’ wants, CEO Doherty mentioned the rental market in 2021 appears so much just like the food delivery market in 2013.
“In 2013, Grubhub had successfully put many restaurant menus online, but most of the transactions and delivery process was still offline,” he advised TechCrunch. “We’re in a similar position with the rental market, as the majority of rental listings are online, but touring, applying or leasing units is still done offline.”
Since its launch, Sunroom Rentals has signed greater than 2,000 leases and had over 100,000 renters enroll for its providers in fast-growing Austin, the place it centered its preliminary efforts.
“According to the U.S. Census, that represents roughly 10% of renters in the greater Austin metro,” Maurais mentioned. “Instead of going shallow and wide nationally, we decided to go deep in markets, in an effort to gain network effects, which was a strategy that worked well for us at Favor.”
Sunroom Rentals claims that it’s leasing items 5 days sooner than the market common. This advantages property managers, Doherty mentioned, as a result of they’ll develop faster “while improving leasing performance.”
Looking forward, the corporate will use the funding to broaden throughout Texas, together with in Houston, San Antonio and Dallas. It will even spend money on its companion portal, which goals to give homeowners and property managers a approach to view real-time information on leasing efficiency.
Sunroom Rentals at present has 18 staff with the objective of greater than doubling its headcount this yr. It’s specifically wanting to rent throughout its engineering, product and gross sales departments.
As talked about above, Gigafund led the Series A financing, which included participation from SubsequentGen Venture Partners, Calpoly Ventures and a slew of angel traders, together with Gokul Rajaram (Google & Square) and Homeward’s Tim Heyl, amongst others. Existing backers embrace Founders Fund Seed, Draper Associates, Boost VC and Capital Factory (amongst many others). The spherical marked Sunroom’s first “priced” spherical, that means the primary time it’s given up inventory.
Jonathan Basset, managing companion at SubsequentGen Venture Partners, believes Sunroom was basically in the best place on the proper time and “on trend with touchless leasing even before COVID hit.”
“I watched them build a profitable consumer marketplace in a competitive market with Favor and was impressed with them as operators,” he mentioned. “These companies have a stunning quantity of similarities and I’m assured they’ll rise to the problem.
Last week, TechCrunch reported on the raise of one other startup working on this more and more crowded house. Seattle-based Knock — an organization that has developed instruments to give property administration corporations a aggressive edge — raised $20 million in a development funding spherical led by Fifth Wall Ventures.
Knock’s objective is to present CRM instruments to modernize entrance workplace operations for these corporations to allow them to do issues like supply digital excursions and talk with renters by way of textual content, e mail or social media from “a single conversation screen.” For renters, it provides a neater approach to talk and interact with landlords.
Maurais mentioned the 2 differ in that Knock is a CRM constructed for leasing brokers with a SAAS mannequin the place as Sunroom is a market, the place renters match, tour and apply with partnered properties.
“Sunroom also provides a suite of leasing & analytics software to its partners and generates both transactional and subscription revenues,” he added.