Sequoia Capital India and Founders Fund support proptech startup Huspy in the UAE in its $37 million seed round – TechCrunch

Sequoia Capital India And Founders Fund Support Proptech Startup Huspy In The Uae In Its $37 Million Seed Round – Techcrunch

The Founders Fund made its first investment in the Middle East by supporting Huspy, a proptech startup based in the United Arab Emirates. The $37 million Series A round, one of the largest to date in the MENA region, was led by Sequoia Capital India.

The round also received participation from Fifth Wall, the largest venture capital firm supporting real estate and proptech startups. Chimera Capital invested in the company, as well as existing investors from its undisclosed seed round last April, such as Breyer Capital, VentureFriends, COTU, BY Venture Partners and Venture Souq.

The software disrupted all traditional industries, from high-volume deals with low-cost items like food, to mid-volume deals with mid-priced items like vehicles. Low-volume deals with high-priced items, the category that real estate falls into, are not exempt. Startups such as Opendoor, Place, HomeLight, QuintoAndar and Loft have democratized access to ownership and rental of homes and offices with a variety of products.

Real estate remains an in-demand asset class around the world, with 2021 global commercial sales volumes surpassing the 2020 total by 59%. While the above startups focus on the US and Latin America, Jad Antoun and Khalid Ashmawy launched Huspy in 2020 to capitalize on the opportunity to buy homes in the Middle East.

Most real estate transactions, offline and online, in the Middle East are fragmented. According to Antoum, clients hire more than five brokers before closing a home purchase; In addition, mortgage processes are long and piecemeal, taking up to eight weeks.

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“There is a problem with zero visibility and a bad transaction process to start with when looking for a home,” said the co-founder and CEO of TechCrunch in a call. “And a lot of people end up paying too much for their mortgage and not closing the house they want. This was the problem we set out to solve.

Antoun saw an opportunity in real estate after working for Beco Capital, a venture capital firm that supported Property Finder, one of the largest real estate portals in the region. The company is also an investor in most Middle Eastern unicorns such as Swvl, Kitopi and Careem.

However, unlike Property Finder and other user-generated classifieds platforms, Huspy wants to simplify and clarify how users access real estate products. Its platform offers a suite of digital solutions for homebuyers, real estate agents and mortgage brokers.

The company’s home finance product removes banks weekly – giving mortgages visibility – and allows users to lock in their loans and get quotes in minutes. According to Antoun, Huspy closes the transaction for customers three times faster than other platforms. It acquired Dubai-based Home Matters last January to accelerate growth in this category.

Earlier this year, Huspy launched its second offering to complement its mortgage product: a real estate market. On the platform, users see a list of properties they can book to view and pay for when Huspy closes the deal on their behalf. To summarize the two business segments, Huspy starts at the top of the funnel, streamlines the process and transacts on behalf of users.

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“When you’re a venture capitalist, you get to see a lot of what’s going on. Proptech has always been dear to my heart,” said the CEO. “If you look at space, a typical customer journey is visiting the portal, which has 25-30% false ads. But all the ads we have on a platform are verified.

For its mortgage product, Huspy partners with banks and agencies. For its marketplace, the proptech platform integrates with the agencies’ CRM through an API that allows you to list trusted properties for sale. As Huspy has a distribution network in the real estate market due to its mortgage game with thousands of customers, it is able to convert faster than classifieds.

“Our conversion rate is over 90%, so every time an agency’s phone rings, they’re still getting clients from our platform versus a portal because our conversion is so much higher,” explained the CEO. .

Huspy claims to process $2 billion in annual gross merchandise volume (GMV), increasing revenue by 25% month-over-month. He makes money by charging banks 1% per mortgage transaction and real estate agencies 2-3% to close a deal.

Sequoia Capital India And Founders Fund Support Proptech Startup Huspy In The Uae In Its $37 Million Seed Round – Techcrunch

The Huppy team

Antoun says Huspy is a market leader in the UAE and has a better unit economy than other proptech platforms in the region. He said the new financing would boost Huspy’s expansion as it would double its growth in the UAE and Spain, two markets with a total addressable market of $13 billion. The company, whose team is made up of talent formerly from Loft, QuintoAndar and Uber split between Dubai and Madrid, plans to expand to other parts of Europe while investing in technology development to meet future demand.

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GV Ravishankar, managing director of Sequoia Capital, the lead investor in the oversubscription round, said his company was impressed by Antoun and Huspy’s mission to transform the experience of buying and financing a home in the MENA region.

“In a short period of time, the company has demonstrated its strong value proposition to the real estate ecosystem and has become the market leader in mortgage brokerage in the UAE with a healthy unit economy,” he said. “And Huspy’s philosophy of building for the long term with a focus on the best team in the region resonates deeply with us.”

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