Sequoia Capital India and Founders Fund back UAE-based proptech startup Huspy in a $37 million round – TechCrunch
Founders Fund made its first investment in the Middle East by supporting UAE-based proptech startup Huspy. $37 million Series A round, one of the biggest at this stage in MENA, due to Sequoia Capital India.
The round also welcomes participation from Fifth wall, the largest VC firm that backs real estate and proptech startups. Chimera Capital has invested in the company as well as existing investors since undisclosed bead ring April last year, such as Breyer Capital, VentureFriends, COTU, BY Venture Partners and Venture Souq.
The software has disrupted every traditional industry from high volume businesses with low fare items like food to mid volume businesses with mid fare items like cars. vehicle. Trading in low volume with high fare items, the underlying real estate class, is not exempt. Startups like Open door, Place, Home page, QuintoAndarand Small flat democratized ownership and rent of houses and offices with different products.
Real estate continues to be an asset class in demand worldwide, with global commercial sales in 2021 59% more than 2020 total. While the startups above are focused on the US and Latin America, Jad Anton and Khalid Ashmawy launched Huspy in 2020 to take advantage of home buying opportunities in the Middle East.
Most real estate transactions, offline and online, in the Middle East are fragmented. According to Antoum, clients deal with more than five real estate agents before completing a home purchase; Additionally, mortgage processes are lengthy and sporadic, taking up to eight weeks to complete.
“There is a problem with no visibility and an ugly transactional process on where to start when looking for a home,” co-founder and CEO told TechCrunch on a call. “And many end up paying too much for their mortgage and not closing the house they want. This is an issue that we are planning to address. “
Antoun saw an opportunity in real estate after working for Beco Capital, a venture capital firm that backs 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 Real Estate Search Engine and other user-generated classification platforms, Huspy wants to bring streamlining and accuracy to the way users approach real estate products. Its platform features a suite of digital solutions for buyers, real estate agents and mortgage brokers.
The company’s home finance product pays banks weekly – which makes it visible on mortgages – and allows users to lock in their loans and get quotes in minutes. . According to Antoun, Huspy closes transactions for customers three times faster than other platforms. It acquired Dubai-based Home Matters this January to accelerate growth in this category.
Earlier this year, Huspy launched a second offering to complement its mortgage product: the real estate marketplace. On the platform, users will see a list of properties that they can book to tour and pay for when Huspy closes the transaction on their behalf. To summarize both business segments, Huspy starts at the top of the funnel, streamlining the process, and completing transactions on behalf of users.
“When you are a venture capitalist, you have the opportunity to see a lot of things happening. Proptech will always hold dear in my heart,” said the executive. “If you look at the space, a typical customer journey involves visiting a portal, where 25 to 30 percent of listings are fake. But every listing that we have on one platform is verified. “
For its mortgage product, Huspy partners with banks and agencies. As for its marketplace, the proptech platform integrates with dealers’ CRM through an API that allows it to list trusted properties for sale. Since Huspy has a distribution network in the real estate market by providing mortgages to thousands of customers, Huspy can convert faster than classifieds.
The CEO argues: “Our conversion rate is 90%, so every time an agent’s phone rings, they always pick up the customer on our platform compared to the portal because of the conversion. Ours is much higher.
Huspy claims to handle $2 billion in gross merchandise volume (GMV) annually, a 25% increase in monthly revenue. It makes money from charging banks 1% for each mortgage transaction and 2-3% for real estate agents when closing a transaction.
Team Huspy
Antoun said Huspy is the market leader in the UAE and has better unit economics than other proptech platforms in the region. He said the new funding will undo Huspy’s expansion as it doubles growth in the UAE and Spain, two markets with a combined $13 billion addressable market. The company – whose team includes former talent from Loft, QuintoAndar and Uber spread across Dubai and Madrid – plans to move into other parts of Europe even as it invests in technology development to meet meet future needs.
GV Ravishankar, managing director at Sequoia Capital, the lead investor in the oversubscribed round, said his firm is impressed with Antoun and Huspy’s mission to transform the home buying and financing experience in MENA area.
“In a short time, the company has proven its strong value to the real estate ecosystem and has become the market leader in mortgage brokerage in the UAE with a strong economy,” he said. healthy unit. “And the Huspy ethos to build long term with a deep focus on having the best team in the region resonates deeply with us.”
