Getaway launches and closes $5.9m seed funding round
US: Real estate investing platform Getaway, which aims to create a new generation of investors by making real estate investing “fun, approachable and accessible”, has officially launched and closed a $5.9 million seed funding round.
The round was made up of a $4.4 million investment led by Cowboy Ventures, XYZ Ventures, Night Ventures and a group of undisclosed fintech, consumer and real estate angel investors, as well as $1.5 million in debt financing.
Unlike its tiny cabin rental startup counterpart with the same name, Getaway enables “everyday” investors to own a fractional share [starting at $1,000] of a property in its portfolio and earn monthly cash flow from rental income. The company believes that it is well placed to tackle the problem of affordability and accessibility of vacation homes, despite the high inflation and volatility of public markets.
According to Zillow and Realtor.com, the average home price in the United States has increased by 39 per cent in the last two years, and the real cost of ownership has grown by around 50 per cent in the last six months alone, accelerating the need for a “new model of real estate ownership” in Getaway’s own words.
To incentivise investors to sign up to the platform, Getaway will enable them to become members automatically and give them VIP access to its properties at member-only discounted rates.
At the time of closing its seed funding round, Getaway will launch with two properties, with The Western in Scottsdale, Arizona, going live for investment on 20 October and the Havana in Miami, Florida, becoming available soon after [though investors can now sign up for early access here].
Co-founded by Ali Nichols and Amr Shafik, Getaway joins an increasingly crowded marketplace, led predominantly by market leader Pacaso, which has raised more than $1.5 billion to date and became one of the fastest companies in history to become a unicorn [achieving a valuation of more than $1 billion].
However, while Getaway allows its investors to invest a minimum of $1,000 to buy an ownership share of a property, Pacaso shares can cost anything between $400,000 and $3 million to buy an eighth of a property.
Other marketplaces in the fractional ownership space to have raised funding this year include Miami-based Here [$5 million seed round in July], Arrived Homes [$25 million Series A round in May], London- and Athens-based proptech startup Flyway [$10 million seed and debt funding round in August] and Berlin-based MYNE Homes [$23 million / €23.5 million in seed funding round in July].
On Tuesday 1 November [4pm GMT], ShortTermRentalz will host a ‘RockSTRz’ webinar on “Timeshare, fractional ownership and membership clubs: making a comeback?” – sign up for the no-cost session at this link.