SoftBank and Lovato back June Homes in raising $50m in funding
US: New York-based proptech startup June Homes has emerged from stealth and announced that it has raised $50 million in funding.
The funding round was led by SoftBank Ventures Asia, with participation from TQ Ventures [Scooter Braun, Schuster Tanger, Andrew Marks], FJ Labs, K50, Reshape, Quiet Capital, and angel investors including Demi Lovato [musician and human rights activist] and Scott Belsky [founder of Behance].
The $50 million in equity financing includes a recently raised $27 million Series B, as well as a previously unannounced $13 million Series A and $10 million in seed funding. The capital is expected to go towards fuelling the company’s expansion to other US markets and furthering its mission to create a “more fair, transparent, and efficient real estate system”.
According to June Homes, the current rental system is “broken”, both for tenants and small landlords.
For tenants, upfront costs associated with renting are “exorbitant”, outdated approval requirements are “often unattainable”, and year-long lease lengths are binding. The process of renting an apartment is “cumbersome, time consuming, slow-moving, and full of excessive paperwork”.
For landlords, long vacancies, broker and management fees, and Covid-related eviction moratoriums “put ‘mom and pop owners’ at risk of losing their generational wealth”.
The company says that it has built an algorithm that detects apartments with untapped potential [often in disrepair] and developed a process to inspect, upgrade, renovate, and list units for rent in just under 72 hours.
With fully customisable homes, June Homes tenants can rent furnished or unfurnished, with roommates or alone, and have the option to stay for as long as they like [between one and 18 months]. It says that unlike other short-term corporate housing companies that up-charge tenants by up to two times for flexibility, June Homes’ rental rates are more in line with the price range for traditional leases.
On the landlord side, June Homes serves as a turn-key partner that seeks to eliminate broker and management fees, and ensure that properties are filled with tenants ten times faster than traditional legacy systems.
Led by real estate entrepreneur, and founder and CEO, Daniel Mishin, June Homes claims to have already signed on “thousands” of tenants across New York City, Washington DC, San Francisco, Los Angeles, Philadelphia and Boston.
Over the last six months, the company has also reported a 150 per cent increase in tenant demand and a 137 per cent rise in unit growth.
Mishin said: “June Homes runs much deeper than addressing a desire for flexible living, which is now table stakes in today’s world. By eliminating middlemen and outdated practices from the rental system all together, tenants and ‘mom and pop’ owners benefit financially and emotionally.”
Sherman Li, partner at SoftBank Ventures Asia and June Homes board member, said: “Innovation in the rental market is long overdue, and we believe that June Homes’ modern approach will solve major pain points for both tenants and landlords. June Homes lives at the intersection of a few trends that have lasting effects – broken rental system, hybrid / remote workforce, and a challenging housing market.
“We’ve watched the June Homes team tackle problems in the space and redefine the market by providing more efficient and reliable services. We are excited to be part of the journey,” added Li.
Since its founding, June Homes has seen early success amongst millennials and Gen Z professionals who value ease, convenience, accessible pricing, and customisation.
Demi Lovato, who invested as part of the company’s Series A last year, said: “Finding a home should be an exciting chapter in life but instead is one of the most stressful things that our generation struggles with, and June Homes hopes to change that.”
In addition to the funding, June Homes has announced that chief financial and strategy officer, Daneel Siddiky [formerly Amazon / Audible], chief of staff, Mauricio Zuniga [IBM], chief people officer Jennifer Gardner [Casper], VP of brand, Erin Abernathy [Feather], and VP of performance marketing, Mateus Rocha [Skyscanner, Expedia], will join the company’s new-look leadership team.