US: Atlanta based affordable housing startup Padsplit has received $10m in a Series A funding round led by Core Innovation Capital.
Other investors include Alate Partners, Citi, Kapor Capital, Impact Engine and Cox Enterprises.
Padsplit was founded by Atticus LeBlanc, a local developer and entrepreneur, to help create a marketplace for affordable properties on the market. Homeowners can list rooms on the website, all of which include access to laundry and wifi, while the company provides access to telemedicine services and reports payments to credit reporters to help renters build credit.
Leblanc told TechCrunch: “We sit between a hotel provider and a longer-term apartment. Where we need to both be an immediate housing provider for people who are in difficult situations while also underwriting that [person].”
Padsplit was founded in 2017 after LeBlanc was inspired by a housing centric entrepreneurship challenge in the city. The plan won that challenge, receiving a small grant from HouseATL and JP Morgan Chase.
After seeking advice from short-term rental leader John O’Bryan, the company began to build up its infrastructure. It would then go on to graduate from the Techstars accelerator.
Founder and managing partner of Core Innovation Capital Arjan Schütte said: “PadSplit provides a truly unique solution to a complicated national problem that’s becoming more dire each day. We’re proud to support Atticus and the PadSplit team as they expand into new markets and introduce critical housing supply at a time when so many require affordable housing.”
The company’s rental rates sit between $140 and $250 per week, far below the average weekly rent in Atlanta. It claims the model can both make money and save create tax relief, claiming it has saved taxpayers over $203 million in subsidized housing costs.
Padsplit currently has a portfolio of over 1,000 rooms in Atlanta and has been attempting to move into Maryland as well. With the injection of new funding, it plans to enter the Houston housing market.