Large private equity players made big bets in late-stage PropTech venture capital funding rounds totaling nearly $3.30 billion to companies like WeWork, Nested and Property Finder in the month of November, according to RE-tech.
A mix of venture capital from private equity and debt financing from institutional investors poured the lion share of funds into co-working and home buying/selling applications offering consumer-facing Proptech solutions ripe for market expansion.
WeWork secures $3 billion from Softbank
Softbank Group continued to bankroll its biggest PropTech investment, WeWork, now the largest occupier of office space in New York City.
The New York-based co-working company signed a $3 billion warrant with SoftBank Group in return for providing SoftBank with the opportunity to buy shares before September 2019 at a price of $110 or higher if WeWork goes public, is acquired or raises a $1 billion round before that date.
This latest funding round brings WeWork’s valuation to a whopping $42 billion, according to the company.
If the WeWork kept up its September sales pace for the next 12 months, it said, its revenue would exceed $2 billion for the year, according to Bloomberg.
London-based PropTech startup secures $150 million
Nested, is a London-based real estate agency that provides cash advances to home buyers before selling an existing property, has raised £120 million, close to $152 million in funding private equity and debt: £20 million and £100 million, respectively, last month.
With Nested loans, homebuyers can borrow up to 95% of the value of their home, as a cash advance for a 2% to 4% fee, while the company sells their home.
The ability to pay in cash and close fast adds significant advantage and leverage in property negotiations when competing with multiple buyers in multi-offer situations in tight housing markets.
The company says the buy first business model keeps checks and balances and incentivizes its team to sell client homes for the best price possible.
Property Finder secures $120 million makes play for Middle East market share
Dubai-based Property Finder, which owns and operates real estate portals across Dubai available in English and Arabic, secured $120 million in late November from private equity investor General Atlantic, which led the round and participation from an existing shareholder, Vostok New Ventures Ltd.
Its websites provide nearly 6 million visitors each month with search facilities covering both residential and commercial properties for sale and rent, real estate news, home advice, and buying and selling guides.
Currently, the market leader in the Middle East, Property Finder plans to expand from its existing presence in UAE, Qatar, Bahrain, and Lebanon, and grow market share in Egypt, Saudi Arabia, Morocco, and Turkey.
The company stated it plans to use a portion of the funds to deliver on its strategy to build innovative products which provide transparency, data insights and an overall better experience for property seekers.