London-based real estate fintech startup IMMO raises €72 million to accelerate growth

IMMO-founders

IMMO Investment Technologies has today announced a funding round totalling €72 million, with €11.5 million in equity from prominent investors Talis Capital, HV Holtzbrinck Ventures, Tom Stafford & Rahul Mehta of DST Global, Mato Peric amongst others. The company is currently finalising a second round closing with value add investors. Further €60 million capital was raised from real estate investors for deployment through the company’s residential platform.

Founded in 2017, IMMO digitally sources, appraises and acquires centrally located properties at scale on behalf of institutional investors. The acquired properties are upgraded and turned into a fully-furnished “living as a service” homes targeting the long-term rental market.

The latest funding round marks an important milestone for the London-based startup, which has sourced €35 million in properties since its first market launch in Sepember 2018. From renting furnished IMMO homes as a young adult to selling a house to IMMO later in life, the company’s vision is to become “Your housing partner for life”.

Founded by Hans-Christian Zappel (Davidson Kempner, Forbes 30U30), Samantha Kempe (Blackstone) and Avinav Nigam (P&G), IMMO buys residential properties directly from consumers on behalf of professional investors, thereby helping consumers sell their homes effortlessly and providing investors with desired real estate exposure at scale. IMMO homes are fully renovated/furnished, meaning tenants enjoy high-quality, long-term rental homes that are professionally managed.

Hans-Christian Zappel CEO & Founder of IMMO said: “Selling a property is the biggest and often most stressful transaction in our lives. It takes on average 19 viewings and many months to identify a buyer. About 40% of transactions still fall through at that point due to financing risk, changing circumstances and minds. When selling to IMMO, customers enjoy a chain-free, professional experience that is fast, reliable, transparent and convenient. We offer attractive prices without charging fees and enable homesellers to plan their lives around this important transaction.”

He continued: “For our tenants we strive to provide the best rental product and experience in the market. IMMO homes are always modernised to a high standard, beautifully designed and furnished. We want our tenants to have the comfort of knowing that they will feel at home in their IMMO apartment.”

Vasile Foca, Managing Partner at Talis, stated: “The IMMO team has impressed us with their vision and track record in building technology companies. IMMO is uniquely placed to revolutionise residential real estate by connecting consumer supply with institutional demand. They are solving major pain points for sellers and tenants, and poised to build a mega brand. IMMO’s data-led ability to unearth and secure properties at scale in a streamlined way using technology has, for the first time, unlocked the opportunity for institutional capital to be deployed in this asset class. We are excited to join the IMMO team on this next chapter of growth.”

Professional investors love residential real estate due to its attractive risk-adjusted returns profile, however deploying capital at scale is very challenging despite the fact that residential is the largest asset class in the world (€39 trillion in Europe alone). Single units account for 94% of all residential real estate transactions, but as valuing and acquiring 1,000s of single units has so far been practically impossible, investors were restricted to deploying in the empty market of portfolios and multi-family developments. IMMO has built the technology to source, appraise and acquire single units at scale, thereby opening up a single unit residential real estate as a new asset class for institutional investors.

In just one year, IMMO has assessed over 6,000 property leads (€2.2 billion) using proprietary machine learning technology, reducing the underwriting process from days to a matter of minutes. IMMO’s inspection team collects 281 data-points on every property. The IMMO Intelligence combines this property level data with millions of environmental data-point such as traffic nodes, crime statistics, school/restaurant/airbnb ratings, distance to supermarkets etc. to come up with an offer price for the seller. It is this speed and accuracy that allows IMMO to buy properties at scale directly from sellers.

Avinav Nigam, COO & Co-founder of IMMO stated: “Fundamentally, IMMO’s Consumer-To-Business (C2B) model is backed by the more resilient rental market as investors’ willingness to pay is based on the asset’s ability to earn a rental return, effectively making our model ‘weatherproof’. The traditional iBuyer Consumer-to-Consumer (C2C) model relies on liquidity in the sales market, that dries up during economic uncertainty. Furthermore, IMMO operates a “balance-sheet light” model – we do not buy properties on our books, and hence don’t take capital risk. By comparison, traditional iBuyers have full capital risk exposure.”

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