£8M Funding For ‘Sell In 90 Days’ London Estate Agent
The innovative London-based start-up Nested, which guarantees to sell your house within 90 days, has raised a further £8 million in funding from investors.
Launched in January last year, the company has now raised a total of £11 million thanks to backing by venture capitalist groups and individuals.
The ‘Win-Win’ USPs
The big difference between Nested’s and other estate agent’s offerings is that Nested guarantees to sell a client’s house for 95-98% of market value within 90 days. It also says that, if it does achieve a higher sale price than the one it guaranteed/offered, either before or after the 90 days, it will split the difference, up to 70/30 in favour of the property owner.
The big benefit to customers that these USPs provide is to take away the uncertainty that the house selling process brings, particularly where the presence of a chain is concerned, or where the house has been on the market with an agent for a few months or longer, and nothing has happened. In both cases, the seller is essentially looking for speed in what has become a crowded housing market, as well as getting a good price, and the USPs that Nested offers appear to be a way to achieve those aims.
Technology Behind The USPs
How the company uses technology and data to accurately price property in the first place are the competencies that have enabled them to build and deliver upon their USPs.
Who Has Invested?
The recent round of investment saw contributions from Passion Capital, GFC (Rocket Internet’s venture arm), and Tim Bunting, who is a partner at Balderton Capital and former Vice-Chairman of Goldman Sachs International.
Broke-Even In Month Four
So far, Nested have proven to be very popular, and figures from the company show that they have an average of 5 clients per month. This translates into an annual run-rate of more than £1 million, and helped the company to reach the break-even point in only the fourth month of trading.
The founders of Nested are reported to believe that, with the funding, and with their unique position in the estate agent marketplace, they are able to achieve 1,000+ sales per month in the not-too-distant future. This, no doubt, will make them even more attractive to any future investors and potential stakeholders, and could trigger a round of me-too offerings from existing and new competitors.
Companies such as Purple Bricks have already paved the way for customers to be more accepting of (and more likely to consider) different types of less traditional estate agent models.
What Does This Mean For Your Business?
This story illustrates how technology-fuelled innovations in existing markets that provide solutions to long-standing challenges can be incredibly attractive to both investors and customers. It also highlights how the technology and the web, and the success of innovative, other technology-fuelled companies have given more options for funding, and have speeded-up the process of bringing new products to market. This creates more potential opportunities for all companies, including start-ups. This story also highlights the fact that, if your company can be particularly smart in how it uses data and technology, it may be possible to create a hard-to-copy competitive advantage.