Purplebricks sets sights on NYC expansion after $177M investment

Axel Springer's funds gives it an 11.5 percent equity stake

New York /
Mar.March 26, 2018 06:10 PM

Eric Eckardt (Credit: LinkedIn)

Purplebricks, a London-based discount brokerage, said Monday it received an $177 million equity investment from German media group Axel Springer SE to accelerate its expansion to New York.

The company, which launched in 2014, said it would earmark $71 million of the cash infusion to ramp up operations in the United States. Purplebricks now plans to launch in New York next month, instead of in July.

In a statement, Eric Eckardt, Purplebricks’ U.S. CEO, said the $71 million will go toward expanded advertising as well as “strategic hires that will bolster our growth.”

The deal — which gives Axel Springer an 11.5 percent stake in Purplebricks — reflects investor interest in lower-cost brokerage options. Last year, Seattle-based Redfin went public in a highly-anticipated IPO. Redfin’s 2017 revenue soared 38 percent to $370 million in 2017, but it lost $15 million.

Purplebricks debuted in Los Angeles six months ago, on the heels of a $60 million investment from investors. The publicly-traded company has a market cap of around $1.08 billion, compared to$341.85 million when it went public in 2015.

Despite its rapid growth, Purplebricks has been stung by controversy after the investment bank Jeffries questioned its sales figures. It was also slapped on the wrist by an advertising watchdog in Australia over misleading ads promising “low, fixed fees.”


Related Articles

arrow_forward_ios
Sam Zell with a RVC Outdoor Destinations site (Getty, RVC)
Sam Zell’s Equity Lifestyle Properties invests $147M in manufactured homes
Sam Zell’s Equity Lifestyle Properties invests $147M in manufactured homes
Gregory Russ, chair and chief executive officer of the New York City Housing Authority (NYC.gov NYCHA, iStock)
NYCHA fires 18 workers in overtime pay probe
NYCHA fires 18 workers in overtime pay probe
Jeff Aronson (iStock, Jeff Aronson, CC BY-SA 2.0, via Wikimedia Commons/Photo Illustration by Steven Dilakian for The Real Deal)
Centerbridge closes $2B real estate fund
Centerbridge closes $2B real estate fund
Scott McIntyre, chief executive officer, Guidehouse (Guidehouse, iStock/Photo Illustration by Steven Dilakian for The Real Deal)
New York rent relief contractor boasted about profits as program struggled
New York rent relief contractor boasted about profits as program struggled
Smile! BDG nabs $125M refinancing at Harlem multifamily
Smile! BDG nabs $125M refinancing at Harlem multifamily
Smile! BDG nabs $125M refinancing at Harlem multifamily
Vector Group/Douglas Elliman's Howard Lorber (iStock, Getty Images, Vector Group Ltd., Douglas Elliman)
Howard Lorber’s $1.8M salary at Elliman offset by Vector pay cut
Howard Lorber’s $1.8M salary at Elliman offset by Vector pay cut
Fredrik Eklund with Tyler Whitman, Ryan Serhant, and Kirsten Jordan and Steve Gold (Getty, Bravo TV)
“The end of an era”: Fredrik Eklund quits Million Dollar Listing
“The end of an era”: Fredrik Eklund quits Million Dollar Listing
BHS CEO Bess Freedman and BHS agent Madison Sutton (BHS, iStock)
Brown Harris Stevens adding TikTok training to its arsenal
Brown Harris Stevens adding TikTok training to its arsenal
arrow_forward_ios

The Deal's newsletters give you the latest scoops, fresh headlines, marketing data, and things to know within the industry.

Loading...