Rentable, an online multifamily rental and property management platform, raised $22.5 million in Series B funding.
Private equity and venture capital firm Susquehanna Growth Equity led the round, Rentable said. Other investors included 4490 Ventures and Flyover Capital, both of which had participated in the startup’s $5 million Series A round in 2016.
The capital raise saw a “significant increase” in valuation relative to Rentable’s last round of financing, the startup said. It did not offer a specific valuation figure.
Madison-headquartered Rentable, which launched in 2013, aims to lift the apartment rental market out of what co-founder and CEO Alec Slocum described as the “classifieds era” and make the rental process as fluid and intuitive as other e-commerce avenues.
Rentable also creates tools for property owners that streamline listing, leasing and management. Unlike legacy competitors such as Rent.com or Apartmentguide.com, Rentable prioritizes smaller-scale, or mid-market, landlords that otherwise might be priced out of the online marketplace.
Addressing the listing and management problem for landlords simultaneously fixes the search problem for renters, Slocum said.
“To really change the search experience for renters, you can’t just add another filter and create a new screen,” Slocum told The Real Deal. “You need to unlock new content, new technology that really solves the friction points that renters experience.”
Rentable’s revenue nearly doubled in 2020 as the country was in lockdown, the startup said. Armed with the new funding, the company plans to double its workforce over the next year with new hires in sales, product, engineering and business development.
Josh Elser, managing director at Susquehanna Growth Equity, described Rentable’s position in the marketplace as a “dream scenario” — young renters are starved for a sophisticated online marketplace at a critical juncture in their financial lives.
“The old, big players can’t really change their ways, and they’ve created an environment where companies like Rentable have big room to improve and grow,” he said.
Susquehanna Growth Equity, a subsidiary of the trading and technology firm Susquehanna International Group, focuses on growth-stage software, internet and data companies with revenue of $5 million to $50 million. It does not raise outside capital, and so can be flexible with check size, deal structure and timing, Elser said.
In recent years, Susquehanna has made about five investments in proptech, which Elser said is finally driving “real impacts in terms of dollars and returns.”
“The dollars are massive, the technology is finally hitting, a lot of the companies that were early are reaching critical scale, and the capital markets have opened for exits,” Elser said. “The perfect storm is here for proptech growth-stage investing.”