A Maine-based iBuying startup raised eight figures from investors to ramp up its business with a focus flipping properties in low-income neighborhoods, a departure from traditional iBuyer models.
Simply Homes raised $22 million in a recent fundraising round co-led by Gutter Capital and Watchung Capital, TechCrunch reported.
The company uses artificial intelligence tools and technology to acquire, renovate and manage properties; its property management arm holds the houses long-term. The startup’s chief executive officer, Brian Bagdasarian, told TechCrunch the company aims to solve the housing affordability crisis while simultaneously making a buck.
Simply Homes makes money by collecting rent to cover property management, taking a transaction fee and an ongoing 3 percent fee to manage its portfolio.
The company, founded in 2020, didn’t make its first home acquisition until the beginning of this year, but expects to have 108 homes or units in its portfolio by the end of 2023. It reported revenue grew by more than 50 percent quarter-over-quarter since its January launch.
The company factored in high interest rates from its inception, according to Bagdasarian, and relies on a majority of customers paying 30 percent of their adjusted monthly income through HUD’s Housing Choice Voucher program. The voucher covers the rest.
Simply Homes operates in Pittsburgh and Cleveland, but is looking to expand to Baltimore and parts of the Midwest, targeting areas with stable housing markets. It also plans on using its fresh funds to develop AI-powered virtual analysts for acquisition decisions.
Other participants in the fundraising round included Village Global, Ambush Capital, RavenOne Ventures, Neil Parikh, Gabe Flateman and Luke Sherwin.
— Holden Walter-Warner
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