Fintech and PropTech are two sectors that are seeing rapid growth in Latin America, as financial services and real estate are two categories, in particular a sector that is in dire need of innovation.
Brazil’s QuintoAndar, which has developed a real estate marketplace focused on rentals and sales, has seen impressive growth in recent years. And today, Sao Paulo-based PropTech has announced that it has closed on $ 300 million in Series E round funding that puts it at an impressive value of $ 4 billion.
The round is notable for a few reasons. For one, the valuation – more than any standard but especially for a LatM company – represents a four-fold increase from the time Quintoander raised $ 250 million Series D in September 2019.
It is also worth noting who is supporting the company. Silicon Valley-based Ribbit Capital led its Series E Financing, Kaszek Ventures, an undisclosed US-based asset manager fund with over $ 2 trillion in SoftBank’s LatM-focused Innovation Fund, LTS, Maverick, Alta Park, AUM. , Including the participation of the dragoner. And Excel partner Kevin Ephrussi.
After endorsing the likes of Coinbase, Robinhood and Creditkarma, Ribbit Capital has historically focused on early-stage investments in the fintech space. Its bet on Quintoander represents a clear belief in the company’s creation, as well as startup plans to branch from its current model to a one-stop real estate shop that also offers mortgage, title, insurance and escrow services. is.
The latest round brings QuintoAndar’s total growth to $ 635 million since 2013’s inception.
Ribbit Capital partner Nick Huber said QuintoAndure has built “a unique and trusted brand in Brazil” over the years for those looking for a place to call home.
Huber told ClearTips, “Whether you want to buy or rent, Quintoander can support customers through the entire transaction process: from browsing verified listings to signing final contracts.” “The ability to meet customer needs through each stage of life and to do so from beginning to end is a unique capability in Brazil and worldwide.”
QuintoAndar describes itself as an “end-to-end solution for long-term rentals” that, among other things, connects potential tenants with landlords and vice versa. Last year, it also expanded connecting home buyers to sellers.
ClearTips spoke with co-founder and CEO Gabriel Braga and shared details about the growth that has attracted such a wife of high-profile investors.
Like most other businesses around the world, QuintoAndar placed itself in the worst position last year when the COVID-19 pandemic struck – particularly considering a core part of its business that hired landlords on its platform Guarantee has to be given.
“Initially, we were afraid of the impact of the crisis but we were able to honor our commitments,” Braga said. “In retrospect, the epidemic was a major test for our business model and has validated the strength and defensiveness of our Binsey on the credit side and strengthened our value proposition for tenants and landlords. So after the initial scary moments, we actually felt even more confident in the business we are building. “
QuintoAndar describes itself as a “distant market leader” with more than 100,000 rentals under management and around 10,000 new rentals per month. Its rental platform is live in 40 cities in Brazil, while its homebuying marketplace is live in 4. Part of its plans with new capital is to expand into new markets in Brazil as well as throughout Latin America.
The startup claims that, in less than a year, Quintoander managed to collect the largest inventory among digital transactional platforms. It now offers over 60,000 properties for sale in Sao Paulo, Rio de Janeiro, Belho Horizonte and Porto Alegre. To give more context to the development of that side of the company’s own platform: in its first year of operations, QuintoAndar closed more than 1,000 transactions. It has now crossed the 8,000 transaction mark on an annual basis, rising between 50% and 100% quarter on quarter.
For the rental side of his business, Braga said QuintoAnder has more than 100,000 rentals under its management and is closing about 10,000 new rentals per month. The company is not profitable because it focuses on growth, although this unit economics is particularly favorable in some markets such as Sao Paulo, which according to Braga is financing some of its growth in other cities.
Now, the 2,000-person company intends to begin its global expansion with plans to enter the Mexican market later this year. Simultaneously, Braga stated that Quintoander wants to employ “top-tier” talents from everywhere.
“We want to invest a lot more in our product and technical core,” he said. “So we are trying to bring more senior people from abroad on a global basis.”
CEO Braga and CTO Andre Penha came up with ideas for QuintoAndar after obtaining an MBA at Stanford University. As many startups do, the company was founded by Braga’s personal “nightmares” of an experience – in this case, to try to rent an apartment in Sao Paulo.
He recalls that the search process was difficult because not enough information was available online and that tenants were forced to provide a guarantor, or co-signer from the same city, or pay rent insurance, which Braga called “very Expensive “.
“Overall, I felt that it was a very inefficient and fragmented process without any transparency or technology,” Braga told me at the time of the company’s final elevation. “All of this involved friction and high costs, only real tangible problems to solve.”
The concept for QuintoAndar (which can literally be translated into “fifth floor” in Portuguese) was born.
“Gradually, we have created a platform that consolidates supply and inventory in a uniform way,” Braga said.
According to Braga, the company took the online search phase for the first time. It also eliminated the need to provide guarantors to tenants, saving them money. On the other hand, QuintoAndar also works to help protect the landlord with the guarantee that they will get the rent “on time each month”, Braga said.
It has been fascinating to watch the company evolve and grow over time, just as it has been fascinating to watch the sector’s startup scene mature and shine in recent years.