Contxto – Yuca, you sneaky proptech you. Why is it that six months after you raised an investment with monashees, you’ve only recently let the world know?
In an interview with Brazil Journal, it was revealed that the startup from São Paulo closed an investment in July of last year for R$20 million (US$4.7 million). monashees led the seed round. And ONEVC as well as Barry Sternlicht from Starwood Capital—an equity firm focusing on real estate—joined the party.
Yuca plans to manage entire buildings and reach 500 apartments by buddying up with developers in 2020. Although for the moment, it has 80 studios divided among 21 apartments under its control.
Moreover, the startup aims to raise its Series A sometime this year.
Yuca has Millenials in mind
As a millennial, I can attest to Yuca’s target market: young people between the ages of 20 and 35, who want to live in an urban setting, preferably near their job, pay rent at an affordable rate and with no immediate plans for having a family.
So, what the proptech does for its target audience is to offer refurbished rooms in sought-after areas of São Paulo at accessible rent. The properties under its management usually consist of four studios and inhabitants share a kitchen, living room, and laundry room.
How Yuca acquires management of these residencies is done in one of three ways.
It can buy out apartments and then subdivide them into rooms for rent. It subleases the property. Or, it simply manages the residence on behalf of its owner.
Of these alternatives, subleasing is the least profitable for it.
So… many… proptechs
The number of Brazilian proptechs keeps growing and growing.
There’s Housi. that like Yuca, aims to provide stylish living spaces for millennials. Loft that buys off properties and resells. Unicorn QuintoAndar is a property rental marketplace. And they’ve been beneficiaries of equity in recent months.
However, as the proptech market in Brazil grows and matures, it’s likely that venture capital (VC) firms and other investors will become pickier as to who’s worthy of capital and who isn’t.
Especially since “buy and flip” models in real estate burn through money so darn quickly.
Related articles: Tech and startups in Brazil!
-ML
