SPEEDHOME (formerly Speedrent), a Malaysian real estate rental platform, has raised RM 7 million Series A financing backed by Allianz Malaysia Berhad (Allianz) and Gobi Partners (Gobi).
The startup is also one of Gobi’s first investments for its SuperSeed Fund II and one of the Gobi SuperSeed II Championship winners last year.
With this recent investment, SPEEDHOME plans to advance the technology and application of the platform, as well as regional expansion starting with Bangkok.
A house that sells
Gobi Partners (Gobi) is a venture capital firm with a Pan-Asian presence in North Asia, South Asia and ASEAN with over $ 1.1 billion in assets under management. Based in KL and Shanghai, the company supports entrepreneurs in the early stages of growth and focuses on emerging and underserved markets.
This funding comes after SPEEDHOME’s efforts to mitigate the negative impact of the pandemic on the real estate sector. A significant drop in volume and transactions of RM 1.3 billion of unsold units was recorded in the local buy and sell market amid the pandemic. This is according to the SPEEDHOME team, citing data from the National Property Information Center (NAPIC).
“Unfortunately, the rental market has not been spared either. With many landlords unable to show their homes during the MCO, tenants unable to travel, and people more conscious of their spending, we’ve also seen a drop in rental demand during this period, ”Vulcan Post told Vulcan Post Wong Whei Meng, CEO of SPEEDHOME.
Thus, SPEEDHOME has launched its Virtual Viewing and Homerunners services which fill in the gaps posed by movement restrictions. Landlords can essentially leave the job of finding tenants to SPEEDHOME’s Homerunners, who essentially function as real estate agents to help rent a vacant property.
Such a service resulted in a 160% year-on-year growth in the gross written premium (GWP) contribution to Allianz in 2020 compared to 2019. This showed SPEEDHOME’s ability to grow as a as an actor in the real estate sector despite the challenges of the pandemic.
Dictionary time: Gross written premiums are the total revenue from a contract that the insurer expects to receive before deducting reinsurance or cession commissions.
Free tenants from the deposit
Since we last spoke to Whei Meng in 2019, when the company was still known as Speedrent, a Zero Deposit plan has been introduced in SPEEDHOME’s services. With it, tenants can rent homes without paying a high upfront deposit fee, which increases tenant cash flow.
“Zero Deposit will help tenants ease their financial burden while allowing landlords to rent quickly by tapping into this pool of tenants who are qualified to rent but don’t want to pay an expensive deposit,” said Whei Meng. In total, RM 37 million in deposits have been saved by tenants over the years thanks to the plan, SPEEDHOME reported.
Homeowners, on the other hand, are promised lossless protection for their properties up to RM42k in coverage which includes eviction assistance, damage and theft, among others. SPEEDHOME also claims that their homes are rented 5 times faster when deposits are reduced for tenants.
In return, owners must pay an insurance fee, the price of which is based on the unit’s one-month rental fee plus 6% SST, as well as RM 10 stamp duty for a basic plan.
To date, SPEEDHOME has over 575,000 app downloads and over 128,000 announcements. The team expects this number to increase as consumers become more aware of their spending habits.
In Bangkok they go
With the startup’s achievements in Malaysia so far, it plans to expand its services to Bangkok.
“Bangkok shares a rental culture similar to Malaysia, so we think our zero deposit model would work well there as well,” said Whei Meng. In addition, Bangkok has a high population density and employment opportunities, qualities around which the rental market revolves strongly.
While the SPEEDHOME team couldn’t share more details about the new updates that users can expect on their platform, they have hinted that AI and machine learning technologies will be involved.
Whei Meng concluded our interview with a piece of advice for startups looking to secure funding during the pandemic: Focus on the fundamentals and the money will follow.
“In any plan or location, we have made sure to put our users first and resolve their issues, in doing so, we want to provide a solution that our users will continue to use and trust for the long term,” said he explained.
- You can read more about SPEEDHOME here.
- You can read our previous coverage on SPEEDHOME here.
Image Credit Featured: Wong Whei Meng, CEO of SPEEDHOME
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