Proptech unicorns had a banner year in 2021. Venture capitalists poured $9.5 billion into the proptech market, the most ever raised in any year for real estate centered technology firms globally.
One such proptech that thrived in particular is Pacaso, a barely two-year-old startup that is out to give more people a chance at second home ownership, and the brainchild of former Zillow executives Austin Allison and Spencer Rascoff.
The company, which launched in October 2020, managed to reach unicorn status in just five months – one of the fastest startups to ever do so, according to Crunchbase data.
In September, Pacaso raised $125 million in Series C funding led by Softbank’s Vision Fund 2, bringing the company’s valuation to $1.5 billion.
Funding abound, the proptech revealed it has generated nearly $300 million in full year 2021 revenue and sold approximately 400 Pacaso units in the company’s first year.
San Francisco-based Pacaso’s proprietary tech enables consumers to own a fraction of a luxury home, from one-eighth to one-half. After purchase, Pacaso manages the home including interior design, repairs, utilities and property management, with owners splitting those operating costs and also paying a $99 fee per month.
The co-ownership model is made possible via the creation of a property-specific LLC. Pacaso purchases a home either outright or shares in a home and then partners with local real estate agents to market the properties.
“Our modern approach to second home ownership for one-eighth the cost is resonating with buyers,” said Austin Allison, Pacaso Co-Founder & CEO. “We are creating a new category of second home ownership, powered by our technology-enabled marketplace and curated selection of the best second homes in top destinations.”
However, the model has come under scrutiny as some residents have complained its business structure is hawking illegal timeshares. Other communities complain its derailing real estate potential for actual full time residents.
But Pacaso has held steadfast in its aim to bring luxury co-ownership to potential buyers. In recent months, it has extended its property acquisitions to Santa Barbara, Central Oregon and the Florida Keys. In all of 2021, Pacaso managed to launch 23 new global second home destinations, for a total of 32 markets.
According to an earnings release, approximately 87% of Pacaso owners are first-time second home owners who purchased one-eighth to one-half ownership in its high-end second home portfolio. The company also managed to increase headcount to nearly 200 team members by year’s end.
As for 2022, Allison said the proptech is focused on accelerating growth within its technology stack and increasing its supply of luxury listings with approximately 30 new markets on the horizon for the company to break into.
“Pacaso is laying the foundation in these early days to address the massive long-term global opportunity available to the company as we continue to build upon our first-mover advantage,” concluded Allison.