Vacation home co-ownership platform Ember announced a $17.4 million raise on Thursday, led by co-founder of PayPal, early Facebook investor and venture capitalist Peter Thiel.
Utah-based VC firm Pando Ventures also participated in the latest round alongside previous investors including the former CEO and Founder of Vivint Smart Homes Todd Pedersen, former CEO of Progressive Leasing Ryan Woodley, and Founder and Chief Innovation Officer of Progressive Leasing Curt Doman.
Ember is one of the latest proptechs to enter the heated rental market, helping consumers and investors dabble in the world of second home ownership. The platform operates as a fractional-ownership firm based in Salt Lake City, Utah. Its tech creates a limited liability corporation (LLC) for each property in its portfolio and divides ownership for each one into eight parts that can be individually purchased or resold.
While 5% may not seem like a substantial portion of the market, it is important to note mortgage lenders issued a whopping $1.61 trillion in purchase loans through the entirety of 2021, based on estimates by the Mortgage Bankers Association.
Ember is projecting its current reach to 20 markets in 10 states, including Utah, Oregon, New Mexico, Texas and California.
Properties begin at around $190,000 a share; however, these homes typically range between $1.5 and $5 million in total home price. Anyone who buys a 1/8 share is guaranteed 45 nights a year and one holiday weekend. According to Ember, individuals and families can buy up to a 1/2 share of a property, which increases their allotted time to 180 nights a year.
The proptech emphasizes it’s not a timeshare, but rather co-ownership by vetted homebuyers to collectively own the property.
Co-owners book time at their properties through an app that has a calendar with available dates and way to communicate with an Ember concierge. The properties typically boast private amenities as well like dedicated owner storage, pools, hot tubs and entertainment spaces.
For a fee, Ember will also handle maintenance and management of the home so co-owners don’t have to lookover cleaning and repairs.
The business model is similar to market leader Pacaso, whose vacation home tech successfully managed to snag the company $300 million in revenue in 2021.
For Ember, its foundation was built on CEO Kurt Avarell’s experience co-owning a houseboat on Utah’s Lake Powell with friends and family for the past decade.
“We recognize that so many families want vacation homes, but their dream home is just out of reach. Ember intends to make second home ownership attainable, affordable, and enjoyable for millions of want-to-be second homeowners,” said Avarell.
Avarell, along with co-founders James Sukhan, Ember’s CRO, and Jeff Lyman, Ember’s CXO, also have consumer financing planned out for Ember’s fractionalized model so even more potential buyers may be able to buy-in to second home co-ownership