Withco, a New York-based startup providing a lease-to-own service, announced raising $32 million in funding through seed and Series A rounds led by Canaan, Founders Fund, Initialized and NFX, according to TechCrunch.
The company plans to use the capital to hire across its engineering, product, data science, sales and operations teams, as well as to expand into new markets across the U.S. Withco also intends to continue building new partnerships with brokerage and developers. They also stated plans to secure more capital for purchasing properties.
The funding included $4 million in seed funding and $28 million in its Series A fundraise, with additional investor participation coming from Enlightened Hospitality Investments, LENX, Thirty Five Ventures, Dreamers VC, BoxGroup, Not Boring Capital and Quiet Capital.
Withco aims to help small business owners become commercial property owners, by purchasing properties and renting them back to the owners with the option of purchasing the property at a future date. The company plans to target the fact that small business owners can often easily secure leases, but have difficulty securing mortgages.
“The only thing that separates most renters from becoming owners is actually a down payment, and believe that the lease and the mortgage doesn’t really serve small businesses well anymore,” Withco CEO and founder Kevin Song told TechCrunch.
While this model has come to the public’s attention through proptech Divvy Homes, withco has chosen to focus on commercial properties instead of residential.
The company also boasts a long list of angel investors, including athletes Venus Williams and Kevin Durant, Affirm founder and CEO Max Levchin, former AmEx CEO and chariman Kenneth Chenault, Carta founder and CEO Henry Ward, Plaid co-founder Zach Perrett, DoorDash founder and CEO Tony Xu and Ramp co-founders Eric Gylman and Karim Atiyeh.
In other recent proptech news, RenoRun raised a $142 million Series B for its e-commerce construction platform, led by Tiger Global. Epropservices also underwent a rebrand: it is now operating under the name nurtur.group and has launched its new proptech accelerator fund.