NestEgg, an operating system for single-family and small multifamily homes, has landed $7 million in a Series A round of funding.
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The company, which offers a suite of financial services for landlords and tenants, aims to help independent real estate investors create wealth by streamlining the property management process.
NestEgg’s target customers are independent landlords in the U.S. who own between one and 10 units. Those landlords often want to achieve financial independence by growing their portfolio to between 20 and 40 units, but they often get stuck somewhere in the 10- to 20-unit range because of how time-consuming and financially risky it is to grow their portfolio, according to NestEgg CEO Eachan Fletcher.
“We are taking a traditionally offline, in-person process and moving online and we’re giving (them) all financial tools to make their finances work and pay bills and stay afloat,” Fletcher said.
Offering options for tenants to pay their rent weekly or mid-month, NestEgg allows them to pay in a way that works for them, since a tenant’s payday and when rent is due does not always line up. Separately, NestEgg pays landlords on the first of the month, so landlords don’t have to worry about making their mortgage payments.
“It’s difficult for landlords to give tenants the flexibility they need, but on our platform, we do that,” Fletcher said.
The company doesn’t lend to tenants or charge any penalties or fees to tenants, besides standard credit card fees. Landlords pay a flat fee of $9 per unit per month to use NestEgg. So far, more than 3,000 landlords in the U.S. use the platform.
NestEgg also offers maintenance coordination services and end-to-end leasing services.
The new funding will be used to grow the NestEgg team by four times, with the company planning on hiring 40 employees, almost entirely engineers, in the next three months.
Additionally, the company is rolling out NestEgg Pay, a payment method offered at online checkouts which allows landlords to pay off an expense interest-free in installments.
The new round, which brings NestEgg’s total funding to $11 million, was led by Hyde Park Venture Partners, with participation from BAM Ventures, Bonfire Ventures, Financial Venture Studio, Dreamit Ventures, and Hyde Park Angels.
Fletcher’s vision of making investing in residential real estate as easy as investing in stocks and bonds is part of what drew Hyde Park Venture Partners to the company, according to Hyde Park VP partner Ira Weiss.
“The idea of owning a condo or owning a rental unit or owning a house that you rent out is so time-consuming and takes so much effort,” Weiss said in an interview with Crunchbase News. “We were drawn to what Eachan has built. The company’s taking off, the results have been really strong.”
Illustration: Li-Anne Dias