Pacaso, a startup aiming to make second-home purchases more accessible, has raised $75 million in new funding, bringing the company’s valuation to $1 billion.
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Users can browse through homes for sale in second-home destinations including Malibu, Lake Tahoe, Breckenridge, Colorado, and Scottsdale, Arizona. Then, Pacaso creates a property LLC for the home, finds and vets co-owners, and handles the sale. The co-owners own the property together, and Pacaso doesn’t own any shares, according to the company.
Pacaso also handles furnishing and managing the property, and owners can schedule their stays through the company’s app.
“This is not just an incremental improvement to an existing problem, this is a whole new category we’re creating,” Allison, CEO of Pacaso said in an interview with Crunchbase News.
According to Sarra Zayani of Global Founders Capital, she was interested in investing in Pacaso because of how the company’s model “aligns the emotional, the functional, and the financial” aspects of buying a home,” she said in an interview.
The target demographic for Pacaso is families with a household income at or above $150,000. The majority of the families in that demographic that Pacaso surveyed were interested in buying a second home, something the company wants to make more accessible.
The residential real estate market in general has been on fire the last year, as people have shifted to working from home amid the COVID-19 pandemic. With many employers now offering the option of remote work or hybrid work setups, it’s likely that many people will continue working from home even after the pandemic is over.
The demand for homes, including second homes, can be seen on the macro level with new mortgage applications up and housing prices increasing, according to Allison. In terms of interest in Pacaso, more than half a million users have visited the company’s website since it launched in October, and more than 60,000 people have inquired about Pacaso or buying a second home through Pacaso.
With the new funding, Pacaso plans on expanding across the country (its listings are in 12 markets mostly on the West Coast right now), growing from about 50 employees to about 150 by the end of the year, and investing in marketing and education, Allison said.
The new round brings Pacaso’s total funding to at least $92 million. The company last raised a $17 million Series A led by Maveron in October 2020.
Illustration: Dom Guzman
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