MakeSpace Raises $55M Series E To Revolutionize Storage Industry

On-demand storage company MakeSpace is poised to revolutionize the United States’ $39 billion self-storage industry and has attracted a big investor to help drive its mission.

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Iron Mountain, a global storage and information management services giant, led a $55 million Series E funding round for New York-based MakeSpace that included equity financing and some debt. The round included participation from 8VC, Upfront Ventures, Maywic Select Investments, Ten Eighty, Provenio Capital and CX Collective.

MakeSpace has raised a total of $150 million since its inception in 2013, according to Crunchbase data. That included a $30 million corporate round led by Iron Mountain in 2019.

In 2019, MakeSpace expanded into 20 new markets through an established partnership with Iron Mountain, Rahul Gandhi, co-founder and CEO of MakeSpace, told Crunchbase News.

“Iron Mountain has spent many years developing technology in the background for logistics, routing and mobile apps,” Gandhi said. “Software has been a strength of ours, but to figure out a way to get into as many markets as possible would require raising hundreds of millions of dollars to do that. Through our partnership with Iron Mountain–they have over 1,500 warehouses and last-mile logistics already completed–we can leverage that footprint and, overnight, get into as many markets as possible.”

Serving the ‘convenience economy’

Gandhi and two other co-founders created MakeSpace just after Hurricane Sandy hit the Northeast section of the U.S. in 2012. They saw the emergence of the “convenience economy,” in which companies were picking up riders from their homes or delivering food, but did not see the same thing in the storage industry, he said.

Traditional self-storage warehouses can only rent a storage space if they have one available, and people must have a car or truck to take their items in or out, Gandhi said. MakeSpace sends a team of drivers and movers to a client’s location to pick up the items and take them back when needed. Instead of having to remember what items were stored, clients can see and manage their items via the MakeSpace app.

On-demand storage is a competitive market and includes tech-driven startups, including MakeSpace and Los Angeles-based Clutter, competing with veteran companies such as PODS.

“It has been amazing to see what MakeSpace has accomplished in the past year alone, growing from four to 24 markets almost overnight, and adding another seven in 2020,” Iron Mountain’s Deirdre Evens, executive vice president and general manager of North America records and information management, said in a written statement. “They have taken a unique approach to storage that answers the modern customer’s demand for convenience, using technology to enhance the service and grow at an immense scale.”

Meanwhile, MakeSpace is seeing 30 percent to 50 percent growth on a month-to-month basis, Gandhi said. Some of that is driven by the current COVID-19 environment; MakeSpace set up programs for college students moving out of their dorms, offered free storage to small businesses impacted by the crisis, and implemented contactless service and new sanitary measures in all affected areas, he added.

The company intends to use the new funding source to grow in the seven new markets it entered this year, as well as improve its technology, marketing and services, Gandhi said.

“Storage is one component, but we would eventually like to be able to provide everything you need with a one-stop shop,” he said. “We plan to expand into another 20 markets by the end of the year, as well as add services. We are listening to our customers, which will determine where we will go next.”

Illustration: Li-Anne Dias