It’s hard to convince people that they deserve a vacation. Convincing people that they can co-own a vacation home and enjoy it at the same time can be deceptively more difficult.
Go away — unlike another company-backed Getaway, which sells getaways in tiny wilderness cabins — wants to make it easier to rent and invest in luxury real estate. The company, co-founded by Ali Nichols and Amr Chafik, wants to do everything. It raised $4.4 million from Cowboy Ventures, XYZ Ventures, and Night Ventures, as well as $1.5 million in debt funding.
The platform, emblazoned with the tagline “investments with a view,” will officially launch soon and plans to launch its first investment offering to investors later this month, pending the SEC. approval.
“We’re actually buying properties,” Nichols said. “Everything we post on our website we have complete confidence in because we are using our own financing to close the house, make it ready for rental and make it an asset as an active Airbnb or VRBO property that is already earning money. Then, she continues, the startup resells the ownership to the members; as a company, Getaway buys equity in the property, so there’s a ‘joint skin’ in play. “Over time, our goal is to have a much more streamlined process from a funding perspective where we could be under contract for a house, and people can invest at that time, and then we close it,” she added.
Getaway isn’t the first startup to try to optimize the exclusive world of vacation rentals. Built by former Zillow executives, Pacaso helps people buy and co-own luxury vacation homes, and has raised more than $1.5 billion in venture capital to date according to Crunchbase. Pacaso is also one of the fastest companies to become a unicorn, or valued at over $1 billion. Already.
Getaway co-founders say users can invest in a Getaway property starting at $1,000 per property share, while Pacaso can cost between $400,000 and $3 million to buy ⅛ of a property. Landlords are “strictly prohibited” from renting out their portion of a Pacaso property, a Pacaso spokesperson confirmed via email. Getaway properties, on the other hand, are active vacation rentals that also generate recurring passive income.
Importantly, Getaway allows homeowners to get discounted rates across its entire portfolio of homes; the flip side is that you have to pay to stay in a house that you partially own.
Here is another startup in the industry, which wants to make investing in vacation rentals as easy as investing in stocks. Unlike Pacaso and Getaway, Here tries to scale the financial benefit of owning a home, not necessarily the vacation aspect of it.
Getaway’s competitive gap is that it wants to be everything, everywhere, all at once. Nichols described wanting to be a cross between Here, where “your experience really ends at the dollar you invest and you hope to see it grow on the app”, and Pacaso, where “it’s not really a financial investment, it’s is an investment in traveling and spending time in beautiful homes.
People want access to these beautiful homes and so our approach is how to take that and make it more accessible and logical,” she said. “If I look at the sea of all the competitors that I can invest $1,000 in, and all things being equal, being able to take advantage of the portfolio of homes all over the country and hopefully soon the world, doesn’t is that a huge benefit from a consumer perspective.The company currently has two homes, one in Scotsdale and one in Miami, and will soon be closing one in Palm Springs.
“It seems like for consumers there’s a new safe investment every day,” Shafik said. “How do you cut out the noise and make sure you’re reaching the right person than that [opportunity] would be interesting, but there’s also the demand generation angle and the customer acquisition angle.
Building a wealth opportunity and experience for a broader consumer market comes with its own set of challenges. Time will tell if Getaway can make it happen.
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