Kocomo raises millions to give people a way to co-own a luxury vacation home – TechCrunch
Who doesn’t want a vacation home?
Law. That’s what I thought.
Kocomo is a Mexico-based startup that wants to help make this dream come true. And he just concluded with $ 6 million in equity and $ 50 million in debt financing to move towards that goal.
The company aims to enable cross-border condominium of luxury vacation properties that goes beyond the historical use of timeshares. Put simply, the founders of Kocomo – who are a mix of Colombians, Brits, Mexicans, Americans and Panamanians – want to shake up conventional vacation home ownership with a market that gives people a way to buy. , owning and selling fractional interests in luxury homes. Or even more simply, Kocomo’s mission is to make the dream of owning a vacation home “an achievable reality for more people around the world”.
Founded this year, it has been operating in stealth mode since May, recently launching a beta version of its website to interact with a “select” group of customers on its waitlist.
“We are focusing initially on Americans and Canadians who want to buy a vacation home in Mexico, the Caribbean and Costa Rica, and then we will do the same in Europe,” said Martin Schrimpff, co-founder and CEO of Kocomo.
AllVP and Vine Ventures co-led the equity portion of the financing, which included participation from Picus Capital, Fontes – QED, FJ Labs and Clocktower Technology Ventures, and JAWS – the family office of Starwood Capital Group President Barry Sternlicht. Architect Capital provided the debt investment.
Interesting way, the founders of four Latin American unicorns also invested in the fundraising, including Mate Pencz and Florian Hagenbuch by Loft, Oskar Hjertonsson from Cornershop, Carlos Garcia from Kavak and Sergio Furio from Credits.
There is no doubt that the COVID-19 pandemic has caused many people to re-evaluate their perspective on life and work.
In Schrimpff’s case, spending more time with friends and family became a top priority and he accelerated his plans to find a vacation home. But he was disappointed as he explored the options.
“Buying an entire vacation home that I was only going to use a few weeks a year, and that I had to manage on my own, seemed unnecessary, stressful and outdated,” he said. “Also, it was impossible to find a beautiful beach house in Mexico that fell within my budget.
The experience of renting an Airbnb year after year, with what Schrimpff described as having “inconsistent quality and lack of professional management,” didn’t make sense to him either.
And so, as he discussed his frustration with his co-founders, the idea for Kocomo was born.
The startup’s model is similar to another proptech startup based here in the United States called Pacaso.
In Schrimpff’s opinion, the biggest difference between the two models is that Pacaso is focusing more on the second home market in places that are an hour or two away from where the owners live.
“Kocomo focuses more on cross-border vacation homes that are more like a two to three hour flight from where the owners are,” he said. In addition, “the complexities and problems” addressed by Kocomo are more important, given that they involve cross-border transactions, according to Schrimpff.
Another big differentiator from Pacaso is that Kocomo gives owners the option to “rent their weeks,” Schrimpff added.
In the same way that NetJets uses shared ownership to create an opportunity for people to enjoy the benefits of private air travel, Kocomo aims to apply a condominium model to vacation homes, he said.
“Our platform allows multiple people to own and enjoy a luxury vacation home and share all the costs between them without the hassle and hassle normally involved,” explained CFO and co-founder Tom Baldwin. “We call it the smartest way to own a home abroad. Buying an entire house for a few weeks a year is more complicated than it is worth while spending money on a rental is a waste and an expense, not an asset.
Kocomo, said co-founder and CPO Graciela Arango, manages all legal and administrative processes that go along with acquiring and owning a home. For example, he buys the house through an LLC, finds and controls qualified co-owners, distributes the time fairly among the co-owners, and provides all the services needed to manage and maintain the house over time. He even takes care of the management of utilities, landscaping and preventive maintenance.
It’s a way different from timeshare concept, say the leaders, in that the participants actually own some of the real estate, not just the use of time. So if the property’s value goes up, then someone’s investment goes up as well.
The company plans to use its equity in part to increase the number of its nine employees, with particular emphasis on sales, marketing and engineering. It also plans, naturally, to invest in the technology that powers its platform. The debt capital will be used to acquire approximately 20 luxury vacation properties in “desirable” destinations in Mexico, close to airports with international flights, such as Los Cabos, Punta Mita and Tulum.
Next, the company plans to expand to other vacation destinations within direct flight distance of the United States, such as Costa Rica and the Caribbean. Ultimately, the company sees “huge potential” in ski resorts, Mediterranean beach destinations and cultural hubs such as Paris, London, Madrid and Berlin.
Kocomo has also identified a partner financial institution so that it can provide financing to clients for the purchase of stakes in properties on their platform, and is in late-stage talks to formalize the partnership, according to Baldwin.
“While many startups coming out of stealth mode focus on moving quickly from 0 to high sales, our primary focus is initially to go from 0 to 10 Kocomo qualified co-owners,” said Schrimpff. “Even though we are a B2C company, since our ticket size exceeds $ 200,000, our sales cycle has a trajectory closer to that of a B2B startup.”
Interestingly, but unsurprisingly, Kocomo finds that most of his initial interest comes from members of the tech community. Pacaso also experienced a similar trend.
“This profile fits our model because they often have flexibility in their schedules or the ability to work remotely, and are open to trying new models, especially if they think it’s a smarter way to own a home.” , said Schrimpff.
Antonia Rojas from AllVP said that Kocomo leverages technology to deliver “an evolved model of real estate ownership that harnesses the profound changes in the way consumers organize and prioritize work, family and leisure time in a post-COVID world.”
The company was also impressed with the caliber of the team. Schrimpff founded and later sold PayU, a global payments company now owned and controlled by Naspers. Baldwin is a former Goldman Sachs banker who has spent the past eight years as a venture and private equity investor in Mexico and Brazil. Arango graduated from Harvard Business School and previously worked at IDEO in Silicon Valley. Brian Requarth, co-founder and non-executive chairman, previously founded real estate classifieds company Vivareal.