Real estate investment startup PropHero scoops up $8 million Seed round

Sydney- and Madrid-based proptech company PropHero has raised $8 million in a Seed round, just eight months after landing $1.6 million in pre-seed funding

The round was co-led by real estate focused VC Fifth Wall, and European early stage fund Samaipata. Local VCs Jelix Ventures and AfterWork Ventures, who invested in February’s pre-seed round, also chipped in again.

The startup wasn’t planning to raise until 2024, but strong local growth this year for the digital property investment platform saw cofounders Pablo Gil Brusola and Mickael Roger bring the Seed round forward amid plans to ramp up PropHero’s international ambitions.

The cash will be used to continue to build an integrated online property investment service, improve the company’s data models and digital customer experiences, grow partner referral channels in mortgage broking, accounting and financial advisory, new hires and to geographic footprint into new international locations. 

The proptech startup set out to transform the way Australian and European investors find, buy and manage investment properties, with an end-to-end solution including an investment strategy, consultation and support from a personal property coach to disrupt the traditional traditional buyer’s agent market.

Gil Brusola, PropHero’s co-CEO, said the platform combines data-driven and AI-led insights with personalised digital user experiences supported by human expertise.

“We are helping our clients to build property wealth over time. After a property strategy consultation with a property coach, our platform  shows you personalised recommendations,” he said.

“Then we make it super easy for you to buy and manage  that property because we have a network of trusted real estate professionals who help with the  inspection, offer, financing and ownership process.” 

The startup kicked off in June 2021 and now has 40 employees based in Australia, Spain, Argentina, India and Indonesia. 

Co-CEO Mickael Roger said they’ve now helped around 250 clients find investment properties and they expect to double that number by the end of 2022.

“Around 60% of our clients are returning to buy their second and third properties with us and 80% refer their  friends and family,” he said.

“Importantly, all our investors are achieving positive cash flow and price growth, even as interest rates go up and the broader property market softens. In fact, PropHero’s clients are outperforming the market and this shows we can use data to beat the downturn.”

Roger said the market was so hot earlier in 2022, they stopped buying properties around April because they were overvalued. Rising interest rates have helped calm things.

PropHero’s tech identifies investment properties with potential for high return and low risk. Clients can access the platform’s bespoke recommendations 24/7 through a smartphone app and additionally have access to a personal  property coach and a network of property professionals. 

“Our ambition is to revolutionise the property investment industry globally by using digital  technology to replace traditional buyer’s agents and make property investment more time-efficient  and profitable,” Gil Brusola said.

“Soon, you will be able to access all the services you need  as a property investor directly from our apps, such as property discovery, mortgage financing,  insurance, property management and tax information.” 

Fifth Wall partner and European lead Miguel Nigorra Esteban said they were pleased to back PropHero to support its European expansion.

“While real estate has  always been one of the most sought-after asset classes, it can be intimidating and inaccessible, and PropHero’s Buy-To-Let (BTL) model helps change that,” he said.

“Enhanced by its use of data-backed  algorithms and an already impressive track record, we believe PropHero is poised to grow into a  global, approachable solution in the real estate investment market.” 

AfterWork Ventures cofounder Alex Khor said: “Against a media backdrop of doom  and gloom in the property market, PropHero is defying the trend to deliver meaningful results for  clients. VCs like AfterWork are most excited by innovative start-ups such as PropHero taking novel,  data-driven approaches to traditionally stale industries like property investing.”