Furnished rental startup Blueground defies proptech woes with $560M in revenue, new $45M raise | Tech Crunch

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Alex Chatzileftherio founded BlueGround in 2013, frustrated by the lack of short-term furnished apartments in Europe. He was traveling as a consultant for McKinsey, living almost exclusively in hotel rooms for months at a time.

“Once the company had to pay up to €15,000 for a hotel room in Amsterdam. And there is not enough space or kitchen to cook,” he said. “I tried to rent apartments for a month or so. But it was difficult, and landlords weren't open to buying furniture. So I created a business that solved my problem.

A few years later, as the pandemic raged, business picked up for his startup category — short-term, furnished apartment rental companies — that traveled the world while people worked from home.

Now that many employers are calling workers back to the workplace, demand for temporary housing has increased.

Some of his competitors did not survive. Juice is living And Wander Zant Closed their doors and returned the keys. Some became acquisition opportunities for BlueGround. In 2022, the company gained a strong foothold in Latin America Buy Tabas, operator of over 9,0000 furnished apartments in Brazil. Within months, Blueground was snagged A traveler's haven, a 15-year-old business that provides on-demand housing to workers in nearly 20,000 cities across the United States. In 2023 it acquired NestPic, a marketplace for furnished apartment operators like Casa and Placemarker, through which customers An additional 18,000 apartments.

BlueGround has been operating a global network of move-in ready homes for a month or so now, and has raised $45 million in Series D funding from new investor Susquehanna Private Equity Investments, along with other backers including WestCap, Chatzileftherio told TechCrunch. The New York-based company has also secured a debt facility from Barclays in partnership with Morgan Stanley, Deutsche Bank and HSBC, which replaces and augments a $40 million loan BlueGround received from Silicon Valley Bank due in 2021.

Blueground leases, furnishes and furnishes apartments in popular neighborhoods for tenants. The company currently manages 15,000 apartments in 32 markets across 17 countries. In addition to taking on its own leases, BlueGround partners with local operators in Japan and Thailand and recently introduced a franchise that lists third-party operators' units on its platform.

The company did not disclose its new valuation, but Chatzieleftheriou said the company's value has increased since the previous round. That The valuation is reported to be $750 million After Raising a $140 million Series C in September 2021.

It's no secret that the fundraising environment is challenging for late-stage companies, especially those in the proptech sector hit by rising interest rates.

Chatzieleftheriou told TechCrunch that his company's rapid growth and near-profitability helped convince investors for fresh funding.

Chatzileftherio said sales will grow 70% to $560 million in 2023, up from $300 million in gross revenue in 2022. The net sales margin—after it pays landlords for leases—is about 35%, he added, and he expects BlueGround to be cash-flow positive in 2024.

While Chatzieleftherio's prediction of industry consolidation seems likely with more acquisitions, the immediate focus is on consolidating these recent acquisitions. The new funding is for market expansion, technology investments and perhaps the ultimate financial goal: an IPO.

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