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Doorstead, a property management platform that offers rental payments to homeowners, has inked a $21 million Series B round and revealed it had acquired hybrid-fintech company Knox Financial, it was announced last week.
The Series B round, which brings Doorstead to $37 million in total funding since its 2019 seed round, includes investments from Avanta Ventures and MetaProp and existing investors M13 and Madrona, according to an announcement Friday. Doorstead said the round will fund product development and expansion plans.
Doorstead CEO Ryan Waliany described the acquisition of Knox, which offers products that convert residences into investment properties, as a no-brainer considering the companies’ overlapping approaches to the rental industry and the vendor’s footprint on the East Coast, where Doorstead has little presence.
“What we’ve seen in the last twelve months is increased demand for reliable investment income and hassle-free property management,” said Waliany, who co-founded the company with Jennifer Bronzo. “We offer guaranteed payments and a hands-off experience for investors in a volatile real estate market,“ he said.
Doorstead provides landlords with an unbroken stream of on-time rent, vacancy forgiveness, and full property management services, “from getting the property rent-ready to conducting showings and screening tenants, inspecting the property and taking care of maintenance requests, and more,“ the company said.
It claims its leasing and placement time is 57 percent faster than the industry average and that clients earn $2,300 more per year, with Doorstead than their prior property managers.
Doorstead provides clients with a broad analysis of how their home will perform. Specifically, it provides landlord customers with a patent-pending rent analysis solution that identifies the ideal rate, based on more than an 11 million market data points. The company said in its release that it has generated over 30,000 guaranteed rental offers and manages over $1 billion in assets.
While Doorstead operates primarily in California and Seattle, the Knox acquisition will position it in on the East Coast, starting with its hundreds of tenants throughout the Boston area.
The Knox Investment Property Platform is a three-tiered offering that rests on Knox Certainty, a program in which the company becomes the lessee to its homeowner client to augment their ability to qualify for the mortgage on the next home. In short, the lease shows verifiable, reportable income.
It also offers mortgage lending, refinance, lines of credit and its KEAP program—Knox Equity Access Program—to give homeowners access to capital, based on the equity in the homes they are turning into investment properties.
“Over the last few years, Doorstead has emerged as one of the most successful companies in tech-enabled property management, giving investment property owners across the U.S. the easiest possible way to build wealth through their properties,” said David Friedman, CEO of Knox Financial, in the release. “Knox’s customers are in great hands with the Doorstead team, and I look forward to seeing the company grow and succeed in the coming years.”
Despite months of rent decreases, the flow of venture capital to the innovators supporting landlords and their tenants hasn’t slowed.
The growth of fintech companies aiming at the rental market, or RentTech, has been noteworthy, with many companies focusing on ways to ensure landlords get paid while flattening the processes powering effective management.
Inman’s 2022 Year in Proptech highlighted the trend, noting that fast-growing players, including RentSpree and Rental Beast, are striking deals with MLSs to demonstrate how critical renters are to the industry’s overall growth.
