Introduction:
Dongnae, a startup in the prop tech industry, announced on Tuesday that it intends to buy Stevens, a Dongnae Acquires Co-living Platform Dears South Korean business that runs Dears, a co-living venture.
The two businesses did not disclose the purchase price, but Dongnae said it would buy Stevens using a combination of cash and stock. The Seoul-based prop-tech company had already received $34 million, $21 million of which came from a Series A round reported only last year. By the end of September, Dongnae hopes to complete the purchase. Investors in the business include Miguel McKelvey, the co-founder of WeWork, NFX, Daol Investment, Hana Financial, MetaProp, and Maple VC.
The primary offering of Dongnae, Dongnae FLEX, is a furnished apartment rental with flexible lease durations for as little as four weeks and cheaper rental deposits.
With Dears, the company will be able to improve the Dongnae FLEX service, manage assets “with a collective AUM of over $400 million,” and cover 90 apartment complexes throughout Seoul and Pangyo, which is home to several digital companies, like Kakao and Naver. More than 520 studio apartments are available at Dears Pangyo in Pangyo.
Along with Xi S&D, the organization will co-manage the Dears Myeongdong building in Seoul. According to co-founder and CEO Matthew Shampine, Dongnae will handle Dears Myeongdong’s commercial areas, which include B1, 14F, and the rooftop. Xi S&D will manage the 112 units at Dears Myeongdong, providing short- and long-term stays.
Proptech Dongnae Acquires Co-living Platform Dears:
Proptech Dongnae Acquires Co-living Platform Dears (Image Source: techcrunch.com)
Shampine and Insong Kim, two former WeWork executives, formed Dongnae in 2020 to digitize South Korea’s fragmented real estate sector. There are two ways to pay rent in South Korea: a monthly fee (as in many other parts of the world) or an upfront payment known as Jeonse. People must work with dozens of brokers to find a new home there.
The co-founders intend to combat Jeonse, the nation’s distinctive residential rental system, by offering reduced rental deposits on flexible, short-term terms. With this strategy, renters can lease an apartment for a sizable lump sum payment of around 70% of the home’s worth without paying a monthly rental cost.
The business has “heavily” enhanced the customer experience since last year. The company claims it has wholly digitalized the process instead of the customary drawn-out, paper-based lease process. It has also introduced Suzie, a digital real estate expert, onto its platform. Suzie responds to inquiries from potential tenants regarding housing or Dongnae’s apartments in any spoken language, much like a chatbot might.
According to Shampine, from American businesses like Mint House, Zeus Living, and Blueground to startups in Asia and Europe like Cove and Habyt, there has been a lot of innovation in the residential renting market over the past few years. “Our team is dedicated to establishing a better rental process here in Korea.” The Dongnae app may be downloaded right now on iOS and Android devices.
