The venture-capital-backed home-sharing platform HubHaus is to close after failing to attract the necessary funding to keep going according to a report published last Friday. The company was founded in 2016 by Shruti Merchant, a medical student looking to make it easier for young professionals to find a place to live while creating a sense of community. The company had raised around $11 million from various American VCs and was one of a number of similar companies to have sprung up in the United States centered around the concept of co-living and flexible housing and becomes the latest to succumb to pressures brought about by the coronavirus pandemic.
Airbnb backed Zeus Living saw a valuation cut and lost funding, short term rental startup Lyric has lost many of its landlords and has lost a co-founder while property management company Stay Alfred has had to close down.
Although HubHaus was once valued at around $40 million, it has seen a number of disastrous events leading up to this point with 100 tenants with bad credit evicted last year and around 15 redundancies at the firm in February. According to a report by The Information around 30% of its rooms were empty, and 75% of its properties were loss-making. With little room for maneuver financially, dwindling demand, and no interest from investors, the company’s remaining employees are to be let go.