Madrid based on-demand housing provider Spotahome has successfully closed a €25 million funding round and announced that it is profitable.
The funding round was led by 14W and included existing investors including Kleiner Perkins, Seaya Ventures, and Passion Capital as well as new investors Mundi Ventures.
Having been founded in 2014 by four young entrepreneurs as a solution to what they saw as a lack of trust and service in the housing market for young people looking to move to a new country, Spotahome made headlines in 2018 when its end-to-end rental model convinced Silicon Valley fund Kleiner Perkins to invest $40 million.
After failing to establish a strong foothold in several new markets including the Middle East and Eastern Europe and seeing its revenue decimated by pandemic lockdown orders, 2020 saw the firm forced to go cap in hand to investors and cut a reported 80% of its staff.
With increasing demand among young professionals to work remotely, the company has changed its model slightly moving towards longer-term rentals and signing up former Airbnb landlords affected by a lack of international tourism.
According to co-founder and CEO Alejandro Artacho, the Spotahome has enjoyed success in 2021 and has been profitable since the first quarter. Taking to Linkedin, the startup founder said:
"We, Spotahome and Erasmusu [acquired in 2018], have just raised €25M in new funding to boost growth. Part of this investment was funded in 2020 during Covid and we just closed the second part now as a result of a great 2021 performance. The business is now well above pre covid levels with higher revenues than 2019 and we are profitable for the first time ever."
"This investment catches us strong with presence in 28 countries and recently launched a breakthrough product across Europe. From almost dying in 2020 to being in our strongest position ever. What a turnaround! Everything is possible!"
With the new capital in its coffers, Spotahome reportedly plans to invest in the tech that supports its platform and consolidate its presence in the 28 markets it currently operates in.