Roofstock, a new online marketplace for investors looking to buy rental properties, has just announced Series B funding of $20 million in a round led by Lightspeed Venture Partners.
“We were not initially going to raise this round so quickly because we really didn’t need the money yet,” Gary Beasley, Roofstock CEO said to the San Francisco Business Times. “It means expanding geography a bit faster, hiring more on our sales and marketing team and expanding to attract more international capital.”
Roofstock specializes in properties that are currently occupied by tenants. Aimed at investors looking for an immediate income, the site allows buyers to view properties on a 3D tour so they can check out the investment online without disturbing the tenants. Roofstock’s service also provides an independent inspection of the property, and certification of the building, tenants and property managers, so buyers know exactly what they’re getting for their money.
Until Roofstock arrived on the scene, most sellers would need to wait for their tenant’s lease to expire before they could market the property. Roofstock therefore provides much needed convenience for all parties, because owners can sell at any time they choose, while buyers get their hands on a rental property that’s guaranteed to deliver an immediate cash flow. It’s also good for tenants too, as they get to remain in the property with minimal interruption to their lives.
Besides offering single properties, Roofstock also lists portfolios of rental properties, funds and a 1031 exchange. The site also offers tools that target neighborhoods based on their investment potential, which is gaged according to local market data.
Roofstock currently serves 10 markets in the U.S., and Beasley said the new funds would be used to help the site enter into new markets, invest in product development and boost its data science initiatives.
Additional participants in the Series B funding include Khosla Venture, Nyca Partners, SV Angel, and Bain Capital Ventures. Since its founding in May 2015, Roofstock has raised $33.25 million in equity funding.