Single-Family Rental Technology Startup Receives Funding Boost
Darwin will use the Series A funding to expand to Florida, Ohio, Tennessee, Colorado and North Carolina. .
Real estate technology startup Darwin Homes announced that it recently received $15 million in Series A funding.
Darwin’s property management automation software, Origin, handles accounting, leasing, inspections, maintenance and repairs. When on-site issues arise, Darwin’s property managers are dispatched automatically, and all operations are tracked.
For the last 24 months, the Darwin Homes team has been testing its platform in four cities in Texas. In 2020, the company tripled its homes under management in 2020. The Series A funding will be used to expand the company’s service to new locations, beginning with Florida, Ohio, Tennessee, Colorado and North Carolina.
Darwin was co-founded by Ryan Broderick and Zachary Kinloch, who were early executives at DoorDash. Broderick and Kinloch are combining proprietary software with local operations, a strategy they learned at DoorDash.
The $15 million in Series A funding round was led by Canvas Ventures. It included new investors Camber Creek and existing investors Khosla Ventures, Wave Capital, Pear Ventures and Silicon Valley Bank. Its angel investors included Tony Xu (DoorDash), Ryan Graves (Uber) and Andrew Marks (TQ Ventures).
Darwin is targeting a market that is highly fragmented with the vast majority (75% or more) of SFR owners individual investors. Increasingly, though, the sector is becoming more institutional—a development ripe for a platform provider. Michael Carey, Senior Director at Altus Group, says the SFR space offers a premium over multifamily yields, which is drawing a lot of investors. That delta may not be there forever, though.
“We’re seeing that gap close because there’s so much money coming into this [SFR] space right now,” Carey says. “There are billions of dollars coming in, just from who we track and our clients. We were looking at $5 to $6 billion coming into the market from March to September, and there’s more than that. That’s just our clients and what we know. So it’s a lot bigger than that.”