A proptech company has launched, which intends to take 10% of the estate agency market by promising to sell a vendor’s home in 90 days or give them the cash.
Nested, which goes live today, guarantees the sale within 90 days or lend the seller the full amount, interest free, enabling them to move on.
Nested has been founded by Matt Robinson, one of the founders of direct debit provider GoCardless.
The service will be available initially in London and aims to solve the problem of uncertainty when in a property chain.
Robinson, speaking exclusively to EYE, said Nested’s mission was focused on “trying to do good” and highlighted that “it’s incredibly painful to sell a property and buy another one. We’re trying to make that simple”.
Instead of sellers losing their dream home or “having to resort to moving into rented accommodation” Robinson says: “Nested makes sellers chain-free from day one, removing months of uncertainty and putting them in the strongest position to make their next purchase.”
He referenced a recent Which? report which shows that three in ten property sales now fall through, with 21% of failed deals caused by buyers unable to sell their own home.
When quizzed about the model shifting from them buying the home – as was reported in EYE previously – to providing a loan to the seller, Robinson said: “Bridging is more aligned – it caps liability – and we make our money alongside the vendor by selling property.”
He added Nested’s model was “cheaper and fairer than the distressed or quick house sale industry” which he highlighted was criticised in a report by the Office of Fair Trading.
The business has raised £3m from investors including Passion Capital and billionaire German entrepreneurs Oliver and Alex Samwer via their Global Founders Capital fund.
Joining Robinson on this journey are James Turford and the former Songkick CTO Phill Cowans, who has built their “smart valuation technology” which Nested uses to provide would-be sellers with a valuation online and guarantees a minimum sale price.
On fees there’s a minimum of 1.8% plus a 20% share of any upside over and above the guaranteed sale price.
Robinson readily admits sellers “pay us more than another estate agent” because “we’ll give you the certainty to move forward”.
He stated his intention was “not looking to be a small business or be bought out for tens of millions. We are looking to take 10% as a minimum of this (estate agency) market by adding more value, not less”.
Talking about previous Proptech as “surface level innovation so far”, he described Purplebricks and eMoov as “not tech companies” as “none of them are product oriented companies”.
He said: “They’re easyJet or Ryanair for estate agency. They’re just agents ditching the offices and racing to the bottom.”
He added: “Traditional high street agents provide a valuable service and if you speak to sellers they tell you they get a good service. We’re not for everyone, when we say a minimum 10% market share, there’s probably a ceiling of 50%, because some won’t be in a hurry (to sell).”
On how they look to achieve such ambitious market share Robinson said: “Purplebricks ask how they can reduce fees but while they chop out cost, they also chop out value. We ask how can we better justify fees and add value.
“Historically middle men are much maligned for not adding value. If we can say for certainty how much your property will sell for and how quickly it will sell, then we put my money where our mouth is, and we think the market will come to us.”
The service, which is signed up to TPO, is available now for homes worth less than £1m and begins with an online valuation at www.nested.com