SA home loans buys stake in PropertyFox
SA Home Loans has acquired a 49% stake in online property start-up PropertyFox.
PropertyFox is a local smart online real estate agent founded by entrepreneurs Ashley James and Crispin Inglis.
Since its launch in April last year, the start-up has disrupted the traditional local estate agency business model through handling all logistics, scheduling and security vetting on behalf of sellers online.
According to SA Home Loans, the deal is a major move from the established industry player, both in the sustainability of the digital real estate agent model - and in the local disruptor's growth potential.
PropertyFox says it will use the cash injection to accelerate growth, develop new tech, ramp up brand awareness and deepen presence across all nine South African provinces.
While PropertyFox will continue to operate as an independent business, the deal will directly benefit both businesses, while the online platform will become a strong source of leads for SA Home Loans.
Kevin Penwarden, CEO of SA Home Loans, says the investment was an excellent fit for both companies: "We had been looking for an opportunity to enter the property industry as it is vertically aligned with our industry and PropertyFox resonated strongly with us. The business model is compelling and has been proven to be successful elsewhere in the world."
He adds that, importantly, the firm's founders Inglis and James, are young visionaries: "We believe deeply in their ability to grow PropertyFox into a leader in the industry and are really excited to be a part of their story."
Worldwide the digital revolution is creating efficient alternatives to the traditional real estate agent model, says SA home loans.
PropertyFox founders say since the company's launch the firm has already saved consumers more than R10 million in fees.
Co-founder and CEO of PropertyFox, Inglis says the business has grown rapidly from "two guys and a laptop" to a business that employs 20 people. "The investment from SA Home Loans will allow us to ramp up growth in 2018, a critical time for the business. We are looking forward to having two SA Home Loans directors on our board and will benefit hugely from their combined 30 years of experience in banking, marketing and home loans."
He adds the deal comes after a year-long "courtship".
"It is a real feather in our cap to have the backing of such an influential mortgage finance provider - and one with an intricate understanding of the South African property industry.
"Technology has allowed us to offer clients greater transparency, a far more efficient process and lower commissions than the traditional players. The business offers an end-to-end service for buyers and sellers - including all paperwork, valuation and legal support, with sellers only needing to 'open the door' and show security-checked prospective buyers their home," Inglis points out.
The company's partnership with SA Home Loans and the synergies it offers, will allow PropertyFox to improve its offering to clients, while still maintaining focus on its core service - homes sales," concludes Inglis.