eMoov, one of a number of online real estate agents fighting it out in the U.K., has picked up £9 million in new backing. The round was led by consumer investment group JXC Ventures, with participation from existing investors Episode 1 VC, Maxfield Capital, Spire and Startive Ventures.
Gaby Salem of Wharton Asset Management has also invested in a personal capacity, along with unnamed high net worth individuals, family offices and “well-known tech entrepreneurs”. The proptech startup had previously raised £3 million and says today’s disclosed round is still open and could add a further £3 million in the coming weeks.
eMoov says the new capital will be used to further enhance the company’s technology platform, in addition to an increase in marketing spend which “will be undertaken by a newly engaged, ultra-sophisticated marketing team”. That inadvertently (and almost certainly unintentionally) suggests the previous team were not engaged or ultra-sophisticated. But I digress. (Update: I’m told there was no marketing team until March this year).
Meanwhile, the new round of funding for eMoov comes amid lots of noise over the last year that U.K. startups in the online estate agent space have been in various, albeit tentative and perhaps informal, acquisition or merger talks, in a bid to better compete with Purplebricks, which is thought to be the leader. One tip TechCrunch received in December is that eMoov and Tepilo held discussions, although I haven’t been able to confirm how serious they were or if they took place at all.
In a call, eMoov founder Russell Quirk didn’t deny that he has at some stage talked to competitors, although he reckons Tepilo wasn’t one of them, but added that he doesn’t think an acquisition/merger or roll up makes much sense.
For a sales business with limited or no repeat customers (since you don’t sell or buy a home very often) it is not clear what you would be acquiring. Putting aside team and whatever tech exists under the hood, you would also likely need to decide which brand to keep or dump, which arguably is the main thing you’d be purchasing. That said, he does think consolidation will happen, but in a “survival of the fittest” kind of way i.e. by startups entering the deadpool.
Perhaps related to this, eMoov is now calling itself a “hybrid estate agent” in recognition that not all of its processes are automated by tech and that Quirk thinks humans are still needed at various touch points of what is a “people business”. Here is how an eMoov company spokesperson explains the change of emphasis:
The online sector has now grown in terms of competitors but there has become a real divide in terms of those that provide a very poor service offering and are almost DIY in their approach, and those like eMoov, who provide a full estate agency offering including real people on the ground that will visit a property to provide valuations, floor plans, EPCs, photos and so on.
So we like to differentiate ourselves from the lower end of the online sector because even in the short time it’s been alive, there have been different variants entering the fray.