It’s hard to convince people that they deserve a vacation. Convincing people that they can co-own a vacation home and enjoy it at the same time can be deceptively more difficult.
Go away — unlike another corporate-backed Getaway, which sells getaways to tiny cabins surrounded by nature — wants to make it easier for people to rent and invest in luxury real estate. The company, co-founded by Ali Nichols and Amr Shafik, want to do it all. It has raised $4.4 million from Cowboy Ventures, XYZ Ventures and Night Ventures, as well as $1.5 million in debt financing.
The platform, with the tagline ‘investments with a view’, will be officially launched soon and plans to present its first investment offering to investors later this month, pending SEC approval.
“We’re actually buying real estate,” Nichols said. “Everything we post on our website we have full confidence in, as we use our own financing to actually close the house, get it ready for rent and actually make it an asset as an active Airbnb or VRBO property that is already making money.” Then, she continues, the startup sells the property to members while a company buys Getaway shares in the property, so there’s a ‘joint skin’ at play.” Over time, our goal is to create a much to have a more streamlined process from a financing perspective, where we can have a contract for a house, and people can invest at that point and then we close it,” she added.
Getaway is not the first startup trying to optimize the exclusive world of vacation rentals. Built by former Zillow executives, Pacaso helps people buy and co-own luxury vacation homes and has raised more than $1.5 billion in venture capital to date, according to Crunchbase. Pacaso is also one of the fastest companies ever to become a unicorn (valued at over $1 billion). Ever.
Getaway’s co-founders say users can invest in a Getaway property as low as $1,000 per share of ownership, while Pacaso can cost between $400,000 and $3 million to buy one-eighth of a property. Owners are “strongly prohibited” from renting out their portion of any Pacaso property, a Pacaso spokesperson confirmed via email. Getaway properties, on the other hand, are active vacation rentals that also generate recurring passive income.
What’s also important is that Getaway allows owners to get discounts on the entire portfolio of homes; the downside is that you have to pay to stay in a house that you partially own.
Another startup in the space is Here, which aims to make investing in vacation rentals as easy as investing in stocks. Unlike Pacaso and Getaway, Here seeks to increase the financial benefit of owning a home, not necessarily the vacation aspect of it.
Getaway’s competitive moat is that it wants to be everything, everywhere, all at once. Nichols described that he wanted to be a cross between Here, where “your experience really ends with the dollar you put in and you hope to see it grow in the app,” and Pacaso, where “it’s not really a financial investment, it is an investment in traveling and spending time in beautiful homes.”
People do want access to these beautiful homes and so our approach is how we can actually take that and make it more accessible and more logical,” she said. “When I look at the sea of all the competitors I can put $1,000 into, and all things being equal, then hopefully it’s just a huge benefit from a consumer perspective.” The company currently has two homes, one in Scottsdale, Arizona and one in Miami, Florida, and is closing one in Palm Springs, California soon.
“It seems like every day there is a new safe investment for consumers,” Shafik said. “How do you cut through the noise and make sure you reach the right person who does this [opportunity] would be interesting, but there’s also something about demand generation and customer acquisition.”
Building a wealth and an experience for a wider consumer market comes with its own challenges. Time will tell if Getaway can get there.