US: Furnished housing for business provider Zeus has raised $24 million to fund its expansion in to the corporate housing market.
San Francisco-based Zeus inspects, furnishes and rents private homes to business travellers. It has annual revenues of $45 million from renting out 900 homes in 23 US cities.
The $24 million raise includes a previous $2.5 million seed round from Bowery, a new $11.5 million Series A led by Initialized Capital whose partner Garry Tan has joined Zeus’ board, and $10 million in debt to pay fixed costs such as furniture. The company’s plan is to add more homes, build better landlord portal software, and forge partnerships or in-house divisions for cleaning and furnishing.
“In the first decade out of school people used to have two jobs. Now it’s four jobs and it’s trending to five,” said Zeus co-founder and CEO Kulveer Taggar. “We think in 10 years, these people won’t be buying furniture.”
After studying at Oxford and working as an analyst at Deutsche Bank, Taggar created and sold several tech start-ups before founding Zeus.
Potential Zeus landlords type in their address, the property’s number of bedrooms and bathrooms, and some aesthetic specs, and they get a monthly price quote. Zeus does a 250-point quality assessment, collects floor plans, furnishes the property, and handles cleaning and maintenance. It works with partners like Helix mattresses, Parachute sheets, and Simple Human trash cans to get bulk rates.
“We raised debt because we had these fixed investments into furniture. It’s not as dilutive as selling pure equity” said Taggar.
Zeus finds tenants through listings on Airbnb and relationships with employers such as Darktrace and ZS Associates. After passing background checks, tenants get digital lock codes and access to 24/7 support. The goal is to get someone sleeping in a new property in just 10 days.
“Traditional corporate housing is $10,000 a month in SF in the summer or at extended stay hotels. Airbnb isn’t well suited for multi-month stays. We’re about half the price of traditional corporate housing for a better product and a better experience,” said Taggar.
Zeus signs minimum two-year leases with landlords and tries to extend them to five years when possible. It gets one free month of rent as is standard for property managers, but doesn’t charge an additional rate.
“Zeus has been instrumental for my company to start the process of re-location to the Bay Area and to host our visiting employees from abroad now that we are settled,” said Zeus client Meitre’s Luis Caviglia. “I particularly like the ‘hard truths’ featured in every property, and the support we have received when issues arose during our stays.”
Taggar concludes: “It feels like I’m running five startups at once. Pricing, supply chain, customer service, B2B. We’ve decided to make everything custom – our own property manager software, our own internal CRM. We think these advantages compound, but I could be wrong and they could be wasted effort.”</p
