REZI Lands $100M In Funding To Further National Expansion

The rental platform REZI, which describes itself as a provider of “Occupancy As A Service”, has secured an additional $100 million in debt funding from longtime partner Stratos Credit, it will be announced later today. REZI, an alum of the startup accelerator Y Combinator, was founded in 2016 with the goal of automating the rental process, decreasing discriminatory practices in renting and improving outcomes for property owners.

“Our vision is it should be as easy to rent as to buy something on Amazon,” said cofounder and CEO Sean Mitchell. Mitchell explains the REZI model as one where their proprietary analysis combined with insights from each property owner can predict market-rate rents and lease performance while lowering overhead costs for the owner-operators. REZI sets the rents through their platform, guaranteeing a baseline for the property owner to earn from rents each month, and then earns its income from the profit margin created through decreased costs.

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“We came to this fork in the road where we said we could simply sell the software and go into that slower adoption curve that we knew property owners were slower [to] buy into. Or we can actually just sell the solution itself,” said Mitchell. “That’s where our business model was born. We don’t have to sell the owners on adopting those softwares, we can simply deliver the owners the results by virtue of guaranteeing, effectively, to being that risk mitigation partner for the owner. The owner gets the financial benefits of that software without actually having to adopt and sell it.”

Applicants use the REZI platform to apply directly for a lease and book showings, which helps lower the discriminatory barriers that can occur in the rental market. Mitchell and the two other cofounders, Keenan Williams and Harsh Yadav, had all previously experienced lengthy, cumbersome rental processes and in some cases acts of discrimination which led to the initial inspiration to found REZI. Mitchell cites his experience as a teen growing up with a single mother who lost her home due to a medical crisis and the encounters he experienced as they navigated the rental market saying he had, “a core understanding from a very early age: access to rental housing should be fair. It should be equitable.”

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REZI software uses rental market data from both publicly available and paid sources to predict the outcome and performance of rental contracts. Mitchell declined to name the sources but shared the company has seen a decrease in the length of time units have remained on the market ranging from 50-70% across the 12 cities where it currently operates. The decrease in renter turnover, which also varies considerably across geographies, has improved by percentages in ‘the low double digits’, according to Mitchell.

REZI started in New York City which Mitchell explains as the proving ground for the concept behind REZI: “I used to get a lot of people actually ask ‘why New York’,” he jokes. “Our thought was, if you’re thinking about building a business model really trying to change the way rentals work in this country, the market where you’re going to get the best battle testing is New York. Now that we’ve effectively battle tested in New York for several years and through several cycles, economic and otherwise, we’ve been able to build enormous confidence in our ability to export that strategy to Austin, Florida and other markets.”

REZI currently operates in 11 other locations, according to their website, with a primary goal of this new funding to expand the company to a national presence. Mitchell says they are monitoring several dozen markets and only move into new locations when they find the right property owners to partner with. He emphasizes a national expansion is not their only goal, summarizing REZI’s philosophy by saying, “We’re going to change the way the entire rental market works.”

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