South African startup PropertyClan is making professional-grade property investment opportunities available to real people who may not otherwise have the insights needed to make the best investment decisions.
PropertyClan was originally founded in 2019 in the United States (US) by three experienced South Africa-born entrepreneurs. However, when the app was ready to launch, the COVID-19 pandemic struck, and two of the founders were stuck in South Africa. Thus, the business was launched back home, with the buoyant South African property market helping the business secure early uptake.
The app empowers users to invest in property like a professional by taking care of finding deals and doing the analysis of them.
“In other words, PropertyClan provides ordinary people with the information they need to make smart property investment decisions even though they may not have the expertise. We help make real wealth-building property investments accessible to those who otherwise would not be able to access this lucrative investment class,” said co-founder Michael Egner.
“The PropertyClan app, and our team of investment strategists, help users to formulate an investment strategy and then delivers these deals directly to the user on a personalised basis, through the app. All the deals are pre-screened and analysed by PropertyClan so that users don’t have to spend the time or have the skill to perform these analyses themselves.”
The app can be used by seasoned investors or those that have always wanted to invest in property but lacked the know-how or confidence to go it alone. The process behind it is fourfold – it finds suitable properties for you, matches them to your profile, facilitates the transaction and manages the property for you. Users can sign up for free, or take advantage of a paid-for Prime membership that comes with a variety of discounts and perks.
So far, uptake has been impressive, with Egner saying it is about 400 per cent ahead of the business plan.
“The company signs on between 100 and 200 new users every month,” he said. “The challenge has been to meet the demand with enough investment opportunities.”
The startup is meeting that challenge through partnerships, and is already in talks with potential offshore partners about making opportunities available in their countries to the PropertyClan user base.
Egner puts the high demand down to the significant gap PropertyClan is filling within the local real estate investment market.
“There was no tech solution for people wanting to enter the property investing space as hands-on investors. One can invest indirectly through REITs, share investing platforms and the like. But many people want to own directly, make their own portfolio decisions, and experience the full wealth-creating power of bank leverage,” he said.
“The biggest hurdle many of these potential investors face is a lack of knowledge when it comes to property investments which is where our app comes in.”
PropertyClan has thus far been funded by the co-founders’ own capital, and has managed to break even on all costs to date. Yet it does plan on raising funding in the near future.
“The company’s scale-up journey lies ahead and we will be looking to raise external venture capital within the coming months. This will assist in building out the South African operations as well as assist us in launching our offshore investment opportunities and opening the platform to users abroad,” said Egner.
