RIO DE JANEIRO, BRAZIL – Backed by funds such as Monashees, Kaszek Ventures and Andreessen Horowitz, the startup manages some 300 apartments in Latin American metropolises.
To create a middle ground between a hotel and an Airbnb apartment: that was entrepreneur Nico Barawid’s goal when he founded startup Casai in Mexico. Used to traveling for work as an executive, the young man lacked a hospitality service model that guaranteed minimum quality standards, such as high-speed Wi-Fi, without having to resort to large hotel chains.
Alongside his partner María del Carmen Herrerías Salazar, who worked in the hospitality industry, he founded Casai in 2019.
The startup adopts a property management model. After handpicking high-end apartments in strategic neighborhoods, the company is responsible for decorating and providing services for each unit. In Mexico, where it started its operation, it now has over 200 apartments in Mexico City and some of the country’s coastal cities.
Now, after two years in operation and more than R$300 (US$55) million received from funds such as Monashees Capital, Kaszek Ventures, and Andreessen Horowitz, the company is betting on Brazil to begin its expansion throughout Latin America. The company landed in the city of São Paulo, where it manages 100 properties in neighborhoods such as Vila Olímpia, Pinheiros, Jardins, and Itaim Bibi, and intends to invest approximately R$100 million over the next few years to establish itself in the market.
“Brazil is an important market for us, I believe that our operation here can be bigger than in Mexico. Consequently, we are thinking of expanding this year to other cities such as Rio de Janeiro, Florianópolis, and Búzios,” says Barawid. In order to find good Brazilian suppliers, the company opened an office in São Paulo, where it employs almost 30 staff.
Despite operating in one of the most affected sectors by the pandemic, Casai tripled its activity in 2020. Now, the goal is to repeat the feat this year. Tripling again. Along this path, Brazil will gain relevance. The goal is to multiply the portfolio in the country by 6 by the end of 2021.
According to its founder, the first two months of the Covid-19 crisis dragged down the properties’ occupancy rates, but in July last year the company had about 80% of the apartments rented again. For the partners, the secret to success is the technological rental model that allows everything from “check-in” to cleaning services to be managed through an app.
“The company has enough muscle to handle the spikes in travel highs and lows during the pandemic. But beyond that, they benefited from this change in the nature of travel. As work and home have blended together, many people are experimenting with working from different places,” says Angela Strange, general partner at Andreessen Horowitz.
It’s not only remote work nomads who enjoy Casai’s hosting model. Many real estate funds and building companies have sought out the startup to manage their real estate launches. In Mexico, Tierra Capital and ZKC have signed partnership agreements with the company. In Brazil, the first contract of this type was signed with American private equity company Cerberus, owner of a building in São Paulo.
For investors, the company’s fast international growth is a way to gain ground while the tourism market does not return to pre-pandemic levels. “It’s always challenging to build a hospitality platform, but for them the challenge of entering another country is almost the same as entering another city in Mexico, so it made sense to prioritize a big market like São Paulo,” says Marcelo Lima, partner at Monashees.
In Brazil, companies such as Housi (startup spin off from Vitacon building company) and Nomah (acquired by the unicorn Loft) also invest in the management of rental apartments. The main difference between Casai and these competitors, according to the founder, is the fact that the Mexican startup is still focused on short stays, while the others work with a model more geared towards flexible housing.
Source: Exame