Our Q&A series is an opportunity for our French team, headed by Elsa Vaillant to discuss all things PropTech, Start-ups, and Career with different founders from across the region. Each time we will ask PropTech innovators burning questions and quiz them about their product, we hope you find it insightful and enjoy getting to know the founders as much as we have.
Prello is a PropTech founded in 2021 by Ludovic de Jouvancourt and Sébastien Gal. Prello specialises in selling and managing second homes. Thanks to its international service, Prello supports its clients through all stages of buying, managing, and renting their second home and offers complimentary services.
With the ambition to democratise access to second homes through co-purchasing, Prello offers all types of property in France (flats, houses, and estates) starting at €50,000.
With second homes located in all the main French holiday destinations, Prello aims to develop its concept in Europe by the end of 2022.
French consumers are interested in personal finance, wealth, and property investment, as the property is still a haven.
With my partner, Sébastien Gal, our desire to launch a start-up in this industry was initially motivated by our shared passion for real estate and our knowledge of the sector based on our professional and personal experiences.
With Prello, we wanted to develop a real estate start-up that focuses on accessibility to make it easy for as many people as possible to become homeowners.
Regarding the market, we focused on second homes. This represents 10% of all real estate transactions in France each year. In addition, it’s an asset that lends itself to time-sharing and co-purchasing. Thanks to our model, a person with a budget of 125,000 euros will find himself in a property worth one million euros by buying 1/8th of the property.
The PropTech market was born in 2017 with the ambition to dust off and revolutionise the property market to meet new consumer expectations looking for simplicity and accessibility.
If the sector has been developing slowly since March 2020, the health crisis has accelerated its transformation because of forced social and physical distancing. Indeed, at that time, digitalisation enabled part of the real estate sector to progress. Digitalisation, which notaries have also had to embrace to sign deeds remotely, which had previously been impossible and was made possible by a decree published in April 2020 to make the market more flexible.
In this context, new, more specialised players have emerged in the last two years. This phenomenon has also accelerated with the arrival of new players specialised, for the most part, in a particular segment of this industry (ibuying, property investment, neo-real estate agencies).
In line with this logic, in 2021, investors gave strong signals regarding new PropTech players’ credibility. In total, 44 rounds for more than 628 million euros were raised in this ecosystem. Thus, PropTech was positioned in 3rd place of the most coveted sectors for investors that year.
Accompanied by a strong French interest in real estate and 1.2 million transactions completed by 2021, PropTech has a bright future ahead of it. But before we can talk about this sector, the French regulatory and legislative framework will have to be less restrictive. They will have to continue evolving and innovating rather than favouring the status quo.
There has been a strong VC interest in PropTech topics, and this is due to strong consumer interest in new models of real estate.
2022 seems to confirm this trend, even though reservations have been made. Indeed, late-stage fundraising is becoming rarer, and series A fundraising is more challenging to complete. Investors are increasingly careful about their investments and, therefore, more selective with their projects. We’re convinced they will be more sensitive to projects that genuinely answer to new consumer expectations and those that match French consumer purchasing power, which has been heavily impacted in recent months.
We felt this impact during our roadshow. Indeed, with Prello, we provided a disruptive concept compared to what existed on the market and made second homes accessible through co-purchasing. This approach has proven popular with investors who have placed their trust in us and continue to do so. Within 6 months, we have obtained two rounds of financing. The first was for €2 million from Axeleo Capital and business angels specialising in property technology. The second was €13 million. We again obtained it from Axeleo Capital, the first French VC dedicated to Proptech, business angels in the real estate sector and Otium Capital. This was a historic deal because it was obtained just a few months after an initial financing round. In total, we raised €15 million in capital.
The market signals for 2021 and the first quarter of 2022 gives us great confidence for the future.
In recent years, the pandemic, the democratisation of remote working, the emergence of medium-sized cities and the need for space have genuinely impacted the French population’s real estate preferences, thus explaining the popularity of second homes. Indeed, second homes are experiencing a considerable rise: one in four French people said they wanted to buy a second home after the 1st quarantine (Se loger 2021 study). Transactions linked to second homes also increased by 6% in 2021.
However, only 10% of households own a second home. At the same time, most second homes are owned by well-off households over 60 years old. To meet French consumers’ new aspirations regarding their life plan and the problem of accessibility, Prello provides a turnkey service for purchasing and managing second homes in co-ownership.
For example, in large cities, particularly in Paris, we can see that French buyers want a base less than two hours from their home, where they can remote work but also have an outdoor space. Faced with these changes in French lifestyles, Prello provides a solution in response to these new, more nomadic, and flexible needs that emerged after the health crisis. Beyond lifestyles and consumption patterns, Prello is entirely in line with the concept of sharing economy by applying it to the real estate industry by providing a service to co-purchase a second home.
Thanks to our model in which co-owners share the property’s costs and occupancy time, our solutions and co-owners contribute to reducing the environmental impact generated from the real estate sector. Regarding the climate emergency, sustainable development is a criterion that is firmly considered by our co-owners.
In my opinion, we will see a new era in the PropTech sector which will structure the market. Indeed, many players have developed over the last two years, simultaneously and for some, by offering the same service without differentiating. In this context, competition is tough, and it will be necessary to stand out with a strong value proposition to consumers. These players will have their pace in this industry, while those who are just a copy of their competitors may see their model called into question.
To be sustainable, it will also be necessary to call on new sources of financing in the structuring phase and to develop collaborations with the historical players in the real estate sector. They lag in the digital industry. I am convinced that synergies need to be established between these players and PropTech to provide a good value offer.
In 2022, we will continue to develop our activity in France in the areas most sought after by our clients (PACA, Calvados, the Atlantic coast, etc.). At the same time, we wish to initiate an internationalisation strategy to extend our service in Europe by prioritising target markets: Spain, Italy, and Portugal, where tourist interest is strong.
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