Thinks are looking pretty good for fintech entrepreneur Dan Gandesha right now, even if he has had a hectic couple of weeks. Just 12 days ago his property crowdfunding business Property Partner landed £5.2m of investment from one of Britain's best-known VC firms – on the very same day his wife went into labour with their first child.
'It was quite an interesting day - making sure we gathered everyone's signatures and closed the round whilst I'm walking around Putney Park trying to encourage the contractions to develop enough so we can go to the hospital,' Gandesha told MT.
As if a newborn son wasn't enough to keep him busy, the former Sky exec now has some of Europe's most seasoned tech investors keeping him in check. Property Partner's certainly an innovative proposition: it allows crowdfund investors to put small amounts of cash (a minimum of £50) into specific buy-to-let properties and, crucially, to trade their stakes on an open market with other investors.
Property crowdfunding has taken off of late and it's not hard to understand why. A surge in house prices last year made becoming a landlord more difficult, even if the market has come off the boil a bit in the last few months. Investing in property can be a risky business, as many discovered after the financial crisis, but its potential rewards remain a big draw for some.
Companies like The House Crowd and Property Moose have attracted the attention and opened the wallets of VCs and property investors alike, but on those platforms it's not easy to dispose of your share of the property until everybody agrees to sell up. But Property Partner's USP is its marketplace, which Gandesha says acts as a 'stock exchange' for property assets.
'With a stock exchange, if I want exposure to a particular company, I don't need to buy all of that company, I can buy a piece of it,' he says. 'During that period of ownership I receive an income stream in the form of a dividend, and crucially when I want to exit I can exit on platform at a price that reflects the underlying value of the asset.'
Similarly, with Property Partner you earn income in the form of a portion of the rents (minus the company's service fee), and can sell off your share in the property at any time through the secondary marketplace. That's assuming a buyer is willing to take it off your hands of course – although the early signs are good. Half of the shares in the first property listed on the website have been traded through the secondary exchange, with an average premium of 12%.
The company only launched fully in January but there's already seven properties on the site, five of which have been fully funded, and more than 1,000 people have invested through the platform. At the moment the properties are all in London, but Gandesha says he plans to expand to the rest of the country and then much further afield in the future.
With this latest investment, the company has assembled an impressive roster of backers and management. The £5.2m comes from Index Ventures, which has put money into the likes of Asos, Funding Circle and Transferwise, and co-founder Neil Rimer will join the board. Previous investors include Ed Wray, the co-founder of Betfair, who will also join the board, and early Zoopla backers Octopus Ventures, so Gandesha's in good company.
But with that lot breathing down his neck and the challenge of raising a young family to contend with, Gandesha better be good at functioning on small amounts of sleep.