Corporate "cookie cutter" housing turns people into worker drones When an employee has to move to a new city for a few months, he is either stuck in huge, immaculate complexes, or Airbnbs, for shorter stays But Zeus allows any owner to be paid to host a white-collar temporary workforce. As part of its managed ownership model, Zeus assumes all the furniture, maintenance and risk of filling the house while its owners expect to earn money.
Zeus has quietly reached a $ 45 million business figure thanks to the rental of 900 homes in 23 cities. It's 5 times in one year thanks to 150 Zeus employees. With 90% occupancy, confirmed employers and their talent are looking for unique, trustworthy, well-equipped, multi-month residences that make them feel at home.
Now, while Airbnb is distracted by his next IPO, Zeus has collected $ 24 million to steal the business real estate market. This includes Bowery's previous $ 2.5 million introductory round, the new $ 11.5 million Series A lead by Initialized Capital, which partner Garry Tan joined the Zeus board, and a 10-year debt. million USD to pay fixed costs like furniture. The plan is to expand the number of homes, create better portal software for homeowners and establish partnerships or internal divisions for cleaning and furnishings.
"In the first decade, out-of-school people held two jobs. Now there are four jobs and five, "said Zeus co-founder and CEO Kulveer Taggar. "We think that in 10 years, these people will not buy furniture." He imagines that they will pay a supplement to hold a home, which, judging by the growing popularity of services on demand without friction, seems an accurate assessment of our lazy future. Meanwhile, Zeus aims to be "the breakthrough in trying to rent your house" where you enter your address and some details and you cash checks 10 days later.
The purchase of a house was a step 1
"When I sold my first startup, I bought a house for my mom in Vancouver," recalls Taggar. It was profitable when she let him go back to his old house while he was at university to buy an apartment in Mumbai that he would rent to make money. "Although I did not grow much, my mother was a travel agency and we traveled a lot," said Taggar, who inspired his goal of living nomadically in homes around the world. Zeus could let others live this dream.
After Oxford and as an analyst at Deutsche Bank, Taggar created the Boso student market before moving to the United States. There, he co-founded the Auctomatic auction tool with his cousin Harjeet Taggar and the future co-founder of Stripe, Patrick Collison, passed by Y Combinator and sold it to Live Current Media for $ 5 million only 10 months later. This allowed him to give his mother a home and start tinkering with new ideas.
With the support of Y Combinator again, Taggar launched Tagstand, the NFC triggered task launcher, which swung in the application settings configuration agent, then in the state of the automatic sharing application location. But when his co-founder, Joe Wong, had to travel an hour south of San Francisco to Palo Alto, Taggar was stunned by the way the process had been distracting. It was difficult to identify and recruit a new tenant, as well as to find a rent in the medium term without having to face exorbitant prices or basics of Cragislist. After seeing his former co-founder a resounding success with Stripe's straightforward integration of payments, Taggar wanted to combine this vision with OpenDoor's easy home sales to make renting or renting an instant location. That spawned Zeus.
Stripe meets OpenDoor to beat Airbnb
To become a Zeus owner, simply enter your address, the number of bedrooms and bathrooms, as well as some aesthetic specifications, and you'll get a monthly quote for what you'll pay. Zeus intervenes and carries out a quality evaluation in 250 points, collects the floor plans, furnishes the property and manages the cleaning and maintenance. He works with partners such as Helix mattresses, parachute sheets and Simple Human bins to obtain preferential rates. "We incurred debt because we had fixed investments in furniture. It's not as dilutive as selling pure stocks, "says Taggar.
Zeus quickly finds a tenant through ads in Airbnb and relationships with employers such as Darktrace and ZS Associates with many employees on the move. After background checks, tenants get the numeric lock codes and have access to 24/7 support in case anything goes wrong. The goal is for someone to sleep there in just 10 days. "Traditional corporate housing costs SF $ 10,000 a month in summer or in long-term hotels. Airbnb is not well suited [for multi-month stays]. Affirms Taggar. "We are about half the price of a traditional business housing for a better product and a better experience."
Zeus signs minimum leases of two years with homeowners and attempts to extend them up to five years when possible. He receives a month's rent free, as do property managers, but does not charge an additional rate. For example, Zeus can rent your house $ 4,000 a month, but the first month is free, and rent it at $ 5,000 so that she earns $ 60,000 but pays you $ 44,000. This is a net margin if Zeus manages to fill his homes quickly and limit his maintenance costs.
"Zeus has been instrumental in having my company start the resettlement process in the Bay Area and welcome our visiting foreign employees now that we have settled in," says Luis Caviglia, a client of Zeus, Meiter. "I particularly like the" hard truths "present in every property and the support we received when problems arose during our stays."
At home, no matter where
There is no shortage of competitors in this $ 18 billion market in the United States alone. There are old school companies and chains such as Oakwood and Barbary Coast that generally rent apartments from large generic complexes at high rates. Stays of more than 30 days accounted for 15% of Airbnb's business last year, but the platform was not designed to provide peace of mind around long-term stays. There are pure markets, like UrbanDoor, that do not always take care of everything for the owner and do not provide a consistent tenant experience. Next are direct competitors such as Sonder ($ 130 million), Domio ($ 66 million), recently rewarded by the second address (GV), and European players such as MagicStay, AtHomeHotel and Homelike.
There is a lot of pie, though. With only 330,000 homes in San Francisco alone, Zeus has plenty of room to grow. The rise of distance work means that companies whose employees are usually not transferred can now use remote workers for a multi-month sprint. A recession could make companies more cautious about spending and encourage them to rethink the implementation of staff in hotels for months. The paperwork and taxes imposed by the regulations could deter homeowners from renting short-term housing and encourage them to rent housing. And the need to develop new businesses could entice large vacation rental platforms like Airbnb to make acquisitions in space – or to try to crush Zeus.
The winners will be determined in part by the widest and cheapest choice of properties, but also by the greater comfort of the people in a new city. That's why Taggar is inspired by WeWork trying to organize more community events for its tenants. Often needing friends, Zeus could become a favorite in helping people to feel part of a neighborhood rather than as a faceless prisoner in a large building or hotel. This gives Zeus a network effect if it can develop a density in the main markets.
Taggar says the biggest challenge is this: "I feel like I run five startups at a time. Pricing, supply chain, customer service, B2B. We decided to customize everything: our own property management software, our own internal CRM. We think these benefits are aggravated, but I can be wrong and waste efforts. "
The benefits of Zeus's success would go beyond the founder's bank account. "I had friends in New York who had great opportunities in San Francisco but did not take them because of the friction of travel," says Taggar. Bringing talent where it belongs could build more things. And easy housing can make people more likely to live temporarily abroad. Taggar concludes, "I think it's a great way to develop empathy."