Emailed on October 2, 2020 in The Friday Forward

Former Zillow Group CEO Spencer Rascoff and dotloop founder Austin Allison are teaming up on a new startup called Pacaso that aims to make it easier for more people to own a vacation home.

The company came out of stealth mode today, announcing a $17 million seed round and $250M in debt financing.

Pacaso is taking all of the hassles associated with the traditional do-it-yourself time-share process, and all of those risks, and eliminating them. The startup partners with real estate agents to find homes for customers and helps set up an LLC designed for co-ownership. The buyers pay for their share — anywhere from one-eighth to half  — and Pacaso pays for the rest, eventually selling the other “shares” to additional owners. It then serves as the owner representative on behalf of the group, handling various logistics such as maintenance, financing, legal, and more. Its platform also lets owners with scheduling and booking.  

Pacaso makes money by charging owners a 10% fee at the time of purchase, and from an annual property management fee equal to 1% of the purchase price. The business model is common in commercial real estate, but not as much in the vacation home industry.

More here.