The problem with housing in Lagos state (Nigeria’s commercial capital and most populous city) is that when it is available, it might not affordable and sometimes it may be the other way round – or even both. Although, there’s no reliable data as to the housing deficits in Nigeria, but the most recent figure according to the Federal Mortgage Bank of Nigeria and the International Human Rights Commission in Q2 of 2022 remains at 28 million units.
With this data, a growing population of Nigerians at 200 million plus (as at 2022) and the linear progression of the housing deficits in the country contribute to solutions such as rent since not everyone is able to build houses while the available ones are sought after by renters, the greater contention may be affordability – a situation where the cost of living is greater than the standard of living. It becomes hard to maintain a rent notwithstanding those who aren’t accessible to deserved housing. In this event, Nigerian Proptech startup, Spleet is providing solutions to accessibility by connecting landlords to tenants as well as enabling loans are utilized for house payments.
“After launching a marketplace in 2019, we realized that the issues in our rental market were beyond what our marketplace could solve. Affordability is one of the biggest pain points for tenants. Most tenants earn income monthly and can therefore not afford the 1-2 years burden of paying their rent in advance,” said co-founder and CEO, Akintola Adesanmi.
Founded in 2018, the proptech has since raised over $3 million – after completing its seed funding with $2.6 million led by MaC Venture Capital channeled towards provision for rent financing in the country particularly Lagos state. Other investors in the seed round include: Noemis Ventures, Plug and Play Ventures, Assembly Fund, Ajim Capital, Francis Fund, Daba Finance and other angel investors including Proptech operators such as; Eduardo Campos and Paulo Buchicher of Yuca, Maajed Chaaaraoui of Insurami. Existing investors from Spleet’s pre-seed round in July of this year – Metaprop VC and HoaQ Fund also participated in the round.
The funding will enable the company to boost its residential rent management and financing solution called: Rent Now, Pay Later which permits renters to receive a no-collateral loan of up to N3 million (approx. $6000) with an interest of about 3.5% to finance rent payments. In December, Spleet beta-tested the BNPL product with users who make a one-month down payment while the it finances the remaining 11 months. However, it experienced 1.2% of nonperforming loans (NPL) rate.
In a strategic attempt, the company plans to include Collect (a service that automatically receives rent payments on behalf of landlords) and Verify (a tool that enables landlords and real estate agents to vet and carry out adequate background checks on tenants) before leasing out to customers. The Proptech which aims to expand to other markets by next year has processed over $3.5 million in rent. It has also onboarded over 35 individuals and corporate landlords as well as over 1,000 tenants – with an average lifetime value of 26 months, Adesanmi noted.
Commenting on the raise, co-founder and managing general partner at MaC Venture Capital, Marlon Nichols stated that: “The housing crisis is an enormous problem that impacts us at a global scale, and Africa is no exception. In countries like Nigeria, the requirement for tenants to provide 12 to 24 months of rent payment in advance creates a barrier for large parts of the population in accessing the rental market and essentially renders them homeless. MaC is proud to partner with Spleet as it continues to bring forward a comprehensive solution that effectively serves both sides of the housing market and makes true deposits to combating homelessness.”
In July 2022, the company became the first African startup to join NewYork’s Meta Accelerator. It was also shortlisted recently for the Google for Startups Black Founders Fund (BFF).