weavera London-based marketplace and SaaS contract negotiation platform for homeowners/architects planning large home renovation projects with vetted contractors, has closed a $4 million seed round to expand nationwide.
The round was led by European VC btov Partners, with participation from, among others, FJ Labs, Enterprise Fund (a consortium of former Atlassian and Docker executives) and Dr. Stefan Heitmann (founder and CEO of MoneyPark and PriceHubble).
Founded in 2017, the startup had previously raised $1.5 million in pre-seed funding from a number of angels — bringing the total raised to date to $5.5 million.
Weaver’s platform matches homeowners and architects with suitable contractors (using an algorithm), making it easy to get quotes and compare prices – without the usual friction of manually researching and contacting contractors.
It is also intended to house important communications around the contract negotiation/offering process through built-in messaging, document sharing and on-site meeting scheduling capabilities. So the platform acts as a centralized pipeline that keeps all parties informed and can be used to track compliance.
“We started as two industry founders looking for product/market customization with no-code SaaS, bootstrapping while minimizing investment. We then invited two tech founders to join us in 2020 and it took us about a year and a half to achieve product/market viability on a proprietary platform,” explains co-founder and CEO Greg Keane why a seed round now is started.
Contractors on Weaver’s platform are manually screened by the startup before being allowed onto the market, where they have the opportunity to bid on high-end projects.
They are also subject to ongoing checks by Weaver to verify the quality of their work and other concerns such as g. early signs of insolvency. Weaver also takes on a troubleshooting role in the event of problems during the build.
“Weaver addresses a fundamental problem of communication between homeowners and contractors in the following order: 1. Find contractors they can trust and; 2. Building trust in a renovation price,” says Keane. “Next, we will solve the problems of 3. understanding how a contract is made and 4. eliminating the risk of contractor bankruptcy with fully insured escrow payments.”
“Renovation projects are matched against contractors by an algorithm,” he confirms. “We also built the first true SaaS home renovation bidding platform where users can now exchange information via messaging, document sharing and site meeting arrangements – we are working towards creating a network effect here.”
Construction is a complex space for startups to revolutionize, if best thought of as not as a cohesive single market that can be rapidly scaled, but as a number of distinct sub-markets that can have their own workflows and suppliers (as well as often to meet specific regulatory requirements).
But this diverse landscape may create opportunities to focus on the necessary nuances and specializations, applying the specifics that a strong software-as-a-service offering can bring.
Notably, Weaver is also aligning its market towards a top slice of home renovation projects – where the size of the project is not only large enough to support monetization via a success fee for contractors, but also the risks involved – for all parties – likely to increase demand for verification and centralized accountability. For example, she plans to install fully insured escrow payments for homeowners.
Other plans the startup has for seed funding include an extra carrot for contractors in the form of quick payments, as well as transitioning its platform from a desktop, cloud-first to a mobile-first product — to better align with the User Customization Commitment to this segment of the home renovation market is strongest.
It will also leverage more renovation pricing data it can collect to create more value for homeowners — via “smart renovation pricing solutions,” as Keane puts it, aimed at giving those users better feedback on where their Prices are compared to the market.
“We are on our way to becoming the leader in renovation pricing in our market, which we believe will establish us as the number one choice for indexing renovation prices,” he suggests, adding: “We have plans to do this Leveraging data to create a machine learning algorithm that accurately budgets and prices home renovations, solving one of the biggest frustrations in the industry today.”
He says the problem is that homeowners are typically under budget (by 10% to 30%) because they do back-of-the-envelope-type calculations, “using standard multipliers of rough averages.” So if Weaver can provide “quick and accurate” pricing information for the specific project from the start, homeowners might be willing to pay for it – provided the data would allow them to save or borrow the right amount before committing embarking on a major project (with all the risks and burdens that entails) or even contemplating a home purchase where a certain type of renovation is envisaged.
Only a minority (40%) according to Keane. Homeowners hire a traditional architect for a renovation project. He also suggests that architects typically only pitch one contractor per project they design (“an architect’s word-of-mouth network just isn’t big enough”) — so Weaver wants to step in and help homeowners make the top three easier Get offers want to be sure they are getting the market price for their project.
The startup also works with third-party firms that produce architectural drawings for a fixed price, so it can offer its services to the approximately 60% of homeowners who don’t hire a traditional architect, so they may be looking for this type of help in realizing their project.
Weaver’s business model has three components: a success fee from contractors who win a project through the market; an access fee for homeowners (or paid by architectural firms) – with tiered prices based on increasing levels of support; and referral fees from home improvement loan providers that Weaver clients can collect.
Whilst in the UK there are growing concerns over a deepening cost of living crisis – for example with energy bills set to skyrocket over the next month following the expiry of a price cap – on top of rising inflation and broader economic concerns linked to the global and others Trade – related events – Keane isn’t worried about that Demand for home renovations is falling as the startup essentially targets its service to the top 1% to 5% of earners, who are likely to be offended by the challenges faced by low-income households.
“We’re not worried [about the impact of the cost of living crisis on demand for renovations] As our average project is £100k to £300k, these are households with incomes in excess of £150k and savings built up over many years,” he tells TechCrunch, going on to suggest other factors are at play, the more affluent Households could induce spending on modernizing their homes, for example in relation to climate issues.
“We are seeing the macroeconomics pushing more households to renovate to combat energy increases with properly insulated homes while reducing household emissions. In addition, we expect The UK government is increasing further subsidies for home insulation and eco-boilers Tackle 40% of UK emissions.”
Weaver’s marketplace, which has been active for over four years as of this writing (although it has only been active in its current form since March 2020), has processed over $120 million worth of construction to date, with the startup noting, that orders received on the platform in 2021 grew by 2.6x compared to 2020. Around 400 construction companies, 300 architects’ offices and around 900 homeowners/individual users are currently registered.
Weaver will use the seed funds to expand its presence in the UK to serve a larger portion of the domestic home renovation market. (Currently the service covers Greater London, South East England, Birmingham, Manchester and Liverpool.)
Keane says it plans future international expansion “eventually” — and on that front it’s eyeing Germany and the US, where its research suggests market dynamics are similar to those in the UK. (Although the Victorian home renovations that typify many domestic projects undertaken through Weaver’s platform would presumably not be the norm as they expand into countries with very different types of housing stocks.)
“Our largest investors are based in those two markets, which gives us the network to hire local talent,” notes Keane, adding, “We thrive in metropolitan areas where there is a very fragmented market for contractors and the potential value for our solution is the largest , so we will be expanding beyond the UK by the end of 2023.
London startup Weaver gets $4M to build out a vetted marketplace for home renovations – TechCrunch Source link London startup Weaver gets $4M to build out a vetted marketplace for home renovations – TechCrunch