ToLet.com.ng raises $1.2m amid economic recession
By Kokumo Goodie, Lagos, Nigeria
Amid ongoing economic recession in the one-time giant of Africa, Lagos-based real estate classifieds start-up, ToLet.com.ng, said it has closed a $1.2 million Series A round of funding from Frontier Digital Ventures (FDV).
"The new funds raised will be used to improve the platform’s technology offering to both property seekers as well as that used by listing agents. The rest of the funds will be channelled into improved marketing efforts and aggressive expansion across Nigeria over the next 12-18 months,” says its Chief Executive Officer, Fikayo Ogundipe.
Founded in 2012 as Estanode.com with a collective personal savings of $400 from four Obafemi Awolowo University fresh graduates –Fikayo Ogundipe, Sulaiman Balogun, Dapo Eludire and Seyi Ayeni – it received a $230,000 seed fund from Jason Njoku’s Tech company accelerator Spark.ng in 2013, then rebranded to ToLet.com.ng. Since then the real estate classifieds start-up has quietly grown into one of the leading and recognisable online property portals in Nigeria.
"Our Agents are much happier to stick with us because, unlike competitors who use subscription models, we collect commissions which essentially makes our service a performance-based one and ensures ‘we don’t get paid unless our agents get paid’. The commission fee is the model locally operated among Nigerian real estate agents. Our research showed that Nigerian real estate agents prefer the model of sharing commissions on closed deals as against paying subscriptions that don’t have guaranteed returns", says co-founder Sulaiman Balogun.
Spark co-founder Bastian Gotter, commenting on the fresh investment says: “We are very excited to welcome Frontier Digital Ventures (FDV) to the ToLet.com.ng family, as a long term thinking and very knowledgeable partner. We believe this new fundraise gives the ToLet management team the capital to scale, and as well serves as validation for what they have achieved already. We are looking forward to seeing ToLet.com.ng win big and change the real estate industry in Nigeria. "
Talking about the raise, Shaun Di Gregorio founder and CEO of FDV says: “We are super excited to be making this investment intoToLet.com.ng, and look forward to being part of helping fuel their next stage of accelerated growth. We have full confidence in the ability of the founding team to continue with the awesome job they have already started and we look forward to the consolidation of their position as the number one property classifieds portal in Nigeria.”
From inception till date, ToLet.com.ng has facilitated over 8 million dollars in transactions value and currently boasts of roughly 20,000 listings online from a growing number of just over 3,500 real-estate agents.
Despite a recession being officially declared by the Nation’s Statisticians, the Real Estate Services in the Second Quarter of 2016 still grew by 2.12%. The contribution to nominal GDP in the Second Quarter of 2016 was 8.64%. This further validates the company’s belief in brighter days ahead. ToLet.com.ng’s mission is to be the largest property vertical in Africa by 2020.
Frontier Digital Ventures is a Malaysia-based investor in leading classifieds companies in emerging markets. Last year it invested $500,000 in Ghanaian real estate classifieds start-up MeQasa and has made several investments across frontier markets including Panama’s general classifieds Encuentra24.com and Pakistan based property website Zameen.