The result is that approximately 60 percent of the investment in Colombia proptech startups is coming from U.S. venture capitalists, followed by Mexico-based VCs, and a smaller amount from Colombia-based VCs and accelerators, he added.
One Colombia startup that has grown its business throughout that country and into the much larger Mexico market of 120 million people is La Haus, a Medellín-based residential marketplace that connects residential developers with homebuyers.
The company’s success is based on its exclusive focus on the “new home built space,” said Jerónimo Uribe, founder and CEO at La Haus. Founded in April 2017, the company has completed more than 30,000 home sales, he said.
“To developers, what we represent is access to an audience that is very expensive and difficult to reach by themselves,” said Uribe. “Sixty-five percent of residential developments in Mexico and Colombia are done and sold by mid- and small-sized developers who do not have the capabilities of the big ones. For buyers, we aggregate the residential development market and give them access to projects that we have validated, creating high trust. For both, we have an online closing experience which makes the product seamless.”
In June 2023, La Haus raised a $62 million Series C round, most of the money coming from U.S. venture capitalists. Colombia-based startups looking for seed-round funding have a more difficult time raising money from within the country, though.
“Today, there’s really not a prominent Colombian early stage VC,” said Uribe. “I think there have been perhaps family offices, high net worths, that have invested, but they have not been determinant to the funding paths of the companies. And in Series B, Series C, and growth stages — really, the key actors have been American funds.”
Colombian startup Castia (formerly Acasa) benefited from U.S. early stage venture capital investment in 2022 when it raised $38 million to expand into Mexico after graduating from last year’s Y Combinator accelerator cohort.
Founded in 2021, Bogotá-based Castia was originally designed to allow homeowners to relocate to a new property with a “buy before you sell process in which we are lending people their downpayment on their second house before they sold their previous house,” said Eduardo Restrepo, chief financial officer at Castia, which he co-founded with brothers Mauricio and Nicolas Peñaranda.
However, by the third quarter of 2022 a “perfect storm” of soaring inflation, high interest and mortgage rates, and a collapse of venture capital interest caused Acasa to become Castia, shifting to a platform on which renters can pay their monthly rent, improve their credit rating and accumulate rewards.
“We pivoted, but I wouldn’t say we abandoned the previous model,” said Restrepo. “But we have it in the freezer, because it’s something that is easily turned on and off.”
The increasing importance of proptech in Colombia and Latin America overall can be seen through the growth and influence of the region’s major conference and networking organization, PropTech Latam Summit, said its founder, Andrea Rodriguez Valdez.
Rodriguez, a native of Argentina, recognized an opportunity to grow proptech in Latin America while working as a Latin America representative for MIPIM, the global real estate events company, she said.
“We had the first PropTech Latam Summit in 2018 in Santiago, Chile,” Rodriguez said. “And from that moment until now we can say that we are building the proptech ecosystem in Latin America. We have had 16 events in eight countries.”
The first event in Chile drew nearly 400 people from eight countries, despite it being relatively unknown. “When we saw that, we said, ‘What happened here? Something is happening.’ ”
In June, Miami-based PropTech Latam held its 11th summit in Mexico, drawing more than 1,000 people from 20 countries, Rodriguez said.
PropTech Latam has been successful as an influencer and ecosystem builder because it combines information and education for startups and incumbents through its academic and corporate network, said Rodriguez.
“There’s a lack of education here about what’s happening in the world and what will be happening with the real estate market,” she said. “My partner Ruben Frattini is a professor at four universities, talking about proptech. So we’ve brought the university and the corporate together to help develop proptech in Latam.”
Like other regional proptech experts, Rodriguez sees Colombia as a particularly interesting real estate tech sector due to the economic clout of its construction and contech industries and the need for more housing and offices space.
“Residential is the first need, but in Bogotá you have a very interesting development in commercial and corporate because it’s the main city of the country,” she said. “International companies are always going to want to be in Bogotá.
“But in Colombia you also have an interesting difference. Colombia has four main cities, and very strong and powerful cities — Cali, Barranquilla and Medellín, all very dynamic and innovative cities. It’s a very good thing for the economy of the country.”
