Despite the epidemic keeping us in one place most of the time, proptech is still Getting out. And not only in America
Dongnae Wants to digitize the rental and home buying market in South Korea. The startup has announced the closure of a $ 4.1 million seed round, led by Flybridge and MetaProp, with participation from Goodwater Capital, Maple VC and strategic angel investors in both Korea and the US Dongna’s total funding of $ 4.8 Million.
The company was founded by Matthew Shampine, who was born in Korea but raised in New Jersey. Running WeWork Labs, Champagne was deployed to Asia and then to Korea in particular to form that arm of a massive peer firm. Going much further, Champagne realized a massive hole in the very fragmented real estate market in Korea.
Dongna is very similar to Redfin in the US, giving buyers and renters a centralized place to find their new home. For now, the startup only represents the buyer / renter side, essentially building the country’s first true MLS (multiple listing system) by partnering with thousands of brokers in Korea.
Some important references: The real estate market in Korea is very different here than in the states. First, most buildings have their own brokers with retail space on the ground floor, meaning that there are thousands of brokers in Korea that represent only a limited number of properties. In fact, Champagne says that there are nearly as many brokers in Korea as there are in the US, with a much larger population.
Secondly, due to fragmentation in brokers, there is no real MLS in Korea that unifies all available properties. Renters and buyers must work among dozens of brokers and usually have the person go into the space instead of browsing photos online. This system also means that brokers often represent both buyer / tenant and seller, meaning that they are not always negotiating in the best interests of the buyer.
Dongnai partners with brokers to centralize all listings in one place, and gives buyers and renters an interface to browse those homes. In fact, Dongnae provides a tinder-like experience for shoppers, allowing them to swipe left and right in homes to find what they are looking for and ultimately serve the best fit.
Unlike AirBnB, Dongnai goes from complex to complex and builds digital inventory for each listing, takes 4K photos and watermarks them and sends them back to the broker, while also listing them on the dongle.
“It’s not necessarily a franchise, but it’s actually a close partnership,” Champine said.
Dongne makes money like any other broker by taking a buyer-side fee, which is about 8% in Korea. The team is strong of 25 people and the gender diversity in Dongnai is around 50/50.