The younger generations are not buying homes as quickly as their predecessors, but Summer, a relatively new startup, is attempting to change this trend. The company claims that it can help young people acquire and rent out properties on marketplaces such as Airbnb.
How Summer Works
Summer’s platform uses data and analytics to assist its customers, which the company refers to as "members," in predicting short-term rental revenue and finding a rental property that fits their needs and goals. The platform layers AI and analytics to build an estimate of short-term rental revenue, similar to Zillow’s Zestimate.
The Founder’s Background
Paul Kromidas, Summer’s CEO and founder, has a background in product development and strategy at Airbnb. He was instrumental in creating Airbnb’s Luxe product before leaving the company to start Summer.
Summer’s Membership Options
Summer offers three options for membership:
- Gradual Ownership: Members choose a property from Summer’s portfolio, submit a listing to see if it’s a good fit, or work with Summer’s acquisition team to find a suitable property. Summer handles the paperwork, home inspections, and due diligence.
- Immediate Ownership: Members can purchase a property immediately through Summer. The company oversees the paperwork, interior design, and furnishing of the property.
- Existing Property: Homeowners can bring their existing property to the Summer platform for management.
Summer’s Revenue Model
In exchange for its services, Summer collects an initial payment as low as 15% of the home price and charges a monthly membership fee. Members receive credits that can be used towards stays at their own vacation home or any other property within the Summer network.
The Benefits of Using Summer
Summer manages the property, including booking rental guests, and puts both the initial payment and monthly membership payments toward the owner’s eventual purchase of the property. At any point over two years, if a member decides to buy their Summer-managed property, 100% of the initial payment and monthly membership fee is credited towards their purchase.
Challenges Facing Summer
Summer faces challenges from various jurisdictions cracking down on short-term rentals. A recent bill signed by Honolulu Mayor Rick Blangiardi requires property owners to book their rental units for a minimum of 90 days. Elsewhere, New York City has begun enforcing tighter restrictions on short-term listings. Aspen, Colorado, and other cities are also implementing regulations.
Summer’s Funding
The company has received funding from venture capital firms, but the exact amount is not disclosed. Kromidas declined to say how many customers Summer has or even hint at the startup’s annual recurring revenue.
Conclusion
Summer aims to change the trend of younger generations not buying homes by offering a platform that makes it easier for them to acquire and rent out properties. While the company faces challenges from regulatory changes, its innovative approach may help it succeed in the competitive market of short-term rentals.
Topics: Airbnb, Funding, property rental, PropTech, startup, Startups, Summer
Authors: Kyle Wiggers is a senior reporter at TechCrunch with a special interest in artificial intelligence. His writing has appeared in VentureBeat and Digital Trends, as well as gadget blogs such as Android Police, Android Authority, Droid-Life, and XDA-Developers.
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