LeaseSurance, an innovative InsureTech platform underwritten by Bryte Insurance Company Limited, has successfully secured R3 million (USD 161,000) in a seed funding round. This funding round was spearheaded by Fedgroup Private Capital. The primary objective of this investment is to propel LeaseSurance’s mission forward, which revolves around revolutionizing the real estate sector through its inventive lease insurance offering. The infusion of funds will be instrumental in several critical aspects, including team expansion and the further advancement of cutting-edge technological solutions tailored for the real estate industry.
Reasons for Investment
Sheldon Friedericksen, General Manager of Fedgroup Private Capital, says that Fedgroup was impressed by LeaseSurance’s commitment to innovation. “LeaseSurance has created the foundation for an end-to-end enterprise InsureTech property platform which resonates with Fedgroup’s 30+ years’ experience in the property industry. Our investment will be used to continue to build the solid foundation required to grow this truly exciting and much-needed solution in the property sector. With this investment, LeaseSurance now forms part of the broader property ecosystem within Fedgroup. Our curated network of providers allows us to unlock value in assets and support property owners and their tenants, while reducing waste through the provision of utility management services that incorporate smart technologies around water and energy.”
Wim Morland of Bryte Insurance Company Limited, which underwrites LeaseSurance’s business, echoes Friedericksen’s excitement. He says that the company is proud to be associated with an organisation which is at the forefront of innovative property and insurance solutions, and continues to look for ways to advance further. “This investment equips LeaseSurance to enhance its product offering, creating even more advantages for tenants and landlords alike,” he comments.
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Schaefer notes that, with the capital injection from FedGroup Private Capital, LeaseSurance is now poised to continue on an exciting growth trajectory that has been in place since the company’s establishment in 2020, and which has seen it amass clients including leading JSE listed residential landlords and other large, privately held property groups.
“We are looking forward to providing an even better service for our client base,” Schaefer continues. “We are extremely excited to have FedGroup on board as our partners as we enter the next stage of our journey, and work towards our ambitious goals. FedGroup’s domain experience in the insurance and property markets is a significant advantage, and the funding positions us to lead the business into its next phase,” Schaefer concludes.
A Close Look at LeaseSurance
Founded in 2020, LeaseSurance stands as a pioneering InsureTech platform focused on real estate solutions. The company’s driving force is the application of financial technology to optimize rental real estate assets, achieved by replacing traditional security deposits with the more efficient lease insurance model. LeaseSurance caters to rental real estate owners and operators through a comprehensive B2B solution, offering a data-driven risk engine and a data platform. These tools work in tandem to amplify operating income and optimize portfolio performance, thereby enhancing overall profitability.
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Essentially, LeaseSurance specializes in providing lease insurance solutions to prominent residential operators and asset owners within South Africa. In a country marked by challenges like low GDP growth, high unemployment, inflation, and interest rates, the pressures on tenants are significant. Traditionally, landlords have relied on cash deposits to safeguard against tenant defaults resulting from these pressures. However, the efficacy of cash deposits is limited, as they present administrative hurdles and provide inadequate protection against rent losses and damages. This situation creates financial constraints for both landlords and tenants.
By replacing traditional cash deposits with affordable monthly fees, LeaseSurance substantially reduces the administrative burden on landlords. This results in a much-improved protection mechanism against tenant defaults and property damages, translating into enhanced Net Operating Income (NOI) for landlords. Moreover, the solution empowers landlords to eliminate current barriers such as concessions and reduced deposits, thus optimizing their bottom line.
LeaseSurance’s operations are backed by Bryte Insurance Company Limited, a well-established insurer in Southern Africa with a specialization in proactive business risk management. This synergy supports LeaseSurance’s mission to innovate and transform the property and insurance landscape. Additionally, the company’s collaboration with Fedgroup Private Capital signifies a strategic partnership that aligns with LeaseSurance’s growth trajectory. This investment-backed momentum propels LeaseSurance into its next phase, poised to continue delivering enhanced services to its clientele while capitalizing on the domain experience of its partners in the insurance and property markets.
Charles Rapulu Udoh
Charles Rapulu Udoh is a Lagos-based lawyer, who has several years of experience working in Africa’s burgeoning tech startup industry. He has closed multi-million dollar deals bordering on venture capital, private equity, intellectual property (trademark, patent or design, etc.), mergers and acquisitions, in countries such as in the Delaware, New York, UK, Singapore, British Virgin Islands, South Africa, Nigeria etc. He’s also a corporate governance and cross-border data privacy and tax expert.
As an award-winning writer and researcher, he is passionate about telling the African startup story, and is one of the continent’s pioneers in this regard