Californian company Pacaso: Start-up sells holiday homes for sharing

The start-up company Pacaso wants to make luxury vacation properties more affordable – by bringing together several buyers who share their homes. A meeting with the co-founder in California.

Wednesday afternoon in the Napa Valley wine region in Northern California. We are standing in front of a modern villa, built in 2016, just outside the city of Napa – a good hour’s drive north of San Francisco. Three bedrooms, pool and small guest house. The property is an impressive 120,000 square meters. “This house is worth between seven and eight million dollars,” says Austin Allison, boss and co-founder of the start-up Pacaso. “We sell it for less than a million dollars for an eighth of the share. For every property we set up a limited liability company. And from this, you buy your share as a buyer.”

Company founded at 15

Almost exactly a year ago, the 28-year-old Allison founded Pacaso together with Spencer Rascoff. Allison is not a Silicon Valley plant. He is originally from Ohio. When he was 15, he started the software company Dotloop there, which he sold to Zillow six years ago for the equivalent of 93 million euros. This is the largest online real estate marketplace in the United States.

“Our idea is to make vacation home ownership affordable,” he says. “Real estate is better utilized this way, which is also good for the respective municipality. This means that more people can afford a second home.”

Pacaso already worth a billion dollars

The start-up’s team has now grown to over 130 employees. In record time, the company has raised more than $ 200 million in venture capital from investors. It is valued at over a billion dollars.

Growing from virtually zero to one hundred so quickly is not common in Silicon Valley either. Pacaso wants to set himself apart from the controversial timeshare models, i.e. timeshare, says his boss Austin Allison: “We sell single-family houses, not vacation homes, which are specially made for timeshare. In addition, you buy a property from us and not time.”

Additional costs are divided

The purchased holiday property is divided between a maximum of eight buyers. Each owner can then use the app to book the house for 44 days a year. Ancillary costs such as water, electricity, gas are shared among each other, the start-up from San Francisco manages the property and receives almost 100 euros per month from each of the owners.

“We bring the individual parties together without ever meeting,” says Allison. “We take care of all the details. We furnish the house and we pay all the bills. It’s like a group of friends owning a property together.”

Expansion plans also for Europe

If you don’t like the concept, you can get out of the contract after one year and sell your share. It is still unclear whether this will work out without further ado and whether there is a market for it: the company has only existed for a year.

In the coming months, Allison and his team do not only want to expand in the USA, where the company has opened branches in 25 holiday regions. “We found out that our customers are particularly interested in the Spanish real estate market,” says the co-founder. “Here we can find buyers from all over the world as well as from Europe particularly well.”

Pacaso boss Allison has one goal in mind: He wants to list his start-up on the stock exchange. Before that, he emphasizes, strong growth is the order of the day.