Q&A: How Venn Is Reinventing Neighborhoods
Or Bokobza, co-founder & CEO of the Israeli proptech startup, talks about the firm's business model after scoring $40 million in funding from backers including the New York State Common Retirement Fund.
Call it urban-renewal-as-a-service. Israeli proptech startup Venn is trying to reinvent the way that people live in cities by managing apartments and shared spaces across neighborhoods, while supporting local businesses and facilitating events to build a sense of community. Founded by three veterans of Israel’s most elite army reconnaissance unit, Venn has recently closed a Series A round with $40 million of total funding to date. The company’s backers include Pitango Venture Capital, Bridges Israel and Hamilton Lane on behalf of the roughly $210 billion New York State Common Retirement Fund.
Venn has grown its portfolio beyond Tel Aviv, Israel, to projects in Friedrichshain, Berlin, and the Bushwick neighborhood of Brooklyn, N.Y., where it oversees a community around 786 Knickerbocker Ave. The firm now manages more than 1,000 units worldwide and serves more than 500 members, with aspirations to bring the platform to millions of people in 100 cities by 2030. Multi-Housing News caught up with co-founder and CEO Or Bokobza, who formed Venn in 2016 alongside Chen Avni and David Sherez, to discuss the company’s model.
Are you getting inquiries from landlords now?
Or: We have about 10 to 15 landlords that are reaching out every month, and we are closing a building every week. So this is pretty massive, because in—I want to say—a year from now, the user journey or user interface that the landlord’s going to face will be the same as a host in Airbnb. A landlord will sign up, do a 15-minute onboarding and in 24 hours a Venn representative will come to take the key, and from then on we will manage the property. It will be that simple.
It’s a win-win-win. One, it’s a win for the landlord because he’s going to make more money through efficiencies. Second, he’s going to reduce his hassle. This is his win. It’s a big win for Venn because it enables us to work on a much bigger scale, on the neighborhood level. And it’s better for the tenant, who becomes a neighbor or member of Venn, because he’s going to get much more than what he gets from his landlord. We’re going to be the best landlord for this member. We reduce all the hassle for the landlord, and the neighborhood is getting much, much better because we have the ability to use all this infrastructure together and to show the opportunities in every building.
Do you have property management agreements with landlords?
Or: We work in three channels. One channel is a revenue-sharing agreement with the landlord. For instance, the landlord is making $700 today, and with Venn they are going to make $900, because it’s much more efficient. So we have a revenue-sharing agreement on the asset. Another method is a 10- to 15-year master lease agreement with the landlord. And in some cases, there are third parties who are our local partners who are looking to buy properties for long-term investment. We work with them to help them find buildings to buy, and we sign with them a master lease or revenue-sharing agreement.
It seems like you’re managing entire neighborhoods.
Or: What we’re trying to create is a transformed developing urban area and thriving communities, not just a specific building. We are looking at the whole neighborhood as a home—more than four walls and a roof. And we’re trying to create the whole area—home, shared spaces—and encourage the local residents and community members to participate on a neighborhood level. And on top of that, we help small businesses on the neighborhood level to start. The idea is that, at the end of the day, the community members can build their own areas and their own neighborhood. The biggest difference between the co-living situation and Venn is that we look at it on the neighborhood level and not a building level.
How do you help small businesses?
Or: If you’re a Venn member and a vendor in the neighborhood, with the help of Venn, you can build your own business, because Venn will help you locate the place, to create your own business model, to get very cheap loans from the bank. Venn can connect you to a source that could help you develop your own business.
For example, we have Pitanga, a local vendor from Bushwick. They were looking for a place to open a second coffee shop, and we helped them to locate a place next door to a co-working space on Knickerbocker Avenue. We helped them to obtain the permits, renovate the place, find a budget, go to the bank, create the business model—everything, from A to Z. And on top of that, they know that our community members, our neighbors, are going to be their customers.
Once we realized that thousands of people wanted to be part of what we did in Tel Aviv, we realized there is a huge opportunity to build a platform for people to build their own neighborhood. So what started with, “If we build it, they will come,” ended up creating the model of, “If they build it, they will stay.” We build all the infrastructure in the neighborhood by this model.
What are you working on now?
Or: We are now focusing mostly on creating housing solutions, as well as developing small businesses and creating new jobs in the neighborhood. We’ve created 65 jobs in the last 12 months across 35 small businesses, and we are just getting started. We’ve just developed the model and the playbook of how we can help small businesses. And on the housing solutions, we realized that ownership is changing dramatically. People all around the world cannot afford to buy a house. We have an impact model to measure and report on economic and cultural uplift, job creation, local business development and displacement. We are developing this with Bridges Israel to directly address UN Sustainable Development Goals. We release bi-annual impact reports, the first of which went live a few months ago. It’s one-of-a-kind and it’s very, very forward-thinking.
What are you offering for residents?
Or: At the end of the day, you will pay rent plus a membership fee. In your membership fee, you get access to all the shared spaces in the neighborhood and to the Venn platform that gives you the ability to use all the services on a neighborhood level. You’ll have access to our app Vini, which is the concierge service that allows Venn to take care of all your hassles, like your laundry, cleaning, dog-walking, babysitting and so on. And besides that, you get access to all the events that are being created by the community in the neighborhood. We have more than 50 events every month, and 90 percent of these events are led by community members.
There is opportunity here for the landlord as well. We are using tech to enable the landlord to reduce headaches and increase property demand, and this is what we’re seeing now in Bushwick because we came much more prepared to integrate with landlords. We realized the power of coming with tools for landlords, to manage their assets and their buildings in a much better and more efficient way. We launched Bushwick about three months ago, and landlords are speaking to other landlords and they realize the power of collaborating with companies like Venn to manage their whole neighborhood. They know that the occupancy is going to be very high. They know it’s going to be much more efficient. They save money, they save headaches and they have a great user interface to work with us.