PayHOA, a beforehand bootstrapped Kentucky-based startup that gives software program for self-managed house owner associations (HOAs), is an instance of how real-world issues can translate into alternative.
It simply raised a $27.5 million Collection A spherical in an atmosphere the place practically $30 million Collection A rounds are now not frequent.
PayHOA founder and CEO Mike Bollinger has been placing his finance diploma to good use. The entrepreneur began PayHOA in 2018 after promoting two different firms — LegFi.com, a startup targeted on fraternity and sorority monetary administration and File990.org, which catered to nonprofit tax compliance wants — to Togetherwork in 2018.
Bollinger says expertise working with volunteer-based organizations fueled his want to create PayHOA.
“Whereas bigger firms catered to skilled property managers, self-managed HOAs struggled,” he informed TechCrunch. “They had been pressured to cobble collectively options with unconnected instruments or generic software program not designed for his or her particular wants — some even got here to us with shoe packing containers of paper receipts.”
PayHOA’s SaaS providing acts as a “central hub” for affiliation board members, dealing with funds, upkeep requests and communication with their communities, Bolinger says.
Notably, PayHOA says it’s worthwhile (with optimistic EBITDA), which helps clarify the way it managed to land such a decent-sized Collection A spherical in what stays a difficult fundraising atmosphere, particularly for non-AI startups. The 15-person startup notched year-over-over income progress of over 70%. It has greater than 652,000 customers, and makes cash by charging a month-to-month subscription payment based mostly on the variety of models in the neighborhood. Costs begin at $49 monthly for HOAs with 25 models or much less. Self-managed HOAs account for 30% to 40% of group associations, made up of two.5 million volunteer board members.
The choice to boost exterior capital for the primary time stemmed from PayHOA reaching a important inflection level, in line with Bollinger.
“We’d discovered product market match and had been rising at a fast price,” he informed TechCrunch. “The extra capital and investor steering will information the enterprise to the subsequent stage.”
The brand new funds will principally go towards product improvement and hiring. PayHOA has plans to develop its crew by 40% throughout engineering, gross sales and help. Right this moment, the corporate additionally introduced a Payables module, which Bollinger stated makes use of Optical Character Recognition (OCR) know-how to mechanically scan and extract information from invoices. PayHOA has processed greater than $1.6 billion in invoices since 2018.
Wanting forward, PayHOA doesn’t have plans to increase exterior of group administration, however Bollinger has seen an elevated variety of property administration firms signing up for the platform — opening up the corporate’s whole addressable market.
“Many HOAs handle their communities themselves, and for too lengthy, their wants haven’t been absolutely addressed,” Peter Fallon, a common associate at Elephant Ventures, the agency that led the spherical, stated in a written assertion. “PayHOA acknowledges this hole and offers a complete platform designed particularly for self-managed HOAs. This empowers them to entry highly effective instruments usually reserved for bigger communities.”
