Don Ganguly has raised more than $15 million for his online real estate investment management firm, proving the concept that investors of all sizes want a piece of the single-family rental market.
Four-year-old HomeUnion specializes in SFR investment properties for the individual investor.
HomeUnion helps them complete the purchase and then handles the ongoing management of the property, which includes finding solid tenants and maintaining the property. HomeUnion’s site has been operational since May 2014 and is active in 19 markets.
“When we look at asset classes you’ve got stocks, bonds, commodities and real estate,” he said. “Most of the others have an efficient way of buying, selling and trading them. It’s a whole new way of thinking to democratize this very large asset class.”
According to investment banking firm Keefe, Bruyette & Woods, there are 14 million SFR properties, with a total value of $2.8 trillion. While Wall Street has a small stake in the SFR market, the market is actually dominated by smaller investors who consider SFR investments a smart way to make money.
HomeUnion has stepped in to fill a gap in the market by creating deep data research and analytics and investment technology for these smaller investors.
HomeUnion has brought digital solutions to what has been an analog industry by identifying markets with favorable cap rates and positive economic prospects.
They’ve also made detailed listing, market and economic information available remotely—so individuals are no longer limited by geography when investing in SFRs.
The company also developed a research program where it issues quarterly economic reports, with an eye toward the SFR market for each of the markets where it is actively listing investment properties, in order to educate investors, Realtors and advisers on how to gauge the performance of SFR properties.
A serial entrepreneur and an expert in the acquisition and management of distressed residential real estate, Ganguly founded two companies prior to HomeUnion: Oracle Financial Services BPO (originally Equinox), was a provider of loan processing, servicing and back-office financial reporting services for banks and large private equity investors, and NexGenix, an IT services (eCRM focus) firm.
He also was an adviser to Acqura Loan Services, a special servicer of distressed residential loans, now owned by Apollo Funds.
HomeUnion is growing 50 percent month over month, and Ganguly plans to add markets when it makes sense.
“We have a technology engine that goes out and looks at markets and figures out what markets work and don’t work,” he said. “We also have boots on the ground to get a local presence.”
Ganguly said what he enjoys most about his work is that it touches lives and adds value for investors, who come from all walks of life: retirees, people saving for retirement and high-net worth individuals who don’t want to put their money in gold, oil or gas.
And many are buying multiple properties.
“I tell my people ‘We’re not making a widget that goes into another widget and goes into something else that goes into the wheel of a car. We’re offering a service that’s really helping people, taking their saved money and putting it into something stable they can earn an income off,’” he said.
“That’s a big reason, but it also touches people’s lives — it’s high value-add.”
He also has a good rule of thumb of how to treat investors: “Act like it’s your mother on the phone. Treat an investor like you treat your mom.”
He adds: “If you’re the sort of person who lies to mom, we don’t want you.”