Castle, a property management software startup, hit a big milestone last week, locking down a little more than $2 million in seed capital.
Model D recently profiled Castle, just before it announced this seed round.
The Detroit-based company has raised $2.75 million to date over its first two years of business. The startup's seed round was led by
Kholsa Ventures out of Silicon Valley.
SV Angel, and
Point Judith Capital, also participated in the round.
"It's an incredible opportunity," says Max Nussenbaum, co-founder & CEO of
Castle. "But it's not a success in and of itself. This is the fuel in the tank, not the end game."
Nussenbaum was part of the inaugural class of the
Venture For America, serving his two-year fellowship in Detroit. He co-founded Castle with two other VFA Detroit fellows (Tim Dingman and Scott Lowe) while the trio renovated a tax foreclosed mansion in Virginia Park. Today that house is their home and the headquarters of Castle, but the company is also looking to move into its own offices in the greater downtown Detroit area later this year.
The trio of VFAers also used the experience renovating that house as a compelling story to help get Castle admitted to
Y Combinator, arguably the most prestigious startup accelerator in the world, earlier this year.
Castle has developed a software platform that makes property management easy by automating communication between tenants and property managers, rent collection, and repair requests. It currently manages 525 units, almost all of those are single-family homes or small multi-unit buildings. All of the rentals are in Metro Detroit and about 60 percent are in the city of Detroit.
Castle's leadership teams plans to use the seed capital to continue building out its software platform. It's also looking at expanding outside of the Detroit market, potentially opening up a new market early next year. It hasn’t chosen a specific one yet, but among the candidates are Baltimore, Phoenix, Atlanta, and Florida.
"The early markets will be in line with Detroit," Nussenbaum says. "They are the ones that are underserved by our competitors."
Castle currently employs a team of about a dozen people and is still adding staff, including
a head of growth in Detroit. The company’s team is currently aiming to double its units under management by the end of the year. Most of its new customers come from word-of-mouth recommendations.
"It's an incredible vote of confidence in us and we are so appreciative of it," Nussebaum says.
Read more about Metro Detroit's growing entrepreneurial ecosystem at SEMichiganStartup.com.
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