Start-up snapshot: Virtual estate agency offering a low-cost alternative in South Africa
Property Fox is a new online real estate start-up that aims to almost cut out the role of traditional estate agents completely. The online platform was launched in April by entrepreneurs Ashley James and Crispin Inglis, and facilitates site viewings, negotiations and deals between buyers and sellers.
Sellers simply submit the details of their property online, and a valuation is provided. A photographer then visits the site to take professional pictures. Through the platform buyers can set up viewings – which are hosted by the owner – as well as submit offers and all potential buyers first undergo a basic security check with the identity verification service, ThisIsMe, for safety reasons.
Property Fox also offers an alternative to the high commissions charged by traditional estate agencies in South Africa – with its fixed rate of either 1.5% of the sale price or R25,000 (US$1,820).
How we made it in Africa chats to the co-founders about the company’s start-up experience so far.
1. Give us your elevator pitch.
We’re an online tech start-up that offers a cost-effective, transparent alternative to the traditional estate agency model. By cutting out estate agents and bricks and mortar ‘shopfronts’ we are able to add value at every step of the buying and selling process. Compared with the traditional estate agency commission of between 5% and 7%, our fees are only 1.5% or R25 000 upfront. We’re all about transparency and putting the client first.
2. How did you finance your start-up?
We have four investors: ourselves and two other non-executive directors.
3. If you were given $1m to invest in your company now, where would it go?
It would go towards growth and support to meet the demand of our rapidly-growing client base. We have ambitions to simplify the buying and selling process in order to save our customer hundreds of thousands of rands while offering them the highest level of service.
4. What risks does your business face?
The risks are the same as those generally associated with new disruptive businesses. We are however unique in that we are satisfying a major need in the South African market when it comes to the cost involved in selling property. We are pioneering this way forward, and because of this we foresee the next threat – more market entrants. We will simply continue to offer the highest level of service, cost savings and innovation, and that should hopefully keep us out ahead of the rest.
5. So far, what has proven to be the most successful form of marketing?
Public relations got the phone ringing for us, as well as testimonial-driven marketing. The old adage ‘the proof is in the pudding’ is really what’s bringing in a growing steady stream of business.
6. Describe your most exciting entrepreneurial moment.
Definitely proof of concept. The day we made our first sale was such a feeling of accomplishment. Not simply the taste of success, but rather the affirmation that the business model worked, and worked well. Our following sales just added to that as they proved to us that there was a real appetite in the market for what we have built.
There is also tremendous excitement in being able to create a business with people, as there is very real satisfaction in creating a role for someone to grow in and then to see them flourish.
7. What has been the biggest mistake made, and what have you learnt from it?
I think the most important lesson we have learnt during our lifespan to date is to do business with the right people. Business, specifically start-up business, is hard at the best of times. So if you are able to invest some time in partnering or employing the right people, it will make life far more bearable in the tough times.