OnTheMarket has made its first direct investment in a proptech company following its purchase of a 20% share in Glanty, the operator of lettings platform Teclet, for £797,000.
OTM has also agreed an option to buy the remaining 80% of the company at a later date for £1.5 million and also pay off Glant’s debts of £1.4 million.
The portal has also entered into an optional ‘earn out’ arrangement that could see it pay Teclet’s directors up to £12 million after three years if key performance goals are met.
Teclet was launched in 2016 and automates many aspects of the lettings process to reduce overheads and maximise operational efficiencies for letting agents.
It also provides online storage and 24-hour access for agents, tenants and landlords to records and documentation relating to their tenancies.
Teclet also supports compliance with the regulatory requirements surrounding tenancy creation and management, providing an audit trail of transactions.
The platform will be offered to its customers and means OTM has made its first significant move into property software provision to agents other than its own in-house developed solutions.
Glanty’s revenues for the year to 31 December 2018 were £771,36, up from £6,209 in 2017. The investment being made by OTM is to fund Glanty until the summer of 2021, when it is expected to break even.
The purchaser of OTM coincides with a share placing announced by OTM, which is to raise £3.4 million by issuing 4.85 million shares at 79p each, which is an 8% discount on its current share price.