Competitor picks up the pieces following Upad closure

Soon-to-launch community lettings platform Mashroom, is offering Upad landlords the option re-list their properties on its site, free of charge.


It’s a tough world out there for online-only estate agencies in the UK. They set out their stall, win eye-watering financial backing and launch with a marketing fanfare to persuade potential movers that they are the new leaders in property agency and will save everyone a fortune, infuriating long established professional high street agencies.

They settle down and, for a time, build business but then, as the fanfare turns fades, close their doors

The most high profile this year is Upad, which claimed to be the UK’s biggest online letting agent, but is now ‘no longer accepting new business’, leaving thousands of landlords in the UK abandoned and their listings void.

As reported in The Negotiator on Monday, “Upad was the largest online-only lettings agency in the UK and recently claimed to have been used by 12,500 landlords and listed 30,000 properties. It is claimed that 450 landlords will be affected by Upad shutting up shop.”

The company’s announcement reveals that tenants and landlords using its service who have entered into tenancies arranged through or managed by Upad should contact each other directly to work out future arrangements.

This follows another high profile online agency, emoov, which closed it doors nearly a year ago and which was subsequently acquired by startup Mashroom, which recently relaunched the business ‘on a more sustainable basis’.

Free of charge

Mashroom, is consequently offering all former Upad landlords the option re-list their properties on its site, free of charge.

Naveen Jaspal, COO of Mashroom (pictured, top), says that for online agents to survive the turbulent property climate, businesses need to deploy a sustainable business model, positioning their customers at their core. Naveen said: “With its free offering for landlords, Mashroom prioritises the needs of its customers.

“Mashroom will further support landlords who previously had to pay for Upad’s services by offering them a simple and stress-free service, giving them a comprehensive toolkit to take charge of their property, as well as providing ongoing communication and support.”


One Comment

  1. I have to hand it to Naveen, holding out a helping hand to allow landlord’s to free list on the major portals.

    But is Emoov/Mashroom not a case of out of the frying pan and into the fire, as from the recent figures given by Naveen – if Emoov if not dead, is very much like parrot in the monty python sketch, as from the figures it would appear that Emoov is running at a considerable loss. And as such can not be doing much business at the sharp end.

    To recap the likely figures: – 200K to buy a defunct company in Jan 2019, with no instructions to sell. Then 9-months of running costs, Jan to Sept; a monthly cost of either 20k, 30k or 40k, gives a 9-month cost of either, 180K, 270K or 360K (or higher).

    Plus of course the initial set up costs of Emoov mark II say 50k.
    So, at the end of Sept Emoov has burnt through either 200k, 50k, and 180k = 430k, or as much as 200k, 50k, and 360k (or higher) = 610k.

    In 9-months Emoov has 72 completed sales or sales proceeding. So, if 33% had a fee of £895, 33% had a fee of £1,200 and 34% had a fee of £1,500, the total amount of fee possible would be £87,000, this includes an element of sales not yet exchanged.

    So, probably 12-sales not yet exchanged, means that at end of Sept 2019, £72,000 is the likely amount of revenue generated.

    As industry cancellation rate is 28%, 72 sales means 100 gross sales have been agreed in 9 months, so Emoov on this model is likely to sstc 125-properties a year, which is a hit rate of 4.5 gross sales a week.

    Not really an industry disruptor.

    The parrot is definitely not very well. And my suspicion is that the monthly burn of cash through Emoov may well be much higher than 40K a month if we look at the cash burn of other failed onliners, or even Emoov I.

    Perhaps, the bigger question is where is all the money coming from to underpin Emoov’s/Mashroom’s current operation?

    It certainly is not coming from upfront fees – the usual model for this type of enterprise, thoughts anyone?

    My thoughts despairing landlords beware of Greeks bearing gifts, or in this case online agents offering a free lunch, it may well cause an upset stomach later.

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