Please note that whilst the campaign is labelled as EIS eligible the Company has £150,000 remaining of its SEIS limit. We will, therefore, be looking to seek SEIS relief on the first £150,000 invested into the campaign, with the balance being EIS eligible. Any tax relief is dependent on personal circumstances and may be subject to change in the future.
SPCE aims to disrupt the student accommodation rental market and become the Airbnb for the higher education community. SPCE already has 800 pre-registered users and is in the process of establishing prospective partnerships with top-20 UK universities. We have signed contractual terms and conditions with Intellectsoft - an experienced software development house and intend to launch to the student diaspora in October 2017. SPCE’s mobile app will be designed to allow students to search and pay for university specific, student rental properties, based near campuses, without estate agents. We intend to have these properties range from studios, 1 bed flats, and 8 bed houses, to privately catered University halls, housing up to 250+ Students.
We believe students and landlords are beset by a host of different issues as they are under-equipped with the digital tools to cohabit with others from around the world. With SPCE, we hope students can build healthy financial relationships with their peers, roommates and landlords alike – inexpensively.
We intend to achieve the same disruptive impact as Airbnb, with student living. With SPCE, we hope that students will be able to cut out estate agents from the rental process.
*Student Issues include:
- Disputes & Deposit Abuse.
- Joint Tenancy Liability.
- Delayed Repairs.
- Intrusive Landlords.
- Misleading Property Information.
- Money Mismanagement.
*Student Solutions SPCE will aim to provide:
- Dispute Management, Room Specific & Communal Deposits.
- No Joint Tenancy Liability.
- Issue & Repair Logging.
- Landlord Visit Notice & Corroboration.
- Reviews, Ratings, Viewings & Systems of Trust.
- Payment Schedules and Automation.
- Unreasonable Demands.
- Late Rent.
- Damage to Property.
- Tenants Leaving Early.
- Expensive Management Fees.
- Scarcity of Analytics.
*Landlord Solutions SPCE will aim to provide:
- Manage SPCE: Amenities.
- Auto Payments.
- Deposit Management.
- Semester Lock-In.
- Competitive Fees (3% as opposed to 20% industry average).
- Property & Room Analytics.
Substantial accomplishments to date
*SPCE has 800 student pre-registrations to date. We aim to convert 1% of these into ambassadors for their respective universities.
*We have formed a great multidisciplinary team. With minds from Rothschild, Ernst & Young, Nokia Bell Labs, LSE, and UCL, our skills span expertise and industries, relevant to students, real estate & technology. Our team have varying backgrounds, giving us perspective on the diverse nature of student life, particularly for internationals, studying & living in various cities across the world.
*SPCE is in the process of establishing University partnerships with Top-20 UK Universities to have a direct presence on campuses.
*SPCE intends to implement ambassador subsidy packages, where UK Universities will sponsor SPCE employees who study with them.
*Implementation details & contractual terms & conditions agreed with Intellectsoft – an experienced software development house, who have built artificial intelligence, big data & analytics software for the likes of Harley Davidson, EuroStar, and Jaguar.
*System design, interface, and architecture complete. All important processes are well planned.
*We are hoping to partner with UNIDAYS - a platform designed to help students save on essentials from their favourite brands. We trust this will be a good avenue for offering discounted rooms & SPCE merchandise to students.
*In talks with Rockstar - one of the largest student event’s organisers in the midlands, to partner with us on our 1st event.
To date, SPCE has been self-funded.
SPCE will look to adopt a freemium business model. SPCE will be free to join and will enable transactions between students and landlords by charging a service fee - 3% basic & 6% for our fully-managed SPCE service. We are aiming to disrupt the traditional private rental industries with this model by being a substitute to using estate agents. With this model, we aim to scale our business, not by purchasing properties, but by increasing user acquisitions (landlords & students) and matching them with each other. In the future, other revenue mediums will likely include; currency conversion, deposit holding, and early-leave fees.
At phase 2, which we hope will be within two years, we aim to start a research initiative - SPCE labs, which will use big-data to map patterns in student behaviour. This serves as the foundation for artificial intelligence and will support our ambitions to transform simple properties into ‘smart accommodation’. In doing so, we hope to further monetize our business by selling research directly to universities and big data companies.
Use of proceeds
*Software & Subscriptions: add layers of software onto our working app design and architecture. Improve performance, appeal, and usability based on initial client feedback. Build our big-data, artificial intelligence and reporting systems.
*Sales, Marketing and Events: increase awareness and lead generation with our core audience groups via university fairs, student parties, events, real estate and mortgage brokers, social media, partnerships, and viral blogosphere in the UK and Hong Kong.
With your investment, we intend to drive the following objectives:
- Develop key partnerships with universities and large student real estate firms.
- Launch the app.
- Scale aggressively in the UK.
- Explore overseas expansion, beginning with Hong Kong.
As a cash-flow back-up, we have in place a small loan arrangement. This facility has been offered by our existing board of directors and is capped at £25K.
Our target market consists of both students (in 2+ year higher education) looking for term-time rental accommodation, domestically and abroad, and landlords aiming to lower outgoings to estate agents and automate the management of their property portfolios.
Many 2nd+ year students, consisting of undergraduates, postgraduates and PHD’s, want to enjoy the benefits of living independently, including:
*Having the freedom to choose who you live with.
But often, they face conflicts with private landlords and may be unable to resolve them without 3rd party intervention. Thus, many students feel dissatisfied with their standard of living:
*1.7 million students complain of problems with accommodation.
*117,000 students have experienced threatening/abusive landlords.
*27% of students feel ‘powerless’ against their landlord.
Despite this, research has shown demand for higher education is growing:
*There are approx. 190 million students worldwide.
*Average annual growth in demand for international higher education between 205 and 2025 is expected to exceed 3%.
*UK overseas postgraduates grew 5x from 28,000 to 140,000 between 1994 and 2011/2012.
Initially, our target market are the 2.28 million UK university students. In 2019, we intend to expand to both European and Asian Universities, starting with Hong Kong.
Our landlord target market consists of:
*Real estate companies.
*Private property owners.
*Individuals who live in homes with extra rooms.
*Semi-private space owners, e.g. rooms above shops and pubs.
It’s no surprise that the number of UK rental properties is rising and with them, the number of landlords:
*The number of landlords in the UK rose by 7% in 2013-14 to reach 1.75 million.
*At this rate over 1/3 of properties will be privately rented by 2032.
*26% of landlords plan to raise rent due to a number of reasons including increasing letting agent fees.
SPCE intends to achieve the same disruptive impact as Airbnb with student accommodation, by penetrating the $200 billion, global student-housing market.
Characteristics of target market
Higher education consultant Bob Goddard listed developing countries such as China and India as main sources of new students and forecasts that there will be over 8 million students studying abroad by 2025, which is 3 times more than today. ///According to UCAS, more than half a million students entered higher education around the UK last semester alone.
43% of landlords said that their primary reason for not hiring letting agencies was the cost while 34% said that they want to meet tenants themselves. This is exactly what we plan to address with SPCE, by putting the landlord in touch with students directly at very little cost.
We believe that stressed student-landlord relationships don’t only affect a few individuals, but the whole market. A recent YouGov survey shows that 40% of landlords wouldn’t rent their property to students, despite research by the NLA stating students are among the most reliable tenants. Although there can still be a strong negative stereotype surrounding student tenants, SPCE aims to improve this by creating systems of accountability amongst the higher education community, to show that a few bad apples don’t mean the whole lot are rotten.
The Sharing Economy:
*Expected to rise from £9bn now to £230bn by 2025.
*Transactions reaching £7.4bn in 2015.
*On-demand household services are expected to be the fastest growing of the 5 sharing economy sectors.
We intend to do the following:
Student focused initiatives:
*Bi-annual SPCE freshers party tour at key universities, where students can meet potential housemates in SPCE T-shirts.
*Campus presence: student unions, ambassadors in t-shirts, posters, and stands at freshers' events.
*Short films highlighting small student tragedies e.g. stolen milk.
*Social media ad campaign (photography & branded posts,) curated by our VP of Marketing in Hong Kong.
*Refer a friend scheme: winner gets 1 weeks free rent.
*Flyering with sandwich boards – app download competitions at stations near London universities.
*TFL advertising campaign – targeting international students with multi-language posters, portraying a fast alternative to finding #homeawayfromhome.
Landlords focused initiatives:
Working with Vestd (a company designed to help start-ups exchange equity for 3rd party input) to deliver equity incentives for early landlords (those who sign up to SPCE prior to launch).
*Advertise in local property magazines.
*Approach networks of property and mortgage brokers to capture “new” landlords through a referral partnership with the aim that property/mortgage brokers will refer their landlords to our service in exchange for referrals to theirs.
*Reduced fees for bulk on-boarding i.e.100-250+ rooms.
*‘Room with a view’ events offering landlords strategic advice on the management, buying and selling of their properties.
*Annual real-estate guide giving advice on landlord essentials, from durable furnishings to ways to tackle property depreciation.
*SPCE branded merchandise, such as cheap (beautifully branded) boxes and tape to be placed in properties for students who need to pack.
*TFL campaign targeting both first-time buyers and existing landlords.
At Phase 2 of SPCE, which we hope will be within two years, we aim to incorporate artificial intelligence and big-data initiatives, run in collaboration with UK and Hong Kong based universities into our marketing.
Whilst various offerings, such as Airbnb, Spare Room and traditional estate agents offer solutions to some of our users, there are no competitors in the student sharing economy that we know of.
Our multi-functional model will be designed to incorporate many simple features, which we hope will allow students to rent from beginning to end, cheaply with one app, as opposed to using many of the above existing solutions.
In contrast, our experience suggests that traditional property sites effectively provide online classifieds where landlords pay to advertise their space. These sites put guests in contact with owners or property managers. However, the student and landlord are often left to establish payment schedules between themselves - a burden we hope to remove from both parties.
With SPCE, we aim for landlords to be able to distinguish good tenants from bad ones and remove themselves from the burden of high estate agent management fees (up to 20% of rental income as opposed to 3% with us). For large student accommodation providers, a 17% differential in fees can amount to massive savings.
With SPCE, tenants are all reviewed and ranked to remove the need for agent validation and empower landlords to make rational tenancy decisions. To sum up, we want to help landlords to collect rent and stay informed with insights/analytics, cheaply.
Since we are the first to enter this space to our knowledge, we are not naive to the likely emergence of competitors in the future - speed to market, customer relations, remaining narrow in focus and building a strong team, we believe, will keep us ahead of any inevitable competition. We have planned phase two of our business and already have perspective on the new upcoming features, products, and services we hope to bring to market 2-5 years from now.
To our knowledge, SPCE is offering a completely new solution. We feel that it is a perfect substitute to traditional estate agents, with a niche focus on students.