ICO Status: In-progress
Rentberry is a home rental service in operation since 2015 which connects tenants and landlords across many cities in the US. It automates all the standard rental tasks from submitting your personal information, credit reports and custom offers, to e-signing rental agreements and online rental payments.
The easiest way to understand Rentberry, is to think ‘Airbnb’, but for home rental, not short term vacation stays. Tennants are able to search for a rental property within a User Interface that is intuitive and familar with many design principles borrowed from platforms (such as Airbnb!). Landlords are able to list their property and set prices, but ultimately these are agreed on an auction basis which adds transparency and fairness to the rental agreement as the laws of supply and demand are brought into play.
Once an agreement is reached, all details are written into a smart contract based on the Ethereum blockchain. Security deposits are paid in the form of BERRY tokens (the ERC-20 token developed by Rentberry), and future rental payments are all handled across the blockchain – again, using Berry tokens.
But here’s where it gets interesting as an investment opportunity: Rentberry provides the opportunity for anyone to ‘back’ tennants by putting up a portion of the Berry tokens required for the security deposit. In return, ‘backers’ receive interest (indicative rate of 5%) on the Berry tokens they put up. So in effect, tennants are benefiting from a form of crowd-funding for their security deposit. And backers are effectively providing loans to people they don’t know.
There are several problems Rentberry are trying to solve with this propositoin:
There’s no doubt that this proposition has real-world utility. Rentberry have an established business, and existing product, and have already been backed with VC funding prior to this new venture into blockchain and cryptocurrency. Economic indicators clearly point towards home rental as an increasing condition due to the prohibitively high cost of purchasing a home out-right. So we have tennants and landlords who can all benefit from an improved process for facilitating this type of agreement – and blockchain would seem a good fit.
The part that’s a little unclear is the benefit for investors – so people like you and me. Would you be willing to put up your Berry tokens as a security deposit for a complete stranger just to receive a 5% return on investment? I’m not so sure. Would you buy Berry tokens in the hope that their value would increase as the Rentberry business expands throughout the US and internationally? Maybe.
There’s no doubt that rental is on the rise. Research by Urban Wire in 2015 revealed that ‘A rental surge is coming. The majority (59 percent) of the 22 million new households that will form between 2010 and 2030 will rent, while just 41 percent will buy their homes.’ Also, we know that the demograph of new renters is more prone to prefering an online experience for finding somewhere to live, facilitating the agreement and making payments.
This proposition gets more interesting still when we consider the ‘unbanked’. For example, could a service like Rentberry where the transaction is conducted completely in cryptocurrency with agreements based on the blockchain outside of the normal credit check process benefit those who don’t have access to a bank account or other traditional financial instruments? It’s clear that Rentberry ticks the box for market size and has potential for global growth.
As an existing business, Rentberry have an established core team of over 30 employees, most of who appear dedicated to Rentberry, and not involved with other employment. They list a further 20 advisors and a further 20 by way of investors. As such, it’s probably safe to say the team is resourced to succeed!
During 2018, Rentberry plan to complete the following roadmap milestones:
Integrate blockchain and smart contracts technology throughout the platform. Launch iOS and Android apps. File international patents.
Allow tenants to unlock billions of dollars by paying a small monthly fee in tokens in lieu of paying full upfront security deposits.
Launch of a payment system allowing users to make/receive payments for rent and other services on Rentberry platform in BERRY tokens.
Buy properties in the top 25 most popular cities and rent them out on a short-term basis to platform users and members of exclusive Rentberry Club.
If these milestones are achieved, then Berry token holders would see their currency being used in cirulation sooner than a lot of other ICOs, and (presumably) benefiting from an early increase in value.
The only feature on the roadmap which isn’t clear in terms of value to cryptocurrency investors is the acquisition of real estate. Rentberry plan to develop a membership model whereby members can rent properties at a discount. This feels like a diversion from the core proposition into more of a centralised Airbnb/retail accommodation style context in which the properties are all owned by the central provider, Rentberry. The only value I can see in terms of Berry tokens for this would be if access and payment for stays in these properties were restricted to Berry tokens only.
Berry tokens will be available via ICO participation at a cost of 1ETH / 1400 BERRY. At the time of writing, this puts the price of Berry at $0.20 each. Compared to other ICOs, this seems like a reasonably high price. Having said that, they do have an existing business, team, and a proposition with real world utility.
There’s no doubt that the Rentberry proposition is well suited to blockchain technology. They have an existing business, a working product, and a team that is resourced and skilled enough to continue succeeding. The market size is large and forecast to continue growing – and that’s just in the US, let alone expansion globally.
The use of Berry tokens makes sense. The potential for people outside of the rental agreement to benefit from the business by way of staking a portion of the rental deposit is interesting. If the risk associated with this is mitigated by suitable background checks by Rentberry then the attractiveness of this as an investment opportunity will increase. Even without participating in that side of it though, it certainly feels like Rentberry would be worthy of speculation.
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