Published on 17, Feb 2023

Techvestor Launches Its 2nd Fund after a $37MM+ Successful Fund 1

Over the past few years, the institutional spotlight in real estate has been on single family homes in a very tight market. At the same time, however, another trend has been emerging: short-term rentals. Most people are well-acquainted with Airbnbs, or homes that are rented to travelers for a few weeks or perhaps longer. “What has been lesser known is that STRs have become a prime investment opportunity for investors,” says Sabrina Guler, the COO and co-founder of Techvestor. “It’s especially exciting because we have created an institutional grade, proprietary rental platform that is taking the uncertainty out of STR investment, and that led to incredible success for us in 2022.”

Co-founder and CEO Sief Khafagi explains that Techvestor’s platform analyzes over 18MM data points each month. “With such a data-driven approach, we are able to identify what, where, how, when, and if an investment should occur,” he explains. “That ability means we have access to insights that others don’t. And our performance proves it.”

Techvestor is vertically integrated and owns the entire stack, from finding and designing a property to operating it. Now, in 2023, Guler and Khafagi are focused on expanding Techvestor’s portfolio of STRs in Florida, Arizona, and elsewhere.

“We are ready to provide STR investors with more exciting opportunities for passive income and wonderful memories,” says Khafagi.

How Techvestor became the leader of STR investments

To understand how Techvestor grew so quickly to become the leader of passive investments in short-term rentals, you have to go to Apple and Facebook, where Guler and Khafagi were both investing in real estate on their own. 

At Apple, Guler was finding fulfillment as an Engineering Project Manager, and she reached a career milestone when she grew its AirPods product line into a multibillion-dollar revenue stream. 

“For fun, I started investing in single-family homes and transformed them into Airbnb rental properties,” Guler recalls. “I could see that it could be extremely lucrative, but so many people were afraid by the complexity of finding that perfect property, redesigning it, furnishing it, and making it profitable. They were locked out of a significant investment opportunity.”

To democratize the journey of investing in short-term rentals, Guler teamed up with Khafagi, who helped scale the second-largest engineering organization at Facebook.

“Our research showed that Techvestor is a perfect example of the right time, right place because of the post pandemic changes in behavior, which in our opinion, is the leading indicator in investing in the future,” says Khafagi. “That interest was increasing because of COVID and remote work. This asset class is still incredibly early, and that allows us to define it.” 

Why Techvestor is able to successfully identify, manage, and exit STRs

Guler says that the key to Techvestor’s success lies in two factors: its team and its software platform. The process of acquiring a home, designing it, and operating it is hard to do at scale, so she sat down with Khafagi and created a plan for how short-term rental properties are identified, managed, and can exit for its investors. 

“We got really specific and designed a 16-point strategy for analyzing the potential of both a property and its location,” Khafagi states. “We included uniqueness, seasonality, tax benefits, diversification, and STR-friendly states as well as other crucial factors. All in all, we look at millions of data points and 250+ markets monthly.”

Guler and Khafagi also made Techvestor vertically integrated, with acquisition, design, property and revenue management, operations and more handled under the same roof. “Our team is the single biggest asset we have. While we’re both ex-Facebook and Apple, our team comes from companies like Vacasa and Dr. Horton, allowing us to scale faster than ever before,” says Khafagi. 

Techvestor’s software was designed to pinpoint the right properties to be added to the company’s portfolio. Khafagi explains that its algorithms mean they know what to buy, where to buy it, how to best finance it, how to operate it, if the property is in a sustainable market, and what realistic growth looks like.

“Our investor partners are the lifeblood of our business, and everything we do is to serve them,” he says. “They receive 100% of tax benefits, have zero liability for loans and lending, and enjoy instant diversification with over 75+ properties. Investors get quarterly distributions and reporting and we target an above average cash on cash annually in the range of 8-12%. After the projected hold period, we look to sell the portfolio. We sell properties based on revenue or value, whichever is higher.”

Guler adds that Techvestor also offers a little perk for investors: Owner Stays. “If you are an owner, we believe that you should stay like one,” she says. “As an investor, you can stay at any property, at any time, for 10-30% off normal rates. We appreciate our investors and want them to have fun at these properties.”

What Techvestor has accomplished with its strategies and rental platform 

With over $37MM from hundreds of investors and 75+ properties across 10+ markets, Techvestor is accomplishing the goals that Guler and Khafagi have set for it. The company has successfully exited eight times, with an average IRR of 42%. 

“We are beating our revenue projections 96% of the time, and we have 52% more revenue than our competitors across our portfolio,” Khafagi states. “We also have a 38% higher occupancy rate for our properties, so we are very optimistic about the performance of our funds for our investors. We’re beating our own expectations.”

Their goal is for Techvestor to become the largest institutional STR operator in the world: a $1B aggregate fund with over 1500 properties.

Why STR investments should be considered in today’s market

Guler recommends that anyone interested in STRs do their homework before jumping in. “It is always wise to make sure you understand an asset class before you invest in it, so if you have any questions, please feel free to reach out to us,” she says. “That said, don’t sit on the sidelines too long. We already have seven and eight figures in commitments and LOIs for Techvestor’s portfolio, so the word is out that short-term rentals are on the radar for large institutional players.”