Shared office space firm Second Home has scooped a £7.5m funding package to dodge bankruptcy and is now eyeing up expansion in the US, City A.M. can reveal.
The London-based start-up, headed by former David Cameron aide Rohan Silva, has been searching for rescue cash from investors since April and kicked off a sale process last month as it faced a potential insolvency.
But the firm is now gearing up for growth in the US and is preparing to begin buying up property after shoring up its coffers, City A.M. has learned.
“Like many businesses, Second Home was hit hard by lockdowns,” a Second Home source told City A.M.
“Occupancies and revenues have bounced back” however, the source said, and the firm was now getting back to “growth mode.”
The injection has come from existing Second Home investor Global Asset Capital, a California-based growth equity and real estate investment fund, which is now preparing to provide Second Home with “tens of millions” of additional funds to snap up real estate assets across the US and Europe, City A.M. understands.
Revenues and occupancy rates at the firm both doubled in 2021, the source said, and all sites are on track to be profitable in 2022, with bosses expecting the group to hit profitability in 2023.
This shift to owning real assets on-balance sheet marks a major shift in direction for the firm which has so far run its workspaces from independently owned buildings.
Founded in 2014, the firm has tempted a host of big name backers including Tencent chair Martin Lau, investment bank Goldman Sachs and private equity titan Index Ventures, as well as the state-backed Future Fund, set up by chancellor Rishi Sunak.
Its six existing co-working sites across London, Lisbon and Los Angeles have housed firms including Netflix, HBO and tech unicorn Clubhouse.