Home News YC, Khosla-backed Atmos lands $12.5M to design custom dream homes • TechCrunch

YC, Khosla-backed Atmos lands $12.5M to design custom dream homes • TechCrunch

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AtmosInc., the startup that created an online marketplace for home buyers, builders and land developers to work together to design and build custom homes, raised $12.5 million in Series A funding round led by Khosla Ventures, today Came out of stealth.

Founded in 2018, San Francisco-based Atmos touts its technology as allowing homebuyers to select a plot of land, design a home within budget, and use 3D technology to approve the design. . Next, we connect buyers with vetted builder partners.

The startup aims to give buyers more choice at a time when the country faces a persistent housing shortage and mortgage rates have more than doubled since last year. Atmos claims it can also help builders by offering out-of-the-box buyers, rather than building to spec (without enthusiastic customers) in an uncertain market. It also said it could help land developers by allowing them to sell directly to consumers.

Existing backers Bedrock, JLL Spark, YC and OpenAI CEO Sam Altman joined new investors real estate brokerage Keller Williams, Duke Angel Networks, Bain Capital Co-Chairman Steven Pagliuka, Participated in the fundraising with Figma CEO and co-founder Dylan Field. The company previously raised nearly $2 million in March 2020. That same year, it joined Y Combinator’s summer cohort and raised an additional $4 million, led by Khosla.

Atmos CEO and co-founder Nicholas Donahue said: “Within two weeks, we accepted it.”

Atmos says its technology will allow buyers to see “exactly what can be built in a given lot, depending on size, shape and development requirements.” First, the buyer undergoes a survey and soil test, and then assists in designing the home based on individual preferences. Once the builder is solidified, construction can begin.

“We are trying to bring the design process online,” says Donahue. “We also onboard partners and collect certain local data such as zoning requirements and typography.”

We also ensure that construction does not violate HOA restrictions before buyers waste too much time on the project.

The average cost of building a home with Atmos is around $225 per square foot. So for a 1,500-square-foot house, that’s about $337,500. Depending on the market under construction, it will be cheap or expensive. Certain choices, such as whether a buyer chooses to build a single-story ranch home or a two-story home, can affect costs, Donoghue adds. .

So far, the startup has built six homes and is “working on dozens more,” he said. It makes money by charging home buyers a service fee of 5% of construction costs “for due diligence, design and project management.” He also charges the builder a flat fee of $20,000 for locating, screening, servicing clients and handling pre-construction services that otherwise need to be handled.

Ultimately, Atmos has its sights set on what it calls other emerging tech markets, such as Denver, Austin, Portland, and Salt Lake City.

Unlike Khosla’s portfolio company Homebound, Raises $70 million Calling his company a “tech-enabled home builder” earlier this year, Donahue said Atmos has a pre-construction focus on homes.

“We are more design oriented and focused on the process of how someone builds a house,” he told TechCrunch. “In my opinion, more people would build houses if they had the ability to design their own homes in a simpler, less ambiguous way.”

He believes Atmos’ biggest differentiator compared to other startups in the space like Welcome Homes is that it offers “more flexibility” and freedom during the design phase.

Interestingly, unlike most startups that raise capital, 26-person Atmos has no plans to use the new funding for hiring in this market, Donahue said. He focuses on building markets.

“Like a builder or developer working in a very hot environment, you have all of this … they usually choose to go to spec rather than work with a client to build a custom mass. “We see an opportunity to help them get some of their over-utilized assets off the ground,” he said.

Evan Moore, partner at Khosla Ventures and co-founder of DoorDash, brings experience in the real estate space and helped the Opendoor team lead the product prior to launch. He told TechCrunch in an email that at his previous job, tracts, which are “huge lots of homes that look the same,” he talked to many families who buy their homes.

“A lot of people wanted to build a custom home to their needs, but didn’t know where to start. says Mr. “It was clear that more people would build custom homes if someone could provide a trustworthy and transparent process … over the next few years, finding available land and building a functioning home. I think it’s clear that we’ll be able to design, access those lots and start building according to local regulations — all online.”

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