Abodo.com, a Madison start-up that provides online apartment listings, said Wednesday it has raised $4.8 million in outside investments.
Abodo's funding round was led by 4490 Ventures, a venture capital fund organized in 2013 by the State of Wisconsin Investment Board and the Wisconsin Alumni Research Foundation. Other investors included American Family Ventures and Flyover Capital, a Leawood, Kan.-based fund whose participation marked its first Wisconsin investment.
Abodo will use the funding for national growth and expansion, said Alec Slocum, chief executive officer.
"They’re operating in a sector that’s lacked innovation for a long time," said Greg Robinson, managing director of 4490 Ventures. "These guys are trying to change that and bring innovation to a market that craves it and needs it and they’re able to do it in a reasonably capital efficient way."
The funding came in the form of what is known as a series A round, which is considered the first meaningful venture capital round for a start-up.
Abodo, which went through the gener8tor training program in 2013, has for the past several years been working to get to the point where it could be considered "a true, venture-scale business," Slocum said. In the last few months, it has become apparent that the company had reached that goal, he said.
"The bottom line is the team has done a very good job of doing what they said they were going to do and make consistent steps toward meaningful milestones," Robinson said. Those milestones included goals for monthly recurring revenue, number of users and amount of customer traffic, he said.
Abodo met or exceeded all of its milestones, which gave investors like Robinson "a high degree of confidence" the start-up could meet its next goals, Robinson said.
Abodo operates in 30 cities, including Madison and Milwaukee, and has 500,000 active renters a month on its platform, Slocum said. The company typically starts in new markets by appealing to college student renters, then expands from there, he said. Now Abodo is ready to "take a swing at the nationwide market as a whole," he said.
There are a handful of competitors in the apartment listings space; apartments.com is one of the best-known.
"We think we can replace one or more of these older-school companies that have been around for a while, that renters don't like and property managers have been stuck with for decades, and push the space forward," Slocum said.
Abodo has 28 employees. With the new funding, the company has raised more than $8 million since it was founded in 2012, Slocum said.