Why We Invested: Garentii

By Kate Fullen, Venture Investment Associate at Elkstone.

The practice of paying a rental deposit puts renters in a cash-bind when signing a lease and leaves them out of pocket for the duration of the tenancy. Despite the obvious protections it offers a landlord, the administrative burden of collecting and managing these deposits is a drain on their time and cash. In the last few years, deposit alternatives have emerged in the US with great success however, the European market has seen little change to the traditional deposit system.

In early 2022, Elkstone invested in a Munich-based insurTech company, Garentii which is on a mission to disrupt this deposit system in Europe beginning with the largest residential real estate market in Europe – Germany.

What does Garentii do?

Garentii offers renters a digital security deposit alternative to a cash deposit. Rather than an up-front payment, renters pay small monthly contributions through Garentii’s digital platform in return for full protection from landlord claims. The platform allows landlords to manage their tenant relationships and policies without the typical administrative burden of a deposit, whilst ensuring they’re protected from tenant defaults or damage with 48-hour pay-out on claims. The solution ensures transparency and protection for both sides without typical cost or liquidity pain points of a deposit.

Garentii is licensed as a Managing General Agent (MGA) giving it the ability to work with its insurers partners to deliver its insurance offering across Europe.

What got us excited?
  1. There is a two-sided struggle in the current deposit system. Tenants want to keep cash in their pockets and landlords want to avoid the administrative burden of managing deposits. The Garentii founding team has first-hand experience of both sides and has created a solution that puts the needs of both at its core. Buy-in from both landlords and tenants is crucial for the smooth running of this system and the team’s dual focus has ensured that Garentii’s offering has real value for both sides – a low-cost offering for tenants, and a free, efficient digital platform for landlords.
  2. However, a clever concept model isn’t enough if it isn’t underpinned by a high quality technology solution. Garentii’s platform has been built to be both intuitive and flexible, making it seamless for a landlord to introduce the solution to its tenants. It has the capacity to onboard tenants at pace, allowing landlords to manage both cash and insurance replacements in one place, and integrate with existing property management systems.
  3. Garentii was pre-market launch at the point of our investment, however had built foundational partnerships that gave the company real depth in the industry – its strategic partner and investor GreenLightRE, reinsurance partner HannoverRE and insurance partner SiriusPoint. This trio of partners gives Garentii the fuel power it needs to roll out its solution at scale.
  4. For any early-stage investment, the experience and character of founding team is crucial. Meeting Michael, Dennis and Vitaliy in Munich gave us the belief that this was a high calibre team with a mission that we wanted to be part of. They combine deep knowledge of the real estate industry, experience building and scaling technology platforms, and expertise in finance and consulting. Yet, despite their differing backgrounds, these three founders share a vision of building a solution that has the power to change the renting experience in Europe, starting with Germany.
What’s next for Garentii:

Garentii is positioned to tackle the inefficiencies of the rental market in Germany in the months ahead. Its market launch has allowed it to begin onboarding its pipeline of landlords and writing policies to deliver on its promise to early believers, signed up to its solution over the past months in advance of its market launch. Garentii has ambitions to scale across new European markets in the years ahead and is building out its team to do so. If you’re interested in hearing more about the opportunities at Garentii – check out their open roles here.

Elkstone is proud to be a part of this stellar team’s journey. If you’d like to learn more about the Garentii team or the team here Elkstone, feel free to get in touch at venture@nullelkstoneprivate.com.  Equally, if you’re a founder with a game-changing business, we’d love to hear from you.