Veev
A housing start-up that built walls in a factory: half of its USD 400 million round never arrived
- Founded
- 2008
- Closed
- 2023
- Lifespan
- 15 years
- Total funding
- $600 million
- Peak valuation
- $1 billion
- Became a unicorn
- 2022
- Country
- United States
- City
- Hayward
- Sector
- Real estate and construction
- Founders
- Amit Haller, Ami Avrahami, Dafna Akiva
- Investors
- BOND, LENX, Zeev Ventures, Fifth Wall Climate Tech, JLL Spark Global Ventures
- At its peak
- Valued above USD 1 billion in a USD 400 million round in March 2022
- Cause of closure
- Ran out of cash
What did it do?
Veev was founded in 2008 by Amit Haller, Ami Avrahami and Dafna Akiva as a property developer, turned to factory-made construction around 2017 and 2018 and took its name in 2019. It produced finished wall panels with mechanical, electrical and plumbing systems built in. It worked between California and Israel. After starting with high-rise housing it shifted to single-family homes.
Why did it shut down?
In March 2022 a USD 400 million round led by BOND made Veev a unicorn. In November 2022 it cut about 100 jobs, or roughly 30% of its workforce. According to Calcalist, the second USD 200 million tranche was not transferred in March 2023 and a proposed USD 120 million internal round ran late. Rising interest rates and changing US housing demand had pushed the company away from high-rise projects. Its largest investor, Lennar, withdrew support for a bridging loan, and the decision to close came in November 2023. Lennar bought the remaining assets on 21 December 2023 for several dozen million dollars.
The story
Veev wanted to answer the housing shortage from a factory. It made walls with plumbing and wiring already inside, then assembled them quickly on site. What began as a property developer took its present name in 2019 and caught investors' attention.
In March 2022 a USD 400 million round made headlines. According to Calcalist, however, only half of that money ever arrived. The second USD 200 million tranche fell due in March 2023 and was not transferred. Interest rates had risen and the housing market had changed.
The company first cut about 100 jobs, then tried a USD 120 million internal round. Its largest investor, Lennar, did not back the effort and withdrew support for a bridging loan. In November 2023 Veev said it would close.
The same Lennar bought the remaining assets on 21 December 2023 for several dozen million dollars. Reported to have raised USD 600 million, Veev shows how a round paid in tranches can open a gap between the headline figure and the bank balance.
Lessons for founders
- In a round paid in tranches, count only the money in your account. If half of USD 400 million has not arrived, build your plan around USD 200 million.
- A strategic investor can also be a customer or rival. A partner like Lennar can turn into the cheapest buyer when times are hard, so weigh that when you give out equity.
- Changing the target product also changes the story you told investors. If you move from high-rise to single-family homes, prove the new factory economics again.
Sources
- The untold story behind the collapse of proptech unicorn Veev (CTech by Calcalist, 2023-11-29)
- Prefab home builder Veev reportedly shutting down after reaching unicorn status last year (TechCrunch, 2023-11-27)
- Proptech startup Veev cuts 30% of jobs eight months after raising $400 million (CTech by Calcalist, 2022-11-11)
- Lennar Corp. Acquires Unicorn PropTech Firm Veev in Deal Worth several dozen million Dollars (The Registry, 2023-12-29)
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