After raising $1.2 million from Frontier Digital Ventures last year, the chief executive of Tolet.com.ng, Nigeria’s real estate and property-listing platform, Mr. Fikayo Ogundipe did made it known to the public that they plan to expand nationwide, consolidate staff strength and roll out new products with the new funds. Well, they have introduced a new feature on the site called Shortlet. The feature presents the option of renting a residential or office space for a duration as short as a day just like AirBnB.
The Shortlet category already has listings from Lagos Mainland’s buildings and Island’s luxurious properties, with for example, a 2-bedroom suite in Lekki going for N120,000 per day and a 1-bedroom miniflat in Maryland up for N26,000 per day. Office spaces are also available for shortlet.
With this brilliant feature, the smart guys at Tolet are going after AirBnB and the billions circulating within Lagos’ hotel industry, as people now have the options of choosing between the N20,000 room in a hotel in Maryland or paying the same for say, a well-furnished apartment in the same locale. According to Slimtrader Managing Director Femi Akinde, Nigeria’s hotel industry was worth $3 billion (N945 billion) in 2014 and there aren’t enough hotels to service its local and international market.
“We just have 7,000 hotels for 70 million adults, excluding people coming into the country. If we consider the internal travels that happen in Nigeria, 7,000 hotels are probably not enough to accommodate all of the people that are looking for rooms,” he said in a Vanguard report.
There is an obvious market opportunity here for ToLet plus there is a whole lot of owners/managers of empty and wasting sprawling properties on the Island that would be glad to list their properties on Shortlet.
This isn’t the first time Tolet will take decisive strides in the properties-listing space. Before raising $1.2 million from FDV last year, they had only raised $230,000 from Spark in 2013 and operated 2 years on a positive balance sheet without the huge marketing budgets of its competitors – Rocket’s Lamudi (Now Jumia House) and ROAM’s PrivateProperty (which reportedly had a $2 million marketing budget). I asked how they got real estate agents to keep paying for their service and co-founder Sulaiman Balogun, explained that while competitors where operating a copy-and-paste subscription model where agents paid monthly for premium visibility of their sites, they noticed agents preferred a commission model where they only get to pay property sites when a deal has been successfully closed via their site.
“That, they can understand. It is a decades-old model they already run. If you help a property vendor sell/rent his building he would give you a commission but for me to now pay ahead for a month’s space on your site and trust you will bring me customers, that is more difficult,” he explained.