Canadian startup OpenUnit raises $150K pre-seed funding from Y Combinator
Toronto-based OpenUnit announced it has raised $150,000 in pre-seed funding from US accelerator Y Combinator. The company is one of a few Canadian startups to receive funding from the high-profile accelerator.
OpenUnit joined its Winter 2020 (W20) batch and received mentorship in California at the beginning of the year. Silicon Valley-based Y Combinator has been the seed accelerator for household names including Airbnb, DoorDash, Instacart and Stripe, among others.
Joining Y Combinator is a big step in helping OpenUnit launch its products into the $40B self-storage market. Being a Y Combinator alum is a mark of distinction for any high-growth company. Participating in the program exposed OpenUnit co-founders Taylor Cooney and Lucas Playford to the expertise of Silicon Valley and helped their team to further develop its products.
"Y Combinator presented a significant opportunity for OpenUnit to connect with top early-stage investors and mentors while accelerating the development of the company," said Taylor.
The financing is helping build OpenUnit's web-based platform, which is the first free management solution for self-storage facilities. With this capital, OpenUnit will be launching their management software and payments offerings, while also expanding its services directly by way of a marketplace that provides listings for self-storage units. By offering facilities modern tools to manage transactions, connect teams, and power customer experience, OpenUnit's free-to-use pricing model is unique in the $40B self-storage industry and challenging the status quo of incumbent software providers.
OpenUnit generates revenues primarily from payment processing fees via its merchant solution, OpenUnit Payments, enabling the company to offer the fully featured management suite at no additional monthly cost. OpenUnit Payments is a fully integrated payment processing solution that allows merchants to accept credit cards at attractive rates alongside a mobile point-of-sale product that's designed to accept payments in-person at self-storage facilities.
Lucas Playford, co-founder and COO of OpenUnit said: "We can solve a lot of problems for self-storage facilities and take care of many things that banks and other vendors do not. 74% of self-storage facilities are small and self-reliant, and current solutions are overkill for these kinds of facilities. While OpenUnit fulfills the needs of the long-tail of the industry, it is also a great fit for facilities and teams of every size. There are no setup fees. No monthly fees. Processing rates are fixed, and transparent, bringing cost certainty for facilities."
The company was self-funded until it raised this investment from Y Combinator and the backing of Y Combinator provides OpenUnit more than funding, "The validation from Y Combinator really speaks to how attractive the market is and gives us the confidence to continue moving forward. Y Combinator looks for disruptive opportunities and this signals to us that we are on the right path," said Taylor.
The company will likely look for more money to scale up growth of its management platform. "It will definitely be within the next year. Probably before Winter, maybe even in the next two to three months," said Lucas.