Reports indicate that Veev, a real estate developer that transitioned into a tech-enabled prefab home builder, is on the verge of shutting down. This comes after the company achieved unicorn status last year. Despite raising a total of $600 million, including a significant $400 million in March 2022, Veev’s sudden cancellation of a capital-raising initiative has forced them to consider closing their doors.
Key Takeaway
Veev, a real estate developer turned tech-enabled homebuilder, is reportedly shutting down after reaching unicorn status last year. Despite previous funding successes, the company’s sudden cancellation of a capital-raising initiative has ultimately led them to consider closure. Veev’s focus on prefabrication and innovative building techniques was not enough to save the company in a challenging market. This serves as a reminder that even well-funded startups may face significant obstacles in the ever-evolving real estate industry.
New Funding Round Secured Prior to Closure
Veev managed to secure its latest funding round in 2022, with Bond leading the investment. Other participants included LenX (formerly Lennar Ventures), Zeev Ventures, Fifth Wall Climate Tech, and JLL Spark Global Ventures. Unfortunately, it seems that this funding was not sufficient to sustain the company’s operations.
A Shift Towards Prefabrication and Innovation
Founded in 2008 as Veev Group, the company initially operated as a traditional real estate developer and asset manager. However, they quickly recognized opportunities for improvement in the building process. By 2017, Veev Group decided to focus on prefabrication capabilities, solidifying their pivot to becoming a vertically integrated developer focused on building innovation. To reflect this shift, the company changed its name from Dragonfly Group to Veev in 2019.
Despite the fate of construction tech startup Katerra, which faced significant challenges in 2021 after raising over $2 billion, Veev remained optimistic about its own prospects. In a March 2022 interview, Veev’s CEO and co-founder, Amit Haller, emphasized that their approach differed from Katerra’s. While Katerra presented itself as a comprehensive supply chain company, Veev prioritized developing an exceptional home product and then sought to scale its success by meeting regional demand through digital prefabrication.
Layoffs and Previous Ventures
In November 2022, Calcalist reported that Veev had laid off approximately 100 employees, accounting for about 30% of its workforce. At that time, the company had around 350 employees, including 100 based in Israel. This recent round of layoffs further underscores the challenges faced by Veev.
It is worth noting that Veev’s co-founders, Amit Haller and Ami Avrahami, have experienced prior failures in the proptech industry. Another one of their ventures, Reali, began the shutdown process in August 2022 after raising more than $290 million. Zeev Ventures also participated as an investor in Reali.
