Agent Interview – Hannah Chappatte, Hybr.co.uk

Many people have tried and a fair share of them have failed. But that doesn’t stop more trying to crack the nut that is a national lettings platform for long-term rented accommodation that isn’t a portal.

26-year-old Hannah Chappatte believes she can do it and has set up Hybr.co.uk. It is a platform for first-time renters and in particular students and young graduates. Investors clearly believe in her pitch; the firm raised £3.24 million in funding via investment syndicate Adjuvo recently and backers included a member of the Rothschild family. This is double her original funding target, reflecting the considerable investor appetite for rental platforms like Hybr.

“This money will be used to fund our rapid expansion across the UK and capture market share at pace,” she says. “We can do this because we’re a proptech platform that uses tech to streamline the lettings process. It doesn’t matter whether you’ve got a single property or a portfolio with 20,000 units, you can plug our service into your offering.”

She says around 70% of her landlords are private, with the rest being BTR or PBSA operators, both of which use her platform as either ‘tenant find only’ or a wider service that includes referencing and contract processing.

Her business, which is based in London, is progressing in the right direction so far. It already operates in ten of the UK’s main student cities including London, Bristol, Manchester, Liverpool and Sheffield with plans to add another 20 by the end of 2024. And other than offering tenants, landlords and BTR/PBSA operators one common platform, its other main schtick is to give inexperienced renters advice on how to navigate the private rented sector while also making it easier for landlords to let out their properties by accessing ‘pre-qualified’ tenants.

Student inspiration

Her decision to launch the business was based largely on her shock as a student renter that there was no central place to find rented properties for students that offered a decent experience. Her belief is that the fragmented market and sometimes shark-infested renting waters that student must navigate offer an opportunity for a better service.

It’s strange. There are marketplaces for flights, clothes and bills – but not for student renting.

“It’s strange – there are marketplaces for flights, clothes and bills but not for student renting,” she says. “During my time studying in Bristol and in my final year, researching the market, I also spoke to many landlords many of whom reported losing thousands of pounds in rent each year from voids, and who said they were struggling to deal with the high number of applicants and enquiries each time a property was advertised.

“This exposes them to making errors and not choosing the best tenants for their properties.”

But Hybr is not a portal. It advertises landlords’ properties on Rightmove and positions itself as a middleman between property manager and tenants. “We say landlords of whatever size should focus their spend on a good experience once the tenant has arrived and use us to make acquiring those tenants as seamless as possible,” she says.

Chappatte also makes the same argument for letting agencies. Her platform already works with several big ones and she says they have plugged Hybr into their processes to enable staff to concentrate on the property and tenancy management.

“We help increase the profitability of agents because Hybr streamlines and automates the pre-qualification of,” she adds. It is also getting ready to offer a guarantor system for tenants who come from abroad or low-income backgrounds in the UK. “It’s unfair that the guarantor system is free for the wealthy who can ask their family to help, and expensive the poor,” she says.

Hybr is to launch a loans system with an as-yet unnamed banking partner that will enable tenants to pay up to six months’ rent in advance and then pay it back when their student loan arrives, bolstering their creditworthiness and decreasing the need for a guarantor the year after.

Talking of money, Hybr also makes it clear that landlords will pay less than letting agents to use its service. It has a fixed fee approach depending on which sort of landlord you are. This is 25% of the first month’s rent for ‘tenant find’ only and 40% of the same for its wider, pre-tenancy service. Consequently most of its private landlords tend to be self-managers as BTR and PBSA operators tend to be too.

But unusually, Hybr does get involved with tenants if a landlord is slow to respond to or complete repairs and maintenance and Chappatte says her team works hard to ensure there are clear two-communications channels between renter and landlord after the tenancy begins.

So how would she sum up her business? “One way to describe Hybr is an Airbnb-style service but for long-term first-time renters that offers a better way to filter and help prospective tenants.” Even more unusually, Chappatte says her business will reach break even by the end of 2024 – something many proptech business in the residential market will look upon jealously.