Dongnae

High-Level Overview

Dongnae is a South Korean proptech startup founded in 2020 that operates the Dongnae FLEX program, providing premium, furnished apartments in Seoul and Pangyo with significantly reduced deposits (around 10-15 million won, 98% lower than typical jeonse averages) and fixed monthly rents.[1][2][3] It serves young professionals, local Koreans (over 80% of users), and foreigners like business executives by simplifying rentals, guaranteeing landlord income, and handling management via professional services including cleaning, repairs, and credit-checked tenants.[1][3][4] Dongnae solves Korea's jeonse system's high lump-sum deposit barriers (e.g., 627 million won average in Seoul) by subleasing high-quality new apartments directly from landlords, while recruiting high-credit tenants and partnering with over 80 local brokers.[1][3][4] The company has raised $33.3M total, including a $21M Series A in 2022, managing over 150 units across 80 complexes, with a team of ~40 focused on tech, finance, and real estate expertise.[2][3][5]

Origin Story

Dongnae was co-founded in 2020 by Matthew Shampine (former GM of WeWork Korea, with a background in information science) and Kim In-song (COO, CSO), alongside CEO Min-geun Cha, CRO Suji Lee, and CFO Seon-ju Yuk (ex-JP Morgan, Citigroup), all drawing from WeWork's commercial real estate and finance experience across the US and Asia-Pacific.[1][2][4] The idea emerged amid shifting preferences from jeonse (lump-sum deposits) to monthly rents, driven by high costs like Seoul's 627 million won average jeonse versus 510,000 won monthly for one-bedrooms, creating barriers for young renters and landlords seeking stable income.[1][3] Early traction came from launching Dongnae FLEX for curated, low-deposit premium apartments, quickly scaling to 60+ properties in Seoul new complexes, expanding to Pangyo, and securing seed funding (including $4.1M extension led by NFX) before the $21M Series A.[3][4][5]

Core Differentiators

• Unique Business Model: Directly rents high-priced new apartments from landlords (guaranteeing monthly income), then subleases to vetted tenants at 98% lower deposits via proprietary credit analysis, unlike traditional brokerages or listings platforms.[1][3][4]
• Premium Quality and Services: Expert-selected furnished units with move-in readiness (cleaning, plastering, inspections, repairs); multilingual support (Korean, English, Chinese, Japanese) appeals to foreigners.[1][3]
• Tech and Partner Ecosystem: Owns all listings (no external platform); 80+ Dongnae Premium Partners for local brokerage; building iOS/Android apps, data tools, and home services marketplace for seamless end-to-end rentals.[2][3]
• Fintech-Proptech Hybrid: Lowers barriers for renters/landlords, boosts landlord yields through pro management; backed by investors like Fursys, Daol, Han River Partners.[2][4]

Role in the Broader Tech Landscape

Dongnae rides South Korea's proptech wave, targeting the residential real estate market—Korea's largest asset class—by disrupting the fragmented jeonse system amid rising monthly rent demand and urbanization in Seoul.[1][3][4] Timing aligns with post-COVID easing, increasing foreign inflows (e.g., executives facing currency hurdles), and a new renter generation prioritizing flexibility over massive deposits.[3] Market forces like high jeonse costs (averaging $480K+ in Seoul) and broker inefficiency favor Dongnae's centralized, tech-driven model, partnering with brokers while digitizing management.[1][3][5] It influences the ecosystem via acquisitions like co-living platform Dears (Stevens), expanding into managed living, and fostering proptech-finance hybrids with strong institutional ties.[5]

Quick Take & Future Outlook

Dongnae is poised to dominate Korea's proptech rental space by scaling beyond Seoul/Pangyo, launching mobile apps, and deepening tech (e.g., AI credit/data tools) amid growing demand for affordable premium housing.[1][3] Trends like foreign investment, urbanization, and jeonse decline will fuel growth, potentially via further M&A and fintech integrations. Its influence may evolve into a full residential platform, transforming fragmented rentals into a seamless marketplace—building on its low-deposit innovation to lead as Korea's go-to for modern renting.[3][5]