Pacaso: Interview With CEO Austin Allison About The Second-Home Ownership Accessibility Company

By Amit Chowdhry ● Yesterday at 5:57 AM

Pacaso is a service that creates a more accessible category of second-home ownership. And the company helps people buy and own a second home through a property-specific LLC, and reduces the cost and hassle of ownership. Pulse 2.0 interviewed Pacaso CEO Austin Allison to learn more about the company.

Austin Allison’s Background

Austin Allison

What is Austin Allison’s background? Allison said:

“I grew up in a small town north of Cincinnati, Ohio. My dad was a carpenter, so I grew up swinging a hammer starting at age three or four. Money was always a point of stress and tension for my parents, but my father, being a carpenter, had to show up every day and figure out how to provide for the family, work hard, and put food on the table. Watching that growing up and experiencing that firsthand really inspired my aspiration to become an entrepreneur.”

“Homeownership was always a dream for me, and I ended up getting into the real estate business. By the time I was 18 years old, I needed to find a way to pay for college, so I decided to start selling real estate.”

“I sold real estate all through undergrad, and I ended up going on to law school after that, which is where I started my first real estate tech company called dotloop. We built that company over seven or eight years, and eventually, we were fortunate enough to sell to Zillow Group in 2015, where I stayed on as an executive for about four years before leaving to start Pacaso with Zillow Co-Founder and former CEO Spencer Rascoff.”

Formation Of Pacaso

How did the idea for the company come together? Allison shared:

“About 10 years ago, my wife and I became second homeowners in Lake Tahoe. We realized how fortunate we were to have a place for our family and friends to gather and create lasting memories. This moment sparked the vision for Pacaso: to make the joy of vacation home ownership accessible to more families, allowing them to optimize their lives for meaningful experiences with loved ones.”

“One of the lightbulbs that went off for me while I was enjoying my home  was the realization that most second homes are only utilized about 10% of the time. That means that we have a lot of empty homes sitting around the world, and Pacaso is about connecting those two problems to create a solution.”

“Essentially, Pacaso is a co-ownership marketplace that empowers people to co-own luxury second homes together. The easiest way to get your mind around the ownership structure is to imagine yourself and three or four of your friends or family members wanting to buy a home together. Pacaso enables you to do that, except you don’t have to know the other people or worry about any household upkeep, management or home design.”

Core Products

What are the company’s core products and features? Allison explained:

“At Pacaso, buyers shop from a curated set of second-home listings on our marketplace. Ownership is sold in ⅛ shares with integrated financing available. Pacaso creates a property LLC for each home, finds and vets co-owners, and handles all the sales details. At closing, the co-owners enjoy 100% ownership of the home – Pacaso does not retain any shares, and we manage everything for its owners – from interior design and property management to bill pay and repairs and even making scheduling dates, making owning the home seamless and simple for co-owners.”

“We often hear DIY co-owners express concern over properly scheduling time in their home among multiple owners, especially when they buy with family or friends, and often worry about the headache of fighting with in-laws for who gets the home during holidays, but Pacaso has a solution to streamline the process regardless of who you buy with.”

Challenges Faced

What challenges have Allison and the team face in building the company? Allison acknowledged:

“High interest rates have forced many buyers to put their dreams of purchasing real estate on hold. However, together with our banking partners, Pacaso offers competitive financing for up to 70% of the home’s purchase price, with rates under 5% on select homes.”

Evolution Of The Company’s Technology

How has the company’s technology evolved since launching? Allison noted:

“We’ve created a proprietary scheduling tool called SmartStay, which distributes the calendar fairly amongst the ownership group. Through SmartStay and the Pacaso app, homeowners can book stays from 2 days to 2 years in advance, guaranteeing owners access to their homes even during high-demand peak seasons. Every region also has a dedicated Home Manager who supports owners with scheduling, home management, special requests, and any other home-related issues.”

“Most recently, Pacaso launched an innovative new home swap program for its owners, allowing them to trade stays with fellow owners and explore luxury destinations across the globe. This unique perk takes vacationing to a new level by ensuring that Pacaso owners can continue to enjoy the same high-end experience, no matter where they travel. Unlike traditional vacation rentals, which can sometimes be unpredictable in terms of quality and service, Pacaso’s swap feature guarantees that every stay within our network maintains the elevated standards our owners expect. From expertly designed interiors to white-glove support, each trip feels just as comfortable and memorable as staying in their own Pacaso home.”

Significant Milestones

What have been some of the company’s most significant milestones? Allison cited:

“In three full years of operation, Pacaso has achieved $100 million in adjusted gross profit and facilitated $1 billion in gross real estate transactions and service fees across more than 40 markets nationwide, as well as internationally in Paris, London, and Cabo.”

“In 2024, we launched DIY services. As the leading expert in real estate co-ownership, Pacaso now offers professional DIY services for owners who prefer to self-manage their ownership experience. Whether it’s a vacation retreat or co-living in a primary residence, our à la carte services include: LLC set-up, Operating agreements, Legal templates, Consultation and guidance.”

“Additionally, we launched our Estate collection, featuring the most desirable homes in the nation’s most desirable locations like Malibu, Nantucket, Aspen, Napa, and Jackson Hole, and even international destinations like Cabo and  London, starting at $1 million per share. As with all our other homes, these luxury estates have been thoughtfully designed and fully furnished by Pacaso to provide residents the over-the-top lifestyle they are used to, but without the hassle of regular upkeep, cleaning and emergency maintenance.”

“And of course, our home swap program, where owners can trade stays with one another and explore more luxury destinations across the globe.”

Customer Success Stories

When asking Allison about customer success stories, he highlighted:

“We have several Pacaso owners who have bought multiple shares of different homes or more than one share of the same Pacaso because of how easy it is to simply show up and enjoy their vacation home. Buyers have fallen in love with the convenience of owning a Pacaso and how little maintenance is required that they end up buying another share to get the same experience in a different destination, or make more memories with longer stays in the same home. For example, we have a buyer who owns in Mexico to connect to their family heritage, Aspen to enjoy family ski trips, and Palm Springs to gather with extended family in a more convenient location.”

Funding

When asking Allison about the company’s funding details, he revealed:

“Most recently, we announced that regular people can now purchase stock in the company through a revolutionary new Regulation A growth round, and join marquee investors such as Maveron, Softbank, Greycroft and Fifth Wall as investors in the company. The initiative democratizes Pacaso’s equity and offers the unprecedented opportunity to be part of the company that is drastically transforming the second-home market. The growth round through “Reg A” is an up-and-coming model of raising capital, and we believe Pacaso is at the forefront of the practice. Funds raised from this growth round will help Pacaso to elevate its production, engineering and operations to provide an even better co-ownership experience for our homeowners.”

Total Addressable Market

What total addressable market (TAM) size is the company pursuing? Allison assessed:

“The vacation home market is massive, with 75% of Americans expressing interest and a total U.S. serviceable value of $1.3 trillion. Coldwell Banker just reported in their 2024 trend report that 40% of Americans want to do so (own a vacation home) in the next YEAR.”

Differentiation From The Competition

What differentiates the company from its competition? Allison affirmed:

“Pacaso’s number one competitor is the whole home.  A buyer who plans to use their second home for more than half of the year may find that a whole home is a better fit for their needs, however, those who only intend to visit their second home less than half of the year may find that Pacaso and co-ownership may make more sense for them. Managing more than one home can also be a challenge for second home buyers, especially if the homes are a long drive or plane ride away, so having the option to co-own through Pacaso and leave the maintenance and upkeep to us is an attractive option for many vacation home seekers.”

Future Company Goals

What are some of the company’s future company goals? Allison concluded:

“Pacaso is on a mission to make home ownership easier and more accessible for more people, and we plan to continue expanding into new markets, enhancing our products and services and offering an even greater variety of price points to make the dream of owning a vacation home a reality for more people.”

“While Pacaso currently operates outside of the United States in Mexico, the United Kingdom, and France,  we are excited to continue our international expansion and introduce more listings abroad to meet the demand.”

Exit mobile version