Venture Studio from Crisis: Our investment in Agile Homes & Property, and Lanu
Today, we are excited to announce our investments into two housing-focused startups, Agile Homes & Property, and Lanu.
Both Agile Homes and Lanu are working within the housing sector to provide effective solutions to housing and homelessness issues. Agile Homes delivers high-quality, low carbon, and affordable homes using rapid, modern construction methods; while Lanu (London Techstars 2020) has developed a digital solution to assess properties for extension and development potential. Both businesses will work with Crisis to unlock the potential of existing housing stock and land hidden in plain sight, to create more affordable housing at pace.
Through the Venture Studio, both companies will be supported by a bespoke programme of support over the next six months. The support will include working with expert teams from Crisis who have over 50 years of experience in ending homelessness, those with lived experience of homelessness, and have access to a network of thought-leading public and private sector organisations.
Part of our mission in the Venture Studio is to broaden access to and understanding of impact investment. As part of this, we wanted to share some thoughts on who Agile Homes and Lanu are, why we invested, and how it happened.
What was the process that led to investment?
We were first connected to Agile through South Yorkshire Housing Association who were exploring the potential use-case of WikiHouse, an innovative digitally manufactured building system. Whereas Lanu was connected to us through an introduction from the founder of RenKap, a Geovation portfolio company. Over the last year, we have been working hard to build this active community that can help us realise the opportunities ahead of us and to build a pipeline of impactful startups. What has been inspiring is that each of our community partners has used their time, energy, and networks to support us to find the right ventures to invest in, playing a critical role in our mission to end homelessness.
The investments happened after months of scouting, followed by a thorough due diligence process which was agreed upon and signed off by a range of internal and external experts, from those with lived experience of homelessness, impact investors, and people with deep housing expertise, helping us to understand what best practice really looks like. By making these two initial investments into housing-focused products, we believe we have a better chance of tackling homelessness at scale.
Why do Agile Homes and Lanu fit the Venture Studio’s thesis?
1. They’re tackling a huge global problem
The housing market is broken. We are in a crisis of affordability, and access to housing is one of the biggest barriers for people experiencing homelessness and for those at risk.
In the UK, social housing provided by councils and housing associations for people in housing need is becoming increasingly scarce. The number of social rented homes in England fell by 120,000 between 2012 and 2016, taking the total number of social rented homes below 4 million. Another 120,000 social rented homes were lost from the social housing stock between 2016 and 2020.
This month, September 2021, the government published statistics showing how many people experienced or were at risk of homelessness between April 2020 and March 2021. The data tells us that there are factors that significantly increase people’s likelihood of being forced into homelessness in the first place.
There are many reasons for this which began much before the pandemic. The core of the problem is that not enough homes are being built to replace those being taken out of the social housing stock. This happens when homes are sold through Right to Buy or are moved into a higher rent bracket known as “affordable rent”. The Government encourages social housing providers to put a proportion of homes into the higher rent bracket to raise money for building new “affordable rent” homes.
Additionally, in England, single homeless people are unlikely to have priority for help from councils under the homelessness legislation. As the supply of social rented homes has decreased, single people have had less access to social housing. This means single homeless people often have no choice but to look for housing in the private rented sector. Read more about private renting.
This can be seen during the pandemic, where there’s been a 25% increase in single adults placed in temporary accommodation, indicating a continued flow of people experiencing homelessness in the last year and the increased provision of emergency accommodation through ‘Everyone In’. No longer being able to stay with friends and family was the greatest immediate cause of homelessness. This increase is likely because it was even harder for those sofa surfing to continue doing so against the backdrop of lockdown restrictions, concerns about social distancing, and overcrowding. It’s also been noted that the pandemic context led to an increase in cases of domestic abuse.
2. They have massive potential to create more affordable housing at scale
Both Agile Homes and Lanu have the potential to change the current housing market crisis. In the UK alone, the existing housing market is worth £52 billion annually. The average house price is £303k which is over 10 times the average household income, yet there are few products and services that help to create more affordable housing.
Agile Homes’ development of a people-centred housing solution helps to break the affordable housing crisis with three key innovations:
- They build homes on land hidden in plain sight and not previously imagined as developable. The social value added by Agile means that land can be brought forward at zero acquisition (social value only) costs
- They build ‘Agile Homes’ using prefab methods with no compromise on very high quality
- They use Distributed Manufacturing model, which supports local communities with employment and training opportunities. For example, they have started producing panels, used in the construction of their homes, inside a prison workshop at HMP Leyhill. Over 30% of prison leavers have nowhere to live. They make up a large proportion of the overall homeless population. Additionally, without employment prison leavers frequently re-offend. The revolving door of reoffending costs UK PLC over £18B a year. Agile provides prisoners with meaningful activity, skills, and qualifications in Modern Methods of Construction whilst they are in prison. This helps ensure that prison leavers are better able to gain employment and find suitable accommodation. It also provides for safer communities.
In addition, we see the opportunity for Lanu to arm Crisis and policymakers with the knowledge to drive change within local councils and housing associations, working to expand existing housing stock at a portfolio, community, or city levels. This will combat the housing crisis by:
- Increasing the number of local councils, housing associations, and private landlords engaged to regenerate vacant housing stock
- Supporting local councils, housing associations, and private landlords to expand or regenerate vacant housing stock
- Ensuring affordable homes or social housing units are subsequently brought back to market
3. The teams are mission-driven leaders dedicated to improving people’s lives through building more affordable housing
Linda (Director) and Craig (CEO) have worked together on Agile for three years, born out of their experience of low carbon architectural practice and innovative prefabrication. Craig has over 30 years of experience in the design and development of low-carbon and sustainable buildings and 16 years in Modern Methods of Construction. Linda is an experienced Company Director, general manager, entrepreneur, and project manager with 25 years of experience in public, private and voluntary sector roles. The team seeks radical disruption of the housing market driven by the belief that everyone deserves a safe, civil, affordable, and sustainable home where they can live the quality of life they deserve.
Co-founders Shane (CEO) and Luke (CTO) have been friends for over 25 years. Previously, Shane was an RTPI Town Planner with 7 years of experience in local government, and Luke is a developer with a Ph.D. in Computational and Applied Mathematics. The team is passionate about transforming the planning system to make it easier for everyone and believes that by using technology, Lanu can transform the property sector.
4. Their products empower an overlooked segment of the population
If you’ve been reading posts about our mission, you’ll know that supporting people from overlooked populations is an incredibly important anchor at the heart of everything we do in the Venture Studio. Both Agile Homes and Lanu support their customers who need access to affordable housing with the technology, tools, and opportunity to make huge changes in their life to finally access a home of their own.
