Investor Updates

February 7 Warrants, Fundraise Pause, & Phase 2 / Profit. 02/07/2024 10:30 PT

Fundraise.
✅ HouseHack is electing to call warrants due prior to fundraising again.
✅ The next fundraise is expected to occur at likely $2/share. However, before we fundraise again, we'd like to call warrants due.

Warrants are Due.
✅ The company is calling ~$13,000,000 in warrants due within the next 60 days. Go to https://househack.com/2024-warrants to learn more.
✅ Warrants expire worthless April 8, 2024.
✅ Warrants allow you to invest at a $1 / share valuation.

Phase 1, Phase 2, and MiniFunds.
✅ Phase 1: Acquiring "wedge" deals and stabilizing the real estate (renovating, renting, managing, etc.).
✅ Phase 2: Strategically sell, at market value, to MiniFunds.
✅ MiniFunds, to be offered in the future, would offer distributions of rent and no-fee real estate (no distribution, acquisition, asset management fees, etc.).
✅ HouseHack would aim to profit the difference between the acquisition of a distressed property and the sale, at market value, to MiniFund investors. This essentially means the seller of a distressed asset pays HouseHack and MiniFund investors benefit from no fees.
✅ If phase 2 works, which we haven't done before and is therefore risky, we should be able to sustain the HouseHack business model without fundraising.
✅ We are aiming at Q3 for our first MiniFund. If it goes as planned, we hope to be gross and net profitable in 2024 (no guarantees of course).

Share Certs & Dalmore.
✅ We have about $400k left to reconcile for the Regulation A to work through with Dalmore before we can issue share certs from the last fundraise. We expect that to be done by March 31, 2024.

Deals and Operations.
✅ The company continues to operate on a daily basis on deal negotiation, bill pay, accounting, audits, property management, leasing etc.

📺 Video Explaining This.
🔗 Link to this post.



January 24 HouseHack Auction Update. 01/24/2024 11:00 PT

✅ Closed our first multifamily deal in January: over $15m.
✅ Over 7 more single-family deals in renovation almost rent ready.
✅ Single family deals have slowed in Mid-Dec-Mid Jan. 😇 This is common. Not worth writing on bad single family deals. Feb/March/April will have much more inventory and we can easily compete.
✅ Just opened escrow on an over $10m auction for HouseHack in a higher-build, lower-income area, with higher yields to diversify the portfolio. We believe a substantial wedge with a defaulting loan.
✅ Multifamily Deal Flow is Growing, especially with Fannie Loans in default - many of these are assumable in 3% I/O range. We're taking advantage of this where we can.
✅ 3 Targets Are:
➡️ Wedge single families.
➡️ Wedge multifamily in lower income / wedge. (High-build areas.).
➡️ Wedge multifamily in higher income / wedge. (Low-build areas.).
✅ HouseHack just earned a $200,000 commission on its first real estate deal (written through Kevin's brokerage while HouseHack license processes and the check was written over to HouseHack).
✅ Kevin has not earned/kept a dime of commission from HouseHack.
✅ HouseHack has still not paid a dime of the plane.
✅ Auditor Hired for 2023 Financials, due mid April.
✅ Property Management Team is Growing Strong
✅ Accounting Team is Growing Strong.
✅ Deal-Finding Team is Growing Strong.
😇 Likely over-staffed at the moment, which will mean higher OpEx as we build. However, this will likely quickly become under-hired.
😇 Very important we keep a strong property-management reputation.
✅ Warrants likely to be called within the next 2 weeks.
✅ Next fundraise will not be lower than $1:1.5 on valuation.
😇 Comparison: Bilt just raised $200m at $3.1b valuation. That's ~$7 into cash and $93 into brand value of every $100 invested. At $1:1.5, $66.6 goes into cash at HouseHack and $33.4 goes into the company built / IP.

📺 Video Explaining more Detail
🔗 Link to this post.



HouseHack Update. 01/06/2024 13:30 PT.

Internal, non-Confidential Updates:

😇 We're licensing HouseHack as a real estate brokerage to capture commissions on deals we transact ourselves. (For example, non-off-market deals.)
😇 14-18 Deals Rented, Under Renovation, In Escrow, or being Acquired/Pursued. We hope to 2-3x this in Q1.
😇 We are plan to use this investor relations website as a place to consolidate all HouseHack updates, in addition to the @HouseHackHomes channel on Youtube and Twitter/X account. This way we can more easily provide updates for our investors.
😇 We are laying the ground work for phase 2 of HouseHack's expansion. Phase 2 will be a critical moment for the long-term success of the company. Phase 1 is, as Kevin says, the easier/well-known part. Reminder: Phase 1 focuses on acquiring wedge deals, renovating them, renting them, and having the infrastructure in place to scale this (people/systems/processes). Phase 2 has to do with MiniFunds: democratizing access to American real estate at low-to-no fees.
😇 We may coordinate with Meet Kevin on real estate seminars that give investors a chance to meet us in person to learn about our systems, how they can buy real estate the way we do, and how they can partner with us on deals or investing either into HouseHack or MiniFunds.
✅ Our second half of 2023 financials are being fully audited and will be available likely in April 2024. $0 of HouseHack funds have paid for Kevin's plane, which he frequently uses to help facilitate HouseHack's growth.
😇 HouseHack is looking to likely balance its exposure to multi-family and single-family real estate.

Fundraising & Share Certifications:

😇 Our Reg A broker-dealer partner is still finalizing some retirement account transactions. Once these are complete, we can issue share certifications. Likely this quarter.
✅ We may call for warrants in Q1 and/or fundraise in Q1 2024.
😇 We believe phase 2 may be easier with at least $50m in assets versus less.
✅ We've raised just over $40m.
✅ 2023 Regulation A Non-Accredited Investor Round, without Warrants: Closed. 1:1 Valuation.
✅ 2022-2023 Regulation D Accredited Investor round, with Warrants: Closed. 1:1 Valuation.
✅ Meet Kevin's ownership stake in the company was purchased at the same valuation as other investors.

Video Archive:

📺 What is HouseHack.
📺 How we Doubled the Valuation of HouseHack.
📺 The $16 Million Dollar HouseHack.
📺 A $100,000 Before & After HouseHack.

🔗 Link to this post.