Our Investment in Keyway

by Rebecca Lynn and Grace Isford

Small and medium-sized commercial real estate properties represent a massive yet fragmented $5T market opportunity in inventory alone and represent $180B in yearly transactions. However, no platform exists to make the strenuous real estate processes easy for downmarket commercial sellers—until Keyway.

Today, we’re excited to announce that Canvas Ventures is leading the $15M Seed Prime round of Keyway, a digital platform reinventing commercial real estate for small and medium-sized businesses.

Serial entrepreneurs, onto a big opportunity

Keyway was founded by Matias Recchia and Sebastian Wilner, both Harvard Business School (HBS) alums with unique complementary experiences.?

Matias is a serial entrepreneur and his prior startup, Argentina-based IguanaFix, provided property management and maintenance services to businesses. He experienced firsthand the headaches that SMBs face when dealing with real estate. After selling part of his business to Black & Decker, Matias began looking for new opportunities to combine his passion for SMBs and real estate. He started his career at Procter & Gamble (where I also launched my career), and met Sebastian while he was an Entrepreneur-in-Residence at HBS.

Sebastian spent more than six years at Google managing a team of machine learning engineers to bring small and medium-sized businesses into the Google ecosystem. During his summer internship at HBS, he worked at a hedge fund analyzing dozens of residential real estate proptech companies changing how homes are bought and sold, and saw that there were no good solutions in the commercial real estate space.?

After meeting over 300 SMB owners and real estate investors of all stages, Sebastian and Matias uncovered a key insight: business owners were frustrated with long, expensive, and opaque transactions. Practically no technology was being used to source, underwrite, and close deals for this segment of the market. Institutional investors were focused on deals that were over $50M. There was a unique opportunity to leverage small and medium-sized real estate assets to free up liquidity for business owners and originate long-term net-lease contracts for investors.

Matias and Sebastian are joined by an all-star team including Director of Real Estate Nadine Anderson who previously executed commercial real estate transactions on a large scale at Jamestown and Goldman Sachs. The team also includes alumni from Capital One, Brookfield, and other prestigious organizations.?

The key solution

Keyway’s platform turns the traditionally long and messy SMB real estate market processes into a frictionless experience for property owners.?

The workflow for property sellers of small and medium-sized businesses is difficult, time-consuming, and expensive, with hefty fees, long sales processes, and opaque pricing—often taking 13+ months to sell and requiring massive double-digit percentage point fees, leading to a generally unpleasant experience.

Keyway’s platform taps into data sources across more than 160K commercial properties in the U.S., leveraging machine learning to programmatically “rate” properties and match them to prospective purchasers based on their unique prospect score. Keyway in turn underwrites offers for these properties promptly and efficiently, including a LOI within 48 hours at a fair price and a 30-day guaranteed close.

“Working with Keyway was incredibly easy,” said Keyway customer and founder of Texas-based QLTC Pharmacy, John Sheehan. “I received the full value of my commercial real estate without a complicated, disruptive, or lengthy transaction. The process was simple and fair, and I look forward to being a tenant in the space my business already occupies for many years to come.”

A massive opportunity

Keyway is uniquely positioned to modernize the commercial sale-leaseback process as well as reinvent the market for SMB real estate overall. Keyway fundamentally changes the way real estate is transacted using data science and machine learning to source and underwrite, digitize due diligence and closing, and provide additional products and services to help property owners benefit from greater access and improved returns.

The team is just getting started with an ambitious and extensive vision to become the next-gen digital platform for commercial real estate transactions.?

We originally met the Keyway team in early 2021 and invested because we believe deeply in their approach to the commercial real estate market. Since then, the team has continued to execute impressively and exceed expectations, boosting their pipeline to over $250M and closing multiple transactions all in a matter of months.?

Given our deep fintech and proptech theses as well as our penchant for ambitious founders looking to create category-defining platforms, Keyway is the perfect addition to the Canvas portfolio. We could not be more excited to partner with Matias, Sebastian, and the Keyway team and also invest in the New York ecosystem where the team is headquartered, alongside FJ Labs, Crosscut Ventures, Montage Ventures, and Great Oaks.?

Learn more about Keyway here and if you’re looking to help build, the team is hiring!