Last week, a few tenants who rent residential spaces with Fibre.ng told TechCabal that they had received lease termination notices from the company. Fibre, Nigeria’s premier property tech startup, has been out of the news cycle for a few years. In that time, there have been questions about its business and whether it was still operating.
Despite those rumours, the startup continued to operate without the fanfare of its competitors, Muster and Spleet.
Three tenants told TechCabal that they also received the same email from Fibre informing them that their leases would be terminated by May 30th. A few of those people concluded that Fibre was being sold.
Refocusing on what works
Munachi Ogbonna, Fibre’s director of operations, confirmed that Fibre sent termination notices to some tenants. He clarified that the startup is only auditing some of the properties in its listing and ending leasing contracts with buildings that are not profitable.
“We are not asking people to leave some of these properties because we’re not in the business of providing a service. The properties that are non-performing, we’re simply not renewing our lease there. We are getting into an arrangement with property owners of those buildings for those tenants who want to continue to stay there.”
According to him, this is all routine and there is no basis for any sort of panic about the startup or its future. It lines up with what he told TechCabal in January, after revealing that following feedback from some customers, the company was making some changes.
Fibre, the pioneer proptech startup which has been under the radar recently told TechCabal that the company hasn’t been in the news because it is shoring up its backend operations. While COVID-19 slowed things down, the startup says its radio silence is deliberate.
The director of operations at Fibre, Munachi Ogbonna thinks that proptech startups have more than a supply problem. He told TechCabal, “In the past 24 months, supply wasn’t much of a problem; the quality of the supply was the problem. We have to make sure that these houses meet the standard.”
One of the changes the startup is also making is that it is now focusing on properties that meet the needs of its customers.
Do people want smaller apartments?
One recurring theme when you talk to proptech founders is that there’s a lot of demand for small one-unit apartments. But what the market often offers are 3 and 4-bedroom apartments. Proptech startups work around this problem by providing shared living to customers, but where they cannot fill up all 3 or 4 rooms, such listings can become unprofitable.
It’s a problem Fibre faces and Munachi says the company is changing its approach. “We are focusing on properties that are more profitable for us. Our operations haven’t changed but we’re taking properties that are close to what our customers want. If people are in demand for one-bedroom, there’s no need for me to continue to take hits on 3-bedrooms to increase my portfolio.”
“We’re working through that and we’ve gotten into some partnerships as well. One thing is sure, we’re not going anywhere.”