NEA Backs 42Floors

42Floors announced in a blog post this morning that it has raised a $12.3 million Series B round of funding that was led by New Enterprise Associates and includes Bessemer Venture Partners and Thrive Capital, two of the company’s Series A investors, as well as new investor Columbus Nova Technology Partners. San Francisco-based 42Floors, which operates a search engine for users to locate commercial real estate space, previously raised $5.4 million in its prior seed and Series A rounds. Previous investors include Andreessen Horowitz, SV Angel, Y Combinator and individual investors Dave McClure and Chris Dixon. As part of the Series B round, Paul Hsiao, a partner at NEA, has joined the board.

BLOG POST

Over the past 12 months, we’ve launched our office space search engine in both San Francisco and New York.  Over a 1000 companies have used us to find their office space.  Collectively, they’ve found 2,000,000+ square feet.  That’s enough to fill the Empire State Building with startups.

Not only is it cool to see our platform helping so many companies find space, it’s cool just to see how many startups need space right now.  The hottest sector in commercial real estate is currently driven by tech startups, and we at 42Floors have worked hard to be their favorite destination for finding office space.

Our decision to initially launch in SF and NYC was not random.  From the beginning we’ve been focused on serving tech startups, because, as startup people ourselves, we really understand what they are looking for in their office space search.  The first version of our platform focused on only a few items that we know startups want: great photography, intuitive map-based search, and a free-to-search model.

As we met with landlords and brokerages in our two cities, we found them welcoming of our approach.  We’d provided them a medium to reach the tech sector.  For many of our partners, they had already embraced the internet; we were simply helping them amplify their efforts by reaching more potential tenants faster.

But something has changed over the past couple of months.  42Floors used to be a search site primarily used by startups.  Now, all types of companies use 42Floors to find space.  And even more interestingly, many of these companies are from across the U.S.; in fact, 80% of our users are searching for office space outside of SF and NY:

There is pent-up demand for a great office space search platform throughout the U.S.  We’re not going to announce yet which cities are coming next, but you can probably take a few guesses.

Over the past few months, we’ve been working closely with our landlord partners to bring all of their buildings on board the 42Floors platform.  We’re happy to announce that the nation’s top landlords—Vornado, Equity Office, SL Green, Shorenstein, and many, many more—will be listing all of their properties on our platform.

We’ve been working hard with them and their brokers to make sure each listing is displayed accurately and with gorgeous photos.

Speaking of brokers… Some people unfamiliar with 42Floors have initially been suspect of our intentions.  Are we here to disintermediate brokers or will we work with them?  Hopefully, we’ve starting to prove ourselves to the broker community, at least those that we’ve worked directly with in SF and NY.

For our 1000+ tenants that have found office space with help from 42Floors, nearly every single one of them has used a broker.  Our role is simply to help make the office discovery process easier and faster.  It’s a fantastic partnership.

With all of this inbound interest, we’ve got our work cut out for us.  We’re going to spend the next year bringing 42Floors to every major market in the U.S.  We’ll continue to partner with landlords. We’ll continue to partner with brokerages.  And we’ll continue to provide the very best search experience to tenants.

We’ve got big ambitions.  It’s still a long road to go, but we’re pumped.

And to accomplish all of this, we’ve raised another round of funding.  New Enterprise Associates (NEA) has led our $12.3M Series B.  Paul Hsiao, a partner at NEA and an expert in building marketplaces, will be joining our board.  Bessemer Venture Partners and Thrive Capital, our two Series A investors, both increased their ownership in the round as well.   We also welcomed Columbus Nova Technology Partners as a new investor.

We thank all of you, both for your support and your skepticism.  We know that expectations are high; we’re going to work our asses off to serve you.  We feel honored to have the opportunity.

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