A start-up that promotes "tiny" living just raised a decidedly big amount of money — and is well on the way to helping stressed-out city dwellers find their happy place.
After closing a $15 million funding round Feb. 21, Brooklyn, New York, based start-up Getaway, which builds and rents tiny homes as destinations for vacationers, plans to expand beyond its current locations near Boston and New York, the company recently told CNBC.
Getaway's funding round was backed by L Catterton, a firm that's invested in start-ups like Pure Barre, Snap Kitchen and Bliss. Prior to this investment, Getaway previously raised $1.4 million in seed financing, according to the company.
Often priced under $50,000 and offering just a few hundred square feet of livable space, tiny homes are part of a growing movement among the world-weary — many of them indebted millennials — looking to downsize, or live a simpler existence.
Enter Getaway, which offers custom-built, simplistic tiny homes nestled in the heart of nature, and without a Wi-Fi network in sight. The stay includes a lock box for guests' cellphones and hair that smells like a campfire. The next locations to build are still being determined.
While the houses at Getaway are small, the big idea is a solution to the growing inability for consumers to disassociate themselves from the relentless pull of technology and work. More people appear to be buying into the concept, and Getaway bills itself as a way to "test drive" the tiny living aesthetic.
"We have thousands of people writing in from around the country asking to nominate their city," founder and CEO Jon Staff told CNBC in an interview. "The game for the next year and beyond is trying to get to as many of those people as possible."
Walking away from the 'Sharks'
Evidence suggests that tiny homes have struck a nerve with renters and homeowners jaded by the contrivances of modern living.
A study released Feb. 23 by the American Psychological Association reported 65 percent of Americans agree that periodically "unplugging" or taking a "digital detox" is important for their mental health, yet of those who agree, only 28 percent reported doing so.
However, the miniature abodes aren't always welcomed with open arms. A 2015 Pew Charitable Trust report detailed a litany of problems associated with tiny homes, including fears of declining property values in traditional home markets, and states and localities that view tiny homes as illegal.
Yet fresh from its big investment haul, Getaway's future appears bright. The backing comes after Staff and co-founder Pete Davis turned down an offer from billionaire investor Chris Sacca on a January episode of "Shark Tank." The founders were seeking a $500,000 investment for 5 percent equity, at a valuation of $10 million.
Taking a veiled swipe at Twitter — in which Sacca was an early investor — Davis called Getaway "the anti-Twitter," only to walk away after refusing Sacca's counteroffer.
"We think we are justified in the decision we made," Staff said. "Things turned out well for Getaway, at least in this chapter."
The 28-year-old has personal experience living in unlikely spaces — including the basement of a frozen yogurt shop he founded in college, a campus library at Harvard and a 26' Airstream trailer.
Unlike Silicon Valley start-ups based largely on ephemeral metrics like active users and web clicks, Getaway's business model is designed to chip away at stress in the tangible world.
"We have real costs, we have real revenues, we have these physical buildings that exist in the world," Staff said.
With near-solid bookings since its July 2015 launch in Boston, including two Februaries with 95 percent occupancy, Staff said Getaway's focus on simplicity lowers costs, and distinguishes the company from traditional hotels, or AirBnb.
Since vacations sometimes create more stress than they alleviate, "we think of ourselves more like a spa, or yoga, or binge-watching Netflix, those other things that allow you to quickly and affordably disconnect," he said.
Disclosure: CNBC owns the exclusive off-network cable rights to "Shark Tank."
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