Latch is the newest organization to pursue going public through a special purpose acquisition company (SPAC) merger. Established in 2014, this New York-based firm initially operated in stealth mode before unveiling its smart lock system two years later. However, Latch positions itself as more than just a hardware provider, describing itself as a comprehensive, connected security software platform designed for apartment building owners.

The company will become publicly traded through a merger with TS Innovation Acquisitions Corp, a blank check company. The involvement of Tishman Speyer Properties is considered a strategically advantageous partnership. This New York-based commercial real estate company is a fitting collaborator, given Latch’s current technology deployment is limited to residential apartment complexes.

Latch’s founder and CEO, Luke Schoenfelder, explained to TechCrunch that a traditional initial public offering (IPO) involves extensive presentations to numerous investors. He believes this SPAC route offers an additional level of strategic collaboration and opportunities for product development. He stated that the partnership will significantly accelerate the company’s expansion into European markets and commercial office spaces.

SPAC transactions have seen a considerable increase in recent months, with examples such as Taboola. Crunchbase data indicates that Latch has secured $152 million in funding to date. The company has also demonstrated substantial growth in the past year—a noteworthy achievement for a hardware-focused or related business during the pandemic.

As noted by a colleague on Extra Crunch, Latch experienced a 50.5% increase in booked revenues from 2019 to 2020. Booked software revenues rose by 37.1%, while booked hardware revenue increased by over 70% during the same timeframe.

Rob Speyer, President and CEO of Tishman Speyer, shared with TechCrunch that his company has been both a customer and investor in Latch for several years. Residents of their buildings have expressed satisfaction with the Latch product, leading to its implementation across their residential properties. He anticipates a collaborative role, acting as both a strategic advisor and a platform for product innovation.

The company’s focus on apartment buildings has proven beneficial, allowing it to avoid direct competition within the highly saturated smart home lock market. This is particularly advantageous when considering competition from major companies like Amazon. The existing partnerships with real estate firms such as Tishman Speyer are also considered a significant asset.

Schoenfelder indicated that the company views these partnerships as valuable testing grounds for its technology. He explained that while their products have been utilized in multifamily residences for an extended period, usage patterns will likely differ in commercial office settings. He believes they have a good understanding of these differences, but real-world observation of product interaction will be crucial.

The transaction values Latch at $1.56 billion and is projected to be finalized in the second quarter of the year.