Grotto AI, a company focused on enhancing leasing team performance, has announced a $10 million seed funding round led by ICONIQ, aiming to mitigate the estimated $500 billion in property value lost annually due to vacancies. This investment positions Grotto AI as one of ICONIQ’s earliest-stage investments, following their co-leadership in Anthropic’s $30 billion Series G funding. Asymmetric Capital Partners also participated in the round, with advisory and angel investments from industry veterans David Dear, Caren Maio, and Avi Dorfman.
While many industries are exploring AI to replace front-line workers, Grotto AI’s strategy focuses on augmenting human capabilities within real estate. The company’s platform analyzes leasing interactions to pinpoint key revenue drivers for each property. It then provides real-time coaching during calls and tours, assisting agents in building rapport, overcoming objections, and finalizing leases.
The platform is currently in use and has demonstrated results with prominent owners and operators, including Weidner Apartment Homes, which manages over 70,000 units. Grotto AI was co-founded by Nick Deveau and Ben Epstein, AI engineers with nearly two decades of experience in developing and scaling AI solutions across various sectors, including hiring, healthcare, and insurance. The co-founders previously led the development of the core technology at EvolutionIQ, which was acquired for $730 million in 2024.
Tengbo Li, General Partner at ICONIQ, commented on the investment, stating, “We had the privilege of working with Nick and Ben at EvolutionIQ and saw firsthand their ability to build and execute world-class B2B vertical AI products. What drew us to Grotto AI is that same combination of technical depth and commercial focus. We believe that they’re solving one of the most quantifiable problems in multifamily by driving real, measurable revenue growth. Grotto AI delivers results you can see on a P&L, not just a dashboard.”
Initial models for Grotto AI were developed by a team of statisticians and AI researchers from Carnegie Mellon and Stanford. Their analysis of hundreds of thousands of interactions between leasing agents and prospective renters identified factors most correlated with lease conversion. The findings indicated that interpersonal signals were stronger predictors of success than speed, scripts, or product knowledge. Specifically, agents who initiated moments of laughter were 48% more likely to convert a lead to a signed lease, while those demonstrating genuine curiosity saw a 35% increase in conversion. In comparison, common practices such as requesting a tour or application were associated with a 14% lift.
Nick Deveau, co-founder of Grotto AI, noted, “The industry has it backwards. Typically, leads are escalated to humans based on complexity — if they ever reach a human at all. In reality, our data shows that we should actually be escalating to humans when intent and warmth can change the outcome. If 2025 was the year of replacing humans, 2026 is about unlocking what only they can do.”
