The Future Of Real Estate: Fintech 50 2020


For years, technology companies played at the edges of the real estate industry. Listing sites like Zillow improved the process of searching for a house, while numerous commercial databases shed light on office and apartment buildings sales. The actual transaction, however, remained largely unchanged.

Recently, a new crop of well-funded startups, including the seven on the latest Forbes Fintech 50, have been finding novel ways to get at the heart of things. From an AI enabled title company to a landlord that wants to help its tenants become owners, these companies are using software to rethink the experience of buying, selling and owning property.

Reach is still limited and the day of one-click home purchases may never come, but there’s now hope for a faster, more accessible and, maybe, less expensive home buying experience.

Better.com

Headquarters: New York

Online mortgage lender provides home shoppers with pre-approvals in as little as three minutes. Making borrowers competitive is a priority for the founder who started Better after losing a Manhattan apartment to an all cash buyer. Uses matching software to sell loans to institutions such as Chase and Fannie Mae. 

Funding: $254 million from American Express Ventures, Goldman Sachs, Ally Financial and others Latest valuation: $610 million

Bona fides: Revenue increased five-fold in 2019 to $115 million, thanks in part to a refi boom

Founder and CEO: Vishal Garg, 41, started MyRichUncle, an early online lender that shut down in 2009

Cadre

Headquarters: New York

By raising money online and using advanced data analysis to source deals, Cadre has undercut the typical fees—and aggravation—institutional and high-net-worth investors face when buying into commercial real estate partnerships. With the launch of a secondary market in 2018, it’s trying to make re-selling property interests simpler too. 

Funding: $133 million from Andreessen Horowitz, Ford Foundation, Goldman Sachs and others Latest valuation: $800 million

Bona fides: Has financed purchases of $3.1 billion worth of property from New York to San Diego in 36 deals, including $1 billion in the last year  

Cofounders:  CEO Ryan Williams, 31, who started buying distressed properties around Atlanta in 2009 when he was still an undergrad at Harvard; Jared Kushner and Joshua Kushner 

Divvy Homes

Headquarters: San Francisco

A digital take on the old rent-to-own model, Divvy buys homes clients select and then becomes their landlord. A 2% upfront fee and a portion of monthly rent can be converted into a downpayment if the tenant wants to buy later. Currently available in six markets, including Atlanta, Cleveland and Dallas. 

Funding: $66 million from GIC, Andreessen Horowitz, Caffeinated Capital and others. 

Latest valuation: $163 million, according to PitchBook 

Bona fides: Bought 900 homes last year, and is now receiving 10,000 applications a month

Cofounders: CEO Adena Hefets, 33, whose parents had to purchase a home with seller financing because they couldn’t qualify for a mortgage; chief product officer Brian Ma, 34; CTO Nick Clark, 37; senior software engineer Alex Klarfeld, 29, who made this year’s Forbes 30 Under 30 list

Opendoor

Headquarters: San Francisco

Home sellers in 21 cities can request all-cash offers from Opendoor online, receive bids in 24 hours and close in as little as two weeks. An app launched last year enables buyers to schedule self-guided tours and make offers on any home for sale in six cities, including Dallas and Phoenix.

Funding: $1.3 billion from Khosla Ventures, SoftBank, General Atlantic and others Latest valuation: $3.8 billion

Bona fides: Purchased 19,000 homes in 2019 

Cofounders: CEO Eric Wu, 37, used scholarship money to buy his first rental property as a sophomore at University of Arizona; CTO Ian Wong, 33; board member Keith Rabois, 50; JD Ross, 29

Roofstock

Headquarters: Oakland, CA

A digital marketplace that allows investors to purchase single family rental properties in 25 states, often with tenants already in place. Roofstock One, launched in 2019, sells stakes in professionally managed homes for as little as $5,000 a share. 

Funding: $133 million from Bain Capital Ventures, Lightspeed Venture Partners, SVB Capital and others. Latest valuation: $550 million

Bona fides: Investors have bought more than $2 billion worth of real estate on Roofstock 

Cofounders: CEO Gary Beasley, 54, who used to run Starwood Waypoint, one of the largest owners of single-family rental homes; chief development officer Rich Ford, 52; chairman Gregor Watson, 39

States Title

Headquarters: San Francisco

Title searches have traditionally held up the real estate closing process. But using online ownership data and predictive analytics, States Title can clear 80% of homes for insurance in less than a minute, instead of days, allowing for faster—and potentially cheaper—closings. 

Funding: $107 million from Lennar, Fifth Wall, Foundation Capital and others

Bona fides: Revenue went from almost nothing in 2018 to $185 million last year, after it took over part of home-builder Lennar’s title business

Cofounder and CEO: Max Simkoff, 38, started an HR analytics company at 25, sold it for $42 million at 33

Unison

Headquarters: San Francisco

From its online platform, Unison offers home buyers and owners in 30 states and Washington, D.C. the option of selling some of the future appreciation in their houses. In exchange for 10% of a home’s purchase price (which is used as a partial down payment), Unison and its institutional investors take 33% of the appreciation when the house is sold. 

Funding: $40 million from Citi Ventures, F-Prime Capital Partners, The Royal Bank of Canada and others 

Bona fides: Unison has purchased stakes in $4.4 billion worth of housing and is the leader in the fledgling “co-investing” market 

Founder and CEO: Thomas Sponholtz, 53, managed a $28 billion residential mortgage portfolio at Barclays Global Investors



Source link