Concreit closes on $6M to allow more people to invest in the global private real estate market

Concreit, a company that wants to open real estate investing to a broader group of people, announced today that it has closed $6 million in a seed funding round led by Matrix Partners. 

Hyphen Capital also participated in the round, in addition to individual investors such as Betterment founder and CEO Jon Stein; Andy Liu, partner at Unlock Venture Partners; and investor and advisor Ben Elowitz. Concreit raised the capital at a $22.5 million post-money valuation.

The Seattle-based startup also today launched its app, which it claims allows “anyone” to invest in the global private real estate market for as little as $1. 

It’s a lofty claim. But first let’s start with some background.

Concreit is not the first time that co-founders Sean Hsieh and Jordan Levy have worked together. The pair previously founded and bootstrapped VoIP communications platform Flowroute before selling it to West Corp. in 2018. Upon the sale of that company, Hsieh and Levy set out to build a company that, in their words, “could help everyday people become more financially secure.”

Hsieh, a second-generation immigrant, worked in his family’s restaurant where they shared the dream of achieving financial freedom through real estate. Similarly, Levy says he grew up watching his parents build a small construction business from scratch. He was intrigued by the idea of passive income through single-family rental homes but became disillusioned with the overhead, risk and hassle of managing one’s own single-family rental investments. 

So the duo worked together to design a mobile-first offering that could enable small investors to benefit from real estate “without the burden of making repairs at 2 a.m. on a Saturday.” Enter Concreit. 

Today, most investors can open a Concreit account and make their first investment in just minutes on their mobile device, the company claims. The company’s free mobile app allows consumers to invest as little as $1 into a fund managed by a team of investment professionals. Withdrawals can be requested at any time through the app and sent upon approval.

The platform facilitates weekly earned payouts, automated investments and on-demand withdrawals while compounding earned payouts weekly.

After selling Flowroute, Hsieh says he “saw the opportunity to earn a great APR through private real estate investing while gaining less correlation with traditional public stocks or bonds markets,” Hsieh said. “But they were only for the already wealthy or required multiyear commitments of capital. Concreit gives everyone access to a real estate portfolio and the ability to have access to withdrawals when they need them.”

Put simply, the startup wants to make it easy for anyone — not just the wealthy — to invest in real estate.

Concreit, Hsieh said, offers “regular people” the ability to access real estate strategies typically used by large hedge funds and private equity. 

“We’re seeing a surge of retail demand for alternatives and other ways to invest outside of the public markets and the crypto space for those that value diversification,” Hsieh told TechCrunch. Most other competitors are focused on marketing and selling securities, but we knew in order to be an innovator in this space we had to produce a truly unique experience for our investors.”

Concreit’s platform is designed to be a more connected investment experience.

“We knew early on that digital natives deserved a whole new real estate investing experience and that it had to be 100x better than just taking traditional real estate investment opportunities and offering them digitally,” Hsieh said. 

So on the platform side, Concreit has built a cloud-based proprietary securities accounting engine that allows the company to process fractional calculations and pull in a lot of mutual fund practices, applying them toward the “more labor-intensive” private equity markets, with a focus on real estate.

“We’ve taken a lot of the cloud-architectural work that we’ve pioneered in the telecommunications space and applied it towards a back-office accounting solution that gives us a competitive edge around what we offer to our investors,” Hsieh said. “This affords the ability to run accounting at a higher frequency, which is how we are able to run weekly dividends, process fractional redemptions and ultimately a more real-time experience for our users.”

Concreit’s first private REIT fund, focused on passive income, consists of lower-risk fixed-income private market residential and commercial real estate first-lien mortgages. The fund, which the company says has an annualized return of 5.47%, is managed by a team of industry professionals. The startup has added over 18,000 customers to its platform since it was qualified by the SEC (slightly over a year ago), and doubled its user base in the month of August.

“Our current users can invest with any dollar amount, no lock-ups, weekly payouts, and an experience that’s as easy & familiar as a savings account,” Hsieh said.

Matrix’s Dana Stalder, who joined Concreit’s board as part of the financing,  believes Concreit has leveled the playing field for real estate investing by making it more accessible. 

“What Concreit has built is incredibly hard to do from both a technology and regulatory standpoint,” he told TechCrunch. “Alternative asset classes, in particular, have been notoriously closed off to the average consumer, leaving high yield returns exclusively to wealthy investors. “

#apps, #concreit, #dana-stalder, #funding, #fundings-exits, #matrix-partners, #real-estate, #real-estate-tech, #recent-funding, #seattle, #startup, #startups, #tc, #venture-capital

Moderne Ventures closes second fund with $200M, targets industry digital transformation

Since 2015, Constance Freedman, founder and managing partner of Moderne Ventures, and partner Liza Benson have built up a network of more than 700 executives across the real estate, finance, insurance and home services industries.

Today, their early-stage venture capital firm buttoned up an oversubscribed second fund, raising $200 million this time, to infuse capital into startups in and around those industries. Moderne’s newest fund includes new and returning high-profile strategic partners like AvalonBay Communities, Camden Property Trust, Greystar, JBG SMITH, Leading Real Estate Companies of the World, funds managed by Oaktree Capital Management and Realogy. The Chicago-based firm now has $350 million in assets under management.

Freedman’s background is in real estate, technology and venture, spending three years in sales and leasing before the “dot-com” days. After getting her MBA at Harvard, she turned toward investing, launching a fund in 2008 that focused on information and media, as well as working with the National Association of Realtors, which wanted to invest in real estate tech. That $20 million fund became the predecessor fund to Moderne Ventures and where a lot of what the firm does now came from, Freedman told TechCrunch.

In fact, a big part of their strategy is looking at companies outside and bringing them in, Freedman said.

“Industries like real estate are cyclical, so you don’t want to be beholden to one industry,” she added. “If a company has that as its beachhead, but can expand into other industries, the bigger the market and bigger the returns for investors. We will also have a stronger fund as a result.”

Moderne Ventures writes first checks of between $4 million and $7 million, and its sweet spot is companies with revenue of $2 million to $10 million. Most of its investments are late seed to early Series B.

To date, the firm has investments in more than 100 companies, including five unicorns, three IPOs and dozens of accretive financing events in the past year, Freedman said. Notable investments in the portfolio include ICON, Porch, Better Mortgage, Hippo Insurance, Homesnap (acquired by Costar), MotoRefi, Super, EasyKnock and Kaiyo. For its new fund, Moderne Ventures has invested in seven companies so far.

In addition to its fund, Moderne runs an industry immersion program called the Moderne Passport, to connect startups with that network of over 700 industry executives and corporate partners that can benefit from their services.

The program includes about 80 companies, and Freedman said Moderne will “make meaningful investments in about a third of them.” There is a class open right now, and the firm will have another one in seven to 10 months.

The firm offers a hands-on approach aimed at affecting a company’s growth, including go-to-market strategy. Moderne facilitates over 1,000 meetings between companies and its network each year, often turning into pilot programs.

Speaking about the ton of artificial intelligence technology applications within its core focus industries, Freedman said more than $30 million is spent on marketing to people who aren’t real buyers, but are just looking. Rather, Moderne Ventures is using AI and data analytics to help companies market to the right people.

“We create a lower or no-cost way for partners to try before they buy to remove the sales friction,” she added. “In return, companies get exposure opportunities that they can’t buy to accelerate their growth.”

 

#artificial-intelligence, #chicago, #constance-freedman, #entrepreneurship, #finance, #funding, #liza-benson, #moderne-ventures, #real-estate, #real-estate-tech, #tc, #venture-capital

Sundae closes on $80M for residential real estate marketplace

Sundae, a residential real estate marketplace that pairs sellers of dated or damaged property with potential buyers, has raised $80 million in a Series C funding round co-led by Fifth Wall and General Global Capital.

QED Investors, Wellington Management, Susa Ventures, Founders Fund, First American Financial, Prudence Holdings, Crossover VC, Intersect Capital, Gaingels and Oberndorf Ventures also participated in the financing. The round marks San Francisco-based Sundae’s third financing in a 13-month time frame, bringing its total raised since its August 2018 inception to $135 million. 

The San Francisco-based company declined to reveal at what valuation its Series C was raised. It also declined to provide hard revenue figures, saying only that it saw a 600% year-over-year increase in revenue from June 2020 to June 2021.

The startup aims to help people who need to sell dated or “damaged” properties for a variety of reasons — such as job loss, illness or divorce. In some cases, according to CEO and co-founder Josh Stech, such vulnerable sellers get taken advantage of by “predatory fix and flippers” seeking to capitalize on their misfortune. 

Since sellers in these situations don’t typically have the funds to fix up their properties before selling, Sundae lists the property for them on its platform – serving as an intermediary between sellers and investors. There, it is visible to about 2,600 qualified off-market buyers.

The company essentially aims to aggregate demand from “fix and flippers,” who use the marketplace to bid against each other for distressed properties. If the seller accepts and an inspection is completed, the company offers a $10,000 cash advance before closing to help homeowners with moving costs or other expenses.

Our goal is to displace wholesalers who exploit desperate or uninformed sellers and lock them into a contract which they turn around and assign to a property investor at a steep profit,” Stech said. “The tens of thousands of dollars in lost equity that goes to a wholesaler could mean the difference between paying off debts, or having enough money to retire.”

Sundae claims that on average, sellers receive 10 offers within three days on its marketplace.

Since its launch in January 2019, the startup has slowly been expanding its marketplace geographically. It went from operating in four markets in California at the end of last year to now operating in 14 markets across Florida, Colorado, Georgia, Texas and Utah.

Sundae makes money by charging buyers in its investor marketplace a fee when it “assigns” them a property. 

In the first quarter of this year, the startup launched a dedicated online marketplace for investors, where they can view properties and submit offers. Once an investor signs up to join the marketplace, they can access the full inventory of properties, including information such as photos, floor plan, 3D walkthrough and a third-party inspection report. 

Looking ahead, the company plans to use its new capital to expand to new markets, invest in its platform and “build brand awareness.” It also, of course, plans to boost its current headcount of 180 mostly remote employees.

Vik Chawla, a partner at Fifth Wall, believes Sundae is serving a segment of the residential real estate market that has historically been overlooked. 

“Their marketplace model simultaneously solves a crucial pain point for sellers by disrupting the wholesale industry, while delivering a platform that property investors can count on for reliable investment opportunities,” he said.

The company last raised $36 million in a Series B funding round in December 2020.

Interestingly, a slew of angel investors — including a number of athletes and celebrities — also put money in the company’s latest round, including: actor Will Smith, DJ Kygo, three-time NFL Super Bowl champion Richard Seymour of 93 Ventures, NFL All-Pro DK Metcalf of the Seattle Seahawks, Matt Chapman of the Oakland A’s, Alex Caruso of the Los Angeles Lakers, Aaron Gordon of the Denver Nuggets, Solomon Hill of the Atlanta Hawks, Kelly Olynyk of the Houston Rockets, NBA All-Star Isaiah Thomas, three-time NBA Champion & Gold Medalist Klay Thompson of the Golden State Warriors, Hassan Whiteside of the Sacramento Kings, Andrew Wiggins of the Golden State Warriors and 2020 U.S. Soccer Player of the Year and Juventus midfielder, Weston McKennie.

#california, #fifth-wall, #florida, #founders-fund, #funding, #fundings-exits, #gaingels, #general-global-capital, #georgia, #golden-state-warriors, #national-basketball-association, #national-football-league, #nfl, #oakland, #prudence-holdings, #real-estate, #real-estate-tech, #recent-funding, #sacramento-kings, #san-francisco, #startup, #startups, #sundae, #super-bowl, #susa-ventures, #texas, #venture-capital, #vik-chawla, #wellington-management, #will-smith

Homeward secures $371M to help people make all-cash offers on houses

Trying to buy a house in a competitive market is perhaps one of the most stressful things an adult can go through.

Competing with a bunch of people all putting offers on a house that fly off the market in a matter of days is not fun. One startup that is trying to give home buyers a competitive edge by giving them a way to offer all cash on a home has just raised a boatload of money to help it keep growing.

Austin-based Homeward, which aims to help people buy homes faster, announced today it has raised $136 million in a Series B funding round led by Norwest Venture Partners at a valuation “just north of $800 million.” The company has also secured $235 million in debt.

Blackstone, Breyer Capital and existing backers Adams Street, Javelin and LiveOak Venture Partners also participated in the equity financing, which brings Homeward’s total equity raised since inception to $160 million. 

Homeward’s model seems to be appealing to both home buyers (including first time ones) and agents alike, with lots of growth occurring since May 2020 when it raised $105 million in debt and equity. The company declined to reveal hard revenue figures but noted that its GMV (gross merchandise value) run rate is up over 600%+ year over year.

Also, as of March, Homeward says it had experienced a 5x increase in the volume of homes transacted and 9x year over growth in the number of new customers. Plus, It’s hired 161 employees since January alone, and currently has a headcount of 203, up from about 33 at this time last year. 

CEO Tim Heyl founded the real estate startup in late 2018 on the premise that in most cases, sellers prefer to receive all cash offers because they are more likely to close. Loans can fall through, but cash is cash.

Heyl started the company after having worked in the industry for the previous decade, first as a broker then as the owner of a title company. During that time, he saw firsthand many of the problems in the industry. And one conundrum he frequently ran into was people not wanting to make an offer on a home without knowing for sure their current house would sell in a certain amount of time. This is a dilemma many are facing during the COVID-19 pandemic as demand outweighs supply in many major U.S. cities.

“The pandemic has greatly increased demand for our product,” Heyl told TechCrunch. “It’s a historic seller’s market with unprecedented demand from buyers and the lowest inventory levels in decades.”

The company plans to use its new capital to “double down” on its offering, scale up to meet “outsized demand” and open additional markets. Currently, Homeward operates in Texas, Colorado and Georgia.

“Right now, we have a waiting list in every market across the country, so this growth capital will enable us to meet that demand,” Heyl said. Its ultimate goal is to open its offering to agents nationwide.

Homeward also plans to double the size of its title and mortgage teams in the latter half of the year so it can offer its clients and partner agents “a single streamlined experience.” It’s also planning to integrate its consumer and internal software systems for approvals, offers and closing “so everyone can be on a single platform and we can eliminate confusion and waste,” Heyl added.

So, how does it work exactly? Homeward will make an all-cash offer on behalf of a customer wanting to buy a house. Meanwhile, that customer can hire an agent (from brokerages such as Redfin or Keller Williams) to list their home with less pressure to sell it in a certain amount of time or at a discounted price. Once Homeward buys a home, it will lease the property back to its customer until they sell their house, get a mortgage, and can buy the property back from Homeward, plus a 2 percent to 3 percent convenience fee. During the process, Homeward offers a predetermined guaranteed price for its customer’s home with the promise that if it’s unable to sell the house for at least that amount, it’ll buy the house from them.

Heyl believes Homeward’s “alternative iBuyer” model is a better deal for customers since it doesn’t purchase a customer’s old home for below market value. The company also works with agents, and not against them, he said. For example, its offerings are available to any agent, but the company “strategically” partners with top brokerages and teams, providing them with what it describes as “dedicated support, white-label branding, and digital marketing tools to help them stand out from the crowd and attract more clients.”

“Most alternatives to traditional real estate minimize or replace the agent,” Heyl said. “But we are agents ourselves, and we’ve built this for agents.”

Homeward is profitable on a per unit basis if you count transaction revenue minus costs to acquire and complete each transaction, according to Heyl. However, it is not yet profitable on a net income basis.

Jeff Crowe, managing partner at Norwest Venture Partners, will join Homeward’s board as part of the funding.

“Homeward is innovating at the intersection of real estate and fintech — that’s the next frontier,” he said. “Homeward’s cash offer addresses real problems for homebuyers in all market conditions, and the team has identified a winning strategy by partnering with agents and their clients.”

Jim Breyer of Breyer Capital describes Homeward as one of Austin’s most innovative companies.

“We are inspired by the company’s mission to build home finance solutions to overcome the limitations of the traditional mortgage and we are proud to support them as they continue to scale rapidly and efficiently,” he said.

#austin, #blackstone, #breyer-capital, #broker, #ceo, #colorado, #economy, #finance, #funding, #fundings-exits, #georgia, #jeff-crowe, #jim-breyer, #liveoak-venture-partners, #managing-partner, #norwest-venture-partners, #proptech, #real-estate, #real-estate-tech, #recent-funding, #redfin, #startup, #startups, #tc, #texas, #united-states, #venture-capital

How Robert Reffkin went from being a C-average student to the founder of Compass

In April, real estate tech company Compass forged ahead with its initial public offering and is now valued at nearly $6.4 billion.

At that time, TechCrunch Senior Editor Alex Wilhelm caught up with founder and CEO Robert Reffkin to chat about his company’s debut in the market’s suddenly choppy waters for tech and tech-enabled debuts.

This week, I caught up with Reffkin on a whole other topic: his path to entrepreneurship as a child raised by a disowned single mother whose father had died homeless. Reffkin is so passionate about inspiring others from nontraditional backgrounds to pursue their dreams that he wrote a book about it.

In our discussion, Reffkin shared what he believes are the secrets to his success (hint: one of them involves lots of listening) and his advice for his young entrepreneurs, especially those from non-privileged backgrounds.

This interview has been edited for brevity and clarity.

TC: As the mother of a teen who is already trying to start his own business, I’m intrigued by your DJing as a teenager. What finally got you motivated to care about school and how did you manage to graduate in such a short amount of time?

Reffkin: Well, I think your son might just be on the right track! Please give him a word of encouragement from me, from one entrepreneur to another.

My mom says that a lot of other parents thought she was crazy for letting me launch my DJ business. But starting a successful DJ business in high school helped me learn about myself and my passion for entrepreneurship — and it ultimately helped me get into Columbia, forming the core of both my personal statement and the relationships I built with several members of the admissions team.

I believe the first step is always to dream big. For me, my big dreams for my college future started on a trip to New York City. I toured Columbia and fell in love with it, but I knew it was going to be hard for me to get in. In fact, my high school guidance counselor said, “Don’t even apply. It wouldn’t be worth your time and money on the application fee.” In that moment, my desire to go to Columbia went from strong to absolute, because suddenly it felt like it was about something larger than myself — not just where I went to school, but about a broader struggle for opportunity for people like me. So I poured myself into my SAT prep to show that even though I had a C average, I had what it took to keep up at a top school. And thankfully, it paid off. 

In high school and college, I was a C-student in part because I didn’t see how studying calculus or Western Civilization related to my life or my dreams. I knew that excelling in school wasn’t going to be the way I was going to distinguish myself in the world. At the same time, I was energized by my entrepreneurial efforts and my summer internships. I moved as quickly as I could to get through school and have my real life begin, because the real world made so much more sense to me.

TC: How do you think being raised by a single mother without privilege helped shape you as a man, and entrepreneur? How would you say being a person of color impact your path?

Reffkin: Growing up, it was just me and my mom. She’s an Israeli immigrant, disowned by her parents because I was Black. My father abandoned us and died, homeless, when I was young. What shaped me most as an entrepreneur was learning from my mother. She embodied the entrepreneurial spirit and taught me one of the most important principles: every time you get knocked down, you’ve got to bounce back with passion. I saw her face bad relationships, bankruptcy, and the stream of daily rejections that comes from being an agent. And she always bounced back. So when the world told me I couldn’t do something or that I was destined to fail, I was ready for them. Thanks to my mom, I already knew how to bounce back.

Image Credits: CEO Robert Reffkin & mother, Ruth / Compass

Being Black and Jewish, I’ve felt out of place my entire life. In most classes in Hosch school and college, I was the only Black person. In almost every meeting early in my career, I was the only Black person. When I was raising capital for Compass, I almost never saw someone Black on the other side of the table. But I’ve been very fortunate. I’ve been lucky to get terrific advice along the way from so many Black mentors, from the late Vernon Jordan, to Ken Chenault, the former CEO of American Express, to Bayo Ogunlesi, who is lead director for Goldman Sachs. There’s a really strong community of people who’ve all supported each other.

TC: You’ve had some impressive mentors over the years. How did those relationships develop? How have they been valuable besides the obvious? 

Growing up, I was hungry for advice. Coming from a single-parent home, I looked for guidance and wisdom on how to create a better life wherever I could find it. My mom connected me to several non-profits when I was in high school that helped open my eyes to how much opportunity and support there was out there in the world. 

The most important lesson I’ve learned in my life is that feedback is a gift. Even when it’s hard to hear, feedback is a gift. My relationships with many of my mentors deepened because I started asking them for really tough, candid feedback — the sort of things they thought other people wouldn’t tell me. And then, I’d actually take their advice, apply it in my life, and let them know how it had helped me. That did two two things: First, it led to more honest and practical advice that helped me get better faster. Second, it made the people who had given me advice feel far more invested in my success and the success of whatI was working on.

The other thing my mentors gave me was the sense that even though the world was telling me I couldn’t be successful, I could be. Meeting someone like Vernon Jordan who advised presidents and CEOs alike, had a profound impact on me. He was a father figure to me. I met him when I was 23 years old, and at that time, it wasn’t clear to me that you could be successful in the business world as a Black man. I just hadn’t seen it before. When I started at Lazard, Vernon Jordan was the only other Black investment banker there. He was not just a senior partner, he was a legend, widely known for serving on more Fortune 500 boards than anyone in history. He took a strong interest in me, and with his support and advice, he made me feel like I belonged and helped me see a path where I could be as successful as I wanted to be. 

I founded a nonprofit in my twenties called America Needs You that has provided mentorship, career development, and college support to thousands of students. I wrote my new book, No One Succeeds Alone, as a way to pay it forward by making the lessons I’ve been fortunate enough to learn from so many remarkable people available to everyone — and it’s why I’m donating all of my proceeds to nonprofits that help young people realize their dreams.

TC: What advice you would give to young, aspiring entrepreneurs, especially those from non-privileged backgrounds?

Reffkin: Here’s the advice I’d give to someone from an underrepresented group who just graduated college and is in their first job:

1) Don’t let anyone get in the way of your dream. Not society, not your colleagues, not even yourself. Whenever anyone tells you to slow down, speed up.

2) Spend the next 10 years learning as much as you can from the smartest people you can. Find mentors in your job and outside that will give you the honest feedback that others won’t. Feedback is a gift. It’ll be hard for you to hear, but it’s actually even harder for them to give it to you. So you may have to ask for it directly and let people know that you can take it.

3) Learn how to turn negativity into positive energy that fuels you. There will always be skeptics, doubters, and haters telling you that you can’t do something or that you don’t belong. 

TC: What next after Compass?

Reffkin: I believe that to be truly successful, you can’t have a Plan B. As a CEO, you have to be all-in, and that’s what I am for Compass: 100% dedicated to our 23,000 agents and employees. One of my mentors told me about the “shower test” once — that if you’re not excited enough about your job to think about it in the shower, you’re probably not in the right job. And I’ll tell you: I’m so passionate about the company we’re building that I’m still thinking about Compass in the shower. At Compass, we’ve accomplished much in the past eight years, but we’re truly just getting started. 

#america, #c, #ceo, #columbia, #compass, #diversity, #editor, #entrepreneur, #goldman-sachs, #ken-chenault, #lazard, #new-york-city, #real-estate, #real-estate-tech, #tc

Brazil’s Loft adds $100M to its accounts, $700M to its valuation in a single month

Nearly exactly one month ago, digital real estate platform Loft announced it had closed on $425 million in Series D funding led by New York-based D1 Capital Partners. The round included participation from a mix of new and existing investors such as DST, Tiger Global, Andreessen Horowitz, Fifth Wall and QED, among many others.

At the time, Loft was valued at $2.2 billion, a huge jump from its being just near unicorn territory in January 2020. The round marked one of the largest ever for a Brazilian startup.

Now, today, São Paulo-based Loft has announced an extension to that round with the closing of $100 million in additional funding that values the company at $2.9 billion. This means that the 3-year-old startup has increased its valuation by $700 million in a matter of weeks.

Baillie Gifford led the Series D-2 round, which also included participation from Tarsadia, Flight Deck, Caffeinated and others. Individuals also put money in the extension, including the founders of Better (Zach Frenkel), GoPuff, Instacart, Kavak and Sweetgreen.

Loft has seen great success in its efforts to serve as a “one-stop shop” for Brazilians to help them manage the home buying and selling process. 

Image courtesy of Loft

In 2020, Loft saw the number of listings on its site increase “10 to 15 times,” according to co-founder and co-CEO Mate Pencz. Today, the company actively maintains more than 13,000 property listings in approximately 130 regions across São Paulo and Rio de Janeiro, partnering with more than 30,000 brokers. Not only are more people open to transacting digitally, more people are looking to buy versus rent in the country.

“We did more than 6x YoY growth with many thousands of transactions over the course of 2020,” Pencz told TechCrunch at the time of the company’s last raise. “We’re now growing into the many tens of thousands, and soon hundreds of thousands, of active listings.”

The decision to raise more capital so soon was due to a variety of factors. For one, Loft has received “overwhelming investor interest” even after “a very, very oversubscribed main round,” Pencz said.

“We have seen a continued acceleration in our market share growth, especially in São Paulo and Rio de Janeiro, the two markets we currently operate in,” he added. “We saw an opportunity to grow even faster with additional capital.”

Pencz also pointed out that Baillie Gifford has relatively large minimum check size requirements, which led to the extension being conducted at a higher price and increased the total round size “by quite a bit to be able to accommodate them.”

While the company was less forthcoming about its financials as of late, it told me last year that it had notched “over $150 million in annualized revenues in its first full year of operation” via more than 1,000 transactions.

The company’s revenues and GMV (gross merchandise value) “increased significantly” in 2020, according to Pencz, who declined to provide more specifics. He did say those figures are “multiples higher from where they were,” and that Loft has “a very clear horizon to profitability.”

Pencz and Florian Hagenbuch founded Loft in early 2018 and today serve as its co-CEOs. The aim of the platform, in the company’s words, is “bringing Latin American real estate into the e-commerce age by developing online alternatives to analogue legacy processes and leveraging data to create transparency in highly opaque markets.” The U.S. real estate tech company with the closest model to Loft’s is probably Zillow, according to Pencz.

In the United States, prospective buyers and sellers have the benefit of MLSs, which in the words of the National Association of Realtors, are private databases that are created, maintained and paid for by real estate professionals to help their clients buy and sell property. Loft itself spent years and many dollars in creating its own such databases for the Brazilian market. Besides helping people buy and sell homes, it offers services around insurance, renovations and rentals.

In 2020, Loft also entered the mortgage business by acquiring one of the largest mortgage brokerage businesses in Brazil. The startup now ranks among the top-three mortgage originators in the country, according to Pencz. When it comes to helping people apply for mortgages, he likened Loft to U.S.-based Better.com.

This latest financing brings Loft’s total funding raised to an impressive $800 million. Other backers include Brazil’s Canary and a group of high-profile angel investors such as Max Levchin of Affirm and PayPal, Palantir co-founder Joe Lonsdale, Instagram co-founder Mike Krieger and David Vélez, CEO and founder of Brazilian fintech Nubank. In addition, Loft has also raised more than $100 million in debt financing through a series of publicly listed real estate funds.

Loft plans to use its new capital in part to expand across Brazil and eventually in Latin America and beyond. The company is also planning to explore more M&A opportunities.

This article was updated post-publication to reflect accurate investor information

#andreessen-horowitz, #baillie-gifford, #better-mortgage, #better-com, #brazil, #co-founder, #d1-capital-partners, #david-velez, #dst, #finance, #financial-services, #funding, #fundings-exits, #instacart, #instagram, #joe-lonsdale, #latin-america, #loft, #max-levchin, #mike-krieger, #money, #new-york, #nubank, #palantir, #paypal, #proptech, #real-estate, #real-estate-tech, #recent-funding, #sao-paulo, #startup, #startups, #tc, #tiger-global, #united-states, #venture-capital, #zillow