Reported by Margherita Beale and Jeff Kauflin
Over the past two years, while droves of Americans began working remotely and mortgage rates hit historic lows, home sales spiked, creating a rising tide for real estate-focused companies. Now that interest rates and concerns about a looming recession are rising, the real estate market is cooling. But in an industry that’s still dominated by slow processes and dated systems, opportunities abound for creating better financial services through technology.
Five real estate companies made our Fintech 50 list this year. From startups reinventing the rent-to-own model to an online marketplace for mortgages, here are the companies that made our 2022 list:
Cadre
By raising money online and using advanced data analysis to source deals, the online platform enables individual and institutional investors to buy and sell stakes in commercial and multifamily real estate partnerships at lower fees. Also runs a StubHub-like secondary market enabling investors to sell otherwise illiquid holdings. The Cadre Direct Access Fund became the company's most in-demand offering shortly after it was launched in 2021.
Headquarters: New York, New York
Funding: $133 million from Andreessen Horowitz, Ford Foundation, Goldman Sachs and others
Latest valuation: $800 million
Bona fides: Has closed more than $3.5 billion in real estate transactions; total customers rose from more than 20,000 at the end of 2020 to more than 30,000 one year later.
Cofounders: CEO Ryan Williams, 34, a 30 Under 30 alum who started investing in real estate while at Harvard; brothers Joshua Kushner, 36, and Jared Kushner, 41, the son-in-law of former President Donald Trump.
Divvy Homes
A digital version of the old rent-to-own model, Divvy buys homes for clients who can’t qualify for a standard mortgage and then becomes their landlord. A 1-2% upfront fee and a portion of monthly rent can be converted into a down payment if the tenant wants to buy later. By the end of three years, customers will have built up as much as 10% equity.
Headquarters: San Francisco, California
Funding: About $400 million from Tiger Global Management, Andreessen Horowitz, Caffeinated Capital and others
Latest valuation: $1.74 billion, according to PitchBook
Bona fides: Purchased $639 million in homes in 2021, up from $160 million in 2020.
Cofounders: CEO Adena Hefets, 35; CTO Nicholas Clark, 39; board member Brian Ma, 36; senior software engineer Alex Klarfeld, 31, a 30 Under 30 alum.
Morty
An online mortgage marketplace founded and run by engineers, Morty aggregates mortgage rates from a range of lenders, offering buyers an easy way to search for competitive rates. Once a customer has locked a loan, Morty guides them throughout the entire process, step-by-step. Like more old-fashioned mortgage brokers, Morty makes its money by charging lenders a fee when the loan closes.
Headquarters: New York, New York
Funding: $38 million from Thrive Capital, Lerer Hippeau, March Capital and others
Latest valuation: $150 million
Bona fides: Has processed more than $1.2 billion in loans to date; had revenue of $3 million in 2021, up from $1.5 million in 2020.
Cofounders: CEO Nora Apsel, 39; CTO Adam Rothblatt, 38.
Roofstock
A digital marketplace that allows investors to purchase single-family rental properties in 27 states, often with tenants (and professional management by Roofstock) already in place. Its Roofstock One sells shares in portfolios of rental homes to accredited investors for as little as $5,000.
Headquarters: Oakland, California
Funding: $393 million from SoftBank Vision Fund 2, Khosla Ventures, Lightspeed Venture Partners and others
Latest valuation: $1.94 billion
Bona fides: More than 15,000 homes in its current management portfolio; has completed nearly $5 billion in transaction volume to date, with more than half of that amount taking place in the last year.
Cofounders: CEO Gary Beasley, 56; Chairman Gregor Watson, 41; Chief Development Officer Rich Ford, 54.
Valon
A cloud-based mortgage-servicing platform, Valon brings down the cost to mortgage investors of servicing loans by automating payments and allowing borrowers to see online their balance and other information about their loans. Last year, Valon secured approval from the Federal Housing Administration and Freddie Mac to service government-backed loans.
Headquarters: New York, New York
Funding: $90 million from a16z, 166, real estate investment trust New Residential and others
Latest valuation: $590 million
Bona fides: Less than two years after its 2020 launch, the company has reached $6 billion in total mortgages serviced.
Cofounders: CEO and 30 Under 30 alum Andrew Wang, 29; CTO and 30 Under 30 alum Jonathan Hsu, 29; Product Manager Eric Chiang, 30.
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