Zillow – Tomo’s seed round hits 70M as ex-Zillow leaders aim to digitize mortgage process for homebuyers
Tomo launches: A brand new actual property startup led by former Zillow executives Greg Schwartz and Carey Armstrong formally launched Wednesday in Seattle, Dallas, and Houston. Tomo additionally introduced a further 30 million as a part of a large 70 million seed spherical — one of many largest ever for an actual property firm. GeekWire initially reported on the corporate in October.
The tech: Tomo desires to hurry up the mortgage approval course of and transfer it completely on-line — like a PayPal for the mortgage trade. Its affords each a verified pre-approval, which doesn’t require a “hard credit inquiry” and will be accomplished in three hours, and an underwritten pre-approval, which takes a couple of day and features a “Closing Guarantee.”
Tomo requires a credit score rating about 660 and a credit score account in good standing. It affords 15- and 30-year mounted charge typical loans beginning at 150,000.
The startup affords a value match if homebuyers discover higher mortgage charges. It additionally reductions rates of interest by zero.125% if prospects use a Tomo Brokerage Accomplice Agent. The corporate partnered with actual property coach Tom Ferry to construct out a community of brokers.
Pace issues: The concept is to make use of information and software program to speed up the acquisition course of and assist get consumers to a stronger place as they compete with different affords in a red-hot actual property market that has sparked intense bidding wars for properties. Tomo says it might probably lower the common time-to-close by as a lot as 55%.
Tomo doesn’t provide refinancing providers and as a substitute focuses on simply approvals. It has devoted customer support brokers for every metropolis. The identify “Tomo” comes from the Japanese philosophy of “omotenashi,” which is about offering final hospitality and anticipating the wants of a visitor.
Tomo faces competitors from conventional mortgage suppliers and likewise extra comparable tech-fueled startups resembling Settle for, Decrease, Maxwell, Lenda, SoFi, and others aiming to digitize actual property processes and provides consumers an edge. That group consists of corporations like Seattle-based Flyhomes, which permits all-cash affords for consumers.
Zillow additionally affords mortgage providers; income from its mortgage enterprise spiked 169% to 68 million within the first quarter.
Management: Schwartz spent 13 years at Zillow, serving to the Seattle firm develop into an actual property database behemoth. He held titles together with vice chairman of gross sales, chief income officer, chief enterprise officer, and most not too long ago president of Media & Market when he left in January 2020.
Armstrong joined Zillow in 2013 and likewise held a number of management roles, together with director of product administration, head of company improvement, and vice chairman of the corporate’s practically 1 billion Premier Agent enterprise. She beforehand labored at Boston Consulting Group and Forrester. Armstrong is Tomo’s chief income officer.
Schwartz, CEO of Tomo, informed GeekWire in October that he was happy with what he and his colleagues achieved at Zillow, however “there was unfinished enterprise for me and my pals in making the true property transaction basically extra comfy.”
Funding: Tomo mentioned it had raised 30 million in October, and added one other 40 million since then. The corporate added DST International as an investor. Ribbit Capital led the seed spherical, which included SVB Capital, Zigg Capital, and NFX, a agency co-founded by Pete Flint, who bought Trulia to Zillow for 2.5 billion in 2015. Former Zillow CEO Spencer Rascoff can also be an investor.
Tomo has workplaces in Seattle, Austin, and Stamford, Conn., the place Schwartz is now based mostly. The corporate employs about 100 folks and expects to achieve greater than 180 staff this yr. It plans to launch in further markets in 2021.