Sure, sites like Zillow and Trulia have forever changed the way we shop for homes and Airbnb has re-imagined the way we rent them out. But the underlying pipes that make the real estate market run have largely remained stuck in the past. The seven real estate companies on the Forbes Fintech 50 list for 2018, including five newcomers, are trying to change that. Companies like Better Mortgage, Blend and LendingHome are reengineering the way mortgages are applied for and underwritten. While Cadre and Fundrise are moving real estate investments from Excel spreadsheets to the digital world.
Better Mortgage,Digital-only mortgage originator estimates the loan an applicant qualifies for within three minutes using stated income and a credit score check. Once borrower uploads required documents, company says, it usually completes underwriting and issues a “verified pre-approval letter” within 24 hours, allowing house hunters to compete with all-cash buyers. Better Mortgage gets paid by the institution buying the loan, not directly by consumers, and uses its proprietary software to match the two. A matching guarantees assure borrowers they’re getting a fair deal.
Bona fides: Fannie Mae and five of nation’s six largest banks buy its loans.
Founder & CEO: Vishal Garg, 40, founder of defunct online lending platform MyRichUncle
Funding: $65 million from Kleiner Perkins Caufield Byers, Goldman Sachs, IA Ventures, KCK and Pine Brook Partners
Threat to: Traditional mortgage brokers
Forbes on Better Mortgage: Is This Company About To Transform The $1.5 Trillion Mortgage Industry?
BlendSpeeds up the mortgage approval process at the nation’s largest lenders with its cloud based white label software. Prospective borrowers can link to online bank statements, tax returns and pay stubs. That chops days off the approval process and reduces document fraud. Plans to expand its services this year to auto, student and other lenders
Bona fides: Wells Fargo and U.S. Bancorp are already onboard
Cofounder & CEO: Palantir-alum Nima Ghamsari, 32
Funding: $160 Million from Allen & Company, Andreessen Horowitz, Founders Fund, Thrive Capital, Greylock and Emergence Capital. Latest valuation: $500 million
Threat to: SoFi, Better Mortgage, Quicken Loans’ Rocket Mortgage
Forbes on Blend: Blend Wants To Bring The $2 Trillion Mortgage Market To The Modern Era
Cadre,Invitation-only platform allows high net worth individual and institutional investors to buy shares in commercial real estate and multifamily deals at lowers fees than are typical in real estate funds and REITs.
Bona fides: Since inception, has closed more than $1 billion in total deals through its platform.
Founder & CEO: Ryan Williams, 30, a Forbes 30 Under 30. (Trump son-in-law Jared Kushner was a cofounder.)
Funding: $130 million from Andreessen Horowitz, Breyer Capital, Ford Foundation, Goldman Sachs, Thrive Capital and others. Latest estimated valuation: $800 million
Threat to: Real estate investment funds, commercial real estate brokers
Forbes on Cadre: How A 28-Year-Old Plans To Upend The $81 Trillion Global Real Estate Investment Market
Fundrise,Crowdfunding platform that allows anyone with $500 to invest in diversified real estate portfolios. Launched eFunds in 2017, selling shares in portfolios dedicated to building and remodeling single family housing in urban locations.
Bona fides: About 17,000 investors have put $300 million into deals through the platform.
Cofounder & CEO: Ben Miller, 41, son of Washington D.C. developer Herbert S. Miller
Funding: $50 million from Renren, Guggenheim Partners, Berman Enterprises and others
Threat to: Other real estate crowdfunding sites, traditional REITs
Forbes on Fundrise: Home Sweet Investment: Fundrise Introduces New Way For Millennials To Endow Their Future Houses
GreenSky,Provides on-the-spot financing for home improvement projects (with loans up to $65,000) via a network of contractors and bank partners -- without itself taking on the risk of defaults. Most borrowers don’t pay a dime in interest thanks to zero-interest promotional periods that last from 6 to 60 months. Recently began offering financing at doctor, dentist and veterinary offices.
Bona fides: Has facilitated over $10 billion in loans
Cofounder & CEO: Billionaire David Zalik, 44, who skipped high school, then dropped out of college to run his first startup
Funding: $560 million from PIMCO, TPG, Wellington Management, Iconiq Capital, QED Investors, DST Global and Fifth Third Bank. Latest valuation: $4.5 billion
Threat to: Synchrony Financial, Wells Fargo and other home remodeling lenders
Forbes on Greensky: Handyman's Helper: How GreenSky's David Zalik Skipped High School On His Way To Becoming A Billionaire
Provides insurance to urban renters for as little as $5 a month and to homeowners for as little as $25. Customers can sign up, modify or cancel their policy on the app. Novel model, designed to cut administrative costs and disputes, lets Lemonade keep 20% of customer premiums, with the rest earmarked for claims payouts and any surplus divvied up to charities of customers’ choosing. About a third of claims are paid automatically.
Bona fides: In 2017, donated 10% of revenue to nonprofits.
Cofounders: CEO Daniel Schreiber, 46; COO Shai Wininger, 44
Funding: $180 million from Softbank, Sequoia Capital, Aleph, XL Innovate, General Catalyst, Thrive Capital, Tusk Ventures, GV, Allianz SE and Sound Ventures. Latest valuation: $600 million.
Threat to: Progressive, Allstate and other traditional insurance companies
LendingHomeFour year-old online lender started out providing bridge loans to fix and flip housing investors, a historically underserved segment. With original product now available in 25 states, LendingHome has expanded into personal mortgages in 14. Also offers investments in its flip loans to accredited investors.
Bona fides: $2 billion in loans made; 10,000 homes financed
Cofounder & CEO: Matt Humphrey, 30, a Forbes 30 Under 30, who sold a daily deal site for $100 million when he was 24
Funding: $166 million from Renren, Ribbit Capital, Foundation Capital and others
Threat to: Traditional mortgage lenders, Better Mortgage
Forbes on LendingHome: Revamping The Home-Buying Process
With reporting by Lauren Gensler and Kristin Stoller.
Read more:
Full list of the Fintech 50 2018
Forbes Fintech 50 2018: The Newcomers
Forbes Fintech 50 2018: The Future Of Lending
Forbes Fintech 50 2018: The Future Of Investing
Forbes Fintech 50 2018: The Future Of Payments
Forbes Fintech 50 2018: The Future Of Personal Finance
Forbes Fintech 50 2018: The Future Of Blockchain And Cryptocurrency
Forbes Fintech 50 2018: The Future Of Wall Street And Big Data