Zillow Execs Launch Mortgage Startup Tomo

Zillow Execs Launch Mortgage Startup Tomo

Tomo's Greg Schwartz and Carey Armstrong (Photos via Tomo Network)

Tomo’s Greg Schwartz and Carey Armstrong (Photographs through Tomo Community)

In Silicon Valley, the standard seed spherical for a brand new enterprise is round $1 million — perhaps $3 million. However a brand new digital mortgage firm, began by two former Zillow execs, has simply launched with $40 million.

Tomo, which payments itself as a fintech startup, introduced the eye-watering seed spherical Wednesday. Trulia co-founder Pete Flint and former Zillow CEO Spencer Rascoff are among the many traders.

Based mostly in Stamford, Conn., with workplaces in Seattle and Austin, Tomo is the brainchild of Greg Schwartz and Carey Armstrong. Schwartz labored at Zillow for 13 years, most not too long ago as president of media and market; Armstrong was vice chairman of its Premier Agent enterprise, which generates almost $1 billion in agent promoting a 12 months.

Though Tomo supplied few particulars about its particular enterprise mannequin, the corporate mentioned it goals to streamline the mortgage and home-buying course of for consumers and brokers. “We’re going to maneuver from a doc administration method to a knowledge administration method,” Schwartz informed Geekwire.

In an announcement, he mentioned: “Shopping for a house is a awful expertise. Regardless of years of tech corporations specializing in actual property, the general course of has not modified.”

Tomo’s preliminary funding was led by Ribbit Capital, Zigg Capital and NFX, a agency co-founded by Flint, who bought Trulia to Zillow for $2.5 billion.

Different traders embody SVB Capital, an affiliate of Silicon Valley Financial institution, and traders Ted Ackerley, Alex Sacerdote, Kurt Mobley, Eli Weinberg. Rascoff, who simply launched a second-home startup referred to as Pacaso, additionally invested. (Aspect be aware: Schwartz backed Pacaso.)

Nearly all of seed rounds for startups are nonetheless lower than $1 million, however their dimension is rising. Final 12 months, the median seed spherical dimension was $3.9 million, up from $3.1 million in 2018, in line with Wing Enterprise Capital, a Palo Alto, California-based agency targeted on early-stage corporations. The median, pre-money valuation for seed financings was $11 million in 2019, up 17 % from $9.4 million a 12 months prior.

Actual property tech startups — together with mortgage and title — have been the beneficiary of elevated investor urge for food.

In Could, San Francisco-based States Title raised $123 million to speed up its digital mortgage, title and escrow providing. Buyers Greenspring Associates, Basis Capital and FifthWall Ventures valued the corporate at $623 million. Individually, mortgage lending startup LoanSnap snagged a $10 million funding this spring from Alex Pall and Drew Taggart, the DJ duo behind the Chainsmokers. Notarize, a digital notary startup, raised $35 million in July.

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