Alternative iBuyer startup, Homeward, is looking to help home hunters get a competitive edge over the market. To meet this end, the company has announced it raised $136 million in a Series B funding round. This brings the current valuation of the Austin-based proptech startup to over $800 million.
Homeward has reported that demand is high and this latest funding will go towards scaling up to meet the demand while expanding into new markets. Right now, the startup is only available in Texas, Colorado, and Georgia.
Moreover, the company says it will couple its title and mortgage teams in the second half of 2021 with a hiring spree in order to offer clients and partner agents "a single streamlined experience," according to Homeward.
The company's other plan includes integrating its consumer and internal software systems for approvals, offers, and closings to make Homeward a true one-stop-shop.
Founded in 2018 by current company CEO, Tim Heyl, Homeward has attracted its user base via its ‘alternative iBuyer’ business model. Heyl explained that he had noticed sellers preferred all-cash offers because they were more likely to close successfully. Thus, Homeward was conceived.
In March of this year, the company reported that it saw a 5x increase in the volume of homes sold on its platform, and 9x increase in customers, year-over-year. The company has hired more than 160 employees since 2021 stated, bringing its current headcount to 203.
Toted as a platform by agents for agents, the process is simple. Homeward makes an all-cash offer on behalf of a house hunter. From there, customers can hire an agent from a brokerage to list their home and work with the seller to make an agreed price. Homeward can buy a home and lease the property back to that homeowner until the house is sold. The homeowner can receive a mortgage and buy the property back from the company at a predetermined price that is accepted by all parties. If the property doesn’t end up selling to a new homeowner, it will still be bought by Homeward, so either way, the seller wins.
Homeward also doesn’t purchase a home for anywhere below its market value, which is an attractive prospect for home sellers.
Jeff Crowe, the Managing Partner at Norwest Venture Partners, the company that led the Series B funding round, said:
“Homeward is innovating at the intersection of real estate and fintech — that’s the next frontier. 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.”
Crowe was also announced as the new member of Homeward’s board as part of the funding round.