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Accept.inc raises $90 million in debt and equity to scale its digital mortgage lending platform – TechCrunch

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Acceptinc raises 90 million in debt and equity to scale
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Many startups are built to help people make cash offers on homes with the goal of gaining an edge over other buyers, especially in ultra-competitive markets.

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accepti.inc is a Denver-based company trying to create a new category in real estate technology. To help scale its digital mortgage lending platform, the company announced today that it has secured $90 million in debt and equity — with $78 million in debt and $12 million in equity. SignalFire led the equity portion of the funding, which also included participation from existing seed investors Y Combinator and DN Capital.
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Accept.inc describes itself as an iLender, or a “technology-enabled lender” that gives people a way to submit cash offers on a home when they qualify for a mortgage.

Using his platform, a buyer is first qualified and can then start looking for homes that are at or below the amount he or she is approved for. They can buy a more expensive house, but any amount in excess of what they are approved for would have to come out of their own pocket. Historically, most buyers don’t know they have to pay out of pocket until they’ve placed an offer on a specific home and an appraisal is less than the amount of the price they’re paying for a home. In those cases, the buyer must cough up the difference out of his own pocket. With Accept.inc., execs are tout, buyers know upfront how much they’re approved for and can spend on a new home “so there are no surprises later.”

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SignalFire Founding Partner and CTO Ilya Kirnos describes: Accept.inc as “the first and only iLender.”

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He points out that, being a lender, Accept.inc doesn’t make its money by charging buyers fees like some others in the all-cash offering space.

“Unlike ‘iBuyers’ or ‘alternative iBuyers“Accept.inc takes care of the money to buy a home and then makes money on mortgages and title, meaning sellers, homebuyers and their agents don’t pay any additional fees for the service,” he told TechCrunch.

Buy iBuyers instead houses from sellers who have signed up online make a profit by often refurbishing those houses and selling them and then helping people buy another house with all the money. They also make money by charging transaction fees. A slew of companies operate in the space, including established players such as: Opened door and Zillow and newer players like Homelight.

Accept.inc raises $90 million in debt and equity to scale its digital mortgage lending platform - TechCrunch

Image credit: Accept.inc. From left to right: co-founders Adam Pollack, Nick Friedman and Ian Perrex.

Since its inception in 2016, Accept.inc says it: helped thousands of buyers, agents and sellers close “hundreds of millions of dollars” in homes. Company saw “14x” growth in 2020 and from June 2020 to June 2021 it achieved “10x” growth in terms of its team size and number of transactions and revenue, according to CEO and co-founder Adam Pollack. Accept.inc wants to use its new capital to build on that momentum and meet demand.

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Pollack and Nick Friedman met in college and started building Accept.inc with the goal of “turning any offer into a cash offer”. The pair have essentially “failed for two years,” Pollack half-jokes.

“We’ve basically become an encyclopedia of 1000 ways to help people make cash offers should not work,” he said.

The team went through Y Combinator in the winter of 2019 and then they created the iLender concept. In the iLender model, the company uses its money to buy a home for buyers. Once the loan with Accept.inc is ready to close, the company will sell the home back to the buyer “without any additional charges or fees.”

“What we learned in those two years is that you need to vertically integrate all of your core competencies and you can’t rely on third parties to own or manage your special sauce for you,” Pollack told TechCrunch. “We also realized that if you’re going to make a cash offer for anyone who can afford a mortgage, you have to make it a completely bona fide cash offer that closes in three days, as opposed to a better version of what existed. . And you have to own that, and take the risk that comes with it and feel comfortable with it.”

The benefits of their model, the couple say, is that buyers can become cash buyers, sellers close in 72 hours, and agents “get a guaranteed commission check.”

“Our mission is that everyone should have an equal opportunity to own their own home,” Friedman said. “We don’t just want to level the playing field, we want to create a new standard.”

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Buyers who use Accept.inc are winning 6-7 times more, the company claims. With its new capital It also plans to double its team to 90 and enter new markets beyond its home base of Denver.

SignalFire partner Chris Scoggins believes Accept.inc is different from other lenders in that its focus is on: “Win the house, not just pay off the loan, with a business model that is 10x more capital efficient than other players in the market.

The team is driven…to level the playing field for home buyers who are losing today to all-cash offers from home flippers and wealthy individuals,” he added.We see a huge opportunity for Accept.inc to become the backbone of the future of mortgages.”

The post Accept.inc raises $90 million in debt and equity to scale its digital mortgage lending platform – TechCrunch appeared first on Notesradar.

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