Home equity financing platform Point has secured a $115 million Series C led by WestCap with participation from existing backers including a16z, Ribbit Capital, and DAG Ventures as well as new investors including Deer Park Road, The Palisades Group and Alpaca VC.
Founded in 2015 by Alex Rampell, General Partner at Andreessen Horowitz (a16z) and Co-Founder of BNPL giant Affirm, Eddie Lim, and Eoin Matthews, Point allows homeowners to receive cash in exchange for a percentage of the the future appreciation of their home.
Homeowners use this newly tapped home equity on a variety of things including home renovations, starting a small business, funding a child's education or saving for their retirement.
On average, Point's Home Equity Investment (HEI) makes up approximately 15-20% of a home's property value with a minimum average investment of $100,000.
Homeowners do not have any obligation to pay Point back for 30 years, although most homeowners sell their home or refinance well before then.
Since its inception in 2015, Point has invested in more than 5,000 homes but the vast majority of their growth has come more recently. In 2021, Point received over $1 billion in new capital commitments from real estate and mortgage-backed securities (MBS) investors.
Point's funding volume was up over 5x in the first quarter of 2022 compared to the first quarter of 2021.
A recent report indicates that Americans are sitting on $26 trillion of home equity and Point, described as an 'asset-light fintech for home equity,' believes homeowners using its platform have an advantage over home equity loans or refinancing due to no monthly payments, no income requirements and no need for perfect credit.
Point currently operates in 16 states including California, New York, Florida, Massachusetts, New Jersey, Washington, Colorado, Pennsylvania, Illinois, Maryland, Michigan, North Carolina, Arizona, Minnesota, Oregon, Virginia, and Washington, D.C., with plans to enter 11 additional states by the end of this year including Ohio and Nevada.
CEO Take: In the past, home equity has only been accessible for homeowners through traditional options like home equity loans or refinancing, startups like Point are offering Americans more accessibility and options when it comes to cashing in on their home's equity.
In essence, Point has created the most consumer-friendly home equity solution for homeowners with an emphasis on flexibility and near zero financial burden. Point empowers its homeowners to safely manage their wealth and invest in their future.
Similar to other startups operating in the home equity space including HomePace and HomeTap, Point first evaluates the finances of every applicant and makes a provisional offer. Next, using an in-home appraisal and data from a variety of sources including property data, Point values each home and updates their final offer. Once all closing conditions are finalized, Point funds homeowners with their investment within 4 business days.
Point is the perfect marriage between technology and data that is set to revolutionize the sector by democratizing access to home equity in a market characterized by fear and uncertainty for millions of American homeowners.
Congratulations to everyone over at Point on your recent Series C raise and we hope you are successful in your mission of bringing your home equity solution to every homeowner in the United States.
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