Uncertainty in the real estate markets and rising interest rates have delivered a blow to people eager to own their own home.
But for Landis, it’s confirmation that the company is in the right place at the right time. Cyril Berdugo and Tom Petit founded the company in 2018 to provide a more accessible way for renters to become homeowners through financial education and coaching.
The New York–based company’s model is for their client to have a budget and work with real estate agents to find a home within that budget. Landis buys the home in an all-cash offer on behalf of the client, who then rents the home from Landis.
During that period of time, the company helps the client reach goals of qualifying for a mortgage to repurchase the home when they are ready, Berdugo told TechCrunch.
“There’s a lot of uncertainty in the real estate markets right now,” he added. “When interest rates go up or down, it greatly impacts the ability for Americans to reach homeownership. We underscore the importance of the stability that lenders provide to our clients. By creating a structure where we set a buyback price, it completely removes the uncertainty.”
We previously profiled Landis in July 2021 when it raised $165 million of funding in a mix of equity and debt. At the time, the company was operating in 29 cities in 11 states, and now it is in over 50 markets, the company said.
Today, the company announced $40 million in Series B funding, led by GV, which was joined by Sequoia Capital, Jay Z’s Roc Nation fund Arrive, the National Association of Realtors’ Second Century Ventures, Operator Partners, Signia Ventures and Team Builder Ventures. This now gives the company $222 million in total equity and debt funds raised to date.
“With the current volatility in the house markets, our clients are looking for the stability that we provide them on their homeowner journey, so we saw an opportunity to raise capital to double down and allocate more funds to coaching clients to reach homeownership,” Berdugo said.
Similar to last year, he declined to disclose revenue metrics, but did say the company’s valuation increased with the new round, and its team grew three times while the number of applications into Landis’s program increased by more than seven times since last year.
The funding will be used to grow Landis’s two-year coaching program, add new markets and grow its team. The company will take $2 million of the new investment specifically for its coaching program, which provides personalized, one-on-one support to clients so they can meet milestones of improving their credit history and building savings. Once a client meets those goals, they are able to get a mortgage and become the owner of their home.
Landis itself makes money when it buys and sells a home and doesn’t charge for the coaching, which is why Berdugo says it is “a big deal that we are investing in financial literacy and knowledge, because there is a massive opportunity for them to reach homeownership.”
Landis grabs $40M to turn renters into homeowners by Christine Hall originally published on TechCrunch
via https://www.aiupnow.com
Christine Hall, Khareem Sudlow
