Sundae closes $ 80 million residential real estate market – TechCrunch
Sundae, a residential real estate market that pairs sellers of dated or damaged property with potential buyers, has raised $ 80 million in Series C funding round co-led by Fifth Wall and General Global Capital.
QED Investors, Wellington Management, Susa Ventures, Founders Fund, First American Financial, Prudence Holdings, Crossover VC, Intersect Capital, Gaingels and Oberndorf Ventures also participated in the financing. The funding round marks the third funding for San Francisco-based Sundae in a 13-month period, bringing its total raised since its inception in August 2018 to $ 135 million.
The San Francisco-based company declined to reveal what valuation its C-Series had been upped to. He also declined to provide concrete income figures, saying only that he saw a 600% year-over-year increase in income from June 2020 to June 2021.
The startup aims to help people who need to sell dated or âdamagedâ properties for a variety of reasons, such as job loss, illness or divorce. In some cases, according to CEO and co-founder Josh Stech, these vulnerable salespeople are exploited by “predatory patches and pinball machines” seeking to capitalize on their misfortune.
Since sellers in these situations typically don’t have the funds to repair their properties before they sell, Sundae lists the property for them on its platform – serving as an intermediary between sellers and investors. There it is visible to approximately 2,600 qualified off-market buyers.
The company basically aims to aggregate demand for “fix and flippers”, who use the market to bid against each other for distressed properties. If the seller agrees and an inspection is complete, the company offers a pre-closing advance of $ 10,000 to help homeowners pay for moving or other expenses.
“Our goal is to displace the wholesalers who exploit desperate or uninformed sellers and lock them into a contract that they flip and cede to a real estate investor at a significant profit, âStech said. âThe tens of thousands of dollars in lost equity that goes to a wholesaler could be the difference between paying off debt or having enough money to retire.
Sundae claims that, on average, sellers receive 10 offers in three days on its marketplace.
Since its launch in January 2019, the startup has slowly expanded its market place geographically. He went from exploitation to four markets in California at the end of last year to now operate in 14 markets in Florida, Colorado, Georgia, Texas and Utah.
Sundae earns money by charging buyers a fee in its investor market when it “assigns” them a property.
In the first quarter of this year, the startup launched an online marketplace dedicated to investors, where they can browse properties and submit offers. Once an investor signs up to join the market, they can access the full inventory of properties, including information such as photos, floor plan, 3D tour, and property report. third party inspection.
Going forward, the company plans to use its new capital to expand into new markets, invest in its platform and âbuild brand awarenessâ. It also plans, of course, to increase its current workforce to 180, mostly remote.
Fifth Wall partner Vik Chawla believes Sundae serves a segment of the residential real estate market that has always been overlooked.
âTheir market model simultaneously solves a crucial problem for sellers in disrupting the wholesale industry, while providing a platform that real estate investors can rely on for reliable investment opportunities,â he said. he declares.
The company last raised $ 36 million in a Series B funding round in December 2020.
Interestingly, a large number of angel investors – including a number of athletes and celebrities – also invested money in the company’s last round, including: actor Will Smith, KYGO and Palm Tree Crew, three-time NFL Super Bowl champion Richard Seymour of 93 Ventures, NFL All-Pro DK Metcalf of the Seattle Seahawks, Matt Chapman of the Oakland A’s, Alex Caruso of the Los Angeles Lakers, Aaron Gordon of the Denver Nuggets, Solomon Hill of the Atlanta Hawks, Kelly Olynyk of the Houston Rockets, NBA All- star Isaiah Thomas, three-time NBA champion and gold medalist Klay Thompson of the Golden State Warriors, Hassan Whiteside of the Sacramento Kings, Andrew Wiggins of the Golden State Warriors and the 2020 American Football Player of the Year and Juventus midfielder Weston McKennie.