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Real estate tech startup Tomo grabs $70M seed round amid housing market frenzy
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| (Nora Carol Photography/Getty Images) |
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The residential real estate market is on fire, and tech companies and their backers are clamoring for a piece of the action. The latest entrant in the space? Tomo, a mortgage lender that just launched with a $70 million seed round led by Ribbit Capital, with support from DST Global, SVB Capital, NFX and Zigg Capital.
- The funding values the startup at $130 million and is one of the largest seed deals in the US, according to PitchBook data. In fact, the average size of a seed-stage round in H1 2021 was $3.9 million, and $5.8 million for real estate tech deals specifically. Both figures represent records.
- Tomo, which was founded by two former Zillow executives, wants to help first-time homebuyers compete against other bidders by offering mortgage pre-approvals within hours and guaranteeing on-time sale closing.
- The space has plenty of competition. Homebuying platform Lower recently brought in $100 million, while mortgage lender Accept.inc just raised $90 million. And Better.com, another mortgage lender, is planning to go public via a SPAC merger that values it at $7.7 billion. Incumbents such as Zillow and Opendoor also offer home loans.
- Many companies in the sector are trying to get into every aspect of homebuying, from brokerage services to lending to homeowners' insurance, Zach Aarons, co-founder of real estate-focused VC firm MetaProp, told PitchBook in a recent interview about real estate tech. Tomo says its unique in that it offers the first platform to focus strictly on the buyer.
Related read: Real estate tech is bouncing back from its pandemic slump |
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PitchBook Benchmarks for PE, VC and more
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Over the past decade-plus, the US private markets have surged in popularity for investors seeking alpha in the world of alternative assets. And general partners have responded by expanding the number of fund strategies. But with no uniform reporting standards, it's hard for pensions and endowments to find true transparency beyond the world of index funds.
Enter PitchBook Benchmarks, a one-stop destination that reveals aggregate investor performance across a range of strategies by measuring IRR, cash multiples and more. And the latest edition, which is updated as of Q4 2020, takes it to another level.
• Improved timeliness: This year we've added preliminary data for quarterly returns to get a quicker first look at performance. For this most recent edition we have shortened the lag in fund reporting to just three months.
• More details: We now offer PDFs with slices for different global regions, funds-of-funds and secondaries, including performance metrics for PE funds-of-funds, real estate funds-of-funds and more.
• Visualizations: Beyond the data, we've added box and whiskers charts showing dispersion among the funds in these areas, as the median returns mask some very different results. We have also included a visual depicting one-year horizon IRRs over the past fifteen years for 10 select strategies, allowing users to track relative performance from year to year. |
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PE driving consolidation across orthopedic healthcare
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From gastroenterology and oncology to urology and dermatology, financial sponsors have spurred innovation and fueled consolidation across the US healthcare landscape. With the latest in a series of industry briefs unpacking key healthcare niches, Dana Jacoby of Vector Medical Group unpacks the growing trend of fund managers jumping on investment prospects in orthopedic healthcare.
In addition to examining PE activity across this space, the brief includes a full-length Q&A that also features Gary W. Herschman of law firm Epstein Becker Green in which they look ahead to what's next for firms and physicians alike.
Read it now |
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PE tech investors move beyond their traditional hunting grounds
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The Denver area has seen an influx of tech-driven PE buyouts.
(Lightvision, LLC/Getty Images) |
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Boulder, Colo., nestled at the base of the Rocky Mountains, is not synonymous with tech investment. But it became the location for one of last year's biggest deals when EQT, Ardian and Digital Colony bought local communication infrastructure company Zayo Group for $14.3 billion.
- The Zayo Group buyout is just one of many deals happening in America's lesser-known tech-driven cities. Just 25 miles southeast of Boulder, the Denver metropolitan area has seen a large influx of tech-driven PE buyouts, and the region is not alone. Miami, better known for its pristine beaches and nightlife, has also seen a strong uptick in tech buyout deals.
- With tech becoming a ubiquitous feature of the economy, PE dealmakers are looking beyond familiar tech hubs such as Silicon Valley and New York—cities like Denver and Miami are particularly indicative of this trend.
- According to PitchBook data on two five-year periods (2011-2016 vs. 2016-2021), Denver saw a more than 70% increase in PE deals, with its deal count rising to 176 from 103, while Miami saw its deal count inflate to 139 from 108, representing a nearly 30% increase. The two metropolitan areas have seen a larger influx of tech buyout deals than almost any other US metro region.
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Private equity doesn't have a big presence in Japan. But with more firms eyeing Japanese companies, that's likely about to change. [The Wall Street Journal]
When Argentina's economy collapsed in 2001, its third-largest city, Rosario, formed an agricultural program to provide food and jobs. It's now being recognized for its unique approach to urban farming. [Bloomberg]
The problem of bias in AI is facing increased scrutiny from regulators. It's also spurred business for startups and tech stalwarts. [The New York Times] |
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Since yesterday, the PitchBook Platform added:
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19
VC valuations
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1641
People
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525
Companies
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30
Funds
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2018 Vintage Global Secondaries Funds
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Unpacking the opportunities ahead for Colorado's venture ecosystem
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Not only did Colorado close out another year of significant startup financing activity, even in the face of unprecedented disruption, but the state is also on course to smash records for VC investment as 2021 unfolds.
However, regional VC trends this past year reveal challenges that remain for emerging innovation hotspots. Innosphere Ventures partnered with PitchBook to produce a new market review of the key trends shaping Colorado's venture ecosystem to spotlight the opportunities ahead as the COVID-19 crisis gives way to recovery. To lead in this environment, states such as Colorado must address the historic imbalance in capital concentration on the coasts to fuel new ventures that create jobs and the future economy.
Read the full Venture Capital Ecosystem Review here |
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General Catalyst leads $85M round for Sword Health
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| Sword Health has raised $85 million in a Series C from lead investor General Catalyst, with support from Bond, Highmark Ventures, BPEA and others, TechCrunch reported. The New York-based startup provides virtual healthcare for patients with musculoskeletal conditions. Sword Health, which closed a $25 million Series B earlier this year, works with insurers, health systems and employers throughout the US, Europe and Australia. |
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Tendo Systems picks up $50M
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| Tendo Systems has raised $50 million at a $550 million valuation in a round led by Lux Capital, with participation from General Catalyst. The Philadelphia-based company is the developer of a digital engagement platform intended to help patients and clinicians manage treatments. |
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Gilmour Space blasts off with $47M
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Robinhood slapped with $70M fine
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FINRA, a regulator of brokerage firms and exchange markets that's overseen by the SEC, has fined Robinhood $57 million and ordered the online stock-trading company to pay nearly $13 million to harmed customers. The penalties are based in part on the number of customers who received false or misleading information and the company's systemwide outages in March 2020. The fine is the largest ever to be ordered by FINRA, the organization's statement said. |
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Luxury travel startup to go public via SPAC
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BMW i Ventures closes $300M fund
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| BMW i Ventures has debuted a new $300 million fund to invest in early- and mid-stage startups focused on sustainability, transportation, manufacturing and the supply chain. The firm's first fund closed on €500 million (about $592 million) in 2016. BMW i Ventures has backed car auction platform provider Motorway, self-driving tech company Aurora and materials startup Boston Metal. |
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"VC mega-funds used to be looked on with skepticism due to the difficulty of putting such large sums to work in high-quality deals. With the advent of longer holding periods and larger late-stage rounds, many VCs believe they must have larger funds to continue maintaining their stakes in existing deals."
Source: PitchBook's Q1 2021 Private Fund Strategies Report |
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