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FintechPolitics & MoneyReal Estate

Direct homebuyer Perch raises $30 million to fund expansion

Currently available in San Antonio, Texas

The move towards institutionalizing the home-flipping business has another player: Perch.

The company, which is based in New York, launched recently and is currently buying houses directly from homeowners and selling those houses in its first market of San Antonio, Texas.

The company, which was founded last year, plans to grow beyond San Antonio, and has secured $30 million in funding to power that growth.

The company announced this week that it raised $30 million in its Series A funding round. The round was led by FirstMark Capital, with Juxtapose and Accomplice also taking part in the capital raise.

According to the company, it plans to use the money in product development and to scale its home buying marketplace.

The company claims that its use of “data science, technology, and human-centered design” allow it to provide a market price offer for an individual’s home in 24 hours. If they accept Perch’s offer, the homeowner can pick their closing date.

From there, Perch makes the necessary upgrades and repairs and then sells the house as “Certified Pre-Owned,” which the company calls a new category for the real estate market.

“Innovating on the home sale process is where we are starting, but it's not where we finish. We believe that the way to truly transform residential real estate is by building a superior selling and buying experience – by becoming a marketplace for homes.” Perch CEO Court Cunningham said.

“For home sellers, we provide a seamless sale experience by removing the uncertainty and inconvenience,” Cunningham added. “For buyers, we're pioneering a new category of homes: Certified Pre-Owned; all Perch homes are move-in ready and include a warranty.”

According to Cunningham, the company will use this new funding to accelerate its product development around “automating access to the related transactions that touch a home closing, including mortgage, title, and inspection.”

Cunningham adds that Perch will be the “simple and easy way to find, purchase, and close on your home.”

Before helping found Perch, Cunningham was CEO of Yodle, an internet marketing company. Cunningham served as CEO of Yodle from 2007 through 2016, during which time the business grew from 15 people to 1,500 employees. Yodle was sold to Web.com in 2016 for $340 million.

Joining Cunningham on the Perch executive team are Phil DeGisi, who serves as head of growth, and Aaron Altom, who serves as head of real estate.

DeGisi was most recently chief marketing officer at CommonBond, the consumer lender. Altom brings real estate experience to the company, having served as regional director for Waypoint Homes and as AVP of acquisitions for American Homes 4 Rent. According to the company, Altom oversaw the purchase of more than 5,000 homes during his time at Waypoint and American Homes 4 Rent.

As part of the capital raise, FirstMark Capital founder and managing director, Rick Heitzmann, will join Perch’s board of directors.

“Real estate is one of the last massive industries that has yet to be meaningfully changed through technology. The Perch team is uniquely focused on serving both home buyers and sellers by building a true marketplace,” Heitzmann said.

“We have known and respected Court for several years,” Heitzmann added. “The leadership team Perch assembled was one of the strongest we've seen at an early-stage company, with deep experience in technology, marketing, and real estate.”

Perch, which plans to expand beyond San Antonio, joins an increasing roster of direct homebuyers.

Zillow recently expanded to direct buying, and is testing a buying program in Las Vegas and Phoenix. Redfin began buying homes back in the first quarter of 2017.

While those two real estate giants have significant real estate businesses, there are other companies besides Perch that exclusively offer direct buying programs, including Opendoor and OfferPad.

And now, there’s a new kid on the block.

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