Flyhomes, the five-year-old real estate startup that lets people make cash offers on homes while they work to secure a mortgage, announced a Series C round of funding on Thursday totaling $150 million.
The company’s latest round was co-led by venture capital firms Norwest Venture Partners — an active investor of industry players homeward, CoreLogic and Opendoor — and Battery Ventures. Additional participation arrived from Fifth Wall, Camber Creek, Balyasny Asset Management, Zillow co-founder Spencer Rascoff, and existing investors Andreessen Horowitz and Canvas Partners.
According to Flyhomes, Thursday’s round will be used to expand the companies current footprint in to new markets as well as boost growth in its existing markets of Seattle the Bay Area, Los Angeles, San Diego, Portland and Boston. With additional funds, the company said it also plans to double its headcount within the next year while integrating new services.
People who use Flyhomes to buy a new property will get a guarantee that their old home will sell at an agreed-upon price within 90 days. If not, Flyhomes will buy it. If it sells above the set price during that period, the seller keeps the extra.
Flyhomes makes its money from brokerage fees, not from flipping homes, said Tushar Garg, Flyhomes’ CEO and co-founder at the time of its Series B funding round in 2019.
With intense demand for homes on the higher end of the pricing spectrum, new updates to the QM rule that went into effect on March 1 and growing investor interest in jumbo mortgages – this is the perfect time for the broker community to support their clients with speed and ease.
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The buyer pays for FlyHomes’ cost of owning the home, but according to the company, that amount is often less than the standard commission rebate that FlyHomes provides to its buyers at closing. The company claims that this process makes submitting a FlyHomes Cash Offer “effectively free” for the buyer.
According to a press release from Flyhomes, the Seattle-based brokerage has bought and sold more than $2.5 billion homes since launching operations in 2016.
“Buying a home is a stressful experience,” said Lisa Wu, Norwest Venture Partners. “Flyhomes is laser-focused on the customer journey and has helped thousands of buyers win homes they love while saving them months of time and thousands of dollars. They are emerging as the leading consumer-facing brand in this new category.”
As part of the funding transaction, Wu, along with Roger Lee of Battery Ventures, will join Flyhomes Board of Directors.