Seattle-area real estate company Flyhomes announced a $15 million investment round to help support its shift from a consumer-facing real estate platform to a behind-the-scenes financial product provider.
The company is doubling down on its “Buy Before You Sell” wholesale lending platform, designed to help homeowners buy their next home before selling the current one.
Instead of working directly with homebuyers, Flyhomes now partners with loan officers and real estate agents who offer the company’s products to their clients.
It marks a key strategic pivot for Flyhomes, which launched in 2016 but has gone through multiple rounds of layoffs in recent years amid rising interest rates and shifting housing demand.
To date, Flyhomes has raised $208 million in equity funding and facilitated more than $7 billion in real estate transactions. It previously raised a $150 million Series C round in 2021.
Flyhomes initially gained attention with a product that gave buyers upfront funding to make more competitive offers, and created the “Buy Before You Sell” initiative during its early days as a rising star in Seattle’s startup scene.
Flyhomes previously offered its services directly to consumers in select urban markets, combining brokerage services with financial products. But by shifting to a wholesale model, the company can now offer its “Buy Before You Sell” solution anywhere it holds a lending license — currently 40 states, with more coming soon.
The program works by securing a backup offer on the seller’s current home before it’s sold, which removes their existing mortgage payments from debt-to-income calculations. This allows buyers to use equity from their current home toward a down payment.
As part of the change, Flyhomes last month announced that it sold its consumer home search technology and related assets to The Real Brokerage.
Investors in the Series D round include existing backers Andreessen Horowitz, Norwest Venture Partners, Canvas Ventures, Camber Creek, Al Goldstein, and Mark Vadon.
“We’re seeing very strong growth in lending volume and revenue, and that’s why our investors backed us to pursue this wholesale strategy,” said Flyhomes COO Adam Hopson.
Flyhomes makes money by charging fees and interest to borrowers who use its financial products. The interest revenue is primarily passed through to Flyhomes’ lending partners. To support lending activity, the company secured a $200 million warehouse lending facility to support loan originations.
The company declined to share specific revenue metrics.
“Our biggest opportunity right now is driving awareness — most loan officers, real estate agents, and certainly homebuyers don’t know our products exist,” Hopson said. “While we’ve built a better mousetrap, it’s much more complicated than that, so it will take time to educate the market.”
The company is led by CEO and co-founder Tushar Garg. It declined to disclose total headcount.
Read the full article here
