Tim Heyl believes he can help real estate agents pandemic-proof their business.
“People don’t want to put their houses on the market because they’ve got to have strangers trekking through them all day, every day and they don’t feel like it’s safe,” Heyl said.
In 2018, Heyl founded Homeward, an Austin startup that allows agents to buy and sell clients’ homes online through a single platform. Heyl said the company solves the “chicken and the egg” problem of buying a new home — which he defined as banks refusing to offer mortgage loans until homeowners have the cash in hand from selling their previous place — by making all-cash offers for residences on the market. Homeward also lets sellers offload their home without inviting human biohazards in to see the place.
“Mortgage lenders require you to sell your house before they’ll give you any credit for that home equity toward your next mortgage,” Heyl, who worked as a real estate agent for 11 years, told Built In. “It causes homeowners to have to move twice or try and time a move really inconveniently and last minute, or potentially miss out on the house that they’re looking for.”
After experiencing a tenfold increase in agent partnerships over the last year, Homeward is now looking for more growth. The company announced on Thursday it received $105 million in capital, with $20 million in equity and $85 million in debt. Homeward plans to use the money to buy hundreds of new houses and partner with thousands of additional real estate agents in Texas, Colorado and Georgia. Prior to the fresh round, Homeward kept an inventory of about 50 homes at all times.
But mainly the funds will fuel a hiring spree. The 33-person company plans to triple its headcount by the end of year, adding team members in engineering, marketing, product and operations as it refines its platform for buying and selling homes.
“We’re designing a whole new way to buy homes, which means designing the entire new transaction,” Heyl said.
The company is currently working on integrating the title, mortgage and insurance process under the business’ Homeward Way sales platform. Unlike how iBuyers like Opendoor buy homes — which Heyl said cut out the agent and buy sellers’ homes at a discount — Homeward works with agents to maximize their clients’ offers, and pays in cash.
Through a membership service, Homeward also offers agents training and access to exclusive pricing and products. Since the coronavirus hit, Heyl said the company has certified more than 1,000 new agents, adapting its training process so it can be done over Zoom.
In the next 18 months, the company plans to expand to other markets across the country.
“We believe that Homeward is the solution for those that are still planning on moving during this time,” Heyl said.
The $20 million in equity financing was led by Adams Street Partners, with participation from Javelin Venture Partners and LiveOak Venture Partners. The new round brings total investment in Homeward to $130 million.
