Stealthy Startup Tomo Raises $40M to Hire ‘Hundreds’ in Austin

October 29, 2020
tomo networks
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After raising a whopping $40 million to streamline the homebuying process, Tomo Networks emerged from stealth on Wednesday to announce a major hiring push in Texas.

The fintech startup will concentrate its hiring in Austin, with plans to grow from about 20 people today to “hundreds” across the company’s three locations over the next year, CEO Greg Schwartz said. Tomo’s team will be spread across Seattle, Austin and its headquarters in Stamford, Connecticut.

In Austin, Schwartz said Tomo plans to concentrate its mortgage operations business, and hire software engineers, product development professionals, fintech experts and more. He said the strong technical talent pool, existing fintech startup ecosystem and Texas’ low corporate tax rate all attracted Tomo to Austin, where he plans to open an office in the city’s downtown or south downtown area.

“It’s got an entrepreneurial mindset that we appreciate,” Schwartz told Built In. “There’s a risk-taking element, with folks there willing to build the next great company.”

Tomo plans to launch its platform during the first quarter of 2021, and the $40 million investment was led by Ribbit Capital, NFX and Zigg Capital.

The company was co-founded by Schwartz and a fellow former Zillow executive, Carey Armstrong, with the aim of combining real estate agents, loan officers and automation to simplify the mortgage buying process. None of the existing operators in the space, like JPMorgan, hold more than a 5 percent market share of the $1.5 trillion mortgage market in the United States, Schwartz said, creating an opportunity for Tomo.

“I’m not gonna spend my day worrying about folks with 1 or 2 percent market share,” Schwartz said.

He believes the Japanese concept of “omotenashi” will help separate Tomo from its competitors, and plans to design its tech to anticipate and meet customer needs before the individual is even aware they existed. He said he first experienced this philosophy on a trip to Tokyo he took with his wife two years ago.

“It was one of the most important trips we’ve taken,” Schwartz said.

As the couple waited on the station platform for their bullet train to arrive, Schwartz said he looked down at his ticket and realized he had no idea how to figure out the correct train to board because he couldn’t read Japanese.

Suddenly, he felt a tap on his shoulder. Schwartz turned around, and saw his taxi driver standing behind him. The man must have realized that Schwartz would have trouble navigating the foreign station, Schwartz said, and used his limited English to help Schwartz read his ticket and board the correct train — offering a living, breathing example of omotenashi, Schwartz said. Tomo is named after an abbreviation of the concept.

“Omotenashi is our north star to look at throughout this very complicated process,” Schwartz said. “Buying a home is an intimidating process. To anticipate our customer’s needs and try and meet them without ever being asked, that is rarefied air.”

Also in AustinEagle Eye Networks Raises $40M for Its AI Video Surveillance

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