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The funds came from a variety of investors, including Andreessen Horowitz, Fifth Wall, 645 Ventures and others. The funding is notable for coming amid a cooling housing market.
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Setpoint, a financial services startup that has billed itself as the “Stripe of real estate,” announced Wednesday that it has just raised $43 million.
In the statement, Setpoint said it would use the new money to “invest in software engineering and develop critical tools for their customers on both sides of asset-backed transactions.”
The funding, part of a Series A round, came from a variety of investors, including well-known venture firm Andreessen Horowitz, which has previously backed an array of famous firms, such as Twitter, Facebook, Airbnb, Clubhouse and many more. Other firms that participated in the funding round include Fifth Wall, 645 Ventures, LiveOak Venture Partners, ATX Venture Partners and others.
“Setpoint will continue to focus on relationships with borrowers and lenders to make transactions instant, automated, and error-free,” the statement added. “The company also expects to expand outside of real estate by powering all asset-backed lending.”
Setpoint first came out of stealth mode in May. The company is the latest venture from Ben Rubenstein, a serial entrepreneur who previously founded lead-vetting company Opcity and who served as chief revenue officer of Realtor.com. Rubenstein serves as Setpoint’s president and co-founder.
Back in May, Setpoint described its mission as providing technology, funding, automation and other assistance to property technology companies. So for instance, a power buyer could use Setpoint to power and fund deals in the same way that an online retailer could use Stripe to power digital transactions.
By the time Setpoint came out of stealth mode, it had already struck up relationships with a variety of real estate firms, including Homeward, Flyhomes, Reali and Houwzer.
In Wednesday’s statement on the new funding, Setpoint said that it is on track to power 25,000 real estate transactions this year and expects to power more than 100,000 next year. Those transactions are spread across a variety of sectors, the statement notes, including iBuying, power buying, fractional ownership and rent-to-own.
Setpoint’s goal is to “make credit more widely available and the underlying assets and loans more liquid,” the statement further reads.
The company’s funding comes at a notable time. Beginning earlier this year, rising mortgage rates cooled the previously hot housing market, leading prices to flatline or even decline in some areas. Some experts now predict national price declines next year, and many real estate executives have signaled that they expect a downturn to persist through 2023.
Numerous companies in real estate have collectively cut thousands of jobs in recent months, and power buyers in particular have been among the hardest hit.
The fact that Setpoint was able to attract investment from a high-profile cohort of venture capitalists against such a backdrop is a notable feat. And the fact that the company aims at diversification, both across real estate sectors and now outside of housing, was no doubt a factor in making it more resilient than companies focused on one area, such as power buying.
In the past, financial firms and real estate startups coordinated using email, Microsoft Excel and even paper documentation, Setpoint CEO Stuart Wall noted in Wednesday’s statement. Setpoint is changing that.
“In less than a year, Setpoint has made significant headway solving this problem within proptech, leading to tens of thousands of home sales, which we expect to more than quadruple in 2023,” he added.
David Haber, a general partner at Andreessen Horowitz, said in the statement that he is “thrilled to be partnering with the experienced team at Setpoint.”
“I believe that Setpoint’s Funding OS has the potential to significantly improve the efficiency of these transactions,” Haber added, “resulting in lower cost for both borrowers and lenders.”
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Real Estate Funding Startup Setpoint Rakes In $43M In Series A Round – Inman – Inman
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