Today, after a year of unprecedented demand for our products, we’re pleased to announce that we’ve secured $371M to help even more agents and their clients win with cash offers in today’s competitive market. “The timing is just right to take on additional growth capital to help us meet this tremendous demand,” says Founder and CEO Tim Heyl.
Heyl became a real estate agent when he graduated from college in 2009. At 24, he was named his city’s number-one real estate agent by The Austin Business Journal. He led his brokerage, The Heyl Group, to become one of the top 25 agent teams in the country.
But Heyl kept running into the same problem. “My buyers who already owned homes felt rushed to make decisions and they often made really bad ones,” he explains. “They couldn’t make an offer on a new home until they sold their old home.” He watched them get stuck paying two mortgages, moving twice, or missing out on the home altogether. So, in December 2018, he tried something radical: he used his own savings to buy a house his client loved, and held it for them until they could sell their existing home and secure a mortgage. This service became Homeward’s first offering: Buy before you sell was born.
Two and a half years later, we’ve helped hundreds of clients buy their homes with cash, and today we’ve secured $371M to help even more homebuyers eliminate their financing, home sale, and appraisal contingencies. This successful fundraise comes just a few months after we introduced our second service, Buy with cash, in response to popular demand.
We’ve witnessed tremendous growth in agent-referred customers over the last year. And this announcement shows that agents and homebuyers aren’t the only ones who recognize our potential. Norwest Venture Partners led this funding round with participation from Blackstone (BAAM), Breyer Capital, and existing investors, Adams Street, Javelin Venture Partners, and LiveOak Venture Partners. “This new funding will help us scale our service and support to meet strong demand and launch in more cities,” says Heyl.
Working with agents, not against them
We empower top agents to make every buyer a cash buyer, keeping them at the center of the real estate transaction. “The Homeward Cash Offer addresses real problems for buyers,” says Jeff Crowe, managing partner at Norwest Venture Partners. “But the team has also identified a winning strategy by partnering with agents.” Most alternatives to traditional real estate minimize or replace agents. But when Heyl founded Homeward, he firmly believed that agents should continue to be a key partner for homebuyers, who need an experienced, local advocate to ensure they have a successful buying and selling experience.
“Buying a home is one of the biggest financial decisions most of us ever make,” explains Brian Gubernick, our Chief Real Estate Officer. “Homebuyers want an expert by their side throughout the process. So we keep agents at the center of the transaction, offering them services that solve their clients’ problems.” And while we can work with any agent, we strategically partner with top teams, providing dedicated support to help them get more leads and close more deals.
Barbara DeBow of Realty Austin, is one of those strategic partners. She’s the one who referred proud grandparents Bob and Sharon to us, “Homeward helped my client’s retirement dreams come true,” she says.
Bob and Sharon, who lived in Houston, decided to move to Austin, Texas, to be closer to their son, daughter-in-law, and their new grandchild. But they had a problem. “Our equity was tied up in our house in Houston, where we’d lived for the last 25 years,” explains Bob. “We needed to find a way to extract the capital so we could make the down payment on a new home in Austin’s competitive market.” They asked DeBow for help and she suggested our Buy before you sell service.
“Without Homeward, we would have been stuck with two bad choices,” explains Bob. “We could cash out our retirement and use that money to buy the home, or sell our existing home first and then live in an apartment temporarily and move twice.” Instead, they made a Homeward Cash Offer to win their dream home. They were able to buy a home less than a 15-minute drive from their son’s family, and then take their time selling their old home for its full market value. “Life isn’t too bad right now,” says Bob, who gets to see his granddaughter much more often.
A calmer, more convenient homebuying experience
Like the first buyer Heyl helped in 2018, about 43% of homebuyers need to sell a home before they can buy. “Our cash makes the process easier, calmer, and more certain for them,” explains Heyl. Buying before they sell also gives customers the ability to move when it’s best for them, not because they have to.
“Selling and buying at the same time is unnecessarily complicated,” says Katie Collins, our Director of Customer Experience. “Factor in your own family’s complexities, and it’s enough to make you want to stay put.” Homebuyer Wes and his family, which includes a child with special needs, were especially anxious about buying a new home and moving. “Stairs are an obstacle for their son,” explains Collins. “So they needed a ranch home with bedrooms on the first floor.” And living in temporary housing or moving twice was simply not an option with three young children.
“Before we found Homeward we made above-asking offers on a few other homes and lost,” says Wes, who recently bought a home with his wife near Atlanta. “Because our offers were contingent on us selling our old home, we just weren’t competitive enough and kept losing.” So Wes’s agent got them approved for a Homeward Cash Offer. When the perfect ranch home came on the market, they were able to make a strong, non-contingent cash offer and win, beating several other offers. And when they listed their old home, it sold in a day.
Cash is still king
With record-low inventory and historically high demand, cash’s competitive advantage is more important than ever. In fact, cash offers are four times more likely to beat financed offers. “In today’s market,” explains Gubernick, “sellers want to know which offer has the fewest contingencies and which offer is going to close more swiftly and smoothly. The answer is the cash offer.”
Homebuyer Austin and her husband agree. “We were able to buy a home in the crazy Colorado market — in Denver! — thanks to Homeward,” she explains. “Our offer wasn’t even the highest offer and we still beat 22 others.” explains Austin.
Today’s announcement will enable us to scale service and support customers and to expand to additional markets. If you’re an agent who would like to get Homeward certified, register for one of our training webinars. If you’re a homebuyer who would like to make a Homeward Cash Offer, get started by completing our online application.