Mexico-based iBuyer, Flat.mx, raises $20M in Series A funding led by 500 Startups and Anthemis. [Ann Azevedo/TechCrunch] The company plans to expand in Mexico and create an ecosystem of products.
Key Takes:
- Flat.mx raised $20 million in a Series A funding round co-led by 500 Startups and Anthemis
- The company offers an iBuyer service in Mexico and Latin America, where the real estate market is broken and lacks an MLS
- Flat.mx’s low-touch digital solution was key to its success during the pandemic
- Flat.mx’s investors are bullish about the company’s future, praising the company’s experienced team, clear vision, and unique approach
The Mexico-based startup, Flat.mx, has raised $20 million in a Series A funding round co-led by 500 Startups and Anthemis; Expa and ALLP also participated in the investment round. The list doesn’t end here.
The company is backed by Tushar Garg (CEO of Flyhomes), Brian Ma (co-founder of Divvy Homes), and Eric Wu (CEO of Opendoor). Prior to this round, Flat.mx raised $25 million in debt and $10 million in equity.
The business model followed by Flat.mx is similar to that of Opendoor’s. They buy properties, renovate them, and resell them at a better price, generating profits. The Mexican housing market was dominated by Opendoor. This new investment, which also happens to be Mexico’s one of largest pre-seed rounds, will put Flax.mx in a place to compete with the real estate giant. [MexicoBased 20M Series StartupsAnn AzevedoTechCrunch]
Bernardo Cordero (co-founder Flat.mx) on Mexican Real Estate and Flat.mx
“The real estate market in Mexico is broken… One of the biggest problems is that it takes sellers anywhere from six months to two years to sell. So we launched the most radical solution we could find to this problem: an instant offer. This product allows homeowners to sell in days instead of months, a fast and convenient experience they can’t find anywhere else,” said co-founder Bernardo Cordero.
Creating an iBuyer service in Mexico and Latin America is hard because there’s no MLS like in the US, so pricing information is mostly unavailable. Real estate agents aren’t required to be certified, which makes the buying and selling process less formal. It’s also tough for buyers to find affordable financing options because mortgage use is low.
“To build an iBuyer, we had to solve the transaction end-to-end,” said Victor Noguera, co-founder Flat.mx.
“We had to build the MLS, a third-party marketplace, a contractor marketplace, financial products, broker technology and a home maintenance provider, along with other services. In other words, we have been building the real estate super app for LatAm,” he added. [MexicoBased 20M Series StartupsAnn AzevedoTechCrunch]
Flat.mx and Its Recent Success
The company is growing quickly, with sales increasing by 70% every quarter, a tenfold increase in inventory in the last year, and an increase in employees from 30 to over 85. Flat.mx has performed thousands of home valuations and completed more than 100 transactions so far.
Covid-19 accelerated interest in Flat.mx
According to co-founder Bernardo Cordero, the pandemic only helped boost the people’s interest in their platform.
“Our low-touch digital solution was key for having a strong business during the pandemic. We were able to create quick liquidity for sellers at a time in Mexico where it was complicated to sell,” said Bernardo Cordero.
Flat.mx aims to simplify home selling by reducing the number of potential buyers a seller has to meet. With their new funding, they want to create a “one-stop-shop” for all home buying and selling services.
The company believes that addressing all aspects of the home-buying process is better than just one. They plan to expand in Mexico and invest in data and financial products to create an ecosystem of products, giving them an important advantage in the market.
Flat.mx’s investors are bullish about the company’s future. They think that Flat.mx will become a popular platform for real estate in Mexico.
Tim Chae (managing partner at 500 Startups said, “There are nuances and specific problems that are unique to Mexico that Flat.mx has done a great job identifying and solving.”
The investors, including ALLVP partner Fernando Leo de Larrea, praise the company’s experienced team and clear vision and believe that the company has identified and solved unique problems in the Mexican market.
“Most models replicate successful models from the more mature U.S. prop-tech space… Since we started investing in prop-tech, we’ve never seen such an innovative approach to seizing a trillion-dollar opportunity,” said De Larrea. [MexicoBased 20M Series StartupsAnn AzevedoTechCrunch]
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