Backflip, the company founded in 2020 that offers a service to real estate investors for securing short-term loans as they look to flip houses, has secured $15 million in funding, according to TechCrunch.
Backflip has raised the $15 million during a Series A funding round led by FirstMark Capital, who has fueled some of the early stages of companies such as Airbnb, Shopify and Pinterest.
“We help investors source properties and curate their pipeline, analyze the deals that they might want to invest in, and hopefully make lower risk, better buying decisions,” Backflip EO and co-founder Josh Ernst said during an interview with the outlet.
“Our interest rates are higher than a retail bank, so our customer pays more for our loans than a bank,” Ernst said. “But what we’re doing is giving them money, underwriting the asset, underwriting the business plan and underwriting the person.”
“We underwrite business plans, assets and people, not just W-2 income… and we provide capital for home renovation and give credit for post-repair valuation,” Ernst continued.
“We’re helping to underwrite the properties and all the while, we’re getting more and more data that can then be used to make a quick and accurate underwriting decision on a specific loan product, which our members use to buy the property and renovate the property,” Ernst added.
“The entrepreneurs in the ‘fix and flip’ industry provide an important service to bring the existing housing stock up to spec and put their own capital and sweat equity on the line to do it in both bull/bear housing markets,” Adam Nelson, managing director at FirstMark said of the company’s aim.
”We view Backflip as the operating system for this $100 billion+ annual transaction market, with the potential to add value and monetize multiple different parts of the fix and flip transaction and ultimately institutionalize the asset class,” Nelson said.
