Home buying and selling platform Perch looks like it’s going to become a much bigger player in the industry after raising a massive $220 million funding. The cash comes via a combination of $20 million in equity that’ll be used to fund its business operations, plus $200 million in debt that’s to be used to finance home purchases.
The equity investment was led by existing investors FirstMark Capital, with participation from Accomplice and Juxtapose. Perch declined to disclose the debt lender in the deal.
Perch is focused on the largest segment of home buyers, which are those who’re currently trying to sell their existing home in order to fund their next purchase. Perch calls these buyers “dual trackers”, and says that many face having to choose between making a huge investment in a new property without selling their home first of all, or else selling their home and moving into a rental property until they can find something suitable to purchase. Dual trackers can alternatively make any new home purchase contingent on the sale of their existing home, but this is not always attractive to sellers, as the deal could well be delayed or fall through.
Perch offers a solution to this by making an offer on people’s homes that’s valid for six months. It also helps them to find a new home so as to facilitate that sale. Perch also helps to close on both transactions in the same day to make things more convenient.
Perch’s business model may have some risk associated with it considering the fluctuations in the housing market, but that doesn’t seem to have dissuaded its investors.
“We are solving one of the biggest problems in residential real estate - the inability of homeowners to line up the sale of their old home with the purchase of their new home,” said Court Cunningham, Co-Founder and CEO of Perch. “We’re thrilled that our investors share our vision for bringing a better home buying and selling experience to millions of homeowners.”