Setpoint, a software startup aiming to simplify the lending process behind iBuying, has scored funding from major Silicon Valley players.
On Wednesday morning, the firm announced a $43 million Series A fundraising round led by Andreessen Horowitz, the storied Silicon Valley investor that has backed Airbnb, Slack and Instagram, among others. Other participants in the round include Brad Greiwe’s Fifth Wall and 75andsunny, the investment firm behind brokerages Side and Avenue 8.
Typically, when an iBuyer purchases a home or buys one on behalf of a consumer, it draws down on a line of credit from a larger bank. That process can be clunky, cluttered with Excel spreadsheets and email threads. Setpoint’s software automates much of the math, due diligence and paperwork behind the process. Its current customers include Opendoor, Flyhomes and Orchard.
The influx of cash comes as layoffs roil the iBuying business and inflation dampens demand in the residential market. Rising interest rates have chilled fundraising for proptech startups.
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Stuart Wall, CEO and co-founder of Setpoint, frames the struggles across the residential business as an opportunity for growth. When business was booming, businesses were willing to tolerate some redundancy. Now that resi businesses face tougher times — what Wall calls an “unusually bad, like once-in-40-years quarter” — they’ll be looking to get leaner.
“It can be hard to get people to change the process when things are really going well,” Wall said. “We actually think now is a great time for us because a lot of these companies are focused on efficiency, and if they’re using Setpoint, they can be a lot more efficient.”
Wall previously founded Signpost, a marketing firm for small businesses. His co-founders at Setpoint, Ben Rubenstein and Michael Lam, were previously the CRO and COO of Realtor.com. The firm operates out of Austin and New York.