PHILADELPHIA , April 4, 2022 – RenoFi, the renovation enablement platform company, today announced $14 million in Series A funding. The round serves as a strong endorsement of RenoFi’s vision to empower lenders to offer best-in-class financing solutions that better meet the needs of today’s homeowners. Canaan led the round with new participation from NYCA Partners and CMFG Ventures. The company will use the funds to scale its business operations and product roadmap, including its first-of-its-kind renovation enablement platform for lenders.
The time for lenders to enhance their product suite and better meet the needs of today’s renovating homeowners has never been more critical. With an aging housing stock, record low inventory, a global pandemic that turned homes into permanent hybrid workspaces, and the largest generation in American history entering their prime homebuying years, this is shaping up to be the decade of renovation. But lenders are severely unprepared and need help to capitalize on the $400B+ primary homeowners already spend annually on renovations and repairs.
The two most popular financial products used to finance home renovations – cash-out refinances and home equity loans – are not designed for renovations. While they can work well for those who’ve been in their homes for a decade or more, they don’t meet the needs of recent homebuyers who haven’t yet built up equity. To solve this problem, lenders need to offer financing solutions purpose-built for renovations.
RenoFi’s Renovation Enablement Platform is the first and only end-to-end loan origination and underwriting platform specifically built to enable renovation lending. The core of RenoFi’s technology platform is its Renovation Underwriter (RU) enabling lenders to provide loans based on a home’s post-renovation value (as opposed to current value of the home with a traditional home loan), helping lenders increase the borrowing power of their customers by 11x on average.
“We believe more than ever that RenoFi will become the platform powering the de facto financing products for home renovations, a $400B+ market that’s been underserved to date,” said Brendan Dickinson, general partner at Canaan who also led Renofi’s seed round back in June 2020. “The team’s progress since its last round has been incredibly strong and speaks to the big future ahead.”
RenoFi completed its first full year of operation in 2021, tripling headcount to more than 60 people and partnering with more than a dozen new lenders now offering RenoFi-powered loans in 49 out of 50 states. Since launch, homeowners have generated more than $10B in renovation financing demand from lenders powered by RenoFi’s platform.
“Historically, paying for that renovation is a whole journey in and of itself,” said Justin Goldman, co-founder and CEO of RenoFi. “Every other major purchase we make in our life has a smart and easy financing solution attached to it. Buying a car? Get an auto loan. Buying a house? Get a mortgage. Going back to school? Get a student loan. Each of these is a purpose-built financial product for a specific use. Remarkably, until now, this has not existed for home renovations. We decided from the outset that the best way to actually help homeowners was to build the rails that America’s great lending institutions needed to bring this new product category online. With the reception we’re getting from lenders, it’s clear we made the right choice.”
To learn more about RenoFi’s platform and loan offerings, please visit https://www.renofi.com/.