Patch Homes, a San Francisco, CA-based home equity financing platform, raised $1m in seed funding.
Backers included Techstars Ventures, Kima Ventures, Eric Di Benedetto and Nathan Blecharczyk, among others.
The company intends to use the funds to expand its team and geographical pressence, and continue to develop its innovative solution and assist with marketing efforts.
Co-founded by Sahil Gupta, who has worked at Motif Investing and BNY Mellon, and Sundeep Ambati, a serial entrepreneur in the real estate industry, co-founding A&A Property Management and Siri Properties, Patch Homes operates a home equity financing platform that enables existing homeowners to cash out equity at 0% interest with no monthly payments.
In exchange for 0% interest, the company shares in future appreciation or depreciation of the home value. The model allows customers to receive capital from investors to finance their home equity, without interest rates or monthly payments, in exchange for a fraction of future home value change.
Both the homeowner and investor will see a profit when the home appreciates in value and Patch Homes will share in downside loss with homeowners, should the house decrease in value.
Patch Homes currently serves homeowners in California, with plans to expand to additional states before the conclusion of the year.