Patch Homes, a San Francisco, CA-based real estate finance company, raised $5m in Series A funding.
The round was led by Union Square Ventures with participation from new investors Tribe Capital and existing investors Techstars Ventures, Breega Capital, and Greg Schroy.
The company intends to use the funds to scale up its team.
Founded in 2016 by Sahil Gupta and Sundeep Ambati, Patch is a modern finance company for homeowners to tap into their home equity without selling their home or taking on additional debt through its home equity sharing product. Its partnership approach allows homeowners to access as much as $250,000 of their home equity without the burden of monthly payments or interest. The company leverages machine learning techniques to analyze thousands of data points on the asset, the market, and the owner to take a more holistic view of the homes they want to invest in.
Patch Capital Partners (PCP), a Chicago-based real estate private equity firm founded by former Guggenheim Partners Managing Director Adam Hitchcock and Coolhouse Labs Founder Jordan Breighner, is the exclusive home financing partner of Patch Homes and intends to invest an initial $100 million in capital in Patch contracts.
In less than two years since launching its Home Equity Sharing product in California, Patch has underwritten homes collectively worth more than $3.5 billion, expanded into 11 metro areas across the United States, and grown origination 20x year-over-year in 2019.
The company also has an office in New York City.