Better.com could be the next mortgage company to join the herd of lenders to go public.
The home loan company masquerading as UberX has just closed $ 200 million in Series D fundraising.
L Catterton, a private equity investor headquartered in Greenwich, Connecticut, led the round with Activant Capital, Ally Financial, American Express Ventures, the Ping An Global Voyager Fund and 9Yards Capital. The cash injection comes 15 months after Better raised $ 160 million in its Series C round from August 2019. In total, Better has raised funds totaling 454 million US dollars as of 2016.
The New York-based digital lender plans to use its latest cash pool to further grow its team and expand its technology, according to a company press release. This corresponds to the company's recent expansion.
"We grew nearly 500% year-over-year and an average of 10% to 15% month-over-month," said Vishal Garg, founder and CEO of Better.com, in an interview at the 2020 Digital Mortgage Conference. "We're probably the second largest online lender today, going direct to consumers online. We have over $ 2.5 billion in monthly volume."
With lenders like Rocket, Guild Mortgage and United Wholesale Mortgage going public in the past few months, speculation has raged on whether Better's recent capital increase signals an imminent IPO. However, no official filing has been made at this point and the company declined to comment on the possibility.
The red-hot demand for refinancing and purchases is leading market watchers to project origins for 2020 and will break annual records and dwarf $ 4 trillion. The IPO is an opportunity for non-bank lenders to make money. Many have already enjoyed the benefits and watched their share prices rise. However, some industry veterans warn that the spate of mortgage IPOs could saturate the market, make too much noise, and lower returns.
