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Just a month after Privlo actually began lending, the real estate loan lending platform has raised $353.8 million, $350 million of which is a debt round. The $3.8 million in equity, which was raised from Spark Capital and QED Investors, will go straight towards hiring at their new Pasadena headquarters. Privlo is looking to take its 25-person team to over 100 employees by the end of 2014.
There will be hiring on Privlo’s mortgage operations and credit science teams, but their tech side is looking to bulk up the most because, when it comes down to it, Privlo considers itself a fin tech company.
When it comes to tech, Privlo runs the gamut: they have a consumer Internet/UX team, a data team that analyzes how to get more people eligible for Privlo’s loans, and also a team of “technological heavylifters” that works on making automated credit decisions. The latter team came up with their own version of Fannie Mae’s automated underwriting system Desktop Underwriter - and even gave their system the lovable nickname of Pepe.
Privlo is hiring engineers on all three teams. CTO and CMO Erick Herring said that no matter what technologies prospective Privlo engineers are already versed in, they can find a way to fit into Privlo’s tech shop which “has a reasonably broad array of technologies” (although Java devs might have a bit of a learning curve when joining the .NET company).
Building up the tech behind Privlo to be scalable is key for the company this year as it slowly gets approval to lend in each state. Herring estimates that Privlo will have access to over 60 percent of the national market by the end of this year.
Granted, the market Privlo is aiming at is just a fraction of the $12.5 trillion nationwide mortgage market, but it is still worth hundreds of billions. Privlo is going for a very specific, yet undefinable consumer: “The people we are going to serve are actors, fishermen and other people with seasonal income or who don’t have W-2 income,” Herring said. “People with medical bankruptcy or the perpetual 1099s (self-employeds) of the world. There’s big demographic shift that the banks can’t keep up with.”
Essentially, Privlo is aiming to give perfectly good loan candidates who are limited by their lifestyle or career the opportunity to borrow money. The strategy to find these ideal “Privolan” candidates is to connect with them via real estate professionals, an iteration of its original strategy of pure P2P lending. After the user is identified, Privlo reels them in with a simple, clean interface.
“We are attacking it by making a really seamless user experience both for borrowers - and also for real estate professionals,” Herring said.
For consumer and real estate professionals, Privlo is a one-stop shop for loan qualification and for closing the deal. The platform instantly tells consumers if they qualify for a Privlo loan before they even search for a home. The system (remember Pepe?) actually has the potential to make instant loan decisions, but Privlo still includes a human decision element for good measure, Herring said.
At the helm of Privlo is founder and CEO Michael Slavin, Herring, Chief Credit and Product Officer Saro Vasudevan, VP of Design and UX Becca Frank and other lending execs.
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