Opendoor Raises $300 Million on a $3.8 Billion Valuation Amid Strong Investor Interest
On Wednesday morning, Opendoor announced new business metrics and $300 million in follow-on equity financing to continue to fuel growth, build new products and integrate services for customers (Pictured: CEO Eric Wu, CEO, Opendoor)
TechCrunch, which first had the story, cited sources who pegged Opendoor’s valuation at $3.8 billion.
Following a year of rapid growth, Opendoor is buying and selling close to 3,000 homes nationally every month, with more than 36,000 customers served to date. The company operates in 23 U.S. markets and said more than 800,000 people toured Opendoor homes in 2018.
TechCrunch said the recent spate of funding suggests the housing market remains a major draw for both investors and consumers.
“Our business is designed to operate in up markets, down markets and flat markets,” Opendoor co-founder and CEO Eric Wu told TechCrunch in an email. “During a slowdown, it becomes increasingly more painful to sell a home, which impacts mobility for homeowners and increases the need for reliable home sales through products like Opendoor.
“It is our responsibility to manage that risk and charge the proper fees to account for the volatility.”
In Las Vegas, Opendoor:
- Has been operating since September 2016
- Has more than 300 homes on the market
- Is hiring for a few open positions and expects to use the additional financing to keep expanding the local team.
This follow-on round of funding comes from investors including homebuilder Lennar Corp., General Atlantic, Hawk Equity, SoftBank Vision Fund, Access Technology Ventures, Fifth Wall Ventures, SV Angel, Norwest Venture Partners, NEA, GGV Capital, Khosla Ventures, and GV along with other investors. This additional funding brings Opendoor’s total equity raised to more than $1.3 billion, with more than $3 billion in debt financing.
In a Wednesday morning blog post, Wu said Opendoor is helping its clients start new life chapters in new homes.
“Every day, we hear from customers all over the U.S. who have been empowered by Opendoor to start the next chapter of their lives — like Anne and Jim Nash from Roseville, California, who were ready to move to a new build home from our partners at Lennar but were also worried about the complexity of selling their current home,” Wu wrote. “We provided the couple with an offer to buy their house and the ability to move into their new community on their timeline, stress-free.”