A who’s who of tech bigwigs have rallied behind Opendoor, the “big-data house-flipping” startup founded by former PayPal and Square exec Keith Rabois, chipping in $9.95 million in what TechCrunch has dubbed “an insane party” investment round.
The funding bonanza was led by the venture capital firm Khosla Ventures, where Rabois is a partner. But more than 20 other tech heavyweights also are reportedly getting in on the action. They include Paypal co-founder Max Levchin, former YouTube and Facebook CFO Gideon Yu and former Twitter Vice President Elad Gil, according to TechCrunch.
Opendoor, slated for launch sometime this month, says it’s out to bring more liquidity to housing markets by making instant offers on homes, closing in three days, and then flipping them. The company will launch in three markets outside of California, TechCrunch reported.
The startup has generated buzz in part because of the proven track record of its founders, which include Eric Wu, the former head of “geo products” at Trulia, but also for its goal of drastically simplifying the home selling process.
Opendoor says it will analyze public and private data to make instant offers to sellers who want to quickly unload their properties. The startup plans to make a profit by buying homes at a discount that is “much less” than the 8 percent that car dealers expect on trade-ins.
“We’re trying to take the 90-day process, convert into a few clicks online, and make it simple easy and fast,” Wu told TechCrunch.
Since it won’t snap up homes at market value, Opendoor seems to be targeting homeowners feeling some kind of pressure, such as people who need to relocate quickly or shed a mortgage they can’t afford.
“Whether you’re accepting a new job, finding space for a growing family or looking for something smaller, selling your home shouldn’t be painful and time-consuming,” the company’s website says. “We’re here to help.”