Greg Schwartz, a former longtime Zillow executive, has spent the past decade trying to improve the real estate transaction. While he acknowledged there’s been some tremendous progress — especially in the search and find and digital signature space — he told Inman the “core process of buying a home is still catastrophically painful and scary for most of us.”
He believes a new startup, Tomo, which he co-founded with his former Zillow colleague Carey Armstrong, will take a big step forward in improving that transaction process. The company is launching with a $40 million seed round, but few details on the actual platform, though press materials note that Tomo will aid consumers “initially as a digital mortgage and transaction company.”
“Whether you’re renting or buying, everyone has experienced the grind and the worry and the dissonance of being fearful,” Schwartz said. “Everyone that we’ve talked to wants to get to this big, massive, fundamentally important category and make it better.”
Tomo is, in-part, a software platform that the company has started building and Schwartz expects will launch in the first quarter of 2021. The seed round is aimed at helping the company get the platform to market by that date, as the company scales operations with offices in Seattle, Austin, Texas, and Stamford, Connecticut.
Schwartz was quiet on exactly what the platform will be ahead of its launch, but Tomo’s initial focus will be on the mortgage process. Schwartz also said that the company is going to “partner with the finest real estate professionals and have a technology platform which is mobile-driven and meets the expectations of consumers.”
He added that they want the “predictability” of “an e-commerce-like experience” combined with “the intimacy and advocacy of having a world-class team of professionals associated with that technology.”
Tomo will have competition in the space. Not only are iBuyers — like his old company Zillow and its competitors Opendoor, Offerpad and others — trying to create a more seamless transaction, but there’s been a number of fintech, real estate technology startups and alternative financing startups aimed at addressing the issue.
But Schwartz believes the company’s approach of marrying the technology with top agents will be a unique approach to solving issues with the real estate transaction.
Schwartz first began germinating the idea more than two years ago on a trip to Japan, where he was first introduced to the concept of Omotenashi — which inspired the company name. Omotenashi, Schwartz explained, is the Japanese concept of anticipatory service where the integrity of the professional is on the line.
“You’re not just being served because it’s someone’s job — it’s who they are,” Schwartz said. “And they’re going to anticipate your needs and meet you without you even being aware of them in many cases.”
When thinking about the concept of Omotenashi and how it applies to the real estate space, Schwartz kept coming back to Zillow’s Premier Agent customers.
Schwartz first joined Zillow in 2007 as vice president of sales and has since served as its chief revenue officer, chief business officer and most recently as president of media and marketplaces, where he oversaw the company’s internet, media and technology segment (IMT), which included Premier Agent.
Armstrong, Schwartz’s co-founder at Tomo, served as the vice president of Premier Agent from 2013 to 2020.
“We kept coming back to all the wonderful agents that we worked with in the Premier Agent program and how much care many of them take for customers,” Schwartz said. “They really care about these people, but the technology, the systems and the platforms they are using to meet these people’s needs are catastrophically messy and difficult.”
The company is launching with a massive $40 million seed funding round led by Ribbit Capital, NFX and Zigg Capital. SVB Capital is also participating in the round as an institutional investor. For comparison, blockchain technology startup Harmony had the largest seed round at $18 million in 2019, according to a report from CrunchBase.
“I have known this team for more than a decade and they will deliver on the movement my team and I drove when we founded Trulia: to delight customers with transformational digital experiences related to the real estate transaction,” Flint, said. “It’s time to get it done and NFX is excited to partner with this exceptional team.”
Individual investors include Rascoff, hedge fund luminaries Alex Sacerdote, Kurt Mobley & Eli Weinberg and Ted Ackerley of Ackerley Partners LLC.