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Digital mortgage lending platform nesto announced Tuesday it will expand its marketing across Canada and launch a new cloud service for lending partners after closing an “oversubscribed” $80 million Series C funding round.
Having closed a $76 million Series B round last summer, Montreal-based nesto has raised $167.5 million (Canadian) to date from some high-profile backers.
The latest financing round was led by IGM Financial Inc., a wealth and asset management company with $257 billion in total assets under management. IGM Financial is a member of the Power Corporation group of companies, an international management and holding company focused on financial services in North America, Europe and Asia.
Also participating were Diagram Ventures, which led nesto’s $11.5 million Series A round in 2020, and Series B leaders Michael Rowell and Michael Paulus, co-founders of Seattle-based insurtech startup Assurance IQ which was acquired by Prudential Financial for $2.35 billion in 2019.
Other new and existing investors participating in the Series C round include Portage, NAventures (National Bank of Canada’s corporate venture capital arm) and BMO Capital Partners (a private equity arm of Bank of Montreal).
Founded in 2018 by CEO Malik Yacoubi, Chief Operating Officer Damien Charbonneau, Chief Technology Officer Karim Benabdallah and Principal Broker Chase Belair, nesto is licensed as a mortgage broker in all Canadian provinces.
“This investment from renowned financial institutions like IGM Financial, National Bank of Canada and BMO Bank of Montreal validates the hard work accomplished by nesto’s team in the last 4 years,” Yacoubi said in a statement. “The new round of funding will help us further develop best-in-class technology and service more Canadians through partnerships with financial institutions.”
Nesto claims it can help consumers save thousands of dollars when taking out a mortgage by helping them find the best rates and charging lower fees. Nesto says that in addition to employing salaried advisers who don’t earn commissions, it collects a lower finder’s fee from lenders that enable it to offer the best rates up front.
In addition to serving consumers as a mortgage broker, nesto is preparing to provide lenders, Realtors and wealth management firms with access to its technology through a new product, nesto Mortgage Cloud.
“From co-branded to fully white-labeled mortgages combined with our growth marketing services, nesto can be your strategic partner by quickly enabling you with a new financial product,” the company promises on its website.