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A credit-building app for renters called Boom has landed seed funding in the amount of $4.5 million, according to an announcement sent to Inman.
Led by Starting Line, the funds will be put toward the Austin-based app’s expansion into rental management operations, according to Boom CEO and co-founder Rob Whiting.
“We invested heavily into building our end-to-end software solution for rent reporting and consumer app layer and now we’re focused on revolutionizing the entire renter experience, from both the renter and the apartment operator perspective,” Whiting said in a statement. “This funding will help us accelerate our roadmap of housing-focused tools for renters and NOI-focused products for real estate operators.”
Also contributing to the round were Clocktower Ventures, Company Ventures, Gilgamesh Ventures and Plaid co-founders William Hockey and Zach Perret.
Boom is a consumer-facing mobile app for both iOS and Android users and was launched in late 2021. It has grown by 450 percent in the last 12 months and reported $1 million in revenue, according to the announcement, a byproduct of a nationwide rent-first culture in the wake of a deepening housing inventory shortage.
The company has partnerships in place with Progressive Insurance, Apartment List and a number of national property management companies.
Rent payments are not automatically tracked by the monitoring agencies, it’s up to a third party to provide to carry out the process. Boom helps renters report rent payments to all three, TransUnion, EquiFax and Experian. The company states that its users have seen an average increase of 28 points in their credit scores within just two weeks of using the app. The majority of rent reporting technologies partner with one or two of the bureaus.
Consumer payments, such as car loans, student debt and other types have long been included in credit reports because the debt servicing companies — large banks — have the capacity to do so and because they handle the vast majority of the economy’s lending business. In short, landlords, institutional or private, never had the technical capability, and likely interest, to do so.
Boom also offers users credit score monitoring through a two-way data feed with the respective credit agencies, updated within 10 days of onboarding. The app can also use previous lease history and does not require involvement from landlords.
Other renter-first apps have emerged in the last 24 months to service the savings and credit-building needs of consumers. Gravy, which also reports on-time rent payments to credit agencies, collected its own seed round of $2.6 million in April of last year; and Stake, which offers banking services and cash rewards to renters for being proactive in their occupancy, secured a Series A funding round of $12 million in June 2022.
