Former Zillow execs raise $70 million to launch mortgage fintech Tomo

Lending startup Tomo Networks announced on Wednesday that it received $70 million in seed funding, after initially raising $40 million eight months ago. Ribbit Capital led the second round, alongside DST Global, NFX, SVB Capital and Zigg Capital, which recently served as lead investor to mortgage fintech Spruce.

Zillow’s former Vice President of its Premier Agent business, Carey Armstrong, and former President of media and marketplace, Greg Schwartz, co-founded Tomo in October 2020 with the aim of improving the buying experience — a popular mission for digital lenders in a crowded field. They plan to forgo refinancings altogether.

"In today's housing market, buying is not an enjoyable experience; it has become competitive, stressful, and confusing,” Schwartz said in a press release. “In the current frenzy, what is being lost is the personal touch, the humanity and the excitement that should go along with buying a home.”

To strengthen the buyer’s position in the marketplace and counteract competition, Tomo claims to get loan pre-approvals done within hours and cut closing times by up to 55%. Under its brokerage division, the company has also partnered with local real estate agents to give borrowers that human aspect through access to better market insights and pocket listings.

Headquartered in Stamford, Conn., Tomo initially targeted markets it deemed “crippling” to first-time and millennial home buyers due to fierce competition and surging property prices, opening up officially in Seattle, Dallas and Houston today. The company plans to expand to more metro areas with similar conditions later in 2021.