A round of investments led by General Atlantic, Access Technology Ventures and Lennar Corporation raised an additional $ 325 million for the California start-up founded in 2014. Opendoor is an online home sales service that aims to accelerate the acquisition process to just a few days.
According to CEO Eric Wu, “the future of the real estate market will be on demand and this is our centerpiece”. According to him, this market needs to be completely transformed to facilitate the process of potential buyers and sellers. According to Opendoor’s operations, the answer lies in instantaneous transactions in real time.
Selling a house requires a lot of coordination and planning; same thing for purchasing. Opendoor’s goal is to simplify these tasks and direct the entire operation. The company allows potential customers to inspect homes by unlocking locks with the app they provide. According to Wu, the majority of customers visit their potential home all week leading up to the final transaction. Each purchase has a 30-day warranty to help people feel confident about their purchase.
Selling and buying a home remains the most important financial transaction for many consumers. The company still faces resistance when it promises a safe transaction of hundreds of thousands of dollars in just a few clicks. For Wu, the challenge is to create this bond of trust and provide a transparent process backed by reliable data and experts who are intimately familiar with the laws dictating the real estate market. The CEO states that they “must establish a world-class pricing model […], to be a low-cost service and provide some security in the process”.
To achieve this goal, Opendoor has a complex data system that judges house prices. The startup employs 650 people and hopes to double that figure by the end of next year. It is on the side of the data science team that future capital inflows will concentrate. As Techcrunch points out, “the challenge is to understand the dynamics of the real estate market – and any potential chaos – to better evaluate how to buy and sell. In fact, Opendoor acquires houses and keeps them for a certain period of time. As a result, it is imperative to know the market to sell them.
The startup wants to expand to 50 markets by the end of 2020 with this additional funding. But they are not the only ones wanting to exploit this market. Others like Knock or OfferPad are starting to earn considerable income too. All of this seems to indicate that consumers no longer want to face a long and winding process in prospect of buying their new home.