Valon, the US-based operator of a technology-facilitated mortgage service, completed a $50m series A round yesterday that included financial services group Jefferies.
Venture capital firm Andreessen Horowitz led the round, which also featured mortgage real estate investment trust New Residential Investment Corporation, family office 166 2nd and an affiliate of investment manager Fortress Investment Group.
Founded in 2019 as Peach Street, Valon provides mortgage services such as managing the principal, interest, taxes and insurance, utilising technology to make charges more transparent and the process more affordable by using a vertically-integrated structure.
Andrew Wang, co-founder and chief executive of Valon, said: “Currently, the largest mortgage servicing software controls more than half of all US residential loans, effectively creating a monopoly in the market.
“This stranglehold has driven servicing costs up nearly 250% in the past decade, and the fees are passed on directly to the borrower. We created Valon as a challenger brand to address the extreme need for an updated, technology-enabled alternative to keep the borrower better informed.”
The cash will fund hiring and the growth of Valon’s operations. The startup said it had previously raised just over $3.2m in seed financing from investors including Alley Corp, Soros Fund Management, Kairos and Zigg Capital, and identified all the series A participants bar Andreessen Horowitz as existing backers.
