On the heels of Opendoor’s massive $325 million Series E funding round Wednesday, competitors insisted to Inman that their rival’s windfall is an indication that the iBuyer market is bigger than ever — even as the Silicon Valley upstart positions itself to rake in more capital from an even bigger name.
Top executives at Offerpad and Knock, two of Opendoor’s most formidable competitors, struck positive notes Wednesday, insisting the investment from real estate companies Lennar and Invitation Homes and venture capitalist Andreessen Horowitz further demonstrates that a rising tide will lift all boats in the iBuyer market.
“It’s encouraging to see additional investment into the space,” Offerpad co-founder and co-CEO Jerry Coleman said in a statement to Inman. “Having spent more than a decade developing solutions in the residential real estate industry, we are excited to help lead the growing interest among consumers.”
“Offerpad and Opendoor have an amazing opportunity to help define an industry and develop a solution that aligns with customer’s homebuying and selling needs,” he added.
Knock co-founder and Chief Operating Officer Jamie Glenn echoed Coleman’s sentiment.
“The recent growth of venture investment in the real estate market is predicated on consumer demand for this kind of innovation and a better way to buy and sell homes,” Glenn told Inman. “Opendoor’s recent round of financing is yet another example of this that represents the overall trend of emerging alternatives to traditional approaches to real estate, such as iBuyers like Opendoor and Offerpad, and models like Knock’s Home Trade-In marketplace.”
Zillow — the most established company in the iBuyer space, albeit the newest entrant with its two-month-old revamped version of Instant Offers — declined to comment.
Opendoor, a 4-year-old company that buys and resells homes online, is now valued in excess of $2 billion. Investors in the latest Series E round include the real estate companies Lennar and Invitation Homes alongside big-name venture capital firms like Andreessen Horowitz.
The tech site Re/Code reported Wednesday that this round likely wasn’t the last of the year: the company is reportedly still in talks with the Japanese firm SoftBank, known for writing startups, like Compass, huge checks.
While Opendoor is bringing on the most capital and has pledged the loftiest expansion goals — 50 cities by 2020, according to a release on Wednesday — other iBuyers are also aggressively expanding.
Offerpad announced its raise of $50 million in equity financing and $100 million in debt financing last month. Knock, the youngest company in this space, launched in its third market — compared to Opendoor’s 10 and Offerpad’s eight — last week.
Taken together, however, all of these companies represent only a fraction of the real estate industry as a whole.