Mortgage rates began to rise in 2022 after hitting record lows at the start of the pandemic, and it hasn't been a big deal since.
With the 30-year mortgage rates above 6.5% today (2.49% in 2020!), buying a home is not achievable for many people.
One Denver-based startup can help change that. Founded in 2022, Multiply Mortgage originally gave high-tech employees access to some of the value of their stock compensation while their employers are still private.
Interestingly, however, founders Michael White and Gautam Gupta observed that most employees of Square, Opendor, Durdasch and Uber alumni – use liquidity provision for home purchases and related expenses.
“Homeowners are becoming increasingly out of reach for many Americans, and I don't think interest rates will fall to the level they saw again in 2020,” White told TechCrunch.
Therefore, in July 2024, the startup changed courses to offer mortgage perks programs to support employees of partner companies such as Anduril and Ramp, navigating purchases from home.
Today, Multiply offers employees a 1:1 mortgage advisor, employee education sessions on the home buying and financing process, and discounts on mortgage interest rates up to .75%. Startups work with a network of 15-20 lenders to access discounted rates.
For businesses that CEO White argues, that's not easy because what he described as “low administrative overhead” to deliver the program doesn't happen.
“We are really creating the mortgage category as a financial health benefit,” he told TechCrunch. Although traditional lenders are effectively their main competition, he said, the startup aims to distinguish itself by focusing on financial health through its employer, in addition to its discounted rates.
That pivot attracted the attention of renowned venture capital firm Kleiner Perkins. KleinerPerkins just led a $23.5 million Series A, the company told TechCrunch exclusively. BoxGroup, A*, Mishief and Workshop also participated in the fundraising. This brings the company's total funding since its launch in 2022 to $27 million. The company declined to disclose what ratings the new round received.
Mamoon Hamid, partner at Kleiner Perkins, said, “Entries and retains top talent is the focus for all great companies, and providing competitive profit and reward programs is a table stakes.” He believes multiples stand out as they partner directly with employers and automate traditionally time-consuming back-end processes.
In particular, co-founder Gupta is also a general partner at Investor A*, which led Multiply's $3.5 million seed round in early 2022. He began working on the Multiply With White concept in late 2021.
Multiply is currently operating as a broker and is permitted to send mortgages in 19 states. They also have broker partners in 26 additional states and the District of Columbia. In a few months, the startup will make the actual loan itself.
Help people fund their homes
Since Pivot, the company has funded the home by over 100 people, White said.
Employees can log in to Multiply's web application via their company email address. Once verified as an employee, you can set up a meeting with an advisor before accessing online applications, transaction dashboards, and educational curriculum.
Increase your network of lenders on behalf of your employees, find the lowest rates and apply your own discounts. White said Multiply could offer discounts in that it automates the origins process of mortgages, in contrast to the more traditional “very human labor-intensive process.”
“On the technology side, we're building workflow automation and AI-driven tools to incorporate a large back-office human workforce and make stakeholders significantly more efficient,” he explained. “It leads to a lower cost structure for us, and we can communicate those savings in the form of lower mortgage interest rates.”
Multiples aren't the only companies that aggregate potential lenders. So are others like lendingtree. However, White argues that the biggest difference between Multipli and Lendingtree is the latter self-service market for finding and comparing lenders. Multiply's model is more like a concierge model combined with interest rate cuts, he added.
Currently, Multiply has 25 employees.
Using new capital, we plan to invest in building a mortgage origination platform and expand our mortgage advisor and company partnership team. Today, we have 23 company partners. This includes a mix of public and private companies from various industries.
Multiply makes money by earning fees for originating mortgages.