American start-up company, Aalto, raises $13m in Series A funding
Launching in April this year, Aalto has a network of around 30,000 buyers and more than two dozen houses have been sold using the platform
Real estate has been the same for decades, the long process that takes time, money and can cause a lot of stress in which should generally be a happy time in someone’s life. Aalto is a new style of real estate selling, without the fuss, fees, and additional back and forth of going between agents and having them control who is buying and viewing your home. They connect buyers directly to homeowners and sellers can have their house up for sale on their platform within five minutes. It’s basically an online marketplace for houses, which cuts out the middlemen and allows sellers to have close to complete control of how and when their homes are listed and sold. Think of an Amazon but for real estate. Currently the company have around 85 homes up for sale on their platform, and averages about one home being listed each day.
Launching in April this year, Aalto has a network of around 30,000 buyers and more than two dozen houses have been sold using the platform. They only charge a 1% fee, whereas real estate agents usually charge around 2-2.5% in commission, meaning sellers can make around $44k more (on average) than if using typical real estate processes. Aalto also offer help from licensed experts willing to assist with the more complicated parts of selling.
Whilst waiting to acquire buyers for their home, sellers can try Aalto without signing a contract, different from traditional brokerages, and again, leading to less stress when thinking about selling. Instant alerts are available to set up, as well as schedule house viewings in out simple platform, making it simpler for buyers as well. Traditional Multiple Listing Services (MLS) will typically show details such as when the home was listed, and will include price reductions and changes, whereas Aalto allows for privacy, not showing the exact address or any of the aforementioned information, which means the seller has peace of mind when listing their home.
Since their inception in 2018, they have raised $17.3m in funding, which has been helped along by some world class entrepreneurs, such as Greg Waldorf (previous CEO and founding investor of eHarmony) and Ariel Poler (an active investor, including Change.org and was previously a board member for Strava). Participants from the latest round of funding that raised $13m, which was led by Sequoia Capital, included Background Capital, Defy Ventures and SciFi VC.
Aalto is planning to expand beyond their current Bay Area location to other real estate markets in California and across the US. Bryan Schreier, partner at Sequoia Capital, believes that real estate is “one of the last giant industries with a 1900s experience.”
“It’s a painful process where the seller has limited visibility and the buyer is holding their breath after every bid,” he said. “Aalto is the first company to reinvent how homes are bought and sold by putting the consumer first. It goes far beyond a listing site and reinvents every aspect of the experience to be customer oriented rather than realtor oriented.”
The technology that has made this possible is incredibly important, and their interface and software is something they will use their capital to keep building upon to make it all-round an enjoyable and pleasant experience for both buyers and sellers, and hopefully move the real estate process into the future rather than hanging onto the tedious and stressful affair that it’s currently at.
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