PropHero looks to expand broker referrals

The proptech had closed a $1.6 million pre-seed round in February of this year and has now announced an additional $8 million seed round.

The round was co-led by venture capital firm Fifth Wall, and Samaipata, an early-stage pan-European fund.

Jelix Ventures and AfterWork Ventures, both investors in the pre-seed round also participated in the current raise.  

According to the group, a proportion of the proceeds will be used to build up its “PropHero Partners” network with mortgage brokers.  

PropHero said its platform could benefit broker clients looking to purchase investment properties, as it “closes the gap” between pre-approval and drawdown by helping them find properties faster. According to the company, around 78 per cent of pre-approvals expire due to investors not being able to find suitable investment properties in time. 

Mortgage broker Suvidh Arora, chief executive and chief solutions officer from Cinch (and a PropHero partner), stated: “We often see pre-approved clients struggle to find the ‘right property’ due to lack of time, options, understanding of market dynamics, or pure procrastination. It has a huge impact on us because a lot of times we have to get extensions or re-apply due to delays or they simply fall through.  

“All up, it means the effort to reward ratio can be little to none when you are financing property investors,” the broker said.

Mr Arora added that the platform helped provide “time poor” investor clients with more solutions. 

According to PropHero, brokers will also receive referrals from the proptech’s investor users who do not yet have a broker/finance secured (reportedly 50 per cent of all users) and will be able to track the progress of their clients’ investment journey via the platform.

Mr Brusola, the co-CEO and co-founder of PropHero, said that the start-up aims to help brokers “book revenue by onboarding their pre-approved investment property borrowers” onto the platform. 

Mr Roger added that it was keen to expand its broker partnerships as he believed brokers were “really important to help Aussies build wealth through property by using the right financial structure”.

“It’s a natural partnership opportunity for PropHero,” he said.

Mr Brusola revealed that the proptech also aims to expand to include the full spectrum of professionals involved in investment property purchases.

“Soon, [users] will be able to access all the services [they] need as a property investor directly from our apps, such as property discovery, mortgage financing, insurance, property management and tax information,” he said.

As well as expanding referral channels in mortgage broking, accounting and financial advisory, the proptech said the new investment proceeds would also be used to continue to build an integrated online property investment service, improve the company’s data models and digital customer experiences, hire key roles; and expand the geographic footprint into new international locations. 

[Related: Qld dumps controversial land tax]