It seems like a lot of Valley investors want to see the process of buying homes become a lot more efficient.
After Khosla Ventures VC and former Square COO Keith Rabois teased that he was working on a project to make buying homes as simple as clicking a few buttons, a horde of Valley angels and VCs started circling.
The company, now called OpenDoor, just closed $9.95 million in what appears to be an insane party round. (To be clear though, Khosla Ventures is the lead.)
Paypal co-founder Max Levchin, Former YouTube and Facebook CFO Gideon Yu, Eventbrite co-founder Kevin Hartz, Y Combinator’s Sam Altman, Quora CEO Adam D’Angelo, Yammer co-founder David Sacks, Angelist’s Naval Ravikant, Yelp CEO Jeremy Stoppelman, Box CEO Aaron Levie, Initialized Capital’s Harjeet Taggar, Garry Tan and Alexis Ohanian, Former Twitter vice president Elad Gil, Blippy co-founder David King, Flixster co-founder Joe Greenstein, Angel investor Mike Greenfield, Quora co-founder Charlie Cheever, Path’s Dave Morin, Facebook vice president Dan Rose, Trevor Traina, Resolute Ventures’ Mike Hirshland, Caffeinated Capital’s Ray Tonsing, Felicis’ Aydin Senkut, True Ventures’ Om Malik, Thrive Capital’s Josh Kushner, Crunchfund’s Michael Arrington (who disclaimer: founded TechCrunch) and SV Angel.
Before you start worrying about real estate speculators, OpenDoor is launching in three markets outside of California and is only for owner-occupied homes. Co-founder Eric Wu did not specify which markets, but he said the company is more concerned with markets where there isn’t a lot of liquidity or demand.
“The Bay Area is a unique market. It’s pretty rare. If you’re an owner here, there’s a fair bit of certainty that if you list your home on a service like MLS with a real estate agent, you’ll see offers within seven days,” he said.
In contrast, Wu said the rest of the $20 trillion U.S. residential real estate market is one of the least liquid kinds of markets even though it represents such a vital kind of asset to Americans across the country. He argues this lack of liquidity ties people to debt and jobs or locations that may not benefit them anymore. Real estate transactions often take more than 90 days and homeowners often don’t have enough capital for a down payment or a mortgage, which makes home buying stressful.
Wu didn’t go into how the product will work, because it has yet to launch.
But he said, “Were trying to take the 90-day process, convert into a few clicks online and make it simple easy and fast.”
Wu used to be head of geo and social products at real estate listings platform Trulia, so he has years of experience in the space. He and Rabois are joined by two other co-founders, Ian Wong and JD Ross. Wong used to lead data science at Square and Ross oversaw product at Addepar.