Redfin Announces $50-Million Investment Led by Tiger Global Management and T. Rowe Price Financing Aims to Help Scale Redfin's Effort to Reinvent Real Estate in Consumers' Favor
SEATTLE, Nov. 13, 2013 /PRNewswire/ -- Redfin (www.redfin.com), the technology-powered real estate brokerage, today announced a mezzanine investment of $50 million led by Tiger Global Management LLC and by portfolios managed by T. Rowe Price Associates, Inc. Previous Redfin investors Greylock Partners, Globespan Capital Partners, DFJ Venture Capital, Vulcan Capital and The Hillman Company are also participating. Redfin will use the capital on new technology to make every step of home-buying and selling better for consumers, from the open house to the tour to the offer, negotiation and escrow process.
"Redfin's devotion to the customer was apparent from our first meeting with the company," said Lee Fixel, Tiger Global partner. "The real estate industry is ready for an innovator who understands how business can be transformed by putting the customer first, as we've seen with many industries before. We are confident this strategy will create significant value for all stakeholders over the long term."
"Redfin is reinventing the process of buying or selling a home," said Henry Ellenbogen, portfolio manager for T. Rowe Price's New Horizons Fund. "We invest in companies that have the opportunity to grow. We believe Redfin has the real-world service, management team and vision to be much larger."
"T. Rowe Price and Tiger Global see opportunities over ten-year time-frames, building positions in companies as they grow from private businesses into industry leaders," said Redfin CEO Glenn Kelman. "We are delighted to have found partners who support our mission to make real estate better for consumers, not just ourselves, because this is the only way we know of to build a business for the ages."
Austin Ligon, co-founder and former CEO of CarMax and Redfin board director, also took part in this financing. Prior to this financing, Redfin had raised $45.7 million in venture capital.
Redfin Growth Milestones
Redfin serves 22 major U.S. markets, with an award-winning website and mobile tools, as well as teams of experienced Redfin real estate agents who are paid to put their customers first. Major milestones include:
- Annual revenue growth of more than 50%.
- Increase of more than 100% in home-selling transactions.
- More than $175 million in customer savings on real estate fees.
- More than $13 billion in home sales.
- Expansion to five major markets in 2013, including Houston, Charlotte, and Miami.
- New ground-breaking technology like Redfin Price Whisperer, Redfin Matchmaker, Home Value Tool and Redfin School Search.
- Industry-leading customer satisfaction, with 97% of Redfin clients willing to recommend Redfin to a friend.
Redfin is a leader in an emerging category of software companies that also offer real-world goods and services. The company's combination of technology and service benefits consumers on three fronts:
- Technology: Redfin invented map-based real estate search, then built technology to make every step of buying or selling a home better, from on-the-spot tour-scheduling to an online deal room to a targeted digital campaign for each listing.
- Advocacy: Redfin's on-demand service model takes the pressure out of working with its agents, who earn a bonus based not on the sale, but on the customer's satisfaction with the sale. Redfin agents fight to get customers a good deal but also tell customers when to walk away from a bad one too.
- Value: because technology frees Redfin agents to spend their time serving -- not searching for -- clients, the company can deliver 97 percent customer satisfaction and an average savings of $10,000 in fees for a customer who buys and sells with Redfin. The company refunds up to half of the buyer's agent fee, and saves a typical listing client 1.5 percent of the home value.
Redfin (www.redfin.com) is a technology-powered real estate broker that represents people buying and selling homes. Founded and run by technologists, Redfin has a team of experienced, full-service real estate agents who are advocates, not sales-people, earning customer-satisfaction bonuses, not commissions. Redfin's online tools feature all the broker-listed homes for sale, as well as for-sale-by-owner properties that don't pay brokers a commission. The company serves 22 U.S. markets and has closed more than $13 billion in home sales. In 2012, Redfin was named one of The DIGITAL 100: World's Most Valuable Private Tech Companies by Business Insider.
About Tiger Global Management
Tiger Global is a fundamentally-oriented, global investment firm. The Firm deploys capital in two businesses - private equity partnerships and public equity funds. Tiger Global's private equity partnerships have ten-year horizons and invest in growth companies in the global Internet and technology sectors. The Firm's public equity funds focus on long-term trends in the technology, telecom, media, retail and consumer sectors. Tiger Global was founded in 2001 and is based in New York.
About T. Rowe Price
Founded in 1937, Baltimore-based T. Rowe Price (troweprice.com) is a global investment management organization with $647.2 billion in assets under management as of September 30, 2013. The organization provides a broad array of mutual funds, subadvisory services, and separate account management for individual and institutional investors, retirement plans, and financial intermediaries. T. Rowe Price's disciplined, risk-aware investment approach focuses on diversification, style consistency, and fundamental research.