Last year we made the commitment to be more diligent with our efforts to find talent in the Phoenix ecosystem. We started Social Leverage here in 2008 and it’s only fitting we open ourselves to the local opportunity. With our larger presence in both New York and California, oftentimes smaller tech markets such as our hometown of Phoenix don’t get the attention they deserve. In 2015, we began to engage with several new Phoenix tech community members which ultimately led to an introduction to CommLoan. It really hasn’t been since GolfNow that we leaned in locally and I’m really glad we did here. We tracked CommLoan for over a year before being nudged by one of our LP’s to dig in further. The company made a significant pivot at the start of 2016 that made a difference. CommLoan is now nearly profitable and the business has proven to be highly scalable through the past two quarters. Their pipeline grows weekly with opportunity.
Yesterday CommLoan announced that Social Leverage and Via West as co-lead’s of their $2.25M seed round. It’s been a pleasure getting to know the management team at CommLoan. Founder, Mitch Ginsberg, has assembled a rock star team of experienced professionals, including former Starwood CFO, Alan Schnaid, who invested alongside us in this round and is joining CommLoan as their CFO/COO and board member.
CommLoan is a company aiming to be the PriceLine of the commercial mortgage business. The mortgage brokerage business has barely changed in the last 30 years and is yearning for technology to disrupt it. Mortgage brokers working on smaller loans ($10 million and under), the lion’s share of whom are small ‘mom and pop’ firms, have weak coverage of lenders in comparison to CommLoan, and typically take a week or more to provide loan quotes versus instantaneous results from CommLoan.
CommLoan provides the private label clients (primarily real estate brokerage firms around the country that do not have in-house mortgage brokerage) with a no-hassle method to steer business through their network for this service, thousands of potential “salespeople” for CommLoan are already in the market, resulting in a win-win opportunity for all parties involved. Through this approach, CommLoan can experience exponential growth to its platform and develop a reputation from name players in the industry. For 2017 the company will grow a Consumer Direct portion of the business, in which borrowers will go directly to CommLoan through existing relationships, introductions, or search engines, which has even greater margins than the private label.
There’s some exciting things happening in tech around Phoenix these days and I'm happy that we’re a part of it.