Follow the Money
SoFi has been making headlines in the crypto world recently.
Just a day after they announced a new partnership with CoinBase on February 26, 2019, Figure, a blockchain-based home equity platform, has raised $65 million in funding, as reported on February 27, 2019.
The missing link? Mike Cagney, the founder of both startups.
This brings the firm’s total funding so far to $120 million.
What the Figures Say
While SoFi mostly concerns itself with student loan financing, Figure focuses on home equity and claims to have created over 1,500 equity lines thus far, though there are plans to expand their services into wealth management, unsecured consumer loans, and checking accounts.
“At the end of 2019, Figure should look like a robust financial platform that can meet the needs of our customers,” Cagney told American Banker.
The target market for Figure, surprisingly enough, isn’t necessarily young people but older retirees who have their funds tied up in their homes. This demographic is referred to as cash light and rich in equity or “CLAREs.”
The firm says that it is currently lending over $1.5 million per day and they expect that figure to double in the next year.
Right at Home
Blockchain has been used in the property market before and is about to see the largest tokenization of a single property in Miami worth $65 million. Its application in the home equity market is a smart move, given that the market is worth billions of dollars.
Cagney’s departure from SoFi was under controversial circumstances. He had been accused of sexual harassment from two employees, and after he stepped down as CEO, Anthony Noto took over his position. Cagney then went on to start Figure with his wife, June Ou, who acts as the COO. The new firm is being run with lessons learned from his time at SoFi, he says.
“One of the biggest takeaways is that at SoFi, we grew so fast and we never really understood what we were going to grow into, and culture never took a front seat. [At Figure] we have a very clear adherence to a ‘no-asshole’ policy.”