SAN FRANCISCO—This week, States Title closed a Series C financing round of $123 million led by Greenspring Associates in response to an unprecedented shift in the real estate industry's structural foundation and future economic uncertainty. States Title's patented technologies enable the use of data science to create predictive title insurance based on an assigned risk score.
This indicates how safe a property is from liens or liabilities, helping to achieve faster title processing and more efficient underwriting. The firm says it is applying "modern-day technology to ancient title and escrow processes to provide an instant customer closing experience, enable mortgage originators and Realtors to be more efficient, and lower costs for everyone involved".
"The most pressing need in our industry right now is to remove friction and cost from mortgage closings, and to do so with solutions that can deliver fully remote, instant digital experiences," said Max Simkoff, founder and CEO of States Title. "We are committed to further investment in our patented, industry-leading machine intelligence platform to support the goal of providing an instant closing experience at a lower cost. Right now we are witnessing an unprecedented shift in the structural foundation of the real estate industry, and this new funding will allow States Title to provide enhanced support for lenders, real estate agents and homeowners, as well as provide a solid foundation for continued technological investment in the face of future economic uncertainty."
Greenspring Associates, a venture capital investment platform with more than $10 billion in assets under management, led the round with significant investments from new investors Horizons Ventures, Eminence Capital and HSCM Bermuda. All of States Title's previous investors also participated in this round of financing including a large investment from Foundation Capital, and additional investments from Assurant, FifthWall Ventures, Lennar Ventures and SCOR Global P&C Ventures.
"Traditionally, this process has been done by people, manually searching through lender and county records," Simkoff tells GlobeSt.com. "Our algorithm can reduce a two to four day title underwriting process down to just seconds. Because the process is more efficient and can move faster, it reduces cost and allows a greater number of deals to move forward to close, versus getting stuck or delayed and ultimately abandoned."
States Title's clients include one of the top two largest bank lenders and two of the top 10 largest non-bank lenders. The company acquired North American Title Company and North American Title Insurance Company in early 2019. The firm grew transaction volume by 100 times from 2018 to 2019 and the combined business has closed or issued insurance policies for nearly half a million real estate transactions in the past year. States Title's team consists of nearly 1,000 data scientists, engineers, product managers and operations associates throughout the country.
"States Title has developed an automated, patented technology that streamlines the laborious title and escrow process, emerging as the market leader in an industry that historically lacks meaningful innovation," said Jim Lim, managing general partner of Greenspring Associates. "We are thrilled to support States Title as they advance the vision of an instant mortgage that closes with one tap. Especially in the current economic climate, the mortgage industry needs to be re-imagined with transformative technological solutions to reduce costs and improve the customer experience. States Title is leading the vanguard of this transformation."
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Lisa Brown
Lisa Brown is an editor for the south and west regions of GlobeSt.com. She has 25-plus years of real estate experience, with a regional PR role at Grubb & Ellis and a national communications position at MMI. Brown also spent 10 years as executive director at NAIOP San Francisco Bay Area chapter, where she led the organization to achieving its first national award honors and recognition on Capitol Hill. She has written extensively on commercial real estate topics and edited numerous pieces on the subject.
