Focusing on homebuyers who are also selling their homes, Orchard has built a platform that combines the home buying AND selling process into a single digital experience. Launched in 2017, Orchard abides by its “move first, sell after” approach and pairs homeowners with an adviser who helps them find a new home and sell their existing property. Once homeowners find their new homes, Orchard provides the cash so that homeowners can present an offer – before selling their existing home, effectively making them cash buyers. After the purchase, Orchard handles the sale of the original property (marketing, showing, closing, etc.) and charges the standard 6% brokerage fee. If the home is not sold within 120 days, Orchard steps up and buys it. Orchard currently serves homeowners in New York, Texas, Colorado, and Georgia with plans to expand.
AlleyWatch caught up with Cofounder and Chief Product and Marketing Officer Phil DeGisi to learn more about Orchard’s genesis, future plans to simplify home buying/selling, and recent funding round, which brings the total equity funding raised to $138M.
Who were your investors and how much did you raise?
Orchard has closed a $69M Series C funding round led by Revolution Growth, with participation from existing investors, FirstMark, Navitas, Accomplice, and Juxtapose.
Tell us about the product or service that Orchard offers.
Orchard revolutionized the home buying and selling process. Our core offering, Move First, allows customers to buy their new home before selling their old home. Customers even have the opportunity to secure their new home with Orchard’s cash. The customer moves into their new home and then our agents get to work on selling their old home for top dollar. Orchard handles everything from cleaning to listing and showing – all after the customer moves out, so they never have to deal with it. This, coupled with giving the customers the option to use Orchard’s integrated digital closing services, makes Orchard the best end-to-end experience in real estate.
What inspired the start of Orchard?
We started Orchard because we saw how antiquated the home buying and selling process was. We saw other industries like retail and transportation radically transform to meet the modern-day needs of the customer. However, nothing had really changed in real estate, so we set out to do what Amazon did for retail or what Carvana did for car buying and bring real estate into the modern age by allowing customers to manage their entire experience through one simple digital platform.
How is Orchard different?
Orchard is different because we are relentlessly focused on the customer. We’ve built a simple and customer-first experience that has radically transformed the way we buy and sell homes; from home search, to listing, to an all-digital close. Our customers get a best-in-class, dedicated local agent, combined with top of the line technology.
What market does Orchard target and how big is it?
Residential real estate is a $1.5T market in the U.S.
What’s your business model?
Orchard delivers unprecedented value to our customers by enabling them to buy before they sell their home, as well as a simple, digital closing process. Orchard does all of this for the same fee as a traditional agent.
How has COVID—19 impacted the business?
Our model is particularly valuable in the current environment for a few reasons:
- Ability to buy before you sell: the housing market is very competitive right – it’s a sellers’ market – so it is challenging to buy with a contingent offer. Orchard turns our customers into non-contingent buyers, a huge advantage.
- Home discovery tools, like our Home Match Quiz, which makes looking for homes easy and delightful – you can rule out the duds easier (and avoid an in-person tour that would otherwise be a waste of time)
- Skipping old home showings – no strangers walking through your home while you live there
- Seamless digital closing, powered by Orchard National Title and Orchard Home Loans
What was the funding process like?
As a company and a leadership team, we have a lot of experience fundraising, which makes things run smoothly.
What are the biggest challenges that you faced while raising capital?
Generally, the biggest challenge in fundraising is balancing the focus required to scale the business and hire top talent, while also meeting with investors. That said, it’s not a challenge that’s unique to Orchard.
What factors about your business led your investors to write the check?
Revolution saw that we have dramatically simplified the home buying process. Our integrated model and tech-forward approach offer the customer the right balance of intuitive technology and human interaction.
What are the milestones you plan to achieve in the next six months?
Orchard will use the investment to further expand our product offerings, as well as grow the team throughout New York, Texas, Colorado, and Georgia. Additionally, after two successful new market launches in Denver and Atlanta, we plan to expand our services to more states to serve even more customers in the next year.
Additionally, after two successful new market launches in Denver and Atlanta, we plan to expand our services to more states to serve even more customers in the next year.
What advice can you offer companies in New York that do not have a fresh injection of capital in the bank?
Never accept the status quo. Focus on offering the customers a substantially better experience than what is currently available. In a hyper-competitive space, the long-term winners will be the ones that relentlessly focus on the customer’s needs.
Where do you see the company going now over the near term?
We’re not disclosing where we’re going yet but expect big things in 2021! We’re looking forward to reaching millions of new homeowners and offering them the best way to buy and sell.
What’s your favorite outdoor dining restaurant in NYC
We’re big fans of The Smith in NoMad or Shake Shack in Madison Square Park.
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