Houwzer expands its challenger real estate company into additional U.S. markets; adds new services to one-stop-shop experience for home purchases, sales, mortgages and insurance
PRINCETON, NJ. (February 5, 2020)—Edison Partners, the growth equity investment firm, today announced leading a $9.5 million investment in Houwzer, the real estate brokerage that saves consumers thousands on a better experience.
Philadelphia-based Houwzer has pioneered a new real estate agency labor model and technology-enabled, unified home buying and selling experience for consumers. The company has nearly doubled in size every year since inception in 2015 and achieved significant growth in its initial markets of Greater Philadelphia and Washington, D.C. Houwzer will use the funds to expand into new regions across the East Coast, bolster its technology platform, and expand owned services to include mortgage, title and home insurance divisions.
“Houwzer is remaking the experience, and economics, of what is typically one of the largest, most complex and emotional financial transactions of a consumer’s lifetime: a home sale or purchase,” said Michael Kopelman, General Partner, Edison Partners, who led the investment. “We look forward to helping Mike and team continue to execute on their vision for end-to-end real estate products, transactions and related home services.” Kopelman will join Houwzer’s board of directors.
Houwzer challenges antiquated brokerages that rely on 1099 agents and commissions as high as 6 percent. In contrast, Houwzer employs full-service, salaried real estate agents to deliver stronger service and value back to buyers and sellers. Houwzer also leverages technology to provide a one-stop-shop for transactions, mortgages, home and title insurance, and more.
“Houwzer is elevating the real estate industry with world-class agents dedicated to customer experience without the distraction of a commission,” said Mike Maher, founder and CEO of Houwzer. “We’re very excited to team with Edison Partners and leverage their investment and operating platforms to change the status quo for real estate brokerage and beyond.”
Houwzer charges a flat $5,000 listing fee at closing plus 2.5%—discounted from the standard 3%—to the buyers’ broker, saving home sellers an average of $15,000 in commissions. The company’s high customer satisfaction rates, evidenced by a Net Promoter Score of nearly 80, “is also unheard of in the residential consumer real estate industry, where the majority of buyers don’t remember their agent’s name several years later,” added Kopelman.
Edison Partners’ investment in Houwzer is the firm’s latest in large consumer services markets ripe for disruption and a differentiated experience. Last year, Edison invested in real estate investment and funding platform Fund That Flip and home services marketplace LawnStarter. The firm has also invested in digital wealth management platform Yieldstreet and financial membership platform MoneyLion. In all, Edison Partners has financed and guided more than 230 private companies.
Houwzer is a next-generation real estate brokerage and home services company built around the customer. Their salaried agents and loan officers help homeowners save when they sell and trust when they buy. Houwzer’s proprietary technology is an end-to-end platform that streamlines the entire transaction from the first meeting to post-closing with an integrated one-stop shopping experience. The company employs seller and buyer agent specialists, who receive salaries instead of commissions, allowing them to focus on service, not just sales. Houwzer has maintained an industry-leading Net Promoter Score of 79.4 and an average rating of 4.9 out of 5 stars from over 850 client reviews online. Since launching in 2015, Houwzer has saved home sellers in the Mid-Atlantic region over $13.8 million and helped clients buy or sell thousands of homes with a total value of more than $750 million.
About Edison Partners
For more than 30 years, Edison Partners has been helping CEOs and their executive teams grow and scale successful companies. The firm’s investment team brings extensive investing and operating experience to each investment. Through a unique combination of growth capital and the Edison Edge platform, consisting of operating centers of excellence, the Edison Director Network, and executive education programs, Edison employs a truly integrated approach to accelerating growth and creating value for businesses. A team of experts in financial technology, healthcare IT and enterprise solution sectors, Edison targets high-growth companies with $5 to $25 million in revenue; investments also include buyouts, recapitalizations, spinouts and secondary stock purchases.
Edison’s active portfolio has created aggregated market value exceeding $10 billion. Edison Partners is based in Princeton, NJ and manages more than $1.4 billion in assets throughout the eastern United States.