Digital lending start-up Blend raised $75 million in fresh funding amid surging demand for streamlined mortgage applications during the coronavirus pandemic.
Blend is growing rapidly as U.S. banks and credit unions seek help in updating tedious, paper-heavy loan processes. The start-up, founded in 2012, began with software that helped banks offer faster digital mortgage applications. More recently, it branched out into auto loans, deposit account openings and homeowners’ insurance.
As it has with digital adoption trends across banking and e-commerce, the pandemic led to a surge in demand for Blend’s software: Refinance application volumes jolted more than 1,000% higher in March, and purchase applications climbed by more than 100% every month since May, according to company figures.
The Series F funding round was led by Canapi Ventures, a fintech VC fund that is backed by the banking industry and led in part by Gene Ludwig, a former U.S. regulator who founded the Promontory Financial Group. Existing investors Temasek, General Atlantic, 8VC and Greylock also took part in the round.
“We’re seeing banks accelerate their move to digital from what was three to five years to months now,” Jeffrey Reitman, a partner at Canapi Ventures, said in an interview. “What really drove us to investing now was just looking at all their expansion opportunities” throughout retail banking, he said. “We just think they’ve wedged themselves into the market in a great place.”