Anatomy of a deal: Why Willow was ripe for seed money

“Thomvest has, from a focused perspective, spent the last decade investing across financial technology and over the last five years or so in real estate technology or, more specifically, mortgage technology,” he said. “We took a survey of the technology landscape in mortgage. Software and automation was becoming table stakes in the origination process – I think Rocket did a lot to encourage and prompt that industrywide as they were gaining market share while the larger banks initiated modernization strategy. So we invested in companies like Blend, on the point-of-sale side, and we’re investors in Maxwell which also has a point-of-sale offering.”

Which is not to say that identifying companies for investment wasn’t a methodical process: “For a long time, we’ve been interested in the mortgage servicing category, more from a user perspective. The process of transferring servicing rights from the originator to the owner of those servicing rights felt broken.”

What’s more, the Net Promoter Score (NPS) of most companies in the industry – a metric for assessing customer loyalty for a company’s brand, products or services – are among the lowest in the business-to-consumer (B2C) category, adding another challenge in assessing firms, he suggested. “NPS scores in the mortgage servicing category are extremely low – some of the lowest of any B2C category. And then we also were aware of the dominance of the single vendor in servicing in the form of Black Knight. We knew we were interested in servicing but weren’t sure what the right venture investments in the category would be. We looked at a lot of companies in the category.”

Willow emerged as a natural fit for Thomvest’s investment, Wedlake suggested. He gives much of the credit for the digital platform’s appeal to the leadership of CEO and co-founder Laura Cain, who previously worked as a senior product manager at Snapdocs. As it happens, she also worked for a while at Thomvest.