Rows of houses in Las Vegas.
Jacob Kepler | Bloomberg | Getty Images
Doma, a company seeking to disrupt the property insurance market, has agreed to partner with Capitol Investment Corp. V, a publicly traded special purpose acquisition company.
Formerly known as States Title, Doma has less than 1% market share of the US title market, but expects to reach 5% by 2023.
The company is supported in part by Lennar, one of the country’s largest homebuilders.
“I founded Doma to take the friction and frustration out of buying a house and make closing a house as easy and efficient as booking a ride or ordering a meal,” said Max Simkoff, founder and CEO of Doma.
“Right now, our proprietary machine intelligence technology reduces title processing time from five days to just one minute. Our goal is to change the entire mortgage closing process from more than 50 days trial to less than a week.”
Founded in 2016, Doma is using machine intelligence to replace large parts of the legacy residential real estate closing process with instant technology solutions, according to a press release. It speeds up titles and closing timelines, while lenders, real estate professionals and title agents also deliver significant time and cost savings.
This merger brings the company’s value from $ 623 million in their C-funding round last March to $ 3 billion. It will also go beyond the title to additional aspects of the closing process, such as home warranty and appraisals.
To date, Doma has enabled more than 800,000 real estate closings for lenders such as Chase, Homepoint, PennyMac, Sierra Pacific Mortgage, and others.
The transaction is expected to generate up to $ 645 million in cash proceeds, including a fully committed $ 300 million in private public equity investment, or PIPE, and up to $ 345 million in cash in Capitol’s trust account, according to a release.
Top investors anchoring the overall PIPE include funds and accounts managed by BlackRock, Fidelity Management & Research Company LLC, The Gores Group, Hedosophia, SB Management, a subsidiary of SoftBank Group Corp., and Wells Capital.
Lennar has also committed to the PIPE, and Spencer Rascoff, co-founder and former CEO of Zillow Group, has made a personal investment in the PIPE.