Tenant Screening Firm Findigs Raises $32M Series C Round

Findigs, a rental screening platform that uses artificial intelligence for autonomous decisioning, announced Tuesday that it raised a $32 million Series C round. (“Decisioning” is techspeak for “making decisions based on data and other inputs.”) 

Marc Weiser and Adam Boyden, managing directors at RPM Ventures, an early-stage generalist venture capital firm, led the round, with participation from existing investors in the startup. The latest round brings Findigs’s total funding to $80 million.

Founded in 2020, the proprietary AI-native platform helps U.S. single-family and multifamily residential operators reduce rental delinquency and evictions. Findigs plans to use the new funds to support product advancement, market expansion, and hiring as well as to expand its capabilities in the affordable housing space, including Low-Income Housing Tax Credit (LIHTCs) and Section 8 workflow support.

“When I think about the evolution of the company, we used to be a tenant screening business,” said Steve Carroll, co-founder and CEO of Findigs. “While we were doing that, we had a tool that was meant to be consumed and used by property managers, owner-operators and landlords across the U.S. They would use our tool, they would get a bunch of information, and they would interact with that tool in order to make better tenant screening decisions.

“Over the last two years, what we’ve built is an autonomous decisioning platform. So, instead of our customers having to consume data and use those data decisions, the product far exceeds what teams are capable of doing.”

While rental fraud is a growing focus in real estate, Findigs is addressing more than that challenge, said Carroll.

“We think we are the very best at preventing fraud, but we want to help answer this question holistically, and that’s why a big part of this round is a change in positioning,” he explained. “We are creating the category of leasing decisioning, and that category is an explicit service of better revenue quality for our customers. It’s really only possible when you take all these things and questions and you put them under one roof. Then you use data that you produce over time to assess whether or not your hypothesis was correct to begin with.

“There’s lots of platforms that help you try and make screening smarter, more protected against fraud, etc., but, from top to bottom, we are a platform that makes a decision and helps you optimize revenue quality. I don’t think this concept is widely understood in the space. We’re really coining the term ‘revenue quality,’ and we want to help operators with three things. One, we want to help them make sure their units are full, because you can’t have an optimized revenue quality equation unless your units are full. Secondly, we want to make sure they’re full with people who actually pay rent. You don’t want to have a rent roll that’s quite leaky with a lot of delinquency and evictions. Third, we want to help you optimize your cost of acquisition.”

Findigs supports 400,000 units for hundreds of different operators and clients. Since its inception, customers have seen up to 80 percent fewer evictions and 90 percent lower delinquency rates, according to the company.

Among the company’s customers are McKinley, where eviction rates across its portfolio declined 46 percent last year, acquisition costs dropped 33 percent, and occupancy increased to 98.6 percent, according to Findigs. Imagine Homes Management, Oakwood Management Company, Western Wealth Communities and Sentral are among the company’s other customers.

“Every rental application in the country runs through screening, underwriting and leasing decisions, tens of millions a year,” RPM Ventures’ Weiser said in a statement. “Almost all of them still go through tools built for a different decade, and rely on manual decisions by leasing teams. Findigs is the only product we’ve seen that rebuilt the decision itself, and they have the data to prove it works. The market is enormous, and this is the team that wins it. That’s why we led the round.”

In addition to announcing its Series C round, Findigs said Hugh R. Frater has been named to the Findigs board of directors. Frater is a founding partner at BlackRock, a former CEO of Fannie Mae, and former chairman and CEO at real estate lender Berkadia.

“The best way to manage a risk is usually by not taking it,” said Frater in a statement. “It’s never been different for the leasing decision, and for too long operators and prospective residents have lived with manual reviews, inconsistent criteria and slow turnarounds because there was no alternative. Modern technology provides an alternative. Using AI, Findigs can combine a better risk decision with a better customer experience, and that is why I’m involved.”

Philip Russo can be reached at prusso@commercialobserver.com.