Blend enters home insurance. HR platforms bulk up. This week in insurance tech.
The most popular real estate portal in the US is undergoing a dramatic transformation. After getting into the home-selling business 18 months ago, Zillow has itself become an investor directly buying homes from sellers in Denver, Atlanta, Las Vegas, and Phoenix.
Now it’s entering the mortgage business, having acquired small national mortgage lender Mortgage Lenders of America. These are bold moves from a publicly-traded company that makes close to 70% of its revenue from providing leads to buyer’s agents.
When CEO Spencer Rascoff was asked yesterday about other aspects of streamlining user experience, he replied: “In terms of other business opportunities that present themselves as we go deeper into funnel, there’s a lot more around mortgages long term.”
The news comes on the same day digital mortgage platform Blend announced it would be entering the homeowners insurance market by acting as a broker for partners including MetLife. According to reports, lenders using Blend represent more than 25% of the total US mortgage market with around $60B in mortgage applications flowing through its software last year.
Zillow’s recent moves in property management have received less notice. With 35M renters visiting its sites each month, the portal just rolled out new tools to allow renters to pay rent through Zillow. The company plans to eventually allow renters to search for properties, schedule tours, apply, sign a lease and pay rent in one place digitally.
After SoftBank’s investment in GM’s Cruise placed essentially the first public valuation on an autonomous OEM asset, more banks are pegging a figure to the self-driving car efforts of Waymo, Cruise, and others.
Evercore, for example, created a framework considering the value of engineering, test miles, ability to industrialize/scale, and potential market premium. Within that framework, they assign a value of $60B to Alphabet’s Waymo.
Today, Morgan Stanley put out a figure today close to three times that estimate at $175B based on various assumptions made around the value of potential logistics/delivery, licensing, and robo-taxi businesses. The TL;DR of it is that, depending on approach, these figures are all over the place as we’ve aggregated below (sidenote: market sizing data for over 12,050 markets is now available on CB Insights).
HR automation platforms add funding
Last week, HR automation and benefits platforms Gusto and Namely both raised new funds. We’ve previously highlighted how the base of small businesses using Gusto has grown significantly (from 50 back when it was only doing online payroll in December 2012 to 60K earlier this year). Namely says it currently serves 1,000 companies that collectively employ 200,000 people.
Recent moves by Gusto including a flexible payments service and partnership with accounting platform Xero are aimed at providing more levers for customer acquisition. While brokers have traditionally played an important role in the highly fragmented market for health insurance sold to small groups or individuals, these moves highlight how HR automation platforms (which offer their own benefits brokerage) are looking to more aggressively become aggregation points for small businesses.