Bulletin: Fraction Technologies raises $289 million
The financing is a combination of equity and debt from Impression Ventures, Primetime Partners, Global Founders Capital, and Panache Ventures.
Fraction Technologies Inc. announced that it raised C$289 million in a combination of equity and debt financing from Impression Ventures, Primetime Partners, Global Founders Capital, and Panache Ventures, among others. Fraction offers a digital platform that operates at the nexus of proptech and fintech. The startup’s flagship product is the Fraction Appreciation Mortgage, which apparently is the first of its kind in North America.
The Fraction Appreciation Mortgage enables homeowners to access the existing value locked in their homes. Customers can convert up to 40 percent of their home equity into tax-free cash. According to a company statement, “In contrast to products such as home equity loans or traditional mortgages, the Fraction Appreciation Mortgage has no monthly payments, and instead offers an interest rate payable upon the sale of the home, or when the homeowner decides not to renew.”
“Fraction aligns its interests with the homeowner. Upon sale of the home, if the home value appreciates, Fraction shares in the upside, but if the home value decreases, there is a protected downside, which helps homeowners preserve their home equity," said Hayden James, CEO and co-founder of Fraction.
The company plans to use its new funding to launch in Canada, expand its team and technology platform, and prepare for its launch in the U.S. There has already been $20 million in demand from interested homeowners according to the company.