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Polly snags $37M in Menlo-led Series B to automate workflows for mortgage lenders

January 26 2022

Polly, a SaaS technology startup aiming to transform the mortgage capital markets, announced today that it has raised $37 million in a Series B funding round led by Menlo Ventures.

New backers Movement Mortgage, First American Financial, and FinVC joined existing investors 8VC, Khosla Ventures, and Fifth Wall to participate in the round. The latest financing brings the San Francisco, Calif.-based startup’s total funding raised to over $50 million.

Adam Carmel, founder and CEO of Polly, said the company has increased its customer count by nearly three times over the past year, including several of the country’s top 100 lenders. Carmel founded the company in 2019 under the premise that while many industries have undergone digital transformation initiatives, the mortgage industry is still largely reliant on the same expensive and cumbersome processes and tasks that have been in use for decades.

Polly’s mission is to fundamentally change the way lenders and loan buyers operate by giving them the ability to make data-driven decisions. "Our modern software is uniquely configured to automate customer workflows and improve execution from rate lock, to loan sale and delivery,” Carmel explained.

Carmel previously founded Ethos Lending, which sold to Fenway Summers in 2014, and it was that experience that helped him conclude that there were significant gaps across the industry in terms of automating workflows for lenders. Carmel believes Polly stands out from others in the industry in that it is helping create a fourth category in the mortgage sector: capital markets.

“I viewed it as a sizable opportunity to build a vertically integrated software platform that would automate workflows for a mortgage company,” Carmel told TechCrunch. “Over time, consumers are going to expect not only a digital experience but also a mortgage product, loan, and associated pricing that are customized and tailored for specific purposes.” To that end, he added, "Polly is laser focused on doing just that so our customers can configure individual loans as dynamically as they would like.”

“The goal is that ultimately, they are able to deliver a lower mortgage price to their consumers or to their customers while increasing their own profitability,” Carmel said. “We want to help these lenders move away from spreadsheets, telephony, and email as a transaction medium, and instead do everything in the cloud. Over time, we want to be able to transition into a system of record for the customer.”

Polly, he said, is able to help configure loans on a multi-dimensional basis. The startup has increased its customer count by nearly three times over the past year, signing several of the country’s top 100 mortgage lenders. While investing mostly in product in 2021, Polly plans to put some of this new capital toward its go-to-market strategy while continuing to be focused heavily on product. That includes expanding its product and engineering teams, as well as investing in artificial intelligence and machine learning capabilities.

“The next year or two is going to be a really exciting time for us,” Carmel explained. “We see this as a compelling window and opportunity to really help transform the market.”

Menlo Ventures partner Tyler Sosin, who is joining Polly’s board of directors as part of the financing, believes the startup is taking on a sector held back by sclerotic incumbents with dated and disconnected solutions, and driving transformation evident by winning customers at an impressive rate.

Sosin said Menlo was interested in leading the company’s Series A round but was too slow to participate. Impressed with Polly’s traction even at that point, the firm still decided to contribute to that financing with a smaller check and stayed close to the company.

“We have gotten to know Adam and we have seen how the customer base, product, and team have evolved, so we leaned into the lead this round,” Sosin told TechCrunch.

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