Knock, a home exchange firm, prepares to go public

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Knock, a fintech company that allows customers to buy a new home before selling the old one, is preparing to go public.

Sean Black

The company plans to raise $ 400-500 million through an IPO or reverse merger with a publicly traded shell company, Bloomberg reported, citing anonymous sources. He hopes to be valued at $ 2 billion once the process is complete.

Knock had already raised $ 600 million, including one Early 2019 Series B round of funding led by Foundry Group.

Knock CEO Sean Black, co-founder of Zillow subsidiary Trulia, has confirmed that the company has hired Goldman Sachs to advise on the process, although he has not discussed the details, Bloomberg reported.

“We think we’re at the start of a tectonic shift,” Black told Bloomberg. “Our priority is to lift a war chest on the theory that whoever lifts the war chest wins the war.”

Knock offers a home exchange service that allows customers to take out a loan on their old home so they can make unconditional cash offers when they buy a new one. This gives them an edge over other buyers and may allow them to get a better deal on their next home, according to the company.

Additionally, Knock offers bridging loans to cover preparations for selling a home, an advance on the down payment on the new home, and mortgage payments on the old home while it is on the market.

Knock earns his money from a 1.25% convenience fee on the client’s new mortgage.

Knock works with approximately 76,000 real estate agents from more than 150 brokerage firms in 27 U.S. markets, according to Inman. The company said it is on track to have a presence in 45 markets by the end of 2021 and will hire 50 people per month.

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