Hero is the latest Australian startup to open expressions of interest in their equity crowdfunding campaign on Birchal. The announcement comes on the back of a successful campaign by Xinja, a digital banking platform, that has so far raised over $1.6 million on the Equitise platform, highlighting a growing interest by the Australian public to invest in fintech startups.
Hero Broker looks to remove the “middle-man” from the mortgage broking experience by placing the lender directly in control of the borrowing process. By removing this hurdle, Hero Broker can then share the savings and rewards, that normally would flow to a broker, directly with the individual taking out the loan.
In their expressions of interest landing page on the Birchal platform Hero Broker highlight that the company generates revenue by taking a small monthly commission on each home loan. They go on to state that they receive on average $39 per month, per home loan and that the industry average life of a home loan is 10 years or 120 months. At this stage the company has not provided further details on the level of revenue currently being generated by the platform.
Hero Broker is entering an industry that generates over $2 billion dollars in commission for mortgage brokers, with the total size of the mortgage market now standing at more than $1.7 trillion. However, given Australia’s love affair with the property market it is also an area of increasing competition amongst fintech startups.
Two other players currently looking to provide a better loan loan experience are Uno, a startup that “imagines a world where people are presented with the very best home loan options for them in a matter of seconds, with complete visibility to everything on offer” and Lendi which uses “smart technology and Home Loan Specialists match customers with the right loan and help you get approved faster”.
Each of these startups have raised significant funding with Westpac investing more than $26 million into Uno and Lendi counting Macquarie Bank as a shareholder. Lendi also raised an additional $25 million of funding in December last year.
The Expression of Interest period for Hero Broker remains open for a further 26 days. Following this period the company will then decide on whether to offer shares on the Birchal platform and provide additional details on the company, its performance to date and current valuation.