nesto, a fintech company that analyzes and finds mortgage solutions for clients, has raised $11.5 million from Montreal company creator Diagram and Investissement Quebec. Other smaller investors also joined the round.
The company says it has seen a significant increase in business volume over May, at a time when the pandemic and gradual deconfinement is encouraging Canadians to turn to technology for their mortgage-related needs.
“This new round of financing marks a turning point in nesto’s young history that will enable us to continue to deliver an outstanding experience to our clients as we invest in the evolution of our tools,” said CEO Malik Yacoubi. “We intend to transform the Canadian mortgage industry.”
nesto’s mortgage rates ‘lowest in the market’
The startup says its mortgage rates are the “lowest in the market as a result of its unique model that reduces commissions to a minimum to then pass these savings on to the clients.”
Clients have access to licensed mortgage agents and they submit required documents via nesto’s platform. They are kept informed at each step throughout the process.
For nesto, it’s an example of the changing mortgage market and the growing collaboration between fintechs and financial institutions as it partners with some 20 of the leading Canadian lenders.
“In a confinement situation such as the one in which we currently find ourselves, e-commerce is undergoing significant growth. It is truly inspiring to watch a nascent business such as nesto provide solutions that meet the changing needs of Quebecers by offering them easier access to high-quality mortgage services,” added Investissement Quebec’s CEO, Guy LeBlanc.
Big increase in demand
nesto says it saw a 729% increase in demand for services in May compared to the same period last year. This increase is fueled by the context of the pandemic, which has thrust the Canadian population into confinement, restricted people’s movements, and caused most human interactions to be carried over to virtual platforms.
“There is no doubt that a service such as nesto makes perfect sense at a time when a pandemic significantly limits people’s ability to get around,” said Yacoubi. “We provide sustained and personalized support to our clients and, thanks to technology, we can offer them better mortgage rates as well as all the information they need based on their situation.”
The company also added Greg Perowne as Senior Director of Operations, who formerly held operations management positions at Goodfood and Uber.