Maxwell, a mortgage tech platform that provides cheaper, faster mortgages to small and midsize lenders, announced Tuesday that it had raised $52.5 million.
The funding follows a $16.3 million Series B announced in March, a $5 million Series B announced in June 2020 and $5 million in seed funding in 2016 and 2017.
The most recent funding round was led by Fin VC with participation from Wells Fargo Strategic Capital, along with existing investors Prudence, Rotor Capital and TTV Capital.
Maxwell has come a long way since graduating from Techstars Boulder in 2016. More than 250 mortgage lenders, banks and credit unions have used the Maxwell platform to serve tens of thousands of homebuyers, facilitating more than $150 billion in loans.
Maxwell’s revenue has grown by 2,752 percent over the past three years, making it the fifteenth fastest-growing software company in the U.S, according to Inc. 5000 data. It also ranked among the top five Colorado-based tech companies of any sector that made the Inc. list this year.
The company currently has 270 employees, with 74 working out of the Denver office. It expects to bring on another 130 people by the end of 2022, bringing the team’s headcount to 400.
Maxwell’s employee base has increased by more than 14 times over the last three years. The company has expanded beyond its headquarters in Denver, with hubs in Minneapolis, Dallas-Fort Worth and Raleigh-Durham.
Maxwell aims to makes the mortgage process faster, cheaper and more efficient for lenders and their borrowers. Built on aggregated loan data and real-time data insights, the platform’s technology offloads time-consuming manual tasks for loan officers, processors and underwriters and helps to increase productivity and economic scale.
Maxwell was designed for small and midsize mortgage lenders, which are the only banking presence for almost one in five U.S. counties, according to a Brookings Institution report. Although these community lenders originate half of the loans in the $4 trillion mortgage market, these lenders bear the brunt of market compression.
Maxwell co-founder and CEO John Paasonen told Built In that the mortgage industry has long been plagued by slow technical processes, inefficiencies and lack of oversight.
Loan expenses have increased 81 percent between 2009 and 2020. The current cost of originating a mortgage is about $10,000, Paasonen said, which is more than what it costs to produce a Toyota.
Maxwell’s team of processors, underwriters and closers work with engineers to ensure its solutions are tailored to solving the issues faced by mortgage lenders. Its platform allows lenders to close loans 13 days faster than the 47-day national average and loan officers to outperform the market by more than 20 percent.
Paasonen believes Maxwell’s efficiency will be increasingly important in the near future.
“We just had the best year of mortgage lending last year that the markets had ever seen. Next year, total originations in the market, according to the Mortgage Bankers Association, are expected to drop by 40 percent,” Paasonen said. “So you’re going to have this market that’s shrinking back down to its natural size, and I think a lot of lenders are going to be saying, ‘Hey, my top line is getting compressed, and my margins are getting compressed. Where do we get help?’ That’s where technology really serves a role to to make that process more efficient.”
