Anthemis has long seen the future state of financial services as embedded, augmented and ubiquitous. We believe this is no truer than during the process of buying a home. Few people in the world get excited about the multifaceted and arduous process of a property transaction, let alone the additional administrative tasks such as getting a mortgage. They get excited about buying their dream home. Our view is that the more we can embed property transactions, mortgage applications and other associated financial products into the home-buying journey, the better! Making the process as seamless and pain free as possible.

We see Flat as an integral part of this embedded finance thesis in the context of the Mexican property sector. Flat is bringing the ibuyer model to Mexico. The company buys used homes instantly with an all-cash offer, renovates them and sells them with a 30-day buy-back guarantee.

The market opportunity in Mexico is vast. Market research indicates that circa 490K homes are sold per year in Mexico with an average price tag of $75K. If we assume Flat takes an average of 20 percent in revenue per home, we are looking at a $7 billion market size just on the ibuyer part of the Flat model. In addition, without a de facto MLS (Multiple Listing Service) provider or public transactional data available in Mexico, there is a high dispersion of prices across the market. The Flat team has been able to build proprietary data of home values, which allows them to buy undervalued homes. Also, the company’s unit economics are almost double the average margins of ibuyers in the US.

Furthermore, over the medium to long term, we believe the team is well-positioned to move beyond the buying and selling of homes and offer additional financial products and services at the point of sale. We see this initial ibuyer go-to-market as a wedge to a much broader market opportunity that could include mortgage products, brokerage services, market data reporting, legal services, rent-to-own solutions and much more. In time we believe they can build a complete marketplace solution, eventually becoming the superapp of real estate in Mexico.

However, whilst we were intrigued by the market dynamics in Mexico and the wider opportunity in this space, it was the team behind this business that gave us so much conviction to lean in and lead their Series A.

I have known Victor for a while now, firstly when he was building companies at STARTegy and subsequently when he was advising Quona Capital on the Mexican market. From our first meeting, I was struck by Victor’s measured and thoughtful approach to articulating his views on the Mexican ecosystem and where he felt there were opportunities to build massive companies. After meeting Bernardo Cordero and hearing his story of building Linio into one of the biggest eCommerce sites in LatAm (raising $100 million+ and eventually selling to Falabella), I knew this team was special.

At Anthemis, we believe the combination of Bernardo and Victor as co-founders is one of the strongest pairings in the Mexican ecosystem today and we can’t wait to see where this journey takes them. Go team Flat!