The archive · Commerce & Marketplaces · Strategic decision · 2018–2023
Loft's iBuying bet: $800M raised, $2.9B unicorn, then a B2B pivot to breakeven
Brazilian proptech Loft bet on buying and reselling homes at scale; $800M raised and a $2.9B valuation in 2021, then a B2B pivot to claim 2023 breakeven.
Loft
What the business is
A São Paulo proptech digitizing home buying and selling — marketplace listings, mortgage origination and no-guarantor rentals — that originally bought, renovated and resold homes as an iBuyer.
Starting capital：~$800M in equity through April 2021 (Series D extension at $2.9B) plus $100M+ in debt via listed Brazilian real-estate funds.
How it started
Mate Pencz, Florian Hagenbuch and Kristian Huber — ex-Goldman Sachs colleagues who had already sold a print startup to Vistaprint — founded Loft in São Paulo in 2018, betting Brazilian real estate would follow e-commerce online the way Zillow and Opendoor had digitized the US.
What happened
A $425M Series D at $2.2B in March 2021 was extended a month later with $100M at $2.9B, bringing total equity to ~$800M. In 2021 Loft bought mortgage brokerage CrediHome, no-guarantor rental CredPago, condominium portal 123i and Mexico's TrueHome. As rates rose, it cut 855 staff in 2022; Bloomberg Línea reported an a16z-led round at ~$1B, which Loft denied.
How it ended up
Loft pivoted from iBuying to a B2B transactional platform and fintech tools for brokerages, cut 340 more jobs in March 2023, then claimed operational breakeven for 2023 with ~30% revenue growth and 300% more transactions.
Background
Loft is a Brazilian proptech founded in São Paulo in 2018 by Mate Pencz, Florian Hagenbuch and Kristian Huber, who had previously sold a printing startup to Vistaprint. Its original bet was that Brazilian home buying and selling would move online end-to-end — and that the winner would be the platform that itself bought, renovated and resold homes, in the mold of US iBuyers like Opendoor.
The bet raised enormous capital: a $425M Series D at $2.2B in March 2021, extended a month later by $100M at $2.9B, bringing total equity to ~$800M. By then Loft maintained 13,000+ listings across São Paulo and Rio with 30,000+ brokers, reported ~$150M in annualized revenue in its first full year, and had entered mortgages and no-guarantor rentals through acquisitions.
In 2022 Brazil's rate shock hit exactly the model's weak point: iBuying needs cheap capital to hold inventory. Loft cut 855 staff in three waves, and Bloomberg Línea reported a down round to ~$1B led by a16z — which Loft denied. The company pivoted from buying homes to selling software and fintech products to brokerages.
After 340 more layoffs in March 2023, Loft claimed operational breakeven for 2023, with ~30% revenue growth and 300% transaction growth. The arc shows a category bet that worked in a bull market being rebuilt, at much smaller scale, as a capital-light business.
What has to be true
- Brazilian real estate was opaque and offline, so a platform that digitized listings and transactions had a real wedge, and its data advantage compounded over time.
- iBuying created an illusion of scale: revenue grew fast but depended on cheap capital to hold inventory, which made the model fragile when rates rose.
- Pivoting to B2B software kept the original data and network assets while removing the capital-heavy inventory business — the same market insight with a safer revenue model.
- Denying the reported down round while privately restructuring shows how valuation optics and survival can diverge in a downturn.
What can be applied
A bet that depends on cheap capital looks brilliant in a bull market; when rates rise it must be restructured fast, and the capital-light version of the same idea is often the one that survives.
Aftermath
As of 2023-12-13, Loft expected to close 2023 at operational breakeven with ~30% year-on-year revenue growth and 300% growth in transactions, crediting a shift to B2B services for brokerages. It had moved from buying and renovating homes to a transactional platform with fintech products and an AI price calculator, similar to China's Beike. The restructuring was brutal: 855 layoffs in 2022 and 340 more in March 2023 as it exited iBuying. The $2.9B valuation of April 2021 had been built on capital that 2022's rate shock made unavailable; the business that survived was the capital-light one.
Sources
- Brazil's Loft adds $100M to its accounts, $700M to its valuation in a single month
- Brazilian Unicorn Loft Denies Receiving Down Round
- Brazilian Unicorn Loft Sheds 12% of Staff In Third Wave of Layoffs this Year
- Brazilian PropTech Loft Claims Break Even Reached After Five Years
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