Naborly, the credit bureau for the rental industry, has closed a new $7.5m seed round led First Round Capital’s Bill Trenchard and Susa Venture’s Chad Byers.
The two venture capital investors have both invested in big industry leaders, with Trenchard having betted on Uber and Byers having backed Robinhood in the past.
Naborly’s seed round was also backed by VC firms, Village Global VC and Third Prime as well as insurer Assurant Insurance.
The startup offers free credit and background checks to landlords and tenants, and helps tenants build credit by paying their rent. The company also announced it would add a new service named NaborlyShield. The new digital service guarantees rental income and lease terms for landlords and tenants.
Naborly claims the new service eliminates the need for landlords to collect a security deposit or require a co-signer as it protects against unforeseen events such as rent default, early vacancy, late rent and property damage. This alleviates the cost and frequency of evictions.
“It’s incredibly expensive to be poor in America,” said Dylan Lenz, CEO and founder of Naborly. “The least privileged people pay the highest interest rates and service fees, while offered the fewest options. Not because they don’t repay their debts, but because they do.
“Research shows the average person in this country is one missed week of work away from a financial emergency. If their kid gets sick or their car breaks down, they get pushed into a financial crisis that costs a lot more than the few hundred dollars they need to get by. Meanwhile, they are paying thousands each year in interest and fees to predatory lenders and financial service providers, which perpetuates the systemic cycle of being broke.”
NaborlyShield is being launched in Canada and in the US.
Y Combinator, the seed accelerator that announced its Fall 2019 batch in August, backed Naborly’s 2016 $2.4m angel investor round.
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