Vontive, which is a fintech specializing in business purpose mortgages, has received an investment from Citi, which also acted as lead bookrunner on its first-ever securitization.
The amount of the off-cycle investment was disclosed.
It is the first new capital in the company since its 2022 Series B fundraise, said Vontive CEO Charles McKinney. The company lends on one-to-four family properties to investors who do fix-and-flip or renovate for single family rentals.
“We got to know the Citi team through one of our venture investors, Zigg Capital, which led our Series B,” McKinney said. Vontive was looking at bank partners in order to grow the company. This relationship will be transformative for Vontive.
“Citi came to us and said, ‘Hey, we like technology. We like to make an equity investment in the company.'” McKinney continued. “That also coincided with Citi wanting to re-enter the market around financing and securitizing short-term mortgage debt.”
The investment was made through Citi’s Spread Products Investment in Technologies team.
Why Citi invested in Vontive
“When it comes to venture investments, we get excited about fintechs who are making growing or novel asset classes more accessible to capital markets,” said Lee Smallwood, global head of markets innovation and investments, in an emailed comment.
“Vontive has a strong focus on data, innovation, and technology — and they balance that with a strong understanding of business purpose mortgage and the needs of real estate investors,” he added.
The securitization, VNTV 2025-RTL1, consists of $150 million of residential transition loans that Vontive originated. It was not rated. But Vontive plans to be a programmatic issuer and it is working on another transaction that is likely to be rated, McKinney said.
“RTL is an attractive growing asset class and we’ve seen securitizations in meaningful volume since the first deal in 2016,” Citi’s Smallwood stated. “The first rated RTL issuance wasn’t until last year, which was a big unlock for the market.”
What is Vontive’s business model
By pairing technology and capital, Vontive “enables any brand that works with real estate investors to offer a mortgage product-set to their clients,” McKinney said.
But Vontive is the lender of record in order to solve any licensing and credit risk issues, he pointed out. It controls the underwriting and the capital commitment to fund loans.
What is Vontive’s new tech offering
In a separate announcement made concurrent with the Citi news, Vontive has rolled out an artificial intelligence-powered data suite, which it said would make access to private real estate credit products scalable and efficient.
“Our latest products are about more than automation — they unlock patterns and opportunities that were previously undetectable,” said Shreyas Vijaykumar, chief technology officer, in a press release. “Vontive’s technology stack now allows us to process mortgage data with unmatched speed and scale.”
McKinney said the aging U.S. housing stock is one reason why Vontive’s services are needed in the marketplace.
“We think that modernizing, standardizing, addressing challenges with the business purpose mortgage, the mortgage that real estate investors use to build homes, to purchase and fix up properties, is a critical success factor for the U.S. to address the affordable housing shortage,” McKinney said.
