29 September 2022, NEW YORK /— Tongo, a FinTech business that realigns earnings and spending for the commission economy, revealed it had secured USD 7 million in venture funding. With Tongo’s ability to enable brokerages to give agents on-demand access to pending commissions, which they may utilize as a line of credit to build their businesses and stabilize cash flows, the company will use these profits to grow its product and staff in its initial market of real estate.
New Valley Ventures, Good Friends, Launchpad, Elizabeth Street, Red Bike, Lab Ventures, and the Entrepreneur’s Roundtable Accelerator were also a part of the round, which MetaProp led. Tongo has raised USD 11 million so far.
“The commission economy of today is not suited to traditional loan products. Their underwriting algorithms prioritize employees with regular salaries that fit with their monthly billing cycles. For tens of millions of self-employed persons in industries where revenue is more erratic, like real estate and other commission-based professions, the combination of limited credit availability and stringent monthly payback creates a significant difficulty. Tongo has a tremendous opportunity to develop financial products that balance income and expenses, “Brandon Wright, CEO of Tongo, remarked.
Tongo provides agents with an alternative to the credit ecosystem that lessens the volatile, cyclical nature of their income while also providing them with a cost-effective source of financing to expand their businesses by effectively establishing a debit card for future income.
According to MetaProp General Partner Zak Schwarzman:
“The lumpy, irregular and uncertain nature of commission revenue defines the income patterns of many of the 3 million licensed real estate agents in the U.S., making it difficult for them to invest in their companies and manage personal expenses.” “With the swipe of a card, Tongo’s innovative, sophisticated technology makes it easier for agents to receive future commission income on convenient, accommodating terms. Brokerage firms are teaming up with Tongo to deliver a powerful and distinctive financial management solution that affects the lives and wallets of its agents, filling a glaring void in the consumer credit market for agents.”
Dan Sachar, managing director of New Valley Ventures, stated that real estate agents are “intimately aware of the commission economy” and that thousands of agents depend on transaction closings to generate commission income. “We know firsthand how this expanding labor force segment might benefit from better liquidity management tools. The next-generation technology from Tongo offers real estate professionals a cutting-edge and user-friendly method.”
Tongo operates on future income, like a debit card. Tongo, a platform created in 2021 by Brandon Wright, Luis Scull, John Macris, and Patrick Waltinger, allows today’s real estate professionals to make year-round, private investments in their companies and in themselves while commissions are still locked up. When agents are paid, Tongo is reimbursed. Among Tongo’s investors, leading companies, including MetaProp, Good Friends, Launchpad, Elizabeth Street, Douglas Elliman via New Valley Ventures, Red Bike, Lab Ventures, and Remarkable Ventures.
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