Mortgage artificial intelligence startup Candor Technology Inc. will expand after snagging more than $12.5 million in a recent venture capital round.
The company, based in The Villages, raised $12.5 million in a Series A round that will enable the company’s patent-pending platform to analyze more types of loans, founder and CEO Thomas Showalter told Orlando Inno. Candor filed documents for the raise with the U.S. Securities and Exchange Commission on Aug. 18.
Growing weekly
Candor’s AI-powered Loan Engineering System can conduct a credit risk assessment and make income, asset and lending decisions. The system makes decisions based on more than 37,000 “decision steps,” which are narrowly defined problems to which it can respond.
After this infusion of cash, Candor will grow its platform’s capabilities to include U.S. Federal Housing Administration and VA loans by the end of the year, Showalter said. Jumbo loans will follow, he added.
The round was led by Minneapolis early growth capital firm Arthur Ventures, Candor announced Aug. 18. Candor solves difficult problems in the mortgage industry because it “taught a machine to think like an underwriter,” Arthur Ventures General Partner Patrick Meenan said in a prepared statement. “This has enabled Candor clients to make revolutionary improvements in the economics of making a mortgage. And their leadership team is first rate.”
Candor employs more than 50 people in its dispersed workforce, and the company is hiring new employees weekly, Showalter said. There are six open positions listed on Candor’s website, including underwriting specialist, software engineer and multiple analyst jobs.
The growth of small businesses is important for Central Florida, as those firms can add local jobs and create economic impact as they scale. Startups also create innovative solutions for businesses, help develop a community and make it easier for other new companies to form in the future.
'One-of-a-kind' tech
Candor’s technology already is in the hands of lenders across Florida and the U.S. That includes Orlando-based FBC Mortgage LLC, which began implementing Candor’s platform into its operations within the past nine months, Chief Strategy Officer Travis Rulle told Orlando Inno. “It’s really one of a kind.”
Candor doesn’t replace humans, Rulle said. Instead, it frees up underwriters to spend more time on the out-of-the-ordinary loans that are exceptions. Meanwhile, the increased efficiency sets up FBC Mortgage to take on more business any time the market explodes and makes it possible to issue sturdy loan approvals quicker, Rulle added.
Likewise, FBC Mortgage co-CEO Joe Nunziata told Orlando Inno that embracing this technology is key. “We have to become more of a technology company that does mortgages instead of a mortgage company that struggles with technology.”
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