Pre-launch home loan fintech Athena raises $25 million just six months after another multi-million raise

Home loan fintech startup Athena has secured $25 million in funding, little more than six months after it closed a $15 million Series A round.

Founded in 2017 by ex-bankers Nathan Walsh and Michael Starkey, Athena is a cloud-based digital home-loan platform seeking to provide an alternative to the big banks and disrupt the home-loan market.

The Series B round was led by Square Peg Capital. The VC also contributed to the Series A round in May this year, when its founder Paul Bassat joined the Athena board.

The round also includes investment from Hostplus and Airtree Ventures.

Athena has now raised a total of $45 million, all without having a full product on the market.

For the past six months, the startup has been running in “friends-and-family mode”, Walsh tells StartupSmart. Now, it’s gearing up for a public launch in early-2019, with an ambitious goal to lend $1 billion in the first 12 months.

Walsh stresses that, while the Series B round follows hot on the heels of the Series A round, the startup still has plenty of Series A capital in the bank.

However, given what the startup is hoping to achieve over the next 18 months, “there were a lot of great reasons that now was the right time” to raise additional funds.

This funding will be used to fuel the full launch, and to continue working on improving the platform, as well as to bring on board more staff members to manage the growth.

The latest raise was also about attracting investors who had the skills and experience to help the startup through the growth phase

“A big part of the journey is around the investors we attract to the business,” Walsh says.

Already, with the likes of Macquarie Bank and Square Peg on board, Athena has “benefited hugely from their insights and support”.

The value of relationships with people who have an understanding of the startup journey, who are able to introduce the founders to other connections, who are thought leaders in their fields, and who share the startup’s values is “broader than funding”, Walsh says.

Fintech boom

The fintech space is having something of a moment in Australia. In September, research company Roy Morgan found 72% of Aussies surveyed had used a digital payment solution within the past 12 months.

Australia has also produced fintechs such as Afterpay and Airwallex — the latter of which raised $109 million in funding in July — while fintech innovation hubs such as Stone & Chalk serve to champion the sector.

Walsh puts this down to the scale of the opportunity, and the ability to “bring both a modern technology platform and a unique funding model to provide a much better deal”.

Home ownership, for example, is part of “the Australian dream”, he says, associated with achieving financial security. But “there are some real pain points in those journeys … and real opportunities for fintechs to solve them”, he says.

“The big legacy banks have been broken by their complexity,” Walsh adds.

“It’s not new news, the community has been getting a raw deal for quite some time, [but] the time couldn’t be riper to put a genuine alternative out there.”

Talent attracts talent

Walsh has always put a large part of Athena’s success down to its “wickedly talented team”, and although that team has doubled in size since the Series A raise, that still rings true, he says.

“The beautiful thing about great talent is it attracts other great talent,” he says.

The founders have focused on maintaining company culture, and keeping a “day-one” feel as the company grows.

Original team members have been heavily involved in building out their own teams, and there’s a company-wide priority on creating a business “that we can operate both effectively and in an entrepreneurial startup way”.

For other startups striving to achieve the kind of growth Athena has, Walsh’s advice is to try to solve a problem you’re passionate about.

Working on “something that is really going to make a difference” is crucial, and something that will help the startup attract both investors and the best talent.

Equally, Walsh encourages founders to connect with others in the startup space and to absorb as much advice as they can.

“Recognise the huge generosity of the startup ecosystem and the opportunity to learn from those that have gone before,” he says.

“You are the company you keep.”

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