Montréal-based online mortgage lender Nesto has raised $80 million CAD in Series C financing.
The all-equity round was led by IGM Financial, a part of Power Corporations Canada, and is being used to help Nesto launch a B2B mortgage offering.
The round closed in December and brings Nesto’s total funding to date to $167.5 million CAD. The company did not respond to questions about whether the Series C round included any secondary financing.
IGM Financial took a minority stake in Nesto as part of this round, which also included participation from a number of existing investors, including fellow Power Corporations companies: Diagram Ventures, and Portage. The other existing investors in this round were National Bank of Canada’s corporate venture capital arm, NAventures, as well as Michael Rowell and Michael Paulus, the co-founders of insurtech company Assurance IQ, who led Nesto’s Series B round in 2021. There was also participation from new investor BMO Capital Partners.
With the fresh financing, Nesto is launching a new B2B offering, called Nesto Mortgage Cloud, where it will work with financial institutions to provide its mortgage platform. The startup claimed that by doing so, it is diversifying its customer base and revenue streams.
The first customer of this new product will be the round’s lead investor, IGM Financial. The mortgage cloud solution will be available to IGM Financial’s more than 3,300 financial advisers in early 2023, according to The Globe and Mail.
Founded in 2018 by CEO Malik Yacoubi, CTO Karim Benabdallah, principal broker Chase Belair, and COO Damien Charbonneau, Nesto is an online mortgage lender with the aim of simplifying the mortgage financing experience for consumers. Nesto was developed out of venture builder Diagram, and in addition to mortgage lending, it automates parts of the mortgage application and underwriting process.
Feature image courtesy Pixabay.