Venture Capital Firm Sees Reverse Mortgages As A Guaranteed Growth Industry

On the industry panel “Where Is the Capital Coming From?” at the recent NRMLA event, one venture capitalist said he was willing to invest in practically any aspect of the reverse mortgage business.  In the article Reverse Mortgages Called a Sure Thing (Subscription Required) from the National Mortgage News Diogo Teixeira of the Revmore Investment Group said that, “We’re looking for additional opportunities elsewhere in the country and elsewhere in the business”.

This represents a growing trend of companies that are looking to get into the reverse mortgage business.  Teixeira heads the Revmore Investing group which is based out of Wellesley, Mass that recently made their first reverse mortgage investment in Your Home for Life.  According to article, YHFL is the 10th-largest originator in New England in 2007 and the sixth largest independent originator.

I was curious about Revmore so I did some research and found out more details about what type of companies they’re looking to invest in.  According to their website, individual company size can vary between $1 & $20 million and should have the following characteristics:

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  • A sound business plan with expansion possibilities
  • Established management team in place
  • A viable exit strategy within 5-7 years

Investments can range from $100,000 to $5 million and can be used to increase sales or marketing, new products, and better technology.

Revmore isn’t the first private equity firm to invest in the reverse mortgage business, recently Menlo Ventures invested in Golden Gateway Financial and JAM Equity Partners has made investments in Reverse Mortgage Solutions and Vertical Lend. 

I don’t know much more about the company but I’m sure there are a few RMD readers who might be looking for an opportunity like this so I thought I’d pass it along.

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