[ad_1]
- Banking technology provider nCino has announced plans to buy mortgage startup SimpleNexus for $ 1.2 billion.
- The deal will see nCino expand to point-of-sale loan services, CEO Pierre Naude told Insider.
- NCino’s deal for SimpleNexus follows the IPO of mortgage technology provider Blend in July.
In its first major deal since going public in 2020, banking technology provider nCino on Tuesday afternoon announced plans to buy SimpleNexus, a digital mortgage company, for $ 1.2 billion, a deal that will see the company behind the scenes speak directly to consumers. .
nCino is a cloud-based operating system used by banks like Wells Fargo and TD Bank to digitally onboard customers, create loans, and open deposit accounts. The company is focused on providing basic banking technologies directly to financial institutions.
With SimpleNexus, nCino would be able to broaden its potential customer base to independent mortgage bankers and expand its reach into consumer lending technologies.
SimpleNexus partners with some 300 mortgage companies and 80 banks and
credit unions
. It provides digital home loan referral, origination and closing tools through an app interface used by loan officers and borrowers. Since launching in 2011, the company says it has partnered with lenders to manage some $ 3 trillion in home loan volume.
“We think our approach has always been to allow you to come in specifically to create a loan product or open an account. It’s very banking-focused, pushing a product out. If you look at SimpleNexus, what is it? ‘they did is watch because of the consumer walking into the bank,’ nCino CEO Pierre Naude told Insider.
nCino seeks to complete its banking ecosystem
nCino plans to integrate SimpleNexus’ origination service, through which mortgage borrowers can apply for home loans through a mobile app and loan officers and real estate agents can track loan status, in the operating system of the business, Naude said.
“This will put us at the forefront of a consumer or end user centric point of sale solution, creating an ecosystem larger than just a banking product,” said Naude.
Naude plans to use SimpleNexus’ technology to expand into other lending opportunities, such as auto or unsecured loans, and “to combine the mortgage experience with additional experiences of creating loans or opening new loans.” account “.
Of the $ 1.2 billion purchase price, about $ 960 million will be paid in shares and $ 240 million in cash, Naude said.
As part of the deal, Naude added, around 300 SimpleNexus employees will move to nCino, with no plans to relocate SimpleNexus from its home base in Lehi, Utah, which is outside of Salt Lake City.
Based in Wilmington, North Carolina, nCino debuted on the Nasdaq in July 2020. While stock prices are down about 20% from all-time highs last summer, stock rose by about 40% since May and the company is now worth around $ 6.8 billion.
Meanwhile, nCino and SimpleNexus share a common investor: New York-based venture capital firm Insight Partners owns about 30% of the outstanding shares of nCino, according to Nasdaq, and led the $ 108 million Series B of SimpleNexus in January.
NCino’s interest in SimpleNexus began about a year ago, Naude said, when the company began exploring a partnership with the mortgage technology company. Partnership plans quickly turned into acquisition talks, in which case an nCino board member, Insight CEO Jeffrey Horing, withdrew from the talks.
As part of the deal, Naude said, Insight agreed to block its shares in SimpleNexus.
NCino’s acquisition of SimpleNexus follows the IPO of mortgage technology provider Blend in July. Blend, which raised $ 360 million in the public offering at a valuation of over $ 3.5 billion, offers digital lending tools that banks like Wells Fargo and US Bank have integrated with their own loan workflows.
[ad_2]
