A Dallas-area real estate company has raised $15 million to create a “one-stop shop” for entrepreneurs seeking the education and financing needed to flip homes.
The firm is called Backflip. Series A fundraising was carried out by FirstMark Capital. Backflip, which was formed in 2020, reported it exceeded $10 million in profits in 2023, becoming near-profitable.
“Backflip is not just about flipping houses; it’s about flipping the script on the why, how, and what it means to be a real estate entrepreneur,” Backflip CEO Josh Ernst said in a statement published by Dallas Innovates. “Our mission is to help everyone access the funding and tools they need to participate. We put information, support, and capital products designed for entrepreneurs in the hands of more individuals in an industry that has historically had too many barriers to successfully starting and scaling. In doing so, we’re empowering our members to rejuvenate communities one modernized home at a time.”
According to data from ATTOM, the average house flip in the first quarter of 2023 netted a profit of $56,000, up 4.7% from the same period in 2022. ATTOM noted that more than 72,000 homes were flipped nationally in the first quarter of 2023, reported Yahoo News.
ATTOM data suggests that house flippers in the Dallas-Fort Worth area may not fare as well. The data licensing business notes that in the third quarter of 2023, house flippers averaged returns of 4.9%, a decline from the 6.6% clocked the previous year. Gross profits averaged just $16,700 in the metroplex, and 1,684 homes were flipped in the quarter.
“We’re thrilled to lead Backflip’s Series A to continue the work of building the financial operating system for this integral but overlooked part of the real estate value chain,” Adam Nelson, managing director at FirstMark, said in a statement, per Dallas Innovates. “The Backflip team has combined deep product empathy, technology, and capital formation to build a 10x better product for their members.”
Backflip’s goal is to help investors earn higher profits through the use of technology and financing. Flipping properties can substantially impact neighborhoods and communities, particularly in areas that see several houses flipped.
Christie’s Enterprises claims that flipping can raise neighborhood property values and foster a better sense of community among residents.
“One of the most visible impacts of house flipping is the revitalization of abandoned and neglected properties,” the real estate firm wrote in a blog post. “By renovating these homes, house flippers bring new life and vitality to once-depressed areas. These revitalized properties become symbols of hope, inspiring neighbors to invest in their own homes and improving the overall aesthetics of the community.”
