Divvy Homes

Divvy Homes was a rent-to-own startup founded in 2016 that purchased homes for renters and leased them back while tenants built savings toward ownership.^123591012 The company raised over $700 million in debt and equity, reached a $2.3 billion valuation in 2021, but struggled after interest rates rose in 2022, leading to layoffs and a halt in home acquisitions.^1359101213 In January 2025, Divvy Homes was acquired by Brookfield Properties' Maymont Homes for about $1 billion, with founders, employees, and most investors receiving no proceeds due to debt and liquidation preferences.^123591013

Timeline

Money raised

Divvy Homes raised a $7 million seed round in January 2018 led by Caffeinated Capital.⁹¹³ In October 2018, Divvy Homes raised a $10 million Series A led by Andreessen Horowitz and a $120 million debt financing.⁹¹³ Divvy Homes raised a $43 million Series B in September 2019 led by GIC and Lennar.⁹¹³ In February 2021, Divvy Homes raised a $110 million Series C led by Tiger Global Management at a $490 million valuation.⁹¹²¹³ In August 2021, Divvy Homes raised a $200 million Series D co-led by Tiger Global and Caffeinated Capital at a $2 billion valuation.⁹¹²¹³ In October 2021, Divvy Homes took on approximately $735 million in debt financing.³¹³ Divvy Homes raised more than $400 million in venture capital and over $1 billion in debt financing over its lifetime.^135101113 Divvy Homes was acquired by Brookfield Properties for about $1 billion in January 2025.^13591013 The acquisition price was less than half of Divvy's peak valuation of $2.3 billion.¹²³⁵¹⁰ After repaying debt, transaction costs, and liquidation preferences, common shareholders and founders received no proceeds.²³⁹¹⁰

Investors named in the sources: Andreessen Horowitz^159101213, Tiger Global Management^159101213, Caffeinated Capital⁹¹²¹³, GGV Capital^59101213, GIC⁹¹²¹³, Lennar⁹, Max Levchin⁹, Moore Capital⁹, SciFi VC⁹, Threshold⁹, Atalaya Capital¹³, Cross River Bank¹³, Jaws Ventures⁹.

What happened

Divvy Homes was founded in 2016.²³⁵¹⁰ The company launched a rent-to-own model in 2017, purchasing homes for renters and leasing them back while tenants built savings toward ownership.¹⁹ Divvy Homes raised a $7 million seed round in January 2018 led by Caffeinated Capital.⁹¹³ In October 2018, Divvy Homes raised a $10 million Series A led by Andreessen Horowitz and a $120 million debt financing.⁹¹³ Divvy Homes raised a $43 million Series B in September 2019 led by GIC and Lennar.⁹¹³

By 2019, Divvy Homes had achieved unicorn status.² In February 2021, Divvy Homes raised a $110 million Series C led by Tiger Global Management at a $490 million valuation.⁹¹²¹³ In August 2021, Divvy Homes raised a $200 million Series D co-led by Tiger Global and Caffeinated Capital at a $2 billion valuation.⁹¹²¹³ Divvy Homes' valuation reached $2.3 billion in 2021.¹²³⁵¹⁰ In October 2021, Divvy Homes took on approximately $735 million in debt financing.³¹³

Divvy Homes raised more than $400 million in venture capital and over $1 billion in debt financing over its lifetime.^135101113 By 2022, Divvy Homes was on track to surpass $100 million in annual revenue.¹ When mortgage rates spiked in 2022, the monthly payments required from new Divvy renters became too high and misaligned with local rent levels.¹ Divvy Homes conducted a round of layoffs in September 2022, affecting about 12% of staff, or 40 employees.¹⁸ In February 2023, Divvy Homes conducted another round of layoffs, including high-level positions.¹⁸

By November 2023, Divvy Homes had conducted its third round of layoffs in a year's time.¹⁵ By late 2023, Divvy Homes had a portfolio of around 7,000 homes and had mostly stopped acquiring homes.¹⁹ Divvy Homes faced customer complaints about high rents, slow repairs, and increased evictions.¹¹⁸ In January 2025, Divvy Homes was acquired by Brookfield Properties' Maymont Homes for about $1 billion.^13591013 The acquisition price was less than half of Divvy's peak valuation of $2.3 billion.¹²³⁵¹⁰

After repaying debt, transaction costs, and liquidation preferences, common shareholders and founders received no proceeds.²³⁹¹⁰ CEO Adena Hefets wrote in a letter to shareholders that neither common shareholders nor founders' preferred stock would receive any proceeds.³⁹¹⁰ An industry insider told ResiClub that just about everyone at Divvy had been laid off except a small team working on dispositions.¹ The insider described the situation as a bloodbath for investors and employee equity.¹ Maymont Homes, the Brookfield unit that acquired Divvy, operates over 10,000 single-family rentals in more than 40 U.S. markets.¹⁹¹⁰

Divvy Homes stated it had created 2,000 homeowners to date.¹⁰ The acquisition was expected to close in mid-February 2025.¹⁰

Where the founders are now

CEO Adena Hefets wrote in a letter to shareholders that she was not proud of the financial outcome but proud of the impact.³

Lessons, as others put them

"The preference stack isn't some abstract financial concept. It has real-world impacts that ripple through the entire startup ecosystem."Brian Nichols, Hustle Fund²

Sources

1. 'A bloodbath for investors and employee equity': Rent-to-own startup Divvy Homes is being acquired, ResiClub, 2025-01-14
2. What happened with the Divvy acquisition? | Hustle Fund, hustlefund.vc, Jan 29, 20
3. Debt Isn’t Free: What Every B2B Founder Needs to Learn from Divvy Homes’ $1 Billion Exit Where Founders and Most VCs Got $0, SaaStrAI, 2026-02-19
5. Once high-flying proptech startups Divvy Homes and EasyKnock are the latest to struggle | TechCrunch, TechCrunch, 2025-01-18
9. Divvy Homes Acquisition, Valuation, Funding & Investors | Multiples, multiples.vc, Sep 18, 20
10. Once valued at over $2B, rent-to-own startup Divvy Homes is selling to Brookfield for about $1 billion | TechCrunch, TechCrunch, 2025-01-22
11. How much has Divvy Homes raised?, komo.ai
12. Divvy Homes hits $2 billion valuation after latest funding round, HousingWire, Aug 13, 20
13. How Much Did Divvy Homes Raise? Funding & Key Investors | Clay, clay.com
18. Divvy Homes has reportedly conducted another round of layoffs, HousingWire, Feb 17, 20

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