The Fintech company provides access to residential property by enabling Australians to buy “Bricks” in individual property trusts.
The investment is a sign that banks are heading into a territory they have been wary of in the past.
“The reason we are seeing the rapid rise of Fintech businesses is because they are creating products that are customer-centric and solving problems for the customer where banks have failed to innovate in past few years,” BRICKX CEO Anthony Millet said.
“Customers have potentially turned back on banks, not necessarily because banks have done anything wrong but because they haven’t done anything right. Housing affordability is number one topic that banks are looking to solve and it is very high up on the government’s agenda.”
“This is further recognition that models like this could and hopefully will be the future of ways to access the property market. For banks, it’s a case of participate or be disrupted.”
Fintechs like BRICKX can innovate faster than banks because they don’t have to deal with political barriers, Mr Millet says.
“Banks are trusted, they feel like a safe place. But innovation outside banking is better because of the way we can iterate and we don’t have political landscapes to navigate.”
Despite the fact that investors are leaving the market and creating a cool down of the market, Mr Millet believes this will not have a big impact on customer pool for BRICKX.
“Our potential audience is very significant in Australia. We have different people using BRICKX for different reasons. Parents might be investing for kids, they might be trustees for a superfund, or people diversifying and investing through the property cycle.
“As an investment class, it’s a very stable non-volatile asset class. It’s a good creator and preserver of wealth. In rising market, we may appeal to 100 per cent of the population. In a softer market, we are aligning ourselves to achieving our customer’s goals. The potential audience for BRICKX is in the millions. BRICKX CEO Anthony Millet says he is proud to have formed this strategic partnership with Reinventure.
BRICKX plans to expand into every Australian capital city within the next 12 months.
Reinventure Managing Director Danny Gilligan said the fund was attracted to BRICKX because it is reflective of the significant change the real estate industry is undergoing.
“BRICKX represents the first full-stack solution to property purchasing, renting and financing in the market,” Mr Gilligan said.
While Mr Millet could not disclose the funding amount or goal for the series A funding round, but he says it is “a pretty sizeable Series A” with Reinventure as the lead investor and they are in talks with other parties and potential strategic partners.
BRICKX were successful in securing the Game Changer of the Year award in the 2017 AREAS in the Clients and Media Agency’s category