Paperstac Company Profile

Background

Overview

Paperstac is a financial technology company founded in 2015, headquartered in Orlando, Florida. The company operates a digital marketplace that facilitates the buying and selling of mortgage notes, aiming to modernize and streamline the trading process within the real estate investment sector. By providing a secure and transparent platform, Paperstac connects investors with sellers, enhancing efficiency and accessibility in the secondary mortgage market.

Mission and Vision

Paperstac's mission is to revolutionize the mortgage note trading landscape by offering a user-friendly, digital platform that simplifies transactions and fosters trust among participants. The company's vision is to become the leading marketplace for mortgage note trading, empowering investors and sellers with innovative tools and resources to optimize their investment strategies.

Industry Significance

In the context of the $772 billion secondary mortgage market, Paperstac's platform plays a pivotal role by providing a centralized hub for mortgage note transactions. This innovation addresses the traditional complexities and inefficiencies associated with note trading, offering a more streamlined and accessible solution for investors and sellers alike.

Key Strategic Focus

Core Objectives

Digital Transformation: To digitize the entire mortgage note trading process, reducing manual intervention and increasing transaction speed.

Market Expansion: To capture a significant share of the secondary mortgage market by attracting a diverse range of investors and sellers.

Innovation: To continuously enhance the platform with advanced features, such as AI-driven document generation and automated closing processes.

Areas of Specialization

Mortgage Note Trading: Facilitating the exchange of performing, non-performing, and re-performing mortgage notes.

Real Estate Investment: Providing tools and resources for real estate investors to source, evaluate, and acquire mortgage notes.

Key Technologies Utilized

Digital Platform: A web-based interface that enables seamless interaction between buyers and sellers.

AI Integration: Incorporating artificial intelligence for document generation and transaction management.

Automated Closing Process: Streamlining the closing process with features like eSignatures and eNotarization.

Primary Markets Targeted

Individual Investors: Retail investors seeking to diversify their portfolios through mortgage notes.

Institutional Investors: Financial institutions looking to acquire mortgage notes in bulk.

Real Estate Professionals: Real estate agents and brokers facilitating note transactions for clients.

Financials and Funding

Funding History

Paperstac has raised a total of $1.73 million across three funding rounds:

Pre-Seed Round (May 2019): Amount undisclosed.

Seed Round (February 2022): Amount undisclosed.

Venture Round (August 2024): $500,000 raised.

Notable Investors

Pax Momentum: An accelerator program that supports early-stage startups.

Starter Studio: A startup accelerator based in Orlando, Florida.

Fort Schuyler Ventures: A venture capital firm investing in early-stage companies.

Utilization of Capital

The funds raised are intended to:

Platform Development: Enhance the digital marketplace with new features and improved user experience.

Market Expansion: Increase marketing efforts to attract a broader user base.

Operational Scaling: Support the growth of the team and infrastructure to handle increased transaction volumes.

Pipeline Development

Key Pipeline Candidates

Paperstac's primary focus is on the continuous development and enhancement of its digital marketplace platform. The company is working on:

Enterprise Auction Product: A flagship product aimed at handling larger trades, with a goal to capture 2% of the $772 billion secondary mortgage market within five years.

Anticipated Milestones

Product Launch: The enterprise auction product is expected to be developed, launched, and grown over the next two years.

Market Penetration: Achieving a 2% market share within five years, equating to approximately $17 billion in sales volume.

Technological Platform and Innovation

Proprietary Technologies

Digital Marketplace: A secure platform for listing, buying, and selling mortgage notes.

AI-Driven Document Generation: Automating the creation of legal documents to streamline transactions.

Automated Closing Process: Integrating eSignatures and eNotarization to expedite the closing phase.

Significant Scientific Methods

Data Analytics: Utilizing data analysis to provide insights into market trends and asset valuations.

Machine Learning Algorithms: Employing algorithms to enhance search functionalities and match buyers with suitable notes.

Leadership Team

Executive Profiles

Rick Allen: CEO and Co-Founder. An active real estate investor since 2005, with experience in over 400 house and 300 loan purchases.

Brett Burky: Marketing Director and Co-Founder. A digital marketer with over 15 years of experience in SEO, paid search, and sales.

Mike McLin: CTO and Co-Founder. A full-stack developer with expertise in building scalable web applications.

TJ Osterman: Senior Advisor. An active investor with expertise in alternative, impact, and real estate investments.

Key Contributions

Rick Allen: Provides strategic direction and leverages his extensive real estate experience to guide the company's growth.

Brett Burky: Drives marketing initiatives and user acquisition strategies to expand the platform's reach.

Mike McLin: Oversees the development and technical aspects of the platform, ensuring scalability and security.

TJ Osterman: Offers insights into investment strategies and market dynamics, contributing to the company's advisory board.

Competitor Profile

Market Insights and Dynamics

The secondary mortgage market is valued at $772 billion, presenting significant opportunities for platforms that can streamline transactions and provide transparency. Digital transformation in this sector is gaining momentum, with increasing adoption of fintech solutions to enhance efficiency and accessibility.

Competitor Analysis

Key competitors in the mortgage note trading space include:

Polly: Offers a product and pricing engine, loan trading exchange, and analytics tools to improve mortgage operations.

Auctree: Provides a marketplace for real estate investment, particularly in distressed properties.

SecondRE: Specializes in the secondary market for real estate assets, offering a platform for trading real estate-backed securities.

Strategic Collaborations and Partnerships

Paperstac has established partnerships to enhance its platform's offerings:

NetWorthy: Collaborated to create a fund that invests in Paperstac notes, offering passive income strategies for investors.

Operational Insights

Paperstac differentiates itself through its comprehensive digital platform that integrates the entire mortgage note trading process, from listing to closing. The inclusion of AI-driven features and automated processes provides a competitive edge in terms of efficiency and user experience.

Strategic Opportunities and Future Directions

The company aims to: