Rent Butter, a revolutionary tenant screening product tailored for the workforce and affordable housing, has successfully concluded its seed financing round, securing $3 million in investments. The round was led by RET Ventures, a venture fund deeply rooted in the real estate technology sector, with a focus on single and multi-family housing.
RET’s involvement is through the RET Ventures ESG Fund, known as the “Housing Impact Fund,” which concentrates on technology investments that offer advantages to real estate operators while advancing social and environmental objectives.
Founded in 2021 by Chris Rankin and Tom Raleigh, Rent Butter was conceptualized to empower owners and managers of workforce and affordable housing communities with a more comprehensive risk assessment tool for screening potential residents. This workforce housing sector encompasses multifamily, single-family, and manufactured housing.
Traditionally, property owners evaluating rental applicants relied primarily on static data such as credit scores and background checks, offering only a partial view of renters’ financial stability. Since its inception, Rent Butter has gained significant traction, with more than 100,000 residential units within its network.
The company intends to extend its product range and customer base into conventional Class A and B multifamily and single-family rentals in 2023.
Rent Butter’s digital platform enables applicants to go beyond static credit scores by providing alternative data like banking information, behavioral patterns, and other unique metrics. It swiftly furnishes property owners with comprehensive financial and credit behavior reports.
By analyzing the complete financial history of potential residents and utilizing predictive analytics, Rent Butter identifies crucial trends, such as credit score fluctuations, enabling property operators to make more precise and equitable assessments of individuals’ rent-paying capacity. The platform also validates vital documents like applicant IDs, employment details, and income in real-time to safeguard property owners against fraud.
Tom Raleigh, Co-Founder and CEO of Rent Butter, stated, “When founding Rent Butter, our main goal was to create an alternative to the antiquated tenant screening process and to empower property owners with a more dynamic, complete picture of an applicant’s financial status and history – reducing turnover and at the same time opening the door for potential renters who may have otherwise been turned away.”
Rent Butter is not only a valuable tool for property owners to reduce leasing risks but also assists applicants with poor credit histories who may have previously faced housing rejections in building a financial track record. By enabling owners to assess risk based on alternative data like banking reports, credit behavior analyses, and authentic income-to-expense ratios, Rent Butter equips them to make more informed rental decisions.
The platform also seamlessly integrates into property managers’ existing workflows, improving the overall leasing experience.
Aaron Ru, Principal at RET Ventures, commented, “Rent Butter’s approach to the tenant screening process aligns perfectly with the mission of our Housing Impact Fund, and its ability to improve both the owner and resident experience makes it an ideal investment for us.”
Chris Rankin, Co-Founder and CTO of Rent Butter, added, “As we continue our national expansion, I’m looking forward to arming even more multifamily owners with the insights needed to make the most informed assessments while giving prospective tenants credit for their overall financial behavior.”