# Morty Financial Model Digital mortgage marketplace connecting consumers to lenders via API-driven B2B2C partnerships - Canonical: https://finamodel.com/startups/morty - Excel download: https://finamodel.com/startup-models/morty.xlsx - Category: Fintech - Model type: SaaS ARR / Valuation - Funding round: Series B - Funding: $36.5M - Founded: 2022 - Geography: US (example property shown in Arapahoe, CO) [DECK] - Customer: B2B ## About the company Morty is a digital mortgage marketplace that connects consumers to lenders through API-driven B2B2C partnerships. It gives borrowers a streamlined mortgage-shopping and application process while distributing lender products through trusted consumer channels. Morty operates as a mortgage broker, with the lender paying the economics rather than the borrower. Its commercial performance therefore depends on partner-generated lead flow and conversion through a long, regulated mortgage funnel. The model should forecast leads by partner, applications, pre-approvals, funded loans, average loan balance, and lender-paid broker fee. Since Morty does not hold loans on balance sheet, it should not model interest income; sales, processing, and compliance costs belong below origination-fee revenue. ## What's included - 5-year monthly revenue build with stage-appropriate growth assumptions - Full P&L, headcount plan, and operating-expense schedule - Cash-flow statement, runway, and burn-rate tracking - Valuation via exit multiple with a DCF cross-check - Returns analysis with MOIC and IRR - Unit economics including CAC, LTV, payback, and cohort retention ## Product & value proposition Three-layer "autonomous mortgage" stack: - **Autonomous Acquisition**: Leads API allows B2B2C partners (apps, real-estate platforms) to embed loan quotes and refer borrowers; Morty receives pre-qualified leads at zero paid-marketing cost. - **Autonomous Sales**: Pricing engine generates real-time, customised rate/cost quotes across multiple terms (30/20/15yr, ARM options) and lenders without a human loan officer. 90% of pre-approvals are self-driven by customers. - **Autonomous Operations**: Underwriting engine + service-provider integrations automate back-office tasks (appraisal, title, closing tracker). NPS 60 vs. industry average 16. Key differentiator vs. SaaS providers (help incumbents) and full-stack lenders (rebuild infrastructure): Morty is a pure marketplace - no balance-sheet risk, infinite lender capital. ## Revenue model Not explicitly stated in deck. Inferred from business model: - Morty operates as a licensed mortgage broker. Standard broker model earns a **yield spread premium (YSP) or origination fee** paid by the lender on each funded loan, typically 0.5%–1.0% of loan amount. - No consumer-facing fee shown (slide 7 shows "Borrower-paid broker fee: $0"), confirming lender-side revenue only. - All customers acquired via B2B2C API partnerships - 100% of customers through partner channels. Partners likely receive a referral share or rev-share. - Revenue = funded loan volume × take rate per loan. ## Traction & metrics - **800% YoY revenue run-rate growth** (Q3-19 → Q1-21 chart; expenses nearly flat over same period) - Run-rate and expense lines shown on chart Q3-19 through Q1-21; no absolute dollar values labelled on axes - numbers not readable - **25+ active API/B2B2C partners**, up 230% YoY - **100%** of customers acquired through B2B2C product & API partnerships - **90%** of pre-approvals are self-driven (no sales support requested) - **NPS 60** vs. industry average of 16 - Lead supply chart (slide 9): current channel volume appears ~50,000–60,000 leads today, projecting ~220,000–230,000 in 12 months (stacked bar; axis reads 0–250,000) - Loan distribution across lenders: Top 4 lenders = Lender 1 (33%), Lender 2 (34%), Lender 3 (18%), Lender 4 (9%), Other (5%); no named lenders - Operational efficiency: Industry requires ~10 loan officers to originate 1,000 loans/mo; Morty currently ~1 (icon-based infographic; exact Morty figure at "1 year" and "5 years" trends to zero) ## Unit economics - CAC implied to be very low / near-zero given 100% B2B2C acquisition (no paid consumer marketing), but no dollar figure stated. - Revenue per loan (take rate) not disclosed. ## Competition / moat **Competitive positioning**: - vs. SaaS providers (e.g., ICE/Encompass): help banks be more efficient - incremental improvement - vs. full-stack lenders (e.g., Better.com, Rocket Mortgage): rebuild infrastructure, take balance-sheet risk - Morty: marketplace model, no balance-sheet exposure, connects all lenders in one platform **Competitive advantages** (short-term): - Price (competitive rates via multi-lender marketplace) - Product differentiation (autonomous, self-service UX) - Marketplace positioning **Moats** (long-term): - Cost superiority (near-zero loan officer cost vs. industry) - Network effects (more partners → more leads → more lender competition → better rates → more partners) - Integrated partnerships (embedded in B2B2C apps) - Government & regulatory (mortgage broker licensing is a meaningful barrier) ## Team & funding ask / use of funds **Leadership**: - Nora Apsel - Co-Founder & CEO; 10+ years engineering & startup experience; Emory B.S. + Penn M.S. (CS) - Adam Rothblatt - Co-Founder & CTO; Goldman Sachs background + Penn B.A. & M.S. (CS) - Robert Heck - Head of Mortgage; 7+ years mortgage experience; Morgan Stanley capital markets; Berkeley B.A. (Applied Math & Econ) **Investors**: Thrive Capital, Prudence, Lerer Hippeau, FJ Labs, Metaprop, Techstars **Next phase stated**: 1. Scale volume - double down via technology development and team growth 2. Build a platform - become "the mortgage layer of the internet," embed Morty into digital real-estate ecosystem --- ## Recommended financial model - **Archetype + why**: **Marketplace loan-origination P&L model** (GMV / funded-volume waterfall). Morty is a pure mortgage broker - no balance-sheet exposure, no interest income. Revenue is purely volume × take rate. The right model tracks: (a) lead flow by partner channel, (b) conversion funnel (leads → applications → pre-approvals → funded loans), (c) revenue = funded loan UPB × broker fee rate, (d) opex (tech + headcount + licensing), (e) contribution margin per loan. A 3-statement build is appropriate given the company is growth-stage with operating losses and will need to model cash runway. - **Forecast horizon & granularity**: 3 years (2021–2024), quarterly for Year 1, annual for Years 2–3. Deck context is Q1-2021 as latest data point. - **Key drivers & assumptions**: - **Funded loan volume (loans/mo)**: 800% YoY growth rate as of Q1-21; absolute volume not disclosed → seed from implied chart shape; model as monthly cohort compounding - **B2B2C partner count growth**: 25+ partners, up 230% YoY → continue at ~100% YoY deceleration curve - **Leads per partner per month**: ~50K–60K total today across 25+ partners → ~1,500–2,000 leads/partner/mo average, growing as partners scale - **Loan officer headcount**: ~1 officer per 1,000 loans/mo today; trending toward 0 → tech-driven; ops headcount grows at ~20% of revenue growth rate - **Gross margin**: ~85–90% (marketplace model, minimal COGS - primarily payment processing, data services, licensing costs) - **Revenue run-rate at Q1-21**: Shape of curve visible but Y-axis unlabelled → placeholder; model should request actual ARR figure from company - **Scenarios (Base / Bull / Bear - which variables flex)**: - **Base**: Partner growth at 80% YoY; conversion rate steady; take rate 0.75% - **Bull**: Partner growth at 150% YoY (platform flywheel); conversion rate improves 1pp/yr; take rate expands to 0.85% as lender competition increases - **Bear**: Partner growth at 30% YoY (slower B2B2C adoption); conversion rate declines in rising-rate environment; take rate compresses to 0.60% - **Required sheets / outputs**: 1. **Assumptions** - all drivers in one place, switchable by scenario 2. **Funnel** - partners → leads → applications → pre-approvals → funded loans (monthly) 3. **Revenue** - funded UPB × take rate; split by partner type if data allows 4. **Opex** - headcount plan (tech, ops, G&A), non-headcount opex 5. **P&L** - revenue, gross profit, EBITDA, net income (monthly/quarterly) 6. **Cash flow & runway** - given no disclosed funding raise amount, model cash burn and runway sensitivity 7. **KPI dashboard** - loans/mo, take rate, revenue/loan, gross margin %, cost per funded loan ## Frequently asked questions ### Is the Morty financial model free? Yes. The Morty model is a free Excel download with live formulas. ### Can I change the assumptions? Yes. The workbook is editable and its live formulas recalculate when assumptions change.