Financial tech firm to open Stamford HQ

STAMFORD — Tomo Networks, a new financial-technology firm focused on the real estate industry founded by two former Zillow executives, has announced it will be headquartered in Stamford, with plans to create several dozen local jobs.

Company executives said they see southwestern Connecticut as an ideal location for recruiting talent for a startup that aspires to be for residential real estate what PayPal is for e-commerce. Bolstering its prospects, the firm has raised $40 million in a seed round of investing.

“We think we can build an attractive proposition in Connecticut — in Stamford — and get some talent to jump on the train or live in Connecticut,” Tomo cofounder and CEO Greg Schwartz said in an interview. “We’re really excited to build a destination fin-tech internet company, with a whole bunch of innovation in Connecticut. We haven’t picked an office location yet, but we’ll probably do something in Harbor Point (in the city’s South End).”

Offices in Austin, Texas, and Seattle will complement the Stamford operations, with Tomo planning to hire more than 100 across the three locations.

Tomo plans to start rolling out its services in the first quarter of next year. A digital-mortgage offering will be the first to launch, with the company saying it would provide details around the time of its debut.

The company is launching amid a surge in activity in recent months in markets like Connecticut. The state saw its number of home sales jump 30 percent year over year in the third quarter.

“Buying a home is really way too hard,” said Schwartz, who recently relocated to New Canaan. “It’s too demanding on the homebuyer.”

Tomo is not trying to compete with Zillow, said Schwartz. He worked at the Seattle-based real estate and rental marketplace from 2007 until the start of this year, in a number of executive positions, including most recently as its president of media and marketplace.

Carey Armstrong, Tomo’s other co-founder and its chief revenue officer, formerly served as vice president of Zillow’s Premier Agent business.

“It’s the same industry, but we’re trying to solve a different thing,” Schwartz said. “We’re specifically focused on re-plumbing the transaction and starting with the mortgage. We want to make it a payments platform for the housing industry, as PayPal is to e-commerce … That will be a very powerful and scalable thing, and we’ll be able to partner with folks like Zillow.”

At the same time, Schwartz said the company aimed to help, not compete with, real estate professionals.

“I would never dream of buying a house personally without having the advocacy of a real estate professional,” Schwartz said. “The risks are too high. I think most folks want that same experience, and they should be able to access modern digital tools.”

Some real estate brokers said they would welcome Tomo’s services, although they noted that a number of other issues in addition to finances can complicate homebuying.

“I’m all in favor of anything that would make real estate transactions more efficient. But I do think having very knowledgeable real estate agents to help buyers and sellers go through the process really expedites the process,” said Tammy Felenstein, Stamford-based executive director of sales for real estate brokerage Halstead. “If you have a buried oil tank that’s leaking or need a roofer on a day’s notice, experienced real estate agents have the resources to help with those inspection issues.”

The company’s name alludes to omotenashi, which Tomo’s website describes as a “Japanese service philosophy in which needs are anticipated and thoughtfully met.” Schwartz said he was inspired by an example of omotenashi while trying to catch a bullet train from Tokyo to Kyoto during a family trip a couple of years ago.

A taxi driver who drove him and his family to the train station parked and helped them find their train, despite not speaking much English and the Schwartzes not speaking any Japanese.

“He looked at our train ticket and kind of shuffled us to the right platform and said ‘next train.’ That was the most kind thing,” Schwartz said. “We started having other moments like that in Japan, where folks just anticipated our needs and customers’ needs. It wasn’t because they had to; it was about their integrity as service providers.”

Schwartz