First Mortgage Network Receives $15 Million in Funding; Primary Investors Include Intuit and Technology Crossover Ventures

Business Wire, Sept 28, 1998

PLANTATION, Fla.--(BUSINESS WIRE)--Sept. 28, 1998--Strengthening its position as a leader in the online mortgage market, First Mortgage Network (FMN) today announced that it has received a total of $15 million new equity funding, from Intuit Inc., Technology Crossover Ventures (TCV) and two of its existing venture investors, Dominion Capital and Canaan Partners. This announcement, combined with its recent acquisition of American Finance & Investment (AFI), and its growing list strategic partners including Intuit, Superior Bank, GMAC Mortgage, Prudential RE & Securities and Fannie Mae, demonstrates FMN's rapid growth as a pioneer and key player in the online mortgage market.

The funding will enable FMN to promote and further develop its innovative business-to-business loan origination software, CLOser, which provides Realtors, home builders and financial institutions with point-of-sale and Internet technology, business management, loan processing, and call center and mortgage funding capabilities. The funding will also fortify the growth of FMN's consumer-direct Internet lending web site, loanshop.com.

"Having received funding from such well-reputed venture capitalists and from the leader in financial software and Web-based services, Intuit, speaks volumes of FMN's technology leadership in online mortgage banking and validates the company's strategy for capitalizing on the rapid growth of this market," said Seth Werner, chairman and chief executive officer, First Mortgage Network. "This funding will prove invaluable as we further our technology development and continue to grow the FMN businesses."

"First Mortgage Network's ability to leverage its technology and outsourcing solutions to reduce the cost of mortgage origination and funding demonstrates its visionary market strategy and technology expertise in online mortgage banking," said Mark Goines, senior vice president and general manager Consumer Division, Intuit Inc. "With its sound strategy and dedicated management team, we are pleased to be working with FMN and believe the company is well positioned to be a dominant player in this growing market."

"TCV is dedicated to financing and partnering with leading technology companies that are providing innovative solutions and are led by exceptional management teams. First Mortgage Network is unique in its ability to deliver a broad set of services that meet the needs of both consumers and business-to-business lending organizations," said Tom Newby, general partner, TCV and, with this investment, a newly-appointed member of FMN's board of directors. "We believe First Mortgage Network is poised to further establish a leadership position in the online mortgage banking industry."

FMN has three interrelated technology-based service groups that enable financial services organizations to harness the power of technology and take advantage of the Internet to conduct business. FMN, and its network members and joint venture partners currently originate more than $4 billion annually in residential mortgage loans using FMN's outsourced services.

FMN's Consumer Direct Group (CDG) offers client members a private-label mortgage call center solution/Internet facility, which allows banks, credit unions, and mortgage lenders of any size the ability to offer remote (telephone and Internet) mortgage counseling, mortgage application and mortgage origination services on a fee basis. FMN also owns and operates the first consumer-direct Internet mortgage lending Website, loanshop.com.

FMN also provides real estate brokerage firms, home builders, credit union, banks and other mortgage websites with the ability to outsource any or all of their mortgage banking operations through its Mortgage Banking Group (MBG). Services include technology support, general management, back office operations (processing, underwriting, closing, loan officer recruiting) and optional loan funding, since FMN is also a licensed mortgage bank.

Additionally, the company's Advanced Technology Group (ATG) supports clients of FMN's Mortgage Banking and Consumer Direct Groups, as well as clients seeking to manage and operate their own mortgage businesses with its nationwide "plug and play" CLOser loan origination network and software solutions. ATG's outsourced technology services are primarily priced on a fee per loan funded basis, eliminating the need for major up front expenditures for technology, significantly reducing the cost required to manage and maintain technology and resources on an in-house basis.

About First Mortgage Network

Founded in 1994 and based in Plantation, Florida, First Mortgage Network is a pioneer in online mortgage banking, providing the industry's most comprehensive mortgage platform consisting of brand companies, private-label outsourcing and technology services. FMN is dedicated to reducing the cost of mortgage origination and funding for its clients by supplying realtors, home builders and financial institutions with point-of-sale and Internet technology, business management, loan processing, and call center and mortgage funding capabilities. Additionally, through its acquisition of American Finance & Investment, FMN also provides online mortgage services directly to consumers via AFI's mortgage lending web site, loanshop.com. First Mortgage Network is privately funded with 400 employees in six offices nationwide.