November 12, 2025 • 16 mins
Paul Corvino sits down with Michael Gifford, CEO of Splitero. He leads the company, which provides homeowners with a lump sum of cash in exchange for a share of their home's future appreciation.
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Speaker 1 (00:02):
This is CEOs you should know with division president of iHeartMedia,
Paul Corvino. We're here with Michael Gifford, the co founder
and CEO of Splitteiro. It's a business that helps homeowners
access the equity trapped in their homes without additional monthly
payments through a home equity investment. But well, welcome Michael.
Speaker 2 (00:20):
Thank you for having me.
Speaker 1 (00:21):
Hey, before we get started on the interview, what I
like to do is a quick Q and a rapid session.
You got to answer real quick. It gets the mind
working and the mouth moving. You ready to go?
Speaker 2 (00:32):
Sounds good?
Speaker 1 (00:33):
Okay, Skier beach vacation beach Beagles are stones, Stones, Tom
Brady or Michael Jordan, Tom Brady, Sean Connery or Daniel Craig.
Speaker 2 (00:42):
Dan Craig Star Wars with Godfather. Oh, that one's tough.
Speaker 1 (00:46):
Godfather celebrity people say you remind.
Speaker 2 (00:49):
Them of I don't know if I resemble any celebrities,
So I don't get that one off.
Speaker 1 (00:54):
We're gonna have to come up with one, all right.
Speaker 2 (00:56):
Figure it out in the next next couple minutes.
Speaker 1 (00:58):
Okay, Hey, let's find that a little bit about your
journey and how you eventually got into the position where
you became the CEO of Splitzeiro.
Speaker 2 (01:05):
Yeah, my journey is all in residential real estate investment.
So where'd you grow up? First of all, I grew
up in Wisconsin. Moved to southern California in two thousand
and nine.
Speaker 1 (01:14):
Okay, where'd you go to go to school in Wisconsin?
I did?
Speaker 2 (01:17):
I did not know. I went to high school in
Wisconsin and I went to college in Minnesota at the
University of Saint Thomas.
Speaker 1 (01:24):
Okay, yeah, and what'd you study?
Speaker 2 (01:26):
I studied realestate and finance there. Wow, so you do
early on with what you wanted to do early on? Yeah,
I was interested in real estate, which was a good
platform for where I'm at.
Speaker 1 (01:35):
What business where your parents had?
Speaker 2 (01:36):
My dad was actually a law enforcement officer and he
did narcotics investigation, So up there, you're buying a lot
of meth and other sort of drugs. My mom ran
her on small bus.
Speaker 1 (01:46):
You had to be straight and clean, otherwise you weren't
going to be able to get anything past your dad.
Speaker 2 (01:50):
That's right, straight and clean from the start. I'm always
the like, you know, ten minutes early as on time person,
So that's kind of been from the start.
Speaker 1 (01:57):
So tell me. So, now, you grew up in Wisconsin,
went to school in Minnesota, studied real estate. What's your
first job out?
Speaker 2 (02:04):
First job out is kind of an interesting part of
my career. So first job out is working with a
family office down in San Diego that was starting a
real estate foreclosure fund. So they at that point, right,
so this is two thousand and nine, did you get
that job?
Speaker 1 (02:19):
Oh?
Speaker 2 (02:20):
Networking in You spend enough time at the beach and
around San Diego, you kind of meet people, and so
I just just networked into that job and knew some
people that were starting there as well.
Speaker 1 (02:29):
So tell us about the job.
Speaker 2 (02:30):
Job is, we are if you've ever seen the movie
Boiler Room, we are operating that, but we're buying houses.
So at that point in time, you could buy as
many houses as you had cash for. And so we're
out there at the trustees foreclosure steps buying houses every day.
We're buying thirty to forty houses a month, which then
turns into a large fix and flip operation. So we're
(02:52):
buying them. At that time. If people were in it,
we had to do evictions or to help them move out.
Speaker 1 (02:56):
And that big margins on a fix and flip. Oh.
Speaker 2 (03:00):
Back then it was all over the mount because value
was really difficult right when things are getting foreclosed on
with you was this two thousand and nine, so you.
Speaker 1 (03:08):
Right right at the height of the subprime collapse, right
at the height of the collapse.
Speaker 2 (03:12):
Yeah, there's you know, at that point in time. It's
hard for people to imagine today, but there's as many
houses as the market as you could buy. So there's
as much as you would cash for. You could buy
that many houses that day at the foreclosure off.
Speaker 1 (03:22):
You would down in at southern California outs not necessarily
in San Diego, but around San Diego. That was that
was subprime you know, the subprime prime market. Yeah.
Speaker 2 (03:33):
Yeah, you saw everything from the crushing stories of truly
like you know, both parents lost their job and now
they're losing their house to the person that has you know,
three BMW's and a boat parked out front. They used
their house as atm SO.
Speaker 1 (03:46):
And what was your exact function with the company.
Speaker 2 (03:48):
I was running a team of analysts buying thirty to
forty houses a month at the foreclosure auctions. So we
would buy you know, forty houses, then those moved on
to construction and then we had fixed them up and
sell them.
Speaker 1 (04:00):
How long did you do this?
Speaker 2 (04:01):
For a couple of years, and then I broke out
and started my own fund, so I partnered with two
developers that were in the market. We started buying about
one hundred hundred.
Speaker 1 (04:09):
So you have twenty five or twenty six years old
now and you started your own fund. That's right, Let's
stop a second. That's a hell of an accomplishment. Thank
you money of your own at that time, or you
had to go ahead and raise money.
Speaker 2 (04:21):
Some of our own. But we went out and raised
a lot of money at that point too. Because of
the collapse, debt was really difficult, so debt terms was
possibly good mortgage, it was impossible to get a mortgage.
It was impossible to get debt for a fund like that,
so it was really low leverage, so you could only
get kind of fifty to sixty percent of your fund
and debt. So that meant you had to raise a
lot of capital.
Speaker 1 (04:41):
So how'd you go about raising his capital? Oh?
Speaker 2 (04:43):
Man, you obviously start with friends, family, and then as
that's going the fix and flip market really started picking up,
so kind of more institutional partners started looking into the
space and figuring out how they could invest in it,
because you're talking about, you know, the largest asset c
so the US real estate, right, So institutional investors started
(05:04):
coming around. They started investing in smaller operators and then
starting their own large operators. So as we went on,
capital got easier. But at the beginning, it's very difficult.
Speaker 1 (05:12):
And how long did you do this for?
Speaker 2 (05:14):
I did this for our fund probably was four or
five years, and then I got on the debt side
of things and started lending money to investors.
Speaker 1 (05:22):
How many people that you have working for you at
this time?
Speaker 2 (05:24):
We had quite a few when you include like all
the contractors and whatnot. Any given time we would own
over one hundred houses.
Speaker 1 (05:30):
That were you were still a kid twenties.
Speaker 2 (05:32):
I was still a kid at this point. Yeah, young
and trying to grow a big business, that's for sure.
Speaker 1 (05:37):
What made you so you have this business that's yours?
Why did you did you leave that business or do
you still do that in addition to what you're doing
I did.
Speaker 2 (05:45):
The hard part about that business is scale, Right, when
you actually have to have crews at a property swinging hammers,
it's really difficult to scale that business, and certainly out
of your own local market, but not anything you could
do nationwide. And so scale ability is the reason why
I left that business.
Speaker 1 (06:02):
So you left that business, Now you're going to start
this new business.
Speaker 2 (06:05):
Yep, which is Splitterario started a little bit after that.
Speaker 1 (06:09):
Okay, so let's go to that first business. Yeah, so
you're like, we are you twenty eight years old? Now? Yeap?
You left the business I actually made, you made a
few bucks. You're living high. You're twenty eight years old.
Are you spending it like it's water?
Speaker 2 (06:23):
No? Thankfully not. I wish not. I actually bought real
estate and rentals and kind of went that route. But no,
So then I roll out of that and I join
a venture backed company that wanted to raise a large
fund to give debt to investors that were fixating.
Speaker 1 (06:39):
You joined the company with other people when you were
running your own company.
Speaker 2 (06:43):
That's right.
Speaker 1 (06:43):
Was that difficult?
Speaker 2 (06:45):
It was difficult, But I wanted to learn that side
of the business. So I wanted to learn how the
debt and capital markets operated.
Speaker 1 (06:51):
So you went into it with the plan of not
staying there, but going in there or as a learning.
Speaker 2 (06:57):
Yes, learning kind of from a few different points. So
the Debton capital markets for sure. But also I'd never
been in a business that was venture back, so I
didn't understand how quickly you could scale a business and
how that happens when you have, you know, a large
investment from venture capital. So it was a learning moment
for me for a few years, which really set me
up for success.
Speaker 1 (07:17):
First, as you sit there and say, going back to
your first business that you said the problem was scalability, saying,
if I knew what I knew now about this venture business,
I could have built that into a tremendous business.
Speaker 2 (07:28):
Yes, and no, I think there's a lot of learnings
in hindsight that go into that. But still the fix
and Flip world, where you have construction going on projects
where people are swinging hammers, it's just a very difficult
business to scale.
Speaker 1 (07:41):
Yep. All right, so now you did this for Hella Ah.
Speaker 2 (07:44):
This is another two or three years, so now we're
kind of your early thirties.
Speaker 1 (07:49):
So now you're coming up with the idea for Splotero.
So now that head did that idea coming back?
Speaker 2 (07:54):
Yeah, So twenty twenty hits, so covid hits. And really
even before COVID, I was looking around the real estate market,
the interesting part about real estate is there's constant change,
so how you can operate and what you should be
doing next is always changing the real estate market. So
I'm seeing nationwide homeowners have difficulty accessing the equity in
(08:17):
their house. There's very low inventory in all the markets,
so nobody really wants to sell their house because it's
hard to buy something, and prices were going on, so
it's hard to buy. Prices are going to this is
twenty twenty, right, and so the market is shooting up
in price, and people have all this equity, but if
they sell their house, they can't really buy in their neighborhood,
(08:39):
so they end up moving to like a tertiary market
or they just use a credit card. At that point,
a lot of people are also selling to like eye
buyers like open Door and Zillow and redfin. Right, it's
not a good solution for these homeowners who have a
ton of equity in their house. So it's trying to
figure out what's the best way to help a homeowner
get equity out of their house without having to leave
their house, because that was the thing. People needed cash,
(09:01):
but they didn't want to sell their house because they
didn't know where they were going to go. That's really
why I started Splitario.
Speaker 1 (09:06):
So what were your first steps to starting it? Now,
you've got to raise money, you've got to do marketing,
you've got to you know, create create a demand. Yeah. Yeah.
Speaker 2 (09:15):
The difficult thing about starting Spilittario is it's two sided.
You have to do all that what you said, right,
You have to raise money, You've got to get a
product that you can put out there, but then you
have to fund it, and you got to get a
lot of money to fund it at scale. And so
that comes with Wall Street commitments. And when you go
to Wall Street, they expect you to act very mature
as a business, even though you just opened the doors
(09:37):
a couple of weeks ago. And so you're building kind
of on both sides where you are a full on startup.
Speaker 1 (09:42):
Selling based on your past track record. Yeah.
Speaker 2 (09:45):
Yeah, both like passtrack record, opportunity of what we think
it could be, and also the scalability of it. Right,
a lot of Wall Street funds aren't interested for a
few million bucks. They want to put out hundreds of
millions or a billion of dollars. So you're you're selling
on all of.
Speaker 1 (09:59):
Those find it's easier sometimes to raise a billion than
it is to raise a billion.
Speaker 2 (10:03):
That's what they say. I think it's probably somewhere in
that line. You know a lot of a lot of folks.
It's they're doing the same amount of work and so
they rather put out more dollars.
Speaker 1 (10:11):
So tell me take me through the process. Yeah.
Speaker 2 (10:14):
So we start in January twenty two and we are
doing that. We're doing sales marketing, we're figuring out how
to build our product.
Speaker 1 (10:22):
What's the marketing pitch, What's what's the value proposition?
Speaker 2 (10:25):
Access the equity in your house without any monthly payments.
And so typically homeowners think about, you know, I'm going
to use a heelock or another debt instrument that comes
in and the home equity line of credit. And so
when they do that, they then have a monthly payment
as soon as they use the capital. And so the
(10:45):
big pitch for Spoto is you can conveniently easily access
the equity in your house and you don't have a
monthly payment and you don't pay anything until you either
refire or sell your property down the road.
Speaker 1 (10:56):
So you could take out the money on your home
and not what if you never take at a home
equity loan or sell your house.
Speaker 2 (11:03):
Yeah, so we our maturity is the maturity of your
first mortgage. So the day that you pay off the
last payment on your mortgage is when you'll pay us
back to And at that point you got you know,
full equity of your house and you have a lot
of opportunity.
Speaker 1 (11:16):
I like that. I may make a caller for this.
Speaker 2 (11:19):
We're happy to help.
Speaker 1 (11:20):
It's it's interesting. So so that's so that's the marketing.
That's that's the value proposition. How do you raise enough
money at this point to do what you need to do?
Speaker 2 (11:29):
Yeah, so we raise a small amount of venture funds
to get employees, start working and start building. We're building
a pipeline of people. We go out there.
Speaker 1 (11:37):
Who are you first employees that you hire?
Speaker 2 (11:40):
Capital markets is one of the first ones. Operations, the
next we got to build sales, script and processing, figure
out how we actually get people the equity in their house,
what we have to do for underwriting.
Speaker 1 (11:51):
So there's your team though, So you're the CEO of
this company, Yeah, who is under you? Who are those
first people that you bring on?
Speaker 2 (11:57):
So I have a co founder who's our CEO. So
he starts kind of taking his background also real estate.
So this is the third time we've worked together, known
each other for fifteen years. So he takes sales through closing, right,
So how do we get people in the door, get
them their funds? I take everything else, so marketing, people, ops, finance,
and accounting, capital markets, which is the big one early on.
(12:20):
So we start building our product, building our agreements, working
with legal, and then we go out and say, hey,
we need you know, one hundred or two hundred or
three hundred million dollars that we're going to put out
in the streets. And that story is the difficult story
to tell.
Speaker 1 (12:36):
Right.
Speaker 2 (12:36):
It's easier to raise venture capital than it is to
raise a couple hundred million dollars from Wall Street. For
these agreements, you have to be very buttoned up on
the underwriting side so you're not putting them at too
much risk. You've got to, you know, have a product
that they can scale, so they're not you know, putting
small dollars. The most interesting part of this is like
when you go to midtown Manhattan, there are so many
(12:58):
funds that you've never heard of that have fifty billion
dollars right, or ten billion dollars, and so hundreds you know,
we're out there pitching hundreds of investors to get this done.
And this is also early on, just to get a meeting.
They'll take meetings, right because they're getting pitched opportunities all
the time, and like there it's their job to investigate them.
So they'll take meetings. But getting follow up after the
(13:20):
meetings is what's difficult. You got to stay on them
really sell the dream that like, hey, there's you know,
I'm in a market where homeowners have thirty four trillion
dollars of equity in their houses right now, and so
this is a massive market opportunity, probably bigger than anything
else they're looking at.
Speaker 1 (13:35):
It's exciting now. And so now who came on board
for you?
Speaker 2 (13:38):
So yeah, so we hire kind of early leadership team,
right that come on. For all those titles that I mentioned,
capital markets, finance, accounting and legal people, operations, and then sales, underwriting, processing, closing.
Speaker 1 (13:51):
What do you look for employees and people in those roles.
Speaker 2 (13:54):
We look for a few different things. One certainly like
self starters, because when you're early on in a company,
everybody has a ton of responsibility. It's it's a startup still, right.
We also look for people with mortgage experience, right, we
have to be industry specific. There's a lot of unique
things about running a business like ours, where you have
to follow a lot of laws, a lot of regulatory stuff.
(14:16):
And then really we're looking for people that can grow teams.
Like what we're doing here is a product that's newer
and will be something huge, but it takes a lot
to get there, and so we need to build teams
grow to tonight.
Speaker 1 (14:29):
So now you've got the fun thing in place, you've
got your core executive team in place. How do you
flip the switch and what happens.
Speaker 2 (14:37):
We flip the switch basically March first of twenty two,
and we get our first homeowner all the way through
the funnel March thirty.
Speaker 1 (14:44):
First get we just started advertising at that point.
Speaker 2 (14:47):
We did we started advertising. We did some pretty targeted
direct mail, we did search and social kind of just
the early onset into our advertising journey, and we get
our first home owners through the door. Mark through the
end of the year, we do about seventy million production,
so we have that many homeowners coming in and wanting
to actually the equity in their house, and we started
(15:08):
growing from there.
Speaker 1 (15:09):
That's an exciting story. How many employees do you have now?
Speaker 2 (15:13):
Now, we have about one hundred and thirty employees.
Speaker 1 (15:17):
Or thirty employees in national and you're.
Speaker 2 (15:19):
We're not quite national. We're in fourteen states. Okay, we're
fully mount so we're headquartered in San Diego, but we
have a team in twenty five states or so.
Speaker 1 (15:27):
Congratulations, I thank you. Exciting. Well, how do our listeners
find you?
Speaker 2 (15:32):
Splittero dot com is the easiest way to find us.
You find everything out that s p l I T
e r O dot com.
Speaker 1 (15:39):
Splitterio dot com. Hey, once again, we're here with Michael Gifford,
the co founder and CEO of Splitteriro. You can go
to splittereo dot com and you could access the equity
trapped in your homes. And thank you very much for
joining our show today.
Speaker 2 (15:55):
Thank you for having me on.
Speaker 1 (15:56):
This is Paul Corvino, Division President of iHeartMedia saying thank
you for listening to another episode of CEOs you Should Know.
Listen to CEOs you Should Know on the iHeartRadio app.
This is CEOs you should know with division president of iHeartMedia,
Paul Corvino. We're here with Michael Gifford, the co founder
and CEO of Splitteiro. It's a business that helps homeowners
access the equity trapped in their homes without additional monthly
payments through a home equity investment. But well, welcome Michael.
Speaker 2 (00:20):
Thank you for having me.
Speaker 1 (00:21):
Hey, before we get started on the interview, what I
like to do is a quick Q and a rapid session.
You got to answer real quick. It gets the mind
working and the mouth moving. You ready to go?
Speaker 2 (00:32):
Sounds good?
Speaker 1 (00:33):
Okay, Skier beach vacation beach Beagles are stones, Stones, Tom
Brady or Michael Jordan, Tom Brady, Sean Connery or Daniel Craig.
Speaker 2 (00:42):
Dan Craig Star Wars with Godfather. Oh, that one's tough.
Speaker 1 (00:46):
Godfather celebrity people say you remind.
Speaker 2 (00:49):
Them of I don't know if I resemble any celebrities,
So I don't get that one off.
Speaker 1 (00:54):
We're gonna have to come up with one, all right.
Speaker 2 (00:56):
Figure it out in the next next couple minutes.
Speaker 1 (00:58):
Okay, Hey, let's find that a little bit about your
journey and how you eventually got into the position where
you became the CEO of Splitzeiro.
Speaker 2 (01:05):
Yeah, my journey is all in residential real estate investment.
So where'd you grow up? First of all, I grew
up in Wisconsin. Moved to southern California in two thousand
and nine.
Speaker 1 (01:14):
Okay, where'd you go to go to school in Wisconsin?
I did?
Speaker 2 (01:17):
I did not know. I went to high school in
Wisconsin and I went to college in Minnesota at the
University of Saint Thomas.
Speaker 1 (01:24):
Okay, yeah, and what'd you study?
Speaker 2 (01:26):
I studied realestate and finance there. Wow, so you do
early on with what you wanted to do early on? Yeah,
I was interested in real estate, which was a good
platform for where I'm at.
Speaker 1 (01:35):
What business where your parents had?
Speaker 2 (01:36):
My dad was actually a law enforcement officer and he
did narcotics investigation, So up there, you're buying a lot
of meth and other sort of drugs. My mom ran
her on small bus.
Speaker 1 (01:46):
You had to be straight and clean, otherwise you weren't
going to be able to get anything past your dad.
Speaker 2 (01:50):
That's right, straight and clean from the start. I'm always
the like, you know, ten minutes early as on time person,
So that's kind of been from the start.
Speaker 1 (01:57):
So tell me. So, now, you grew up in Wisconsin,
went to school in Minnesota, studied real estate. What's your
first job out?
Speaker 2 (02:04):
First job out is kind of an interesting part of
my career. So first job out is working with a
family office down in San Diego that was starting a
real estate foreclosure fund. So they at that point, right,
so this is two thousand and nine, did you get
that job?
Speaker 1 (02:19):
Oh?
Speaker 2 (02:20):
Networking in You spend enough time at the beach and
around San Diego, you kind of meet people, and so
I just just networked into that job and knew some
people that were starting there as well.
Speaker 1 (02:29):
So tell us about the job.
Speaker 2 (02:30):
Job is, we are if you've ever seen the movie
Boiler Room, we are operating that, but we're buying houses.
So at that point in time, you could buy as
many houses as you had cash for. And so we're
out there at the trustees foreclosure steps buying houses every day.
We're buying thirty to forty houses a month, which then
turns into a large fix and flip operation. So we're
(02:52):
buying them. At that time. If people were in it,
we had to do evictions or to help them move out.
Speaker 1 (02:56):
And that big margins on a fix and flip. Oh.
Speaker 2 (03:00):
Back then it was all over the mount because value
was really difficult right when things are getting foreclosed on
with you was this two thousand and nine, so you.
Speaker 1 (03:08):
Right right at the height of the subprime collapse, right
at the height of the collapse.
Speaker 2 (03:12):
Yeah, there's you know, at that point in time. It's
hard for people to imagine today, but there's as many
houses as the market as you could buy. So there's
as much as you would cash for. You could buy
that many houses that day at the foreclosure off.
Speaker 1 (03:22):
You would down in at southern California outs not necessarily
in San Diego, but around San Diego. That was that
was subprime you know, the subprime prime market. Yeah.
Speaker 2 (03:33):
Yeah, you saw everything from the crushing stories of truly
like you know, both parents lost their job and now
they're losing their house to the person that has you know,
three BMW's and a boat parked out front. They used
their house as atm SO.
Speaker 1 (03:46):
And what was your exact function with the company.
Speaker 2 (03:48):
I was running a team of analysts buying thirty to
forty houses a month at the foreclosure auctions. So we
would buy you know, forty houses, then those moved on
to construction and then we had fixed them up and
sell them.
Speaker 1 (04:00):
How long did you do this?
Speaker 2 (04:01):
For a couple of years, and then I broke out
and started my own fund, so I partnered with two
developers that were in the market. We started buying about
one hundred hundred.
Speaker 1 (04:09):
So you have twenty five or twenty six years old
now and you started your own fund. That's right, Let's
stop a second. That's a hell of an accomplishment. Thank
you money of your own at that time, or you
had to go ahead and raise money.
Speaker 2 (04:21):
Some of our own. But we went out and raised
a lot of money at that point too. Because of
the collapse, debt was really difficult, so debt terms was
possibly good mortgage, it was impossible to get a mortgage.
It was impossible to get debt for a fund like that,
so it was really low leverage, so you could only
get kind of fifty to sixty percent of your fund
and debt. So that meant you had to raise a
lot of capital.
Speaker 1 (04:41):
So how'd you go about raising his capital? Oh?
Speaker 2 (04:43):
Man, you obviously start with friends, family, and then as
that's going the fix and flip market really started picking up,
so kind of more institutional partners started looking into the
space and figuring out how they could invest in it,
because you're talking about, you know, the largest asset c
so the US real estate, right, So institutional investors started
(05:04):
coming around. They started investing in smaller operators and then
starting their own large operators. So as we went on,
capital got easier. But at the beginning, it's very difficult.
Speaker 1 (05:12):
And how long did you do this for?
Speaker 2 (05:14):
I did this for our fund probably was four or
five years, and then I got on the debt side
of things and started lending money to investors.
Speaker 1 (05:22):
How many people that you have working for you at
this time?
Speaker 2 (05:24):
We had quite a few when you include like all
the contractors and whatnot. Any given time we would own
over one hundred houses.
Speaker 1 (05:30):
That were you were still a kid twenties.
Speaker 2 (05:32):
I was still a kid at this point. Yeah, young
and trying to grow a big business, that's for sure.
Speaker 1 (05:37):
What made you so you have this business that's yours?
Why did you did you leave that business or do
you still do that in addition to what you're doing
I did.
Speaker 2 (05:45):
The hard part about that business is scale, Right, when
you actually have to have crews at a property swinging hammers,
it's really difficult to scale that business, and certainly out
of your own local market, but not anything you could
do nationwide. And so scale ability is the reason why
I left that business.
Speaker 1 (06:02):
So you left that business, Now you're going to start
this new business.
Speaker 2 (06:05):
Yep, which is Splitterario started a little bit after that.
Speaker 1 (06:09):
Okay, so let's go to that first business. Yeah, so
you're like, we are you twenty eight years old? Now? Yeap?
You left the business I actually made, you made a
few bucks. You're living high. You're twenty eight years old.
Are you spending it like it's water?
Speaker 2 (06:23):
No? Thankfully not. I wish not. I actually bought real
estate and rentals and kind of went that route. But no,
So then I roll out of that and I join
a venture backed company that wanted to raise a large
fund to give debt to investors that were fixating.
Speaker 1 (06:39):
You joined the company with other people when you were
running your own company.
Speaker 2 (06:43):
That's right.
Speaker 1 (06:43):
Was that difficult?
Speaker 2 (06:45):
It was difficult, But I wanted to learn that side
of the business. So I wanted to learn how the
debt and capital markets operated.
Speaker 1 (06:51):
So you went into it with the plan of not
staying there, but going in there or as a learning.
Speaker 2 (06:57):
Yes, learning kind of from a few different points. So
the Debton capital markets for sure. But also I'd never
been in a business that was venture back, so I
didn't understand how quickly you could scale a business and
how that happens when you have, you know, a large
investment from venture capital. So it was a learning moment
for me for a few years, which really set me
up for success.
Speaker 1 (07:17):
First, as you sit there and say, going back to
your first business that you said the problem was scalability, saying,
if I knew what I knew now about this venture business,
I could have built that into a tremendous business.
Speaker 2 (07:28):
Yes, and no, I think there's a lot of learnings
in hindsight that go into that. But still the fix
and Flip world, where you have construction going on projects
where people are swinging hammers, it's just a very difficult
business to scale.
Speaker 1 (07:41):
Yep. All right, so now you did this for Hella Ah.
Speaker 2 (07:44):
This is another two or three years, so now we're
kind of your early thirties.
Speaker 1 (07:49):
So now you're coming up with the idea for Splotero.
So now that head did that idea coming back?
Speaker 2 (07:54):
Yeah, So twenty twenty hits, so covid hits. And really
even before COVID, I was looking around the real estate market,
the interesting part about real estate is there's constant change,
so how you can operate and what you should be
doing next is always changing the real estate market. So
I'm seeing nationwide homeowners have difficulty accessing the equity in
(08:17):
their house. There's very low inventory in all the markets,
so nobody really wants to sell their house because it's
hard to buy something, and prices were going on, so
it's hard to buy. Prices are going to this is
twenty twenty, right, and so the market is shooting up
in price, and people have all this equity, but if
they sell their house, they can't really buy in their neighborhood,
(08:39):
so they end up moving to like a tertiary market
or they just use a credit card. At that point,
a lot of people are also selling to like eye
buyers like open Door and Zillow and redfin. Right, it's
not a good solution for these homeowners who have a
ton of equity in their house. So it's trying to
figure out what's the best way to help a homeowner
get equity out of their house without having to leave
their house, because that was the thing. People needed cash,
(09:01):
but they didn't want to sell their house because they
didn't know where they were going to go. That's really
why I started Splitario.
Speaker 1 (09:06):
So what were your first steps to starting it? Now,
you've got to raise money, you've got to do marketing,
you've got to you know, create create a demand. Yeah. Yeah.
Speaker 2 (09:15):
The difficult thing about starting Spilittario is it's two sided.
You have to do all that what you said, right,
You have to raise money, You've got to get a
product that you can put out there, but then you
have to fund it, and you got to get a
lot of money to fund it at scale. And so
that comes with Wall Street commitments. And when you go
to Wall Street, they expect you to act very mature
as a business, even though you just opened the doors
(09:37):
a couple of weeks ago. And so you're building kind
of on both sides where you are a full on startup.
Speaker 1 (09:42):
Selling based on your past track record. Yeah.
Speaker 2 (09:45):
Yeah, both like passtrack record, opportunity of what we think
it could be, and also the scalability of it. Right,
a lot of Wall Street funds aren't interested for a
few million bucks. They want to put out hundreds of
millions or a billion of dollars. So you're you're selling
on all of.
Speaker 1 (09:59):
Those find it's easier sometimes to raise a billion than
it is to raise a billion.
Speaker 2 (10:03):
That's what they say. I think it's probably somewhere in
that line. You know a lot of a lot of folks.
It's they're doing the same amount of work and so
they rather put out more dollars.
Speaker 1 (10:11):
So tell me take me through the process. Yeah.
Speaker 2 (10:14):
So we start in January twenty two and we are
doing that. We're doing sales marketing, we're figuring out how
to build our product.
Speaker 1 (10:22):
What's the marketing pitch, What's what's the value proposition?
Speaker 2 (10:25):
Access the equity in your house without any monthly payments.
And so typically homeowners think about, you know, I'm going
to use a heelock or another debt instrument that comes
in and the home equity line of credit. And so
when they do that, they then have a monthly payment
as soon as they use the capital. And so the
(10:45):
big pitch for Spoto is you can conveniently easily access
the equity in your house and you don't have a
monthly payment and you don't pay anything until you either
refire or sell your property down the road.
Speaker 1 (10:56):
So you could take out the money on your home
and not what if you never take at a home
equity loan or sell your house.
Speaker 2 (11:03):
Yeah, so we our maturity is the maturity of your
first mortgage. So the day that you pay off the
last payment on your mortgage is when you'll pay us
back to And at that point you got you know,
full equity of your house and you have a lot
of opportunity.
Speaker 1 (11:16):
I like that. I may make a caller for this.
Speaker 2 (11:19):
We're happy to help.
Speaker 1 (11:20):
It's it's interesting. So so that's so that's the marketing.
That's that's the value proposition. How do you raise enough
money at this point to do what you need to do?
Speaker 2 (11:29):
Yeah, so we raise a small amount of venture funds
to get employees, start working and start building. We're building
a pipeline of people. We go out there.
Speaker 1 (11:37):
Who are you first employees that you hire?
Speaker 2 (11:40):
Capital markets is one of the first ones. Operations, the
next we got to build sales, script and processing, figure
out how we actually get people the equity in their house,
what we have to do for underwriting.
Speaker 1 (11:51):
So there's your team though, So you're the CEO of
this company, Yeah, who is under you? Who are those
first people that you bring on?
Speaker 2 (11:57):
So I have a co founder who's our CEO. So
he starts kind of taking his background also real estate.
So this is the third time we've worked together, known
each other for fifteen years. So he takes sales through closing, right,
So how do we get people in the door, get
them their funds? I take everything else, so marketing, people, ops, finance,
and accounting, capital markets, which is the big one early on.
(12:20):
So we start building our product, building our agreements, working
with legal, and then we go out and say, hey,
we need you know, one hundred or two hundred or
three hundred million dollars that we're going to put out
in the streets. And that story is the difficult story
to tell.
Speaker 1 (12:36):
Right.
Speaker 2 (12:36):
It's easier to raise venture capital than it is to
raise a couple hundred million dollars from Wall Street. For
these agreements, you have to be very buttoned up on
the underwriting side so you're not putting them at too
much risk. You've got to, you know, have a product
that they can scale, so they're not you know, putting
small dollars. The most interesting part of this is like
when you go to midtown Manhattan, there are so many
(12:58):
funds that you've never heard of that have fifty billion
dollars right, or ten billion dollars, and so hundreds you know,
we're out there pitching hundreds of investors to get this done.
And this is also early on, just to get a meeting.
They'll take meetings, right because they're getting pitched opportunities all
the time, and like there it's their job to investigate them.
So they'll take meetings. But getting follow up after the
(13:20):
meetings is what's difficult. You got to stay on them
really sell the dream that like, hey, there's you know,
I'm in a market where homeowners have thirty four trillion
dollars of equity in their houses right now, and so
this is a massive market opportunity, probably bigger than anything
else they're looking at.
Speaker 1 (13:35):
It's exciting now. And so now who came on board
for you?
Speaker 2 (13:38):
So yeah, so we hire kind of early leadership team,
right that come on. For all those titles that I mentioned,
capital markets, finance, accounting and legal people, operations, and then sales, underwriting, processing, closing.
Speaker 1 (13:51):
What do you look for employees and people in those roles.
Speaker 2 (13:54):
We look for a few different things. One certainly like
self starters, because when you're early on in a company,
everybody has a ton of responsibility. It's it's a startup still, right.
We also look for people with mortgage experience, right, we
have to be industry specific. There's a lot of unique
things about running a business like ours, where you have
to follow a lot of laws, a lot of regulatory stuff.
(14:16):
And then really we're looking for people that can grow teams.
Like what we're doing here is a product that's newer
and will be something huge, but it takes a lot
to get there, and so we need to build teams
grow to tonight.
Speaker 1 (14:29):
So now you've got the fun thing in place, you've
got your core executive team in place. How do you
flip the switch and what happens.
Speaker 2 (14:37):
We flip the switch basically March first of twenty two,
and we get our first homeowner all the way through
the funnel March thirty.
Speaker 1 (14:44):
First get we just started advertising at that point.
Speaker 2 (14:47):
We did we started advertising. We did some pretty targeted
direct mail, we did search and social kind of just
the early onset into our advertising journey, and we get
our first home owners through the door. Mark through the
end of the year, we do about seventy million production,
so we have that many homeowners coming in and wanting
to actually the equity in their house, and we started
(15:08):
growing from there.
Speaker 1 (15:09):
That's an exciting story. How many employees do you have now?
Speaker 2 (15:13):
Now, we have about one hundred and thirty employees.
Speaker 1 (15:17):
Or thirty employees in national and you're.
Speaker 2 (15:19):
We're not quite national. We're in fourteen states. Okay, we're
fully mount so we're headquartered in San Diego, but we
have a team in twenty five states or so.
Speaker 1 (15:27):
Congratulations, I thank you. Exciting. Well, how do our listeners
find you?
Speaker 2 (15:32):
Splittero dot com is the easiest way to find us.
You find everything out that s p l I T
e r O dot com.
Speaker 1 (15:39):
Splitterio dot com. Hey, once again, we're here with Michael Gifford,
the co founder and CEO of Splitteriro. You can go
to splittereo dot com and you could access the equity
trapped in your homes. And thank you very much for
joining our show today.
Speaker 2 (15:55):
Thank you for having me on.
Speaker 1 (15:56):
This is Paul Corvino, Division President of iHeartMedia saying thank
you for listening to another episode of CEOs you Should Know.
Listen to CEOs you Should Know on the iHeartRadio app.
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